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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 20-F
(Mark One) ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Date of event requiring this shell company report
Commission file number 001-40876
IHS Holding Limited
(Exact Name of Registrant as Specified in its Charter)
Not Applicable
(Translation of Registrant’s Name into English)
Cayman Islands
(Jurisdiction of Incorporation or Organization)
1 Cathedral Piazza
123 Victoria Street
London SW1E 5BP
United Kingdom
(Address of Principal Executive Offices)
Sam Darwish
Chief Executive Officer
Telephone: +44 20 8106 1600
IHS Holding Limited
1 Cathedral Piazza
123 Victoria Street
London SW1E 5BP
United Kingdom
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
Securities registered or to be registered, pursuant to Section 12(b) of the Act
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Name of each exchange on which registered |
Ordinary shares, par value $0.30 per share |
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The New York Stock Exchange |
Securities registered or to be registered pursuant to Section 12(g) of the Act: None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None
Indicate the number of outstanding shares of each of the issuer’s classes of capital stock or common stock as of the close of the period covered by the annual report: 333,440,937 ordinary shares
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Yes ☐ No ☒
Note—Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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☐ Large accelerated filer |
☒ Accelerated filer |
☐ Non-accelerated filer |
☐ Emerging growth company |
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to § 240.10D-1(b). □
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
☐ U.S. GAAP |
☒ International Financial Reporting Standards as issued by the International Accounting Standards Board |
☐ Other |
If “Other” has been checked in response to the previous question indicate by check mark which financial statement item the registrant has elected to follow. Item 17 ☐ Item 18 ☐
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
CONTENTS
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ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS |
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F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation |
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ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
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ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES |
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ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS |
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ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES |
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ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS |
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ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS |
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F-1 |
ii
ABOUT THIS ANNUAL REPORT
Except where the context otherwise requires or where otherwise indicated in this Annual Report, the terms “IHS Towers,” the “Company,” “the Group,” “we,” “us,” “our,” “our company” and “our business” refer to IHS Holding Limited, together with its consolidated subsidiaries as a consolidated entity.
MARKET AND INDUSTRY DATA
We obtained the industry, market and competitive position data and forecasts in this Annual Report from our own internal estimates and research as well as from publicly available information, industry and general publications and research, surveys and studies conducted by third parties, including Euromonitor International Limited. Certain industry, market and competitive position data and information referred to in this Annual Report is based on third-party data provided by Analysys Mason Limited, or Analysys Mason, delivered in April 2024 for use in this Annual Report. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to these estimates, as there is no assurance that any of them will be reached. Our and Analysys Mason’s data is derived from publicly available information released by independent industry analysts and other third-party sources, as well as data from our and Analysys Mason’s internal research, and are based on assumptions made by us upon reviewing such data, and our experience in, and knowledge of, such industry and markets, which we believe to be reasonable. Analysys Mason’s third party data is also prepared on the basis of information provided and views expressed by mobile operators, tower operators and other parties (including certain views expressed and information provided or published by individual operators, service providers, regulatory bodies, industry analysts and other third party sources of data). Although Analysys Mason has obtained such information from sources it believes to be reliable, neither we nor Analysys Mason have verified such information. You are cautioned not to give undue weight to these estimates and assumptions.
In many cases, there is no readily available external information (whether from trade associations, government bodies or other organizations) to validate market related analyses and estimates, requiring us to rely on our own internally developed estimates regarding the industry in which we operate, our position in the industry, our market share and the market shares of various industry participants based on our experience, our own investigation of market conditions and our review of industry publications, including information made available to the public by our competitors. While we believe our internal estimates to be reasonable, these estimates have not been verified by any independent sources and you are cautioned not to give undue weight to these estimates.
Industry publications, research, surveys and studies generally state that the information they contain has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. Forecasts and other forward-looking information obtained from these sources and from our and Analysys Mason’s estimates are subject to the same qualifications and uncertainties as the other forward-looking statements in this Annual Report and as described under “Cautionary Statement Regarding Forward-Looking Statements.” These forecasts and other forward-looking information, are subject to uncertainty and risk due to a variety of factors, including those described under Item 3.D. “Risk Factors.” These and other factors could cause results to differ materially from those expressed in the forecasts or estimates from independent third parties and us.
In addition, our and Analysys Mason’s estimates involve risks and uncertainties and are subject to change based on various factors. See Item 3.D. “Risk Factors” and Item 4.B. “Information on the Company—Business Overview” for further discussion.
TRADEMARKS, SERVICE MARKS AND TRADE NAMES
We have proprietary rights to trademarks used in this Annual Report that are important to our business, many of which are registered under applicable intellectual property laws.
Solely for convenience, the trademarks, service marks, logos and trade names referred to in this Annual Report are without the ® and ™ symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensors to these trademarks, service marks and trade names. This Annual Report contains additional trademarks, service marks and trade names of others, which are the property of their respective owners. All trademarks, service marks and trade names appearing in this Annual Report are, to our knowledge, the property of their respective owners. We do not intend our use or display of other companies’ trademarks, service marks, copyrights or trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies.
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PRESENTATION OF FINANCIAL AND OTHER INFORMATION
We report under International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board, or the IASB (“IFRS® Accounting Standards”).
Use of Non-IFRS financial measures
Certain parts of this Annual Report contain non-IFRS financial measures, including Adjusted EBITDA and Adjusted EBITDA Margin. The non-IFRS financial information is presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with IFRS Accounting Standards, and may be different from similarly titled non-IFRS measures used by other companies.
We define Adjusted EBITDA (including by segment) as (loss)/income for the period, before income tax expense/(benefit), finance costs and income, depreciation and amortization, net impairment/(reversal of impairment) of withholding tax receivables, impairment of goodwill, business combination transaction costs, net impairment/(reversal of impairment) of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent, reversal of provision for decommissioning costs, net (gain)/loss on sale of assets, share-based payment (credit)/expense, insurance claims, gain on disposal of subsidiary and certain other items that management believes are not indicative of the core performance of our business.
The most directly comparable IFRS measure to Adjusted EBITDA is our profit/(loss) for the period.
We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue for the applicable period, expressed as a percentage.
We believe Adjusted EBITDA and Adjusted EBITDA Margin are useful to investors and are used by our management for measuring profitability and allocating resources, because they exclude the impact of certain items that have less bearing on our core operating performance such as interest expense and taxes. We believe that utilizing Adjusted EBITDA and Adjusted EBITDA Margin allows for a more meaningful comparison of operating fundamentals between companies within our industry by eliminating the impact of capital structure and taxation differences between the companies.
Adjusted EBITDA measures are frequently used by securities analysts, investors and other interested parties in their evaluation of companies comparable to us, many of which present an Adjusted EBITDA-related performance measure when reporting their results.
Adjusted EBITDA and Adjusted EBITDA Margin are used by different companies for differing purposes and are often calculated in ways that reflect the circumstances of those companies. You should exercise caution in comparing Adjusted EBITDA and Adjusted EBITDA Margin as reported by us to Adjusted EBITDA and Adjusted EBITDA Margin as reported by other companies. Adjusted EBITDA and Adjusted EBITDA Margin are unaudited and have not been prepared in accordance with IFRS Accounting Standards.
Adjusted EBITDA and Adjusted EBITDA Margin are not measures of performance under IFRS Accounting Standards and you should not consider these as an alternative to (loss)/income or (loss)/income margin for the period or other financial measures determined in accordance with IFRS Accounting Standards.
Adjusted EBITDA and Adjusted EBITDA Margin have limitations as analytical tools, and you should not consider them in isolation. Some of these limitations are:
| ● | they do not reflect interest expense, or the cash requirements necessary to service interest or principal payments, on our indebtedness; |
| ● | although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often need to be replaced in the future and Adjusted EBITDA and Adjusted EBITDA Margin do not reflect any cash requirements that would be required for such replacements; |
| ● | some of the items we eliminate in calculating Adjusted EBITDA and Adjusted EBITDA Margin reflect cash payments that have less bearing on our core operating performance, but that impact our operating results for the applicable period; and |
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| ● | the fact that other companies in our industry may calculate Adjusted EBITDA and Adjusted EBITDA Margin differently than we do, which limits their usefulness as comparative measures. |
Accordingly, investors and prospective investors should not place undue reliance on Adjusted EBITDA or Adjusted EBITDA Margin.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Annual Report contains forward-looking statements. We intend such forward-looking statements to be covered by relevant safe harbor provisions for forward-looking statements (or their equivalent) of any applicable jurisdiction, including those contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Annual Report may be forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates," “believes,” “estimates,” “forecast,” “predicts,” “potential” or “continue” or the negative of these terms or other similar expressions. Forward-looking statements contained in this Annual Report include, but are not limited to statements regarding our future results of operations and financial position, future organic growth, industry and business trends, business strategy and plans, shareholder value creation (including our ongoing strategic review and related productivity enhancements and cost reductions, as well as our ability to refinance or meet our debt obligations), our market growth, position and our objectives for future operations, including our ability to maintain relationships with customers, the potential benefit of the terms of our contract renewals the impact (illustrative or otherwise) of the renewed agreements with MTN Nigeria (including certain rebased fee components) on our financial results, the impact of currency and exchange rate fluctuations (including the fluctuations of the Naira) and other economic and geopolitical factors on our future results and operations, the outcome and potential benefit of our ongoing strategic review, including our ability to make commercial progress, increase Adjusted EBITDA and cash flow generation and reduce debt, our objectives for future operations, and the timing of any of the foregoing.
We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to:
| ● | non-performance under or termination, non-renewal or material modification of our customer agreements; |
| ● | volatility in terms of timing for settlement of invoices or our inability to collect amounts due under invoices; |
| ● | a reduction in the creditworthiness and financial strength of our customers; |
| ● | the business, legal and political risks in the countries in which we operate; |
| ● | general macroeconomic conditions in the countries in which we operate; |
| ● | changes to existing or new tax laws, rates or fees; |
| ● | foreign exchange risks, particularly in relation to the Nigerian Naira, and/or ability to hedge against such risks in our commercial agreements or to access U.S. dollars in our markets; |
| ● | the effect of regional or global health pandemics, geopolitical conflicts and wars and acts of terrorism including, but not limited to, or as a result of, political instability, religious differences, ethnicity and regionalism in emerging and less developed markets; |
| ● | our inability to successfully execute our business strategy and operating plans, including our ability to increase the number of Colocations and Lease Amendments on our Towers and construct New Sites or develop business related to adjacent telecommunications verticals (including, for example, relating to our fiber businesses in Latin America and elsewhere) or deliver on our sustainability or environmental, social and governance (ESG) strategy and initiatives under anticipated costs, timelines, and complexity, such as our Carbon Reduction Roadmap (and Project Green); |
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| ● | our inability to manage growth; |
| ● | our reliance on third-party contractors or suppliers, including failure, underperformance or inability to provide products or services to us (in a timely manner or at all) due to sanctions regulations, supply chain issues or for other reasons; |
| ● | our estimates and assumptions and estimated operating results may differ materially from actual results; |
| ● | increases in operating expenses, including fluctuating costs for diesel or ground leases; |
| ● | failure to renew or extend our ground leases, or protect our rights to access and operate our Towers or other telecommunications infrastructure assets; |
| ● | loss of tenancies or customers; |
| ● | risks related to our indebtedness; |
| ● | changes to the network deployment plans of mobile operators in the countries in which we operate; |
| ● | a reduction in demand for our services; |
| ● | the introduction of new technology reducing the need for tower infrastructure and/or adjacent telecommunication verticals; |
| ● | an increase in competition in the telecommunications tower infrastructure industry and/or adjacent telecommunication verticals; |
| ● | our failure to integrate recent or future acquisitions; |
| ● | the identification by management of material weaknesses in our internal control over financial reporting, which could affect our ability to produce accurate financial statements on a timely basis or cause us to fail to meet our future reporting obligations; |
| ● | increased costs, harm to reputation, or other adverse impacts related to increased intention to and evolving expectations for environmental, social and governance initiatives; |
| ● | our reliance on our senior management team and/or key employees; |
| ● | failure to obtain required approvals and licenses for some of our sites or businesses or comply with applicable regulations; |
| ● | inability to raise financing to fund future growth opportunities or operating expense reduction strategies; |
| ● | environmental liability; |
| ● | inadequate insurance coverage, property loss and unforeseen business interruption; |
| ● | compliance with or violations (or alleged violations) of laws, regulations and sanctions, including but not limited to those relating to telecommunications regulatory systems, tax, labor, employment (including new minimum wage regulations), unions, health and safety, antitrust and competition, environmental protection, consumer protection, data privacy and protection, import/export, foreign exchange or currency, and of anti-bribery, anti-corruption and/or money laundering laws, sanctions and regulations; |
| ● | disruptions in our supply of diesel or other materials, as well as related price fluctuations; |
| ● | legal and arbitration proceedings; |
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| ● | our reliance on shareholder support (including to invest in growth opportunities) and related party transaction risks; |
| ● | risks related to the markets in which we operate, including but not limited to local community opposition to some of our sites or infrastructure, and the risks from our investments into emerging and other less developed markets; |
| ● | injury, illness or death of employees, contractors or third parties arising from health and safety incidents; |
| ● | loss or damage of assets due to security issues or civil commotion; |
| ● | loss or damage resulting from attacks on any information technology system or software; |
| ● | loss or damage of assets due to extreme weather events whether or not due to climate change; |
| ● | failure to meet the requirements of accurate and timely financial reporting and/or meet the standards of internal control over financial reporting that support a clean certification under the Sarbanes Oxley Act; |
| ● | risks related to our status as a foreign private issuer; and |
| ● | the important factors discussed in the section titled “Risk Factors” in this Annual Report. |
The forward-looking statements in this Annual Report are based upon information available to us as of the date of this Annual Report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. You should read this Annual Report and the documents that we reference in this Annual Report with the understanding that our actual future results, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. Additionally, we may provide information herein that is not necessarily “material” under the federal securities laws for SEC reporting purposes, but that is informed by various ESG standards and frameworks (including standards for the measurement of underlying data), and the interests of various stakeholders. Particularly in the ESG context, materiality is subject to various definitions that often differ from, and are generally more expansive than, the definition under US federal securities laws. Much of this information is subject to assumptions, estimates or third-party information that is still evolving and subject to change. For example, we note that standards and expectations regarding greenhouse gas (GHG) accounting and the processes for measuring and counting GHG emissions and GHG emissions reductions are evolving, and it is possible that our approaches both to measuring our emissions and any reductions may be at some point, either currently or in future, considered by certain parties to not be in keeping with best practices. In addition, our disclosures based on any standards may change due to revisions in framework requirements, availability of information, changes in our business or applicable government policies, or other factors, some of which may be beyond our control. These forward-looking statements speak only as of the date of this Annual Report. Except as required by applicable law, we do not assume, and expressly disclaim, any obligation to publicly update or revise any forward-looking statements contained in this Annual Report, whether as a result of any new information, future events or otherwise. Additionally, references to our website and other documents contained in this Annual Report are provided for convenience only, and their content is not incorporated by reference into this Annual Report.
CERTAIN DEFINED TERMS
Unless the context provides otherwise, references herein to:
| ● | “2026 Notes” refers to our $500 million 5.625% Senior Notes due 2026. |
| ● | “2027 Notes” refers to our $940 million 8.0% Senior Notes due 2027. |
| ● | “2028 Notes” refers to our $500 million 6.250% Senior Notes due 2028. |
| ● | “2030 Notes” refers to our $550 million 7.875% Senior Notes due 2030. |
| ● | “2031 Notes” refers to our $650 million 8.250% Senior Notes due 2031. |
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| ● | “9mobile” refers to Emerging Markets Telecommunication Services Limited, which was previously known as Etisalat Nigeria. |
| ● | “Airtel Nigeria” refers to Airtel Networks Limited, a subsidiary of Airtel Africa. |
| ● | “Articles” refers to our second amended and restated memorandum and articles of association, adopted by special resolution dated June 28, 2024. |
| ● | “Brazilian Real” and “BRL” refers to the lawful currency of the Federative Republic of Brazil. |
| ● | “Carbon Reduction Roadmap” refers to our strategy for decreasing our emissions, including a goal to reduce the Scope 1 and Scope 2 kilowatt-hour emissions intensity of our tower portfolio by 50% by 2030, using 2021 emissions data as the baseline. |
| ● | “CBN” refers to the Central Bank of Nigeria. |
| ● | “Centennial Acquisition” refers to the acquisition by us on March 19, 2021 of Centennial Colombia and the acquisition by us on April 8, 2021 of Centennial Brazil, both from affiliates of Centennial Towers Holding LP. At closing, Centennial Colombia had 217 towers and Centennial Brazil had 602 towers. |
| ● | “Centennial Brazil” refers to Centennial Towers Brasil Coöperatief U.A. and its subsidiaries. |
| ● | “Centennial Colombia” refers to Centennial Towers Colombia, S.A.S. and its subsidiaries. |
| ● | “Churn” refers to the loss of tenancies when services provided by us are terminated, a Tenant does not renew its contract or we have ceased recognizing revenue for sites under a customer’s contract in any particular period, adjusted for the reintegration of previously lost tenancies. When we decommission a site and move a customer from one of our sites to another site to rationalize our portfolio, this is not included in Churn. |
| ● | “Colocation” refers to the installation of equipment on existing towers for a new tenant alongside current Tenants. |
| ● | “Colocation Rate” refers to the average number of Tenants per Tower across our portfolio at a given point in time. We calculate the Colocation Rate by dividing the total number of Tenants across our portfolio by the total number of Towers across our portfolio at a given time. |
| ● | “Contracted Revenue” refers to lease fees to be received from the existing Tenants of Key Customers for the remainder of each Tenant’s current contractual site lease term, lease fees to be received from the existing Lease Amendments of Key Customers for the remainder of each Lease Amendment’s current contractual term and lease fees to be received from Key Customers where we provide fiber access to an OLT for the remainder of the relevant contractual term, as of a specified date. In aggregating Contracted Revenue, we have taken the average lease rate for our Key Customers as of December 31, 2024, which is applied to the remaining term of the tenancies, lease amendments and fiber access of each Key Customer, assuming constant foreign exchange rates, no escalation of lease rates despite contractual provisions in our MLAs in that regard, no new Tenants, new Lease Amendments or new access to fiber, no amendments to our existing MLA terms and no Churn. See “Risk Factors — Our Contracted Revenue is based on certain estimates and assumptions and actual results may differ materially from such estimated operating results.” |
| ● | “CSS” refers to Cell Sites Solutions — Cessão de Infraestruturas S.A. |
| ● | “CSS Acquisition” refers to the acquisition by us on February 18, 2020 of CSS from affiliates of Goldman Sachs and Centaurus Capital LP. At closing, CSS had 2,312 towers, including 2,251 towers in Brazil, 51 in Peru and 10 in Colombia. |
| ● | “Dollar”, “USD” or “$” refer to U.S. dollars. |
| ● | “euro” or “€” refer to the currency introduced at the start of the third stage of European economic and monetary union pursuant to the treaty establishing the European Community, as amended. |
| ● | “Existing Notes” refers to the IHS Holding Notes and IHS Netherlands Holdco B.V. Notes collectively. |
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| ● | “GTS SP5 Acquisition” refers to acquisition by us on March 17, 2022 of São Paulo Cinco Locação de Torres Ltda (“GTS SP5”). At closing, GTS SP5 had 2,115 towers in Brazil. |
| ● | “IFRS” refers to International Financial Reporting Standards which have been developed by the International Accounting Standards Board (“IASB”). |
| ● | “IHS Holding Notes” refers to our 2026 Notes, our 2028 Notes, our 2030 Notes and 2031 Notes, collectively. |
| ● | “IHS Netherlands Holdco B.V. Notes” refers to our 2027 Notes. |
| ● | “IHS Nigeria” refers to IHS (Nigeria) Limited, one of our operating subsidiaries in Nigeria. |
| ● | “INT Towers” refers to INT Towers Limited, one of our operating subsidiaries in Nigeria. |
| ● | “Key Customers” refers to MTN Customers, Orange Cameroun S.A., or Orange Cameroon, Orange Côte d’Ivoire S.A., or Orange Côte d’Ivoire, 9mobile, Airtel Nigeria, Airtel Networks Zambia PLC, or Airtel Zambia, Airtel Rwanda Limited, or Airtel Rwanda, Claro S.A., or Claro Brazil, TIM Cellular S.A., or TIM Brasil, Telefonica Brasil S.A., or Vivo Brazil, Colombia Móvile S.A. E.S.P., or Tigo Colombia, COMSEL S.A., or Claro Colombia, Oi S.A., or Oi Brazil and Telkom South Africa. |
| ● | “Kuwait Acquisition” refers to our acquisition of approximately 1,499 towers in aggregate from Zain Kuwait, pursuant to an acquisition agreement signed in October 2017. We sold IHS Towers’ 70% interest in IHS Kuwait Limited in December 2024 as further disclosed in this Annual Report. |
| ● | “Kuwait Disposal” refers to our disposal of IHS Towers’ 70% interest in IHS Kuwait Limited to Zain Kuwait. The transaction completed in December 2024. |
| ● | "Latam” refers to our business segment that includes our markets in Latin America, which currently are Brazil and Colombia, but has historically included Peru prior to the completion of the sale in April 2024. |
| ● | “Lease Amendments” refers to the installation of additional equipment on a site or the provision of certain ancillary services for an existing Tenant, for which we charge our customers a recurring lease fee. |
| ● | “LTE” refers to long-term evolution, a standard for high-speed wireless communication for mobile devices and data terminals. We refer to LTE and 4G interchangeably in this Annual Report. |
| ● | “Managed Services” refers to when MNOs outsource the day-to-day operations of their owned towers or other towers on which they are present, including maintenance, security and power supply. |
| ● | "MENA” refers to our business segment that included our markets in the Middle East and North Africa region, which were Egypt and Kuwait. |
| ● | “MLA” refers to the long-term lease agreements we enter into with our customers, including but not limited to master lease agreements, master services agreements, infrastructure sharing agreements, master tower space use/license agreements and MLL agreements. |
| ● | “MLL” refers to towers we manage with a license to lease for a defined period. Where there is an MLL agreement, we have the right to lease out space on the tower to other MNOs and provide services, generating further revenue for ourselves. The site owner typically reduces its operating costs and eliminates capital expenditures. |
| ● | “MNOs” refers to mobile network operators. |
| ● | “MTN Customers” refers to MTN Nigeria, MTN Côte d’Ivoire S.A., or MTN Côte d’Ivoire, MTN Cameroon Limited, or MTN Cameroon, MTN Zambia Limited, or MTN Zambia, MTN Rwandacell Limited, or MTN Rwanda or MTN South Africa. |
| ● | “MTN Group” refers to MTN Group Limited and its subsidiaries, one of which is one of our shareholders as well as a related party of certain MTN operating entities that are our customers in the countries in which we currently |
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| operate. In each African market in which we currently operate, one of the MTN operating entities is a customer of ours. |
| ● | “MTN Nigeria” refers to MTN Nigeria Communications PLC. |
| ● | “MTN SA Acquisition” refers to the acquisition of 5,691 towers from MTN South Africa in May 2022. We signed a shareholding agreement with a consortium of B-BBEE parties in September 2024 which received regulatory approval in December 2024 and completed on January 14, 2025, following which IHS Towers owns 69.93% of the South African Towers business with the remaining 30.07% owned by the B-BBEE consortium. |
| ● | “MTN South Africa” refers to Mobile Telephone Networks Proprietary Limited. |
| ● | “NAFEM”, refers to the Nigerian Foreign Exchange Market introduced by the CBN in October 2023 to rename the Investors’ and Exporters’ foreign exchange trading window implemented by the Central Bank of Nigeria in April 2017. |
| ● | “NAFEX” refers to the Nigerian Autonomous Foreign Exchange Fixing and is the reference rate for spot FX operations in the Nigerian Foreign Exchange Market. |
| ● | “Naira”, “NGN” and “₦” refers to the lawful currency of the Federal Republic of Nigeria. |
| ● | “New Sites” refers to Towers owned and operated by the Group constructed through build-to-suit arrangements for the initial Tenant. |
| ● | “NFEM”, refers to the Nigerian Foreign Exchange Market which was introduced in December 2024 to replace NAFEM. The pricing of all foreign exchange transactions in the NFEM are required to be undertaken on the Electronic Foreign Exchange Matching System (“EFEMS”). |
| ● | “OLT” refers to an optical line terminal or optical line termination, which is a device which serves as the service provider endpoint of a passive optical network. |
| ● | “Project Green” refers to the current phase of our Carbon Reduction Roadmap. |
| ● | “Prospectus” refers to the final prospectus of IHS Holding Limited, dated October 13, 2021, filed with the Securities and Exchange Commission (“SEC”) in accordance with Rule 424(b) of the Securities Act on October 15, 2021. |
| ● | “ROU” refers to towers we operate under a right-of-use agreement for a defined period. Where there is an ROU agreement, we have the right to lease out space on the tower to other MNOs and provide services, generating further revenue for ourselves. |
| ● | “South African Rand” and “ZAR” refers to the lawful currency of the Republic of South Africa. |
| ● | “sites” refers to towers that are owned or operated by us. |
| ● | “Skysites” refers to Skysites Holdings S.A. |
| ● | “Skysites Acquisition” refers to the acquisition by us on January 6, 2021 of Skysites from a group of eighteen persons. At closing, Skysites had 1,005 towers in Brazil. |
| ● | “SLAs” refer to site-specific documents or agreements entered into in relation to specific sites pursuant to an MLA. |
| ● | “SSA” refers to our business segment that includes our markets in the Sub-Saharan region of Africa, which currently are Cameroon, Côte d’Ivoire, Rwanda, South Africa and Zambia. |
| ● | “subscribers” refers to the number of active subscriber identification module, or SIM, cards in service rather than the number of services provided (excluding machine to machine connections). For example, if a subscriber has both a data and voice plan on a smartphone this would equate to one subscriber. Alternatively, a subscriber who has a data and voice plan for a smartphone and a data plan for a tablet would be counted as two subscribers. |
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| ● | “Tenants” refers to the number of distinct customers who have leased space on each Tower across our portfolio. For example, if one customer had leased tower space on five of our Towers, we would have five Tenants. |
| ● | “TIM Brasil” refers to TIM S.A. |
| ● | “TIM Fiber Acquisition” refers to the acquisition and deployment of TIM Brasil’s secondary fiber network infrastructure. Closing occurred on November 16, 2021. The existing and future fiber assets are operated in Brazil through a new entity, which we refer to as I-Systems, in which we own 51% of the shares and TIM Brasil owns the remaining 49%. |
| ● | “Towers” refers to ground-based towers, rooftop and wall-mounted towers, cell poles, in-building solutions, small cells, distributed antenna systems and cells-on-wheels, each of which is deployed to support wireless transmission equipment. We measure the number of Towers in our portfolio at a given time by counting the number of Towers that we own or operate with at least one Tenant. The number of Towers in our portfolio excludes any towers for which we provide managed services. |
| ● | “Zain Kuwait” refers to Mobile Telecommunications Company K.S.C.P. |
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PART I
Item 1. Identity of Directors, Senior Management and Advisers
Not applicable.
Item 2. Offer Statistics and Expected Timetable
Not applicable.
Item 3. Key Information
A. Reserved.
B. Capitalization and Indebtedness
Not applicable.
C. Reasons for the Offer and Use of Proceeds
Not applicable.
D. Risk Factors
You should carefully consider the risks described below before making an investment decision. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. Our business, financial condition or results of operations could be adversely affected by any of these risks. The trading price and value of our ordinary shares could decline due to any of these risks, and you may lose all or part of your investment. This Annual Report also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including the risks faced by us described below and elsewhere in this Annual Report.
Risks Relating to Our Business
A significant portion of our revenue is derived from a small number of MNOs. Non-performance under or termination, non-renewal or material modification of customer lease agreements with these customers could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
A significant portion of our revenue in each of our markets of operation is derived from a small number of customers, who usually constitute some of the largest MNOs in those markets. In particular, for the years ended December 31, 2024 and 2023, revenue from our top three MNO customers, considered in each of our individual markets of operation, collectively accounted for 99% and 97%, respectively, of our consolidated revenue, with MTN Nigeria and Airtel Nigeria accounting for 46% and 11%, respectively, of our consolidated revenue for the year ended December 31, 2024. Should there be any negative impact on the businesses of our major customers, including these key MNOs, including as a result of economic conditions (global, local or otherwise), it could adversely affect their demand for tower space and/or ability to perform their obligations under their lease agreements with us. For example, Nigeria’s currency has experienced significant devaluation since 2023 resulting in, among other things, rising inflation, and any further downturn in the local economies in which we operate could significantly impact our Key Customers.
Due to the long-term nature of our MLAs (usually 5 to 10 years with subsequent renewal provisions), we are also dependent on the continued financial strength of our customers. Some customers may operate with substantial leverage and/or rely on capital-raising to fund their operations and such customers may not have sufficient credit support or the ability to raise capital. If, for example, our customers or potential customers are unable to raise adequate capital to fund their business plans, including as a result of events with a wide-ranging regional or global impact (including health pandemics or epidemics) or economic conditions or if they do not have adequate support from parent companies or shareholders, they may reduce their capital spending, which could materially and adversely affect demand for space on our Tower sites or other infrastructure, which in turn could have a material adverse effect on our financial condition and/or results of operations.
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Furthermore, some of our customers have or may become subject to regulatory or other action, which may result in unanticipated levies or fines. For example, until January 2020, MTN Nigeria was involved in a $2 billion dispute with Nigeria’s Attorney General regarding a demand for allegedly unpaid tax, which was subsequently referred to the Nigeria Federal Inland Revenue Service, or FIRS, and the Nigeria Customs Service. Any fines levied against our customers, their inability to fund their operations or other financial difficulties experienced by our customers could negatively affect their demand for tower space or their ability to perform their obligations under their lease agreements with us, and in turn could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
In addition, if any of our customers are unwilling or unable to perform their obligations under the relevant tower lease or other customer agreements, including as a result of events with a wide-ranging regional or global impact, or related events (such as regulatory interventions on pricing to make MNO services more accessible, for example, during periods of lockdown or restricted movement or operations), our revenue, financial condition and/or results of operations could be adversely affected. In the ordinary course of our business, we do occasionally experience disputes with our customers, generally regarding the interpretation of terms in our lease agreements. From time to time, we also undertake routine revenue assurance exercises to determine that all customer equipment on site and services being provided to the customers are being accurately invoiced according to our contracts, and occasionally, we locate equipment that we have not previously invoiced to customers that we believe we are contractually able to invoice. Historically, we have sought to resolve these disputes in an amicable manner, and such disputes have not had a material adverse effect on our customer relationships or our business. However, it is possible that such disputes could lead to a termination (or non-renewal) of our lease agreements with customers, a material modification of the terms of those lease agreements or a failure to obtain new business from existing customers, any of which could have a material adverse effect on our business, prospects, financial condition and/or results of operations. Furthermore, if we are forced to resolve any of these disputes through litigation or arbitration, our relationship with the applicable customer could be terminated or damaged, which could lead to decreased revenue or increased costs, which may in turn result in a material adverse effect on our business, prospects, financial condition and/or results of operations.
Our customers may fail to meet their payment obligations on a timely basis or at all. Such failures to pay, payment delays or other non-performance may be due to a customer’s insolvency or bankruptcy, a downturn in the economic cycle or factors specific to the relevant customer. For instance, in March 2023, Oi S.A. (“Oi Brazil”) filed for a new judicial reorganization proceeding, listing our contract related to the GTS SP5 Acquisition among Oi Brazil’s debts. In April 2024, an Oi Brazil restructuring plan was presented to the court in Brazil and agreed upon by creditors (including the Company), which resulted in our customer contract terms being amended (including, among other things, haircuts and amended payment terms). As a result of the agreed upon terms, we had to reduce the carrying amount of the IHS Latam tower businesses group of cash generating units (CGUs) to its recoverable amount and we have recognized in the three month period ended March 31, 2024, an impairment of $87.9 million in the IHS Latam tower businesses group of CGUs. Any continued or future failure of customers to make payments (including pursuant to any new arrangements entered into to try and resolve the situation) may result in us not receiving payment of amounts owed to us and further potential renegotiation of contract terms. See “— We may experience volatility in terms of timing for settlement of invoices or may be unable to collect amounts due under invoices.” The failure of our customers to meet their payment obligations and/or our inability to find new customers in a timely manner could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
No assurance can be given that our customers will renew their customer lease agreements upon expiration of those agreements or that customers will not request unfavorable amendments to existing agreements, including in relation to pricing. While a number of the MLAs with our customers are deemed automatically renewed or continue in effect on a month-to-month basis, under the same contractual provisions, if not cancelled by the stated expiration date, we regularly keep upcoming renewal or expiry dates under review, and engage in discussions with customers from time-to-time regarding such matters. For instance, we have an MLA with a certain customer in South Africa up for renewal in 2025. No assurance can be given that we will be successful in renewing or negotiating favorable terms with these or other customers, or that we will not be required to enter into interim continuation provisions with these customers if we are unable to agree to renewal agreements prior to the expiry of our current agreements. For example, in September 2023, prior to agreeing the renewal in August 2024, MTN Nigeria had issued a statement that it had selected ATC Nigeria Wireless Infrastructure Solutions Limited to provide services to approximately 2,500 sites that were owned and managed by the Group in Nigeria. Of these, 1,430 tenancies (including new colocations) were renewed under the terms agreed with MTN Nigeria in August 2024. Any failure to obtain renewals of existing customer lease agreements or failure to successfully negotiate favorable terms for such renewals of or amendments to existing agreements (if sought) could result in a reduction in revenue and, accordingly, have a material adverse effect on our business, prospects, financial condition and/or results of operations.
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We may experience volatility in terms of timing for settlement of invoices or may be unable to collect amounts due under invoices.
Our contractual invoicing cycle is typically monthly in arrears or monthly or quarterly in advance, with the contractual payment cycle on average 30 to 60 days post invoice. As of December 31, 2024, we had gross receivables more than 90 days overdue of $34.6 million and held an impairment provision allowance of $16.3 million. While we may continue to pursue our contractual rights in collecting outstanding amounts, should the relevant counterparties be unable to meet their obligations to pay us any such sums in a timely manner, this could have a material adverse effect on our business, prospects, financial condition and/or results of operations, including planned working capital requirements. In addition, if our customers experience financial difficulties, as a result of regulatory actions, events with a wide-ranging regional or global impact (including health pandemics or epidemics) global economic conditions, prolonged economic downturn, inability to raise funds or capital, or for any other reason, we may be unable to collect amounts due under invoices from those customers, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Our current and future markets involve additional risks compared to more developed markets, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We and our customers operate in various international markets, particularly in emerging markets such as in Africa and Latin America. As a result, we may, directly or indirectly, be exposed to economic, political and other uncertainties, including, but not limited to risks of:
| ● | general political and/or economic conditions, including any deterioration thereof, impacting our existing or anticipated markets of operation, such as the effects of outbreaks or events with a wide-ranging regional or global impact (including health pandemics or epidemics), geopolitical conflicts and wars (whether local, regional or international) or as a result of changes in the price of commodities, examples of which include the historical declines in copper prices that adversely affected Zambia’s economy or the volatility of oil price markets that have adversely affected economies such as Nigeria’s; |
| ● | inflation and measures taken to control inflation; |
| ● | civil strikes, acts of war, terrorism, insurrection and incidents of general lawlessness; |
| ● | acts of piracy or vandalism; |
| ● | significant governmental influence over (or intervention in) many aspects of local economies, including, but not limited to, import-export quotas, subsidies on certain input products, license requirements or restrictions, or wage and price controls, or the imposition of trade barriers; |
| ● | telecommunications regulatory systems and/or competition regimes regulating our or our customers’ services, or our ability to invest further in particular markets as a result of antitrust regimes that may, for example, impact us due to our ultimate shareholders also investing in other, ancillary businesses in the same market or determining our market share is too large, requiring sales of assets or other restrictions that impact our business; |
| ● | laws or regulations that tax or otherwise restrict repatriation of earnings or other funds or otherwise limit distributions of capital; |
| ● | laws or regulations that restrict foreign investment or indigenous ownership laws, or expropriation or governmental regulation restricting foreign ownership or requiring divestiture; |
| ● | uncertain tax regimes and inconsistent income taxation, or changes to existing or new tax laws, rates or fees, either generally or directed specifically at the ownership and operation of towers, communications infrastructure or our international acquisitions or other transactions and operations, which may also be applied or enforced retroactively; |
| ● | changes to zoning regulations or construction laws, which could also be applied retroactively to our existing sites or infrastructure; |
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| ● | actions restricting or revoking spectrum or other licenses or suspending business under prior licenses; |
| ● | security and safety of employees, and material site security issues; |
| ● | inability to secure rights or access to the land necessary to execute customer orders for New Sites and for new fiber roll-out; |
| ● | significant license or permit surcharges; |
| ● | difficulties in staffing and managing operations, labor unrest or unionization action (including in relation to the business of any third-party supplier or customer), or changes in labor conditions (including, but not limited to, increases in the cost of labor, as a result of unionization or otherwise); |
| ● | seizure, nationalization or expropriation of property, equipment or other assets; |
| ● | repudiation, nullification, modification or renegotiation of contracts; |
| ● | limitations on insurance coverage, such as political risk or war risk coverage, in certain areas; |
| ● | political or social unrest, whether internal, local, tribal, regional or otherwise; |
| ● | local, foreign and/or U.S. monetary policy and foreign currency fluctuations and devaluations, changes in foreign currency exchange rates, restrictive foreign exchange regulations (including, for example, restrictions on the transfer of funds into or out of countries in which we operate) and/or illiquidity in the foreign exchange markets (such as the historic and recent fluctuations in the Naira, and the significant shortage of U.S. dollar liquidity in Nigeria for periods); |
| ● | price setting or other similar laws for the sharing of passive communications infrastructure, or requirements to construct New Sites in remote or rural areas that are less commercially viable for us; |
| ● | logistical and communications challenges, complications associated with repairing and replacing equipment in remote locations, or supply chain issues arising out of global or geopolitical issues, such as operational and transport restrictions or challenges; |
| ● | equipment failure, grid unavailability, planned and unplanned outages, fires, natural catastrophes or climate-related events, accidents and infrastructure that lead to network failure; |
| ● | U.S. and foreign sanctions, trade embargoes or export control restrictions; |
| ● | failure to comply with U.S. Treasury and other internationally recognized sanctions regulations restricting doing business with certain nations or specially designated nationals; |
| ● | failure to comply with the requirements Office of Foreign Assets Control of the U.S. Department of Treasury, the requirements of the Bureau of Industry and Security of the U.S Department of Commerce and other internationally recognized sanctions regulations restricting doing business with certain nations or specially designated nationals; |
| ● | failure to comply with anti-bribery, anti-corruption or money laundering laws and regulations such as the Foreign Corrupt Practices Act, the UK Bribery Act or similar international or local anti- bribery, anti-corruption or money laundering laws and regulations; |
| ● | potential adverse or unforeseen changes in laws and regulatory practices, or inconsistent or unpredictable application of laws or regulations by governmental authorities, including financial regulators; |
| ● | uncertain rulings or results from legal or judicial systems, including inconsistencies between and within laws, regulations and decrees, and judicial application thereof, which may be enforced retroactively, and delays in the judicial process; |
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| ● | actions, proceedings, claims, disputes and threats brought by governments, regulators, entities or individuals for fees, taxes or other payments, even if meritless or frivolous under applicable law; |
| ● | regulatory or financial requirements to comply with bureaucratic actions; |
| ● | changes to existing laws or new laws, and/or changing labor and taxation laws or policies, including confiscatory taxation; |
| ● | other forms of government regulation and economic conditions that are beyond our control; |
| ● | governmental corruption consequences of poorly designed and executed government policies, corrupt practices (or alleged corrupt practices) on the economy in general or particular industries or companies, or of ineffective or insufficient corporate governance standards and practices; and |
| ● | higher volatility of our ordinary share price. |
Any of these or other risks could adversely impact our customers’ and/or our operations, which, in turn, could have a material adverse effect on our business, prospects, financial condition and/or results of operations, as well as our growth opportunities. In particular, a significant portion of our revenue is currently derived from our Nigerian operations (58.3% of our revenue for the year ended December 31, 2024), and any such risks materializing within Nigeria in particular may have a significant impact on our business as a whole, including our business, prospects, financial condition and/or results of operations.
Operations in international markets, including emerging and less developed markets (including Africa and Latin America), also subject us to numerous additional and different laws and regulations affecting our business, such as those related to labor, employment, unions, health and safety, antitrust and competition, environmental protection, consumer protection, import/export and anti-bribery, corruption and money laundering. Our employees, subcontractors and agents could take actions that violate any of these requirements. Violations, or alleged violations, of any such laws or regulations could subject us to criminal or civil enforcement actions and adversely affect our reputation, any of which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Our expansion into new geographic markets, such as Latin America and South Africa, and other markets we may enter in the future, may present competitive, distribution, regulatory and other challenges that differ from the challenges we face in markets that we have historically operated in. In addition, we may be less familiar with the customers, competitive dynamics (including antitrust concepts or regimes that may be based on our ultimate group shareholding and that may limit our ability to make future investments, due to, for example, our ultimate shareholders also investing in other ancillary businesses in the same market, which regulatory authorities in some markets may view as impacting their antitrust considerations) and regulatory environment in these markets and may ultimately face different or additional risks, as well as increased or unexpected costs, compared to those we experience in our existing markets. Expansion into new geographic markets may also expose us to direct competition with companies with whom we have limited or no past experience as competitors. To the extent we rely upon expanding into new geographic markets and do not meet, or are unprepared for, any new challenges posed by such expansion, our future sales growth could be negatively impacted, our operating costs could increase, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations. See also “Risks Relating to the Markets in which We Operate.”
We and our customers face foreign exchange risks, which may be material.
For the years ended December 31, 2024, 2023 and 2022, 47%, 49%, and 52%, respectively, of our revenue was linked to the U.S. dollar and euro. The manner in which this revenue is linked to the U.S. dollar or the euro differs across our MLAs and jurisdictions of operation.
Our U.S. dollar-linked revenue is denominated in U.S. dollars in the relevant MLAs but paid to us in local currency through contractual mechanisms. In such cases, including the majority of our MLAs in Nigeria, our MLAs may contain a formula for periodically determining the U.S. dollar to local currency exchange rate. Such MLAs typically have U.S. dollar-denominated components and local currency components of pricing, and the U.S. dollar components are converted to the local currency for settlement at a fixed conversion rate for a stated period of time, which conversion rates are reset monthly and quarterly. As a result, in the event of devaluation, such as the one that occurred in June 2023 in Nigeria, there is a risk of a delay between the timing of the devaluation and the next contractual reset, which may be significant.
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During the period between the date of the devaluation and the date of the reset, all of our revenue (i.e., both revenue that is contractually linked to the U.S. dollar and that is contractually linked to local currency) would reflect the new, devalued foreign exchange rate. When the reset is effected, the amount relating to the portion of the lease fees linked to the U.S. dollar, which is invoiced in local currency, is adjusted upward, at the relevant time. Furthermore, our ability to maintain or enter into such contractually linked foreign exchange protection mechanisms with our current and new customers in the future is not assured, which may in turn reduce our protection against fluctuations in foreign exchange rates and therefore could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
In addition, the conversion rates included in our MLAs may also be different from the rates at which our financial results are translated into U.S. dollars for reporting purposes. If we are required to use a higher rate for accounting purposes than that of our contracts, notwithstanding any underlying performance, it is likely that our financial results for the relevant periods in the future will show a related decline in performance. For example, as described below under “— The existence of multiple foreign exchange markets with different exchange rates may impact the rate at which our operating subsidiaries’ financial results are translated into U.S. dollars for group reporting purposes, which may impact our financial condition and/or results of operations,” in April 2017, the CBN introduced a new foreign exchange window for investors and exporters (the I&E window, now referred to as NFEM), and while certain of our contracts in Nigeria contain contractually linked foreign exchange protection mechanisms that are intended to protect against foreign exchange fluctuations, such contracts historically only protected against changes in the official CBN exchange rate. While we reached agreement with our Key Customers in Nigeria to update the reference exchange rate in our contracts to the prevailing market rate available on Bloomberg (which is currently approximately aligned to the NFEM rate), should these and similar circumstances arise again (where there is a divergence between the applicable market rate or translation rates for our financial results, and the exchange rate reflected in our contracts with customers), there is no guarantee that we will be able to renegotiate these contracts or enter into new contracts to fully protect against such foreign exchange risks, which could materially impact our results of operations. For instance, in June 2023, the CBN announced the unification of all segments of the foreign exchange market by replacing the old regime of multiple exchange rate “windows” for different purposes with, in effect, a market rate. The unification of the Nigeria foreign exchange market was aimed at eliminating multiple “windows” and to allow foreign exchange transactions to be determined by market forces via a single I&E window (now referred to as NFEM). Despite these efforts, the Naira depreciated significantly against the U.S. dollar and from June 14, 2023 to December 31, 2024, the NFEM rate depreciated by 69.1%, from approximately ₦474.0 to $1.00 to approximately ₦1,535.0 to $1.00, while the Bloomberg rate depreciated by 69.5%, from approximately ₦472.3 to $1.00 to approximately ₦1,546.0 to $1.00 during the same period. In addition, some of our contracts, particularly in Latin America and South Africa, are based on local currency pricing with no direct foreign exchange link or conversion mechanism, and therefore any depreciation in local currency rates against the U.S. dollar would similarly impact our financial results when they are translated into U.S. dollars for reporting purposes, notwithstanding any underlying performance.
Certain of our other MLAs have revenue components linked to hard currencies, such as the U.S. dollar or the euro, because the MLAs are in local currencies that maintain a fixed exchange rate, or are “pegged,” to such currencies, such as those in Côte d’Ivoire and Cameroon. In addition, it was announced in 2019 that the CFA Franc used in the West African Economic and Monetary Union (“UEMOA”), which includes Côte d’Ivoire, and which has a fixed exchange rate to the euro, would be replaced by a new currency called the Eco, and in June 2021, the heads of state of fifteen West African countries, including Côte d’Ivoire, comprising the Economic Community of West African States adopted a roadmap for the launch of the Eco in 2027. If such fixed or linked exchange rates are not maintained or are “de-pegged,” it could result in fluctuations and/or devaluations of these currencies, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
In addition, even though our MLAs may have foreign currency-linked revenue components, or have use fees expressed in foreign currencies, the actual currency of settlement of a significant portion of our revenue is in local currencies, and we therefore remain exposed to foreign exchange risks. There may also be regulatory actions or pressure based on, among other things, socioeconomic or political reasons or events, to enforce local currency-based pricing, or customers may seek to renegotiate the pricing elements of their contracts (for example, to the extent the local currency foreign exchange rate changes significantly, as seen in Nigeria), which would dilute any protection we may seek to include in our contracts to protect against local currency devaluations.
Most of our expenses are in the local currencies of the relevant jurisdiction of operation, except for certain of our borrowings, which are predominantly in U.S. dollars. For example, our Existing Notes and some of our other indebtedness (for example the IHS Holding Dual-Tranche 2024 Term Loan ), and certain Nigerian letters of credit) are denominated in U.S. dollars, with an aggregate principal amount outstanding of approximately $2,447.9 million as of December 31, 2024. Certain other components of our capital expenditures may also be linked to foreign currency-based pricing elements. Diesel, which is one of our most significant expenses, may be considered as linked to U.S. dollars given the international pricing of oil, and can be paid for in U.S. dollars when purchased offshore or in local currency when purchased locally.
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See “— Any increase in operating expenses, particularly increased costs for diesel or an inability to pass-through or mitigate against increased diesel costs, could erode our operating margins and could have a material adverse effect on our business, prospects, financial condition and/or results of operations.” Should the relevant local currencies depreciate against the U.S. dollar, the cost of buying diesel in the relevant local currency may increase, but the impact on our results is less notable when translated back into U.S. dollars at a higher foreign exchange rate. There may, however, be instances where our suppliers face foreign exchange pressure in the importation of certain materials, or as a result of the exchange rate at which they are able to source (or which applies to items for which charges are based on) foreign currency and import certain materials. This could in turn result in pressure from our suppliers to increase amounts payable by us.
We hold U.S. dollar cash balances in some of our jurisdictions of operation and/or convert local currencies to the relevant foreign currencies for payment obligations. We are also party to certain instruments and/or facilities (such as letters of credit) from time to time, where there may be requirements to hold or deposit foreign-currency linked amounts (including local currency equivalents) to back-up debt or other obligations (including, but not limited to, as collateral). Accordingly, we are subject to fluctuations in the rates of currency exchange between the local currencies and the relevant foreign currency as well as availability to source the relevant foreign currency in the jurisdictions in which we operate, and such fluctuations and/or availability could have a material adverse effect on our business, prospects, financial condition and/or results of operations. We may also be required to post additional foreign-currency linked amounts as collateral or otherwise to reflect such fluctuations. There may also be limited availability of U.S. dollars in the market at the time when we convert the relevant local currency to U.S. dollars, in which case we may need to convert the relevant local currency into U.S. dollars at a less favorable currency exchange rate. See also “Risks Relating to the Markets in which We Operate — Shortage of U.S. dollar, euro or other hard currency liquidity in the markets in which we operate could have a material adverse effect on our ability to service our foreign currency liabilities.”
In addition, our major customers may also face foreign exchange risks where their revenue is denominated in local currency, but their costs, including the fees they pay to us, are denominated in, or linked to, a foreign currency such as the U.S. dollar. When the local currency depreciates against the relevant foreign currency (such as the significant depreciations of the Naira against the U.S. dollar in 2016 (when the Naira depreciated from approximately ₦196.5 to $1.00 as of January 1, 2016 to ₦304.5 to $1.00 as of December 31, 2016), in 2023 (when the Naira depreciated from approximately ₦461.5 to $1.00 as of January 1, 2023 to ₦911.7 to $1.00 as of December 31, 2023), and again in January 2024, with the Naira having depreciated to ₦1,546.0 to $1.00 as of December 31, 2024), it may impact the ability of our customers to make payments to us on a timely basis or at all, and our customers may either raise prices for their customers or cut back on capital and operational expenditures, both of which could reduce future demand for our services, or result in requests to renegotiate contract terms (including pricing) with us prior to the relevant MLA end date.
Fluctuations in exchange rates, including volatility related to events affecting the economy (global, regional or local) or to geopolitical events or conflicts, depreciation of local currencies and/or a lack of sufficient availability of hard/international currencies, as required, could have a material adverse effect on our business, prospects, financial condition and/or results of operations. See “— Financial authorities in the markets in which we operate may intervene in the currency markets by drawing on external reserves, and their currencies are subject to volatility” and “— The existence of multiple foreign exchange markets with different exchange rates may impact the rate at which our operating subsidiaries’ financial results are translated into U.S. dollars for group reporting purposes, which may impact our financial condition and/or results of operations.”
The existence of multiple foreign exchange markets with different exchange rates may impact the rate used in our customer contracts and the rate at which our operating subsidiaries’ financial results are translated into U.S. dollars for group reporting purposes, which may impact our financial condition and/or results of operations.
As described below under “— Risks Relating to the Markets in which we Operate — Financial authorities in the markets in which we operate may intervene in the currency markets by drawing on external reserves, and their currencies are subject to volatility,” central banking authorities in the countries in which we operate may intervene in the currency markets or adopt policies that may impact the applicable exchange rates and/or amounts of foreign currency that may be obtained. In markets where there are multiple exchange rates available and/or referenced by the applicable banking authorities, there may be differences among the exchange rates companies use pursuant to accounting standards, contracted rates, rates quoted for other foreign exchange transactions, and “official” central bank rates. If such differences exist, we may encounter issues relating to the interpretation or enforcement of our contracts with our customers. We may also be required to change the exchange rate applied to the translation of the local currency books of our operating subsidiaries to U.S. dollars for our consolidated group reporting purposes.
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This has been particularly relevant to our operations in Nigeria in the past, where a significant portion of our operations are based. Following the significant depreciation of the Naira against the U.S. dollar in 2016, as described in “— We and our customers face foreign exchange risks, which may be material,” in a continuing effort to improve U.S. dollar liquidity in Nigeria and to assist investors and exporters in accommodating foreign exchange transactions, the CBN introduced a new foreign exchange window for investors and exporters in April 2017 (the I&E window (now referred to as NFEM), from which the NAFEX rate is also derived). This resulted in a situation where there were differing exchange rates in the market and we were required to regularly monitor and evaluate which exchange rate was most appropriate to apply in the translation of the Naira books of our Nigerian operations to U.S. dollars for our consolidated group reporting purposes.
Until the CBN ceased publishing the CBN official rate in May 2021, there existed a divergence between the two rates, with the CBN official rate (against the U.S. dollar) usually being lower than the NAFEX rate. Although the CBN ultimately implemented steps to unify the Nigerian foreign exchange market in June 2023, by replacing the old regime of multiple exchange rate segments into a single NFEM window within which foreign exchange transactions would be determined by market forces, it is possible that in the future, official exchange rates in Nigeria or our other markets of operation may diverge again from prevailing market exchange rates due to future government interventions. We currently use the USD/NGN rate published by Bloomberg, which is approximately aligned to the NFEM window rate, for reporting purposes.
The determination of the most appropriate rate to use at the relevant time we produce financial information will depend on a number of factors, including, but not limited to, availability and liquidity in the market generally. The foreign exchange rate that we determine to be the most appropriate for the translation of our results for group reporting purposes may, therefore, differ from the conversion rates contained within our contracts. For example, in Nigeria, following the Naira depreciation in 2016 and the existence of multiple rates in the market, we began to translate the results of our subsidiaries in Nigeria into our presentation currency, U.S. dollars, at rates more reflective of the NAFEX. Prior to the agreements that we subsequently reached with our Key Customers in Nigeria to update the reference exchange rate in our contracts to the prevailing market rate available on Bloomberg, because the NAFEX rate used for accounting purposes had historically been higher than the CBN official rate used in our contracts, notwithstanding any underlying performance, our financial results for the relevant periods would have shown a related decline in performance in case of devaluation of the NAFEX where the CBN official rate remained at the same level. While our contracts with certain of our Key Customers in Nigeria were amended to resolve that anomaly, and notwithstanding the action taken by the CBN in June 2023 to unify the Nigerian foreign exchange market, there can be no assurance that such a divergence between the applicable market rate or translation rate for our financial results, and the exchange rate reflected in our contracts with customers, will not occur again in Nigeria, or that the prevailing market rate on Bloomberg will not diverge from other exchange rates in the market (including NFEM), or that a similar situation would not occur in other countries in which we operate, any of which could, in turn, have a material adverse effect on our business, prospects, financial condition and/or results of operations, notwithstanding any underlying performance.
In addition, other measures taken by the relevant central banks or similar, including the manner in which various exchange rates are published, may further impact the rates available in the market, and we may need to consider such measures for the purposes of our accounts.
Potential investors should, therefore, bear this in mind when considering an investment in our ordinary shares, and the potential impact on the future trading and/or market price of our ordinary shares based on a decline in reported financial and/or operational performance based on such factors.
We may not successfully execute our business strategy and operating plans or manage our growth, all of which depend on various factors, many of which are outside our control.
The existing and future execution of our strategic and operating plans will, to some extent, be dependent on external factors that we cannot control, such as changes in the tower infrastructure industry or the wider communications industry, particularly in the various jurisdictions in which we operate and may seek to operate in the future, changes in budgets of or demand from our current or potential customers for tower and other communications infrastructure services, international legislative and regulatory changes, changes in regional security or the economy of the countries in which we operate, changes in fiscal and monetary policies, the availability of additional tower and other communications infrastructure portfolios for acquisition and restrictions or other limitations relating to foreign direct investment or foreign ownership in particular markets (including, among other things, events such as inflation, geopolitical instability, health pandemics or epidemics, or events with a wide-ranging regional or global impact, accelerating the implementation of any such measures or giving rise to such factors). For example, high tariffs charged to users in the countries in which we operate compared to certain other countries in which we do not operate, may impede or slow the growth of the communications industries in the countries in which we operate and, in turn, our business.
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We may be unable to implement our strategy relating to the construction of New Sites and deployment of other communications infrastructure. See “— Our ability to construct New Sites or to deploy other communications infrastructure depends on a number of factors, many of which are outside of our control.”
Our ability to increase the number of Colocations and Lease Amendments on each Tower that we own across our portfolio is a key factor contributing to our growth and a key part of our strategy in the markets in which we operate. If we are unable to increase the number of Colocations and Lease Amendments on our Towers, either due to a lack of available space or from reduced customer demand, if we are unable to accurately assess and invoice customer equipment on our sites, or if we are unable to implement or achieve our other strategic plans or targets and key performance indicators, we may not achieve the revenue, margins or earnings that we need to grow or to offset the impact of any adverse economic conditions that may develop in the future.
Our ability to increase the usage of our infrastructure by our customers may depend on the performance of these customers and their success in acquiring and retaining end users for the purposes of their services. A decline in the number of end users for our customers, or lower than expected growth in end users for our customers, could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
In addition, our strategic and operational plans need to be continually reassessed to meet the challenges and needs of our businesses in order for us to remain competitive. For instance, we expect to adopt a more balanced approach to revenue growth and cash generation to counterbalance the recent macroeconomic headwinds across the world, particularly in Nigeria given the significant recent depreciations of the Naira in June 2023 and January 2024. As part of our heightened focus on cash generation, we may pursue operational efficiencies through productivity enhancements, cost and capital expenditure reductions, and a review of our portfolio of markets and assets. In addition, in March 2024, we announced that we were undertaking a strategic review process, which includes evaluation of our organizational initiatives, plans and goals to try to ensure they align with our long-term objectives and external environment conditions, and targeted at shareholder value-creation options (See “Business Overview — Our Strategy”). Notwithstanding our expectations, we may deploy strategic plans that ultimately do not achieve our initial expectations or goals, including, but not limited to, as they relate to entering new markets or exiting certain markets, acquiring or disposing of assets or deploying growth capital. Incorrect initial assumptions or the failure to implement and execute our strategic and operating plans in a cost-effective and timely manner, or at all, realize the cost savings or other benefits or improvements associated with such plans, or have financial resources to fund the costs associated with such plans or to incur costs in excess of anticipated amounts, or sufficiently assess and reassess the plans (including, in each case, as a result of challenges that may be posed or arise as a result of operating companies in which we may not have a majority of the economic or share ownership, whether in terms of operational or further commensurate funding challenges or otherwise), could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Further, successful execution of our business plan will require effective management of growth, which may include acquisitions or dispositions. The management team, operational systems and internal controls currently in place or to be implemented may not be adequate for such growth or other strategy, and the steps taken to hire personnel and to improve such systems and controls may not be sufficient. If we are unable to grow as anticipated, manage our growth effectively or successfully integrate any acquisitions (including their information technology or finance systems into our control environment), it could have a material adverse effect on our business, prospects, financial condition and/or results of operations. See “Business Overview — Our Strategy” for further information on our key strategies.
Moreover, investors and other stakeholders, including regulators, are or may become increasingly focused on our sustainability or environmental, social and governance initiatives, including our plans to reduce diesel consumption. There can be no assurance we will be able to execute such strategies or deliver on projections or targets. For more information, See “— Increased attention to, and evolving expectations for, sustainability and environmental, social, and governance (“ESG”) initiatives and disclosures could increase our costs, harm our reputation, or otherwise adversely impact our business.”
We rely on third-party contractors for various services, and any disruption in or non-performance of those services would hinder our ability to effectively deploy or maintain our infrastructure.
We engage third-party contractors to provide various services in connection with the site acquisition, construction, supply of equipment and spare parts, access management, security and preventative and corrective maintenance of tower sites, as well as power management, including the supply of diesel to certain of our sites, sometimes with a small number of contractors in the relevant jurisdiction. For example, we have outsourced power management, refurbishment, operations and maintenance and security functions for certain of our sites in Nigeria to certain key suppliers and may continue to do so in other markets (including any new markets which we may enter).
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Their power management functions include the supply of diesel to and deployment of alternative power technologies, such as hybrid and solar power technologies, on certain sites, to help reduce diesel consumption to a contracted volume. Across our eight markets, as of December 31, 2024, we outsourced certain operations and maintenance activities at 73% of our Towers. We also engage third-party contractors and suppliers with respect to other systems we use to operate our business, including but not limited to information technology systems and services.
We are exposed to the risk that the services rendered by our third-party contractors will not always be available, satisfactory or match our and/or our customers’ targeted quality levels, as well as the risk that they may otherwise be unable to perform their obligations to some extent or at all, including as a result of labor disputes, insolvency, operational, access or transport restrictions or other limitations related to global or regional health events or outbreaks (such as COVID-19), geopolitical events (such as those related to political instability, conflicts or wars), or other events resulting in the imposition of economic or trade sanctions, export controls or similar restrictions. As a result, we may experience interruptions in our ability to provide services, our customers may be unsatisfied with our services, and we may be required to pay certain financial penalties under our contracts, or our customers may terminate their contracts in the event of a material breach, any of which could have a material adverse effect on our reputation and brand, as well as our business, prospects, financial condition and/or results of operations.
Additionally, over the past few years the U.S. government has imposed economic and trade sanctions and export control restrictions on a number of entities in China, including certain China-based technology companies (such as Huawei Technologies Co., Ltd., or Huawei, and certain of its affiliates), with whom we conduct business. It is possible that, in the future, there may be additional regulatory challenges or enhanced trade-related restrictions targeting Huawei or other China-based technology companies. Such potential restrictions or sanctions, as well as any associated inquiries or investigations or any other government actions, may be difficult or costly to comply with and may, among other things, delay or impede the development of the technology, products and solutions of China-based third-party contractors and/or suppliers with whom we are currently engaged or may become engaged with and hinder the stability of the supply chains of such contractors and suppliers, any of which may have a material adverse effect on our business, financial condition and/or results of operations.
In addition, if third-party contractors do not meet execution targets for both financial and operational performance, including not meeting our standards of service or complying with health, safety, employment or other laws and regulations, or are unable to perform to some extent or at all, we may have to step in and complete the process. If we are required to undertake this work ourselves, it could require extensive time and attention from our management and lead to increased future operating costs while the work is carried out, which in turn could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We rely on third party suppliers for the supply of diesel, materials, equipment and other goods, and any disruption in the provision of those goods would hinder our ability to effectively deploy or maintain our infrastructure.
We rely on third parties for supply of various materials, equipment and other goods or items to support our operations, including the supply of diesel, which is critical, as many of the markets in which we currently or may, in future, operate (including, in particular, those in Africa) have limited or unreliable power grid connectivity (including due to the impact of seasonal extreme weather conditions), thereby resulting in a heavy reliance on alternatives such as diesel-powered generators. Given the importance of diesel for our operations, we may purchase diesel in large quantities which is then stored at our facilities. This supply could be disrupted by events that are beyond our control, including, for example, outbreaks or events with a wide-ranging regional or global impact (including health pandemics or epidemics), or geopolitical events such as those related to political instability, conflicts or wars. While we aim to purchase diesel from reputable third parties that can provide a consistent supply of diesel of appropriate quality, we also cannot control the ultimate source of the diesel provided by such suppliers or any alteration in the quality of the product at the point of receipt (such as adulteration or theft of products during the delivery period). While we maintain planning, monitoring and logistics systems including bulk storage facilities aimed at providing a consistent supply of diesel to sites, scarcity of diesel, lack of available trucks, labor disputes, blockades, protests by third parties, queues and other issues at fuel depots and security concerns at certain sites, and fire, among other things, including the impact of climate change or related initiatives, have in the past and may in the future, cause this supply to be disrupted. Disruption in the supply of diesel or diesel quality not meeting our requirements would impede our ability to continue to power our sites and adversely affect power uptimes. Widespread or long-term disruption in the supply of diesel may result in us being unable to meet the service level agreement targets under our MLAs, and in some cases we would be required to shoulder resultant financial penalties, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
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We also rely on third-party suppliers for many of the other materials, equipment and goods necessary to operate our business, including batteries, solar panels, and fiber optic cable. The failure of suppliers to supply equipment in a timely manner or on commercially reasonable terms could delay our plans to expand our business and otherwise increase our costs. Our orders with certain of our suppliers may represent a very small portion of their total orders. As a result, they may not give priority to our business, leading to potential delays in or cancellation of our orders. If any single-source supplier were to fail to supply our needs on a timely basis or cease providing us with equipment, we would be required to locate and contract with substitute suppliers. We may have difficulty identifying a substitute supplier in a timely manner and/or on commercially reasonable terms. If this were to occur, our business and operations could be harmed. In addition, adverse economic conditions and trade policy considerations, such as supply chain disruptions and labor shortages and persistent inflation, have impacted, and may continue to adversely impact our suppliers’ ability to provide us with materials and equipment, which may negatively impact our business. These economic conditions make it more difficult for us to accurately forecast and plan our future business activities.
Additionally, there are increasing regulations and expectations in various jurisdictions that companies monitor the environmental and social performance of their suppliers, including compliance with a variety of labor practices and the provenance of certain materials, as well as consider a wider range of potential environmental and social matters. Compliance can be costly and may require us to establish or augment programs to diligence or monitor our suppliers, or, in certain cases, to design supply chains to avoid certain regions altogether. Failure to comply with such regulations can result in fines, reputational damage, or otherwise adversely impact our business.
Our Contracted Revenue is based on certain estimates and assumptions and actual results may differ materially from such estimated operating results.
Our Contracted Revenue disclosed in this Annual Report represents our estimate of the lease fees to be received from existing Tenants of Key Customers for the remainder of each Tenant’s current contractual site lease term, lease fees to be received from the existing Lease Amendments of Key Customers for the remainder of each Lease Amendment’s current contractual term and lease fees to be received from Key Customers where we provide fiber access to an OLT for the remainder of the relevant contractual term, as of December 31, 2024. Our Contracted Revenue is based on certain estimates and assumptions, such as constant foreign exchange rates, no escalation of lease fees despite contractual provisions in our MLAs in that regard, no new tenants or new Lease Amendments added, no amendments to our existing MLA terms and no Churn. Unanticipated events may occur that could adversely affect the actual results achieved by us during the periods to which these estimates relate, causing some or all of the actual results to deviate from our estimates and assumptions, which in turn could have a material adverse effect on our business, financial condition and/or results of operation.
Any increase in operating expenses or costs, particularly increased costs for diesel or ground lease costs, or an inability to pass-through or mitigate against such costs, could erode our operating margins and could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Our primary operating expenses include diesel fuel, site maintenance and security, salaries of engineers and security personnel, fees for licenses and permits and insurance. In addition, we incur ground lease costs and the continued development, expansion and maintenance of our tower site and other communications infrastructure requires ongoing capital expenditure. There is no assurance that our operating expenses, including those noted above, will not increase in the future or that we will be able to successfully pass any such increases in operating expenses to our customers. For example, we require a substantial amount of diesel to power our tower site operations. For the year ended December 31, 2024, the cost of power generation, which includes diesel, haulage and minimal electricity, accounted for 39.2% of our cost of sales, as compared to 33.5% of our cost of sales for the year ended December 31, 2023.
Diesel prices have fluctuated significantly over time, often in parallel to changes in oil prices, and may fluctuate in the future as a result of many factors, including but not limited to the impact of events with a wide-ranging regional or global impact (including health pandemics or epidemics), geopolitical conflicts and wars (including their consequences, for example on trade routes or supply chains), and any related economic sanctions, foreign exchange effects and/or climate change or related initiatives or government action and/or regulation, and we are only able to pass-through a component of the fuel costs at our sites to our customers under the terms of certain of our contracts. We have in the past been exposed to diesel price volatility, and could again be impacted if diesel prices continue to fluctuate or impact other regions in which we operate, which may result in substantial increases in our operating costs and reduced profits if prices rise significantly. For example, in May 2023, the Nigeria Federal Inland Revenue Service issued a letter to diesel suppliers in Nigeria, informing them that they would be required to pay a Value Added Tax (VAT) of 7.5% on imported diesel at the point of entry into the country although this has now been suspended pursuant to the VAT Modification Order 2024. Further, our attempts to reduce power costs through the deployment of DC generators, hybrid battery and solar technologies, while presently successful, may not be successful in the future.
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Our ground lease costs are for a fixed duration, typically a 10-to-15-year term, paid for either on a monthly or quarterly basis or in advance for a multi-year portion of the overall term of the lease.
Approximately 12% of our ground leases are due for renewal within the next 24 months. The renewal of a large proportion of our tower portfolio ground leases within a particular year may require a significant upfront rent payment made upon such renewal, which in turn could increase our cash outflows for that particular year. Any increases in operating expenses or lease costs referred to above would reduce our operating margins and may have a material adverse effect on our business, prospects, financial condition and/or results of operations.
If we are unable to renew and/or extend our ground leases, or protect our rights to access and operate our Towers or other communications infrastructure assets, it could have a material adverse effect on our business and operating results.
Our site portfolio consists primarily of ground-based towers constructed on land that is leased under long-term ground lease agreements. As of December 31, 2024, approximately 89% of the sites in our portfolio were operated under ground leases on land that we do not own. For sites on leased land, approximately 36% of the ground leases have an expiration date before the end of 2029 and, as of December 31, 2024, the average remaining life of our ground leases was 10.4 years. For various reasons, landowners or lessors may not want to renew their ground leases, may seek substantially increased rents, or they may lose their rights to the land (including, for example, if such land is subject to concession agreements) or transfer their land interests to third parties, or decide to negotiate the terms of their ground leases collectively through landlord associations and/or through land aggregators companies, which could affect our ability to renew ground leases on commercially viable terms or at all. In addition, we may not have the required available capital to extend these ground leases at the end of the applicable period.
In the event that we cannot extend these ground leases, we will be required to dismantle and/or relocate these Towers and may lose the cash flows derived from such Towers, which may have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Real property interests relating to Towers consist primarily of leasehold interests, which in some cases relate to sites for which special access arrangements may be required, such as Towers located on or near airports, government facilities or rooftops. For various reasons, we may not always have the ability to access, analyze and verify all information regarding titles and other issues prior to entering into a ground lease, or we may be unable to contractually agree to amendments in relation to sensitive site access issues, all of which could affect the rights to access and operate the site. From time to time, we may also experience disputes with lessors regarding the terms of ground leases, which could affect our ability to access and operate a tower site. The termination of a ground lease may interfere with our ability to operate and generate revenue from the Tower. If this were to happen at a material number of sites, it would have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Our ability to access and operate our Towers or other communications infrastructure may also rely on right of use or other similar agreements with third parties. In the event that we cannot renew or continue to exercise our rights under these agreements, we will be required to dismantle and/or relocate these Towers or other communications infrastructure assets, and may lose the cash flows derived from such assets, which may have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We may experience the loss of tenancies and/or customers, and are exposed to the loss of revenue from the failure or acquisition of any customer or customer consolidation.
If we were to experience a loss of tenancies when services provided by us are terminated, a Tenant does not renew its contract or we have ceased recognizing revenue for a customer on a site in any particular period, we would face what is known as Churn. For example, Tenants may determine that demand has changed in a particular area and they no longer need tower infrastructure at certain sites. A Tenant may Churn if the relevant MLA or SLA is not renewed at the end of its term, the customer ceases operations or switches to a competing tower company. For example, in September 2023, prior to agreeing the renewal in August 2024, MTN Nigeria had issued a statement that it has selected ATC Nigeria Wireless Infrastructure Solutions Limited to provide services to approximately 2,500 sites that were owned and managed by the Group in Nigeria (of which 1,430 tenancies (including new colocations) were ultimately renewed under the terms agreed with MTN Nigeria in August 2024).
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Similarly, certain customers may be acquired, experience financial difficulties or cease operations as a result of technological changes or other factors, including the impact of events with a wide-ranging regional or global impact (including health pandemics or epidemics) and resulting effects, which could result in renewal on less favorable terms, cancellation or non-renewal of our tenancy agreements. We experienced Churn of 1,198, 1,334, 603, Tenants for the years ended December 31, 2024, 2023 and 2022, respectively. Other than a customer Churning at the end of its term, limited termination clauses may apply pursuant to the relevant MLA. Certain of our customer agreements also contain a contractual right to Churn a limited number of sites each year without penalty, and customers with no such right could use their negotiating power in the future to request the ability to Churn certain tenancies. If customers terminate or fail to renew customer lease agreements with us (either on commercially acceptable terms, or at all), are acquired or, become insolvent, or otherwise become unable to pay lease fees, the loss of such customers could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Also, as is customary in tower infrastructure acquisitions, purchase agreements sometimes allow the purchaser of a site, such as us, to unwind sites when legal title has not been transferred by a date falling a number of months after completion of the acquisition, or the long-stop date, unless extended by the mutual consent of the parties. In the event that such unwinding takes place, which is typically at the option of the purchaser, the seller would reimburse the purchaser for the price paid for the sites that are subject to unwinding and the seller, such as the relevant MNO, would stop paying the lease fee for those sites. Failure to transfer the legal title of acquired sites, including in respect of prior acquisitions where the long-stop date has been extended, or future acquisitions, could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Further, consolidation among or with our customers could result in a reduction in their or the market demand for base transmission sites and/or Colocation, as certain base transmission sites may become redundant or additional tower spaces could be acquired through consolidation, and our customers may therefore choose not to renew their contracts and lease agreements, and we may also not be able to pursue our strategies to obtain or engage with new customers, or we may face reduced or less than anticipated demand from new or existing customers, in any particular market. Such consolidation may also result in a reduction in our customers’ (or potential new customers’) future capital expenditures, including as a result of their expansion plans being similar or if their requirements for additional sites decreases on a consolidated basis. We believe consolidation may occur in certain of our markets in order to achieve both the scale and economic models necessary for long-term growth. Customer or industry consolidation may also result in increased customer concentration. See “— A significant portion of our revenue is derived from a small number of MNOs. Non-performance under or termination, non-renewal or material modification of customer lease agreements with these customers could have a material adverse effect on our business, prospects, financial condition and/or results of operations.” Our contracts and lease agreements may be unable to protect us adequately from a reduction in tenancies due to consolidations and we may be unable to renew contracts or lease agreements on favorable terms, or at all. If a significant number of contract or lease terminations occur due to industry consolidation, our revenue and cash flow could be adversely affected, which in turn could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
A slowdown in the growth of, or reduction in demand for, wireless communications services could adversely affect the demand for tower space and could have a material adverse effect on our financial condition and/or results of operations.
Demand for tower space is dependent principally on demand from wireless communications carriers, which, in turn, is dependent on subscriber demand for wireless services. Most types of wireless services currently require ground-based network facilities, including communications sites for transmission and reception. The extent to which wireless communications carriers lease such communications sites depends on a number of factors beyond our control, including the level of demand for such wireless services, the availability of spectrum frequencies, the financial condition and access to capital of such carriers, changes in telecommunications regulations and general economic conditions, as well as factors such as geography and population density. In addition, if our customers or potential customers do not have sufficient funds from operations or are unable to raise adequate capital to fund their business plans or face other financial issues, they may reduce their capital spending, which could adversely affect demand for space on our towers, which in turn could have a material adverse effect on our business, prospects, financial condition and/or results of operations. These customers could also be forced to reduce their operating expenses, including the amount they spend to lease space on our towers or other communications infrastructure, despite their contractual obligation to pay us, which in turn could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
In addition, tower sharing must continue to be seen by wireless telecommunications providers as a cost-effective way to satisfy their passive infrastructure needs. Any slowdown in the growth of, or reduction in demand for, wireless telecommunications services, or any failure of tower sharing to continue to develop as a way to meet the requirements of wireless telecommunications providers in the countries in which we operate, may adversely affect the demand for tower sites and could have a material adverse effect on our business, prospects, financial condition and/or results of operations, as well as our cash flows.
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For example, certain of our customers in various countries in which we operate have, in recent years, formed their own independent companies for the sole purpose of providing tower sharing and have subsequently directed much of their new business to these companies.
Further, there can be no assurances that 3G, 4G, 5G, advanced wireless services in any other spectrum bands or other new wireless technologies will be deployed or adopted as rapidly as estimated or that these new technologies will be implemented in the manner anticipated or at all.
Additionally, the demand by consumers and the adoption rate of consumers for these new technologies once deployed may be lower or slower than anticipated, particularly in emerging and less developed markets such as those in which we operate or may operate in the future. We may also need to adapt our business model to new technologies such as 5G and the resulting change to products and services we offer, as well as to changing customer or local or regulatory requirements, such as increasing construction of New Sites and infrastructure expansion in remote or rural areas, which may be less commercially viable or more technologically or operationally challenging for us (including potentially as a result of needing to contemplate elements of active communications equipment or revenue share models within our business or operating model). These factors could adversely affect our growth rate since growth opportunities and demand for our tower space as a result of such new technologies may not be realized at the times or to the extent anticipated, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
New technologies designed to enhance the efficiency of wireless networks and potential active sharing of the wireless spectrum could reduce the need for tower-based wireless services and could make our tower infrastructure business less desirable to or necessary for Tenants and result in decreasing revenue.
The development and implementation of new technologies designed to enhance the efficiency of wireless networks or the implementation by MNOs of potential active sharing technologies could reduce the use of and need for tower-based wireless services transmission and reception and could decrease demand for tower-based antenna space and ancillary services we provide. For example, new technologies that may promote network sharing, joint development, or resale agreements by our wireless service provider customers, such as signal combining technologies or network functions virtualization, may reduce the need for our wireless infrastructure, or may result in the decommissioning of equipment on certain sites because portions of the customers’ networks may become redundant.
In addition, other technologies and architectures, such as WiFi, DAS, femtocells, other small cells, or satellite (such as low earth orbiting satellite systems capable of providing internet coverage, including the service commenced by Starlink in some of our African markets; for example, MTN Group announced in 2024 it was partnering with satellite providers as a complement to their terrestrial network in order to increase network coverage in rural areas) and mesh transmission systems may, in the future, serve as substitutes for, or alternatives to, the traditional macro site communications architecture that is the basis of substantially all of our site leasing business. Additional examples of such new technologies might include spectrally efficient technologies which could potentially relieve some network capacity problems, or complementary voice over internet protocol access technologies that could be used to offload a portion of subscriber traffic away from the traditional tower-based networks, which would reduce the need for telecommunications operators to add more tower-based antenna equipment at certain tower sites.
MNOs in European markets and Latin America have implemented active sharing technologies in which MNOs share the wireless spectrum and, therefore, need fewer of their own antennas and less tower space for such equipment. For example, in October 2023, Colombia’s business regulator authorized Tigo and Movistar to share their network infrastructure and radio spectrum. Moreover, the emergence of alternative technologies could reduce the need for tower-based wireless services transmission and reception. For example, the growth in delivery of wireless communication, radio and video services by direct broadcast satellites could materially and adversely affect demand for our antenna space, or certain alternative technologies could cause radio interference with older generation tower-based wireless services transmission and reception. As a result, the development and implementation of alternative technologies to any significant degree could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
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Increased competition in the tower infrastructure industry could have a material and adverse effect on our business.
Although we are a leading independent provider of telecommunications tower infrastructure in most of our markets, competition in the tower infrastructure industry exists and customers have alternatives for leasing tower space, including:
| ● | telecommunications operators which own and lease their own tower portfolios; |
| ● | in certain circumstances, owners of alternative site structures such as building rooftops, outdoor and indoor DAS networks, billboards and electric transmission towers; and |
| ● | other independent tower companies operating in the market, such as American Tower Corporation, or ATC, SBA Communications Corporation, or SBA, or other tower companies that may enter the market. |
We believe that competition in the tower infrastructure industry in emerging and less developed markets (including markets such as Africa and Latin America) is based on, among other things, power management expertise, tower location, relationships with telecommunications operators, tower quality and height, pricing or other more favorable or suitable contractual terms, and ability to offer additional services to tenants and operational performance, as well as the size of a company’s site portfolio and its ability to access efficient capital. We believe we are the market leader in Africa by tower count as of December 31, 2024, with 30,650 towers. ATC is our primary competitor in Africa among independent tower companies, including in Nigeria and South Africa and Helios Towers and SBA are other notable competitors in Africa. In Brazil, the competitive landscape is wider with ATC, SBA and Highline owning more towers than we do as of December 31, 2024, and numerous smaller tower companies of similar size to or smaller than our business. The Brazilian and South African competitive landscape presents opportunities for consolidation. We also compete to a lesser extent with telecommunications operators who have retained their own towers and continue to manage them and make them available for Colocation or who have formed their own independent companies for the sole purpose of providing tower infrastructure sharing. In certain circumstances, we also compete with owners of alternative site structures such as building rooftops, outdoor and indoor DAS networks, billboards and electric transmission towers. In addition, there may be increased competition in the future from other independent tower companies operating in, or that may enter, our markets.
Competitive pressures could increase and could have a material adverse effect on lease rates paid by our customers, which could result in existing customers not renewing their leases, renegotiating for more favorable contractual terms, switching infrastructure providers, or new customers leasing towers from our competitors rather than from us. In addition, we may not be able to renew existing customer leases or enter into new customer leases, either on commercially acceptable terms or at all, which could have a material adverse effect on our results of operations and growth rate. Increasing competition could also make the acquisition of attractive tower portfolios or other tower companies more costly, or limit acquisition opportunities altogether, particularly in cases where our competitors have a lower cost of capital. Any of the foregoing factors could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We face a number of risks related to our strategic transactions.
A key element of our growth strategy has been to increase our tower portfolio through acquisitions, which we may continue to do in the future, including in new geographic markets and/or adjacent communications infrastructure verticals. In 2021, we completed the acquisition of towers in Brazil and Colombia, and acquired TIM Brasil’s secondary fiber network infrastructure. In 2022, we completed the acquisition of towers in South Africa and Brazil. There can be no assurance that we will be able to identify suitable acquisition candidates in the future or acquire them on acceptable terms, including due to increased competition for attractive acquisition opportunities in the relevant markets, or that any particular acquisition or investment will perform as anticipated in our investment appraisals or related targets. Additionally, we rely on our due diligence of the acquired assets or business and the representations and financial records of the sellers and other third parties to establish the anticipated revenue and expenses and whether the acquired assets or business will meet our internal guidelines for current and future potential returns. Given the nature of the individual assets which are numerous and geographically diverse, it can be difficult to conduct effective physical diligence on these, which is typically conducted by way of a sample audit. In addition, we may not always have the ability to analyze and verify all information regarding title, access and other issues regarding the land underlying acquired towers. The condition of the assets can also deteriorate significantly during the period prior to closing (and after physical site audits) because sellers may reduce operating and capital expenditure on such towers.
Moreover, we may incur significant costs during the evaluation and consideration of new investment opportunities or the pursuit of such acquisitions, which are often conducted through competitive auction processes.
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Tower portfolio or other asset acquisitions typically take a considerable period of time to sign and close and usually close in stages, but can involve up-front investments that cannot be recovered regardless of whether the transaction is successfully completed. Tower portfolio or other asset acquisitions are subject to certain customary conditions and closing these transactions will generally depend on whether certain conditions precedent and/or conditions subsequent are satisfied, such as regulatory approvals. In the event that conditions are not satisfied or are not satisfied in a timely manner, we have been in the past and may in the future be unable to acquire certain tower portfolios or other assets, or closings (and therefore operations and revenue) may be delayed, while, in each case, incurring associated or continuing transaction costs.
We may also at any time be participating in one or multiple sale or acquisition processes across various markets and continents (which may include processes in different regions of the world with different counterparties). Given the confidential nature of such processes the details of these would only be available once we have been selected as the preferred candidate and reached agreement on terms with the counterparty. We may also be unable to succeed in the processes (or any of them) in which we participate or reach an agreement on terms with the counterparty should we be selected as the preferred candidate. Given the often-varying transaction structures of these communications infrastructure sales or acquisitions, we often have little or no control on the timing of such processes.
We may be required to rely on the financial and operational representations, warranties and undertakings (including any indemnity) of sellers. If: (i) records with respect to the acquired assets are not complete or accurate, (ii) we do not have complete access to, or use of, the land underlying the acquired towers, (iii) we discover that the towers or other communications infrastructure have structural issues (such as overloading) (iv) the towers or other assets do not achieve the financial results anticipated, or (v) there are historic liabilities attaching to the acquired assets that we are unable to successfully recover under an indemnity, it could have a material adverse effect on our business, prospects, financial condition and/or results of operations. Furthermore, some sellers may or may not have the financial capacity to support a subsequent claim against them. While we acquire representation and warranty insurance in some of our transactions, such policies typically contain certain exclusions that would limit our ability to recover certain losses.
In addition, the process of integrating acquired assets or businesses into our operations has resulted in and may result in unforeseen operating difficulties and large expenditures and may absorb significant management attention that would otherwise be available for the ongoing development of our business. Even if we are successful in completing one or more acquisitions, the failure to adequately address the financial, operational or legal risks of these transactions could harm our business. We also may incur unexpected or contingent liabilities in connection with acquisitions. We may also be unable to retain or replace key personnel of an acquired business or recruit key personnel in the case of acquired assets, which could reduce the value of the acquisition and prevent us from realizing our strategic goals. In certain instances, including pursuant to the TIM Fiber Acquisition and the MTN SA Acquisition, we may also rely on transition services arrangements with external parties to support the operation of acquired assets while they are fully integrated. These risks may be exacerbated in material acquisitions. Further, such material acquisitions may exacerbate the risks inherent with our growth strategy, such as (i) an adverse impact on our overall profitability if the acquired towers or business does not achieve the financial results estimated in our valuation models, (ii) unanticipated costs associated with the acquisitions that may impact our results of operations for a period, (iii) increased demands on our cash resources or increased debt on our balance sheet that may, among other things, impact our ability to explore other opportunities, (iv) undisclosed and assumed liabilities that we may be unable to recover, (v) increased vulnerability to general economic conditions, (vi) an adverse impact on our existing customer relationships, (vii) additional expenses and exposure to new regulatory, political and economic risks if such acquisitions were in new jurisdictions and (viii) diversion of managerial attention.
Furthermore, our international expansion initiatives are subject to additional risks such as complex laws, regulations and business practices that may require additional resources and personnel. There can be no assurance that we will be successful in integrating acquisitions or new businesses into our existing business or be able to fully recognize the anticipated benefits of towers or businesses that we acquire, and failure to do so could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
In addition, we may divest or reduce our investment in certain businesses from time to time. Such divestitures involve risks, such as difficulty separating portions from our other businesses, distracting employees, incurring potential loss of revenue, negatively impacting margins, and potentially disrupting customer relationships. We may also incur significant costs associated with exit or disposal activities, related impairment charges, or both, including if such divestiture is not adequately covered by insurance or other enforceable indemnity or similar agreement with a creditworthy counterparty. In certain instances, including pursuant to the sale of our operations in Kuwait in December 2024, we may need to enter into transition services arrangements with external parties for a period of time to support the operation of disposed assets, which may also give rise to disputes or liabilities in relation to the provision of such services. If we are unable to successfully manage any of the risks in relation to any future acquisition or divestitures, our business, financial condition and results of operations could be adversely impacted.
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We may consider selling certain assets or businesses; however, we may not be successful achieving a sale and if we do it may not be on terms similar or higher to the valuation in which we bought or constructed the assets or at levels investors would view as attractive.
As part of our ongoing business, we are constantly evaluating the markets in which we operate and the assets and businesses which we own, and whether they continue to fit within our overall strategic objectives. Some of the reasons for which assets and or businesses may no longer fit within our overall strategic objectives could be a recognition we will not achieve the intended scale in a market that we believe is needed; changes in macroeconomic, secular (including regulatory) or competitive conditions within the market they are located; a decision to reduce revenue or customer concentration within a region or market; or a perceived disconnect in the value being ascribed to our assets by the public markets or investors relative to what we believe their value is. Such sales could include an outright or partial sale of the assets or business. To the extent we elect to consider a sale, it is possible that we may ultimately not receive interest from willing buyers or there is a risk that such interest is at a price that is lower than the value which we believe they are worth, in either case resulting in us not being able to sell them. Even if we are successful in selling the assets or business, it may not be for the same value at which we previously bought the assets or the cost at which we constructed them, or the value at which they are being recognized in our financial statements. They may also not be at a value which our investors would view as attractive.
Moreover, similar to acquisitions, sale transactions are also usually subject to the satisfaction of certain conditions precedent or conditions subsequent, which may impact our ability to successfully complete any such sales or complete them in a timely manner. We also may be required to provide certain representations, warranties and undertakings (including indemnities) to buyers, which could lead to future liabilities and/or adjustments of the sale price, including as a result of the buyers enforcing such indemnities against us, or full or partial unwinding of any such transaction. Any of these could, in turn, have a material adverse effect on our business, prospects and/or results of operations.
Our ability to construct New Sites or to deploy other communications infrastructure depends on a number of factors, many of which are outside of our control.
Our ability to construct New Sites or to deploy other communications infrastructure in new or existing markets is affected by a number of factors beyond our control, including the availability of and access to suitable land that meets our requirements, including those of the initial customer, and the availability of construction equipment and skilled construction personnel. Delays brought on by a number of factors could also adversely affect our ability to deliver New Sites or to deploy other communications infrastructure in a timely and cost-effective manner, particularly in connection with timelines contractually agreed with customers. There can be no assurance that:
| ● | we will be able to enter into identified new markets in which we intend to deploy New Sites or other communications infrastructure; |
| ● | every individual New Site or other communications infrastructure asset will be commercially viable or meet our investment criteria; |
| ● | we will be able to overcome setbacks to new construction, including local opposition; |
| ● | we will be able to maintain relationships with the regulatory authorities and to obtain any required governmental approvals for new construction; |
| ● | the number of towers or other infrastructure planned for construction will be completed in accordance with the requirements of customers or the ability of our customers to obtain the requisite level of end users to support the level of capital expenditure spent to expand the network; |
| ● | there will be a significant need for the construction of new towers or other communications infrastructure; |
| ● | we will be able to agree to favorable revenue share models with our customers or other parties that make constructing new rural sites economical for all parties; |
| ● | we will be able to finance the capital expenditures associated with construction or deployment of New Sites or other communications infrastructure; |
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| ● | we will be able to import the equipment necessary for the construction or deployment of New Sites or other communications infrastructure; |
| ● | we will be able to purchase and/or import components necessary for the construction or deployment of New Sites or other communications infrastructure, including steel and fiber, or purchase such components at expected prices or that such components will be delivered in a timely fashion; or |
| ● | we will be able to secure rights or access to the land necessary to execute customer orders for New Sites or other communications infrastructure. |
Although we are continuously examining the merits, risks and feasibility of and searching for strategic new site opportunities, such efforts may or may not result in profitable New Sites, including as a result of these uncertainties, which could, in turn, have a material adverse effect on our business, prospects, financial condition and/or results of operations. See “— We do not always operate with the required approvals and licenses for some of our sites, particularly where it is unclear whether a certain license or permit is required or where there is a significant lead time required for processing the application, and therefore may be subject to reprimands, warnings and fines for non-compliance with the relevant licensing and approval requirements” for more information.
Increased attention to, and evolving expectations for, sustainability and environmental, social, and governance (“ESG”) initiatives and disclosures could increase our costs, harm our reputation, or otherwise adversely impact our business.
Companies across industries are facing increasing scrutiny from a variety of stakeholders related to their ESG and sustainability practices, including climate change, human capital and other ESG matters. Expectations regarding voluntary ESG initiatives and disclosures and consumer demand for alternative forms of energy may result in increased costs (including but not limited to increased costs related to compliance, stakeholder engagement, contracting and insurance), changes in demand for certain products, enhanced compliance or disclosure obligations, or other adverse impacts to our business, financial condition, or results of operations.
We at times engage in voluntary initiatives (such as voluntary disclosures, certifications, or target and goals, among others), such as our Carbon Reduction Roadmap (including Project Green), to improve the ESG profile of our company and/or offerings or respond to stakeholder demand; however, such initiatives may be costly and may not have the desired effect. Our estimates and projections regarding the implementation of such initiatives and goals, and the savings achieved from their implementation, are subject to various risks and uncertainties. For example, we may ultimately be unable to complete certain initiatives or targets, either on the timelines initially announced or at all, due to technological, cost, or other constraints, which may be within or outside of our control. Our ESG efforts may also include the adoption, or expansion, of certain ESG practices or policies, which may require us to expend additional resources to implement or to forego certain business opportunities to the extent others in our value chain do not meet pertinent requirements of such policies. By contrast, any failure, or perceived failure, to conform to such policies could have an adverse impact on our reputation and business activities. Moreover, actions or statements that we take are in many cases based on expectations, assumptions, or third-party information, which may require substantial discretion and forecasts about costs and future circumstances. Perceptions regarding the reasonableness of such data and methodologies evolve overtime, along with stakeholder expectations regarding ESG initiatives more generally. Our approach to such matters likewise evolves; however, we cannot guarantee that it will align with the expectations of any particular stakeholder. Any failure, or perceived failure, to appropriately manage ESG matters or related stakeholder expectations may result in various adverse consequences, including potential enforcement and litigation, even if such initiatives are currently voluntary. Our performance may be subject to greater scrutiny as a result of our announcement of any goals or policies and the publication of our performance against the same.
Moreover, despite the voluntary nature of such efforts, we may receive pressure from external sources, such as lenders, investors or other groups, to adopt more aggressive or different targets and goals, or other ESG-related initiatives; however, we may not agree that such initiatives will be appropriate for our business, and we may not be able to implement such initiatives because of potential costs or technical or operational obstacles. Certain market participants, including major institutional investors and capital providers, use third-party benchmarks and scores to assess companies’ ESG profiles in making investment or voting decisions. Unfavorable ESG ratings could lead to increased negative investor sentiment towards us, which could negatively impact our share price as well as our access to and cost of capital. To the extent ESG matters negatively impact our reputation, it may also impede our ability to compete as effectively to attract and retain employees, customers, or business partners, which may adversely impact our operations. In addition, we expect there will likely be increasing levels of regulation, disclosure-related, audit and otherwise, with respect to ESG matters.
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Various policymakers, including but not limited to the European Union, the SEC and/or certain states in the United States, have adopted (or may in the future adopt) requirements for additional ESG-related disclosures or actions, which may require us to incur significant additional costs to comply; any failure to comply may also result in fines, reputational damage, or other adverse impacts. Such requirements are not uniform, and may not be interpreted or enforced uniformly, which may increase related compliance costs and risks. Simultaneously, there are efforts by some stakeholders and policymakers to reduce companies’ efforts on certain ESG-related matters. Both advocates and opponents to certain ESG matters are increasingly resorting to a range of activism forms, including media campaigns and litigation, to advance their perspectives. To the extent we are subject to such activism, it may require us to incur costs or otherwise adversely impact our business. This and other stakeholder expectations will likely lead to increased costs as well as scrutiny that could heighten all of the risks identified in this risk factor. Such ESG matters may also impact our suppliers, customers, or other stakeholders, which may compound or cause new impacts on our business, financial condition or results of operations, including risks which may not be known to us.
We rely on key management personnel and any inability to recruit, train, retain and motivate key employees could have a material adverse effect on our business.
We believe that the current management team contributes significant experience and expertise to the management and growth of the business. The continued success of the business and our ability to execute our business strategies in the future will depend in large part on the efforts of key personnel particularly Mr. Darwish, our Chairman and Group Chief Executive Officer, and our other senior officers, each of whose services are critical to the success of our business strategies. There is also a shortage of skilled personnel in the communications infrastructure industry in the markets in which we operate, which we believe is likely to continue. As a result, we may face increased competition for skilled employees in many job categories from tower companies, communications operators and new entrants into the communications infrastructure industry and this competition is expected to intensify. Although we believe our employee salary and benefit packages are generally competitive with those of our competitors, if our competitors are able to offer more generous salary and benefit packages in the future, we may face difficulties in retaining skilled employees. Further, employee compensation and benefit costs may increase due to inflationary pressures, and if our compensation does not keep up with inflation or that of our competitors’, we may see increased employee dissatisfaction and departures or difficulty in recruiting new employees. In addition, we have at times experienced a loss of personnel due to migration from the markets in which we operate. If key employees depart or we are unable to recruit and integrate new employees successfully, our business could be negatively impacted. An inability to successfully integrate, recruit, train, retain and motivate key skilled employees could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We have incurred and may continue to incur losses.
We incurred losses of $1,644.2 million (including approximately $1,573.5 million of unrealized foreign exchange losses), $1,988.2 million (including approximately $1,796.4 million of unrealized foreign exchange losses) and $469.0 million (including approximately $158.3 million of unrealized foreign exchange losses) for years ended December 31, 2024, 2023 and 2022, respectively. Our losses were principally due to depreciation, and amortization and finance costs, which includes realized and unrealized losses from foreign exchange movements, in each respective year. As a result of our acquisitions and exposure to foreign exchange movements, we expect our depreciation, amortization and finance costs to continue to be significant and may increase as a result of the execution of our strategy or foreign exchange volatility. For example, in June 2023 the Naira experienced significant depreciation following steps taken by the CBN to unify the Nigerian foreign exchange market, by replacing the old regime of multiple exchange rate segments into a single NFEM window to allow foreign exchange transactions to be determined by market forces. In January 2024, there was a further significant devaluation of the Naira to ₦1,455.6 to $1.00 as of January 31, 2024. If we incur losses in the future, it could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We do not always operate with the required approvals and licenses for some of our sites, particularly where assets are acquired from third parties or where it is unclear whether a certain license or permit is required or where there is a significant lead time required for processing the application, and therefore may be subject to reprimands, warnings and fines for non-compliance with the relevant licensing and approval requirements.
Although we generally seek and obtain the requisite federal, national, state and/or local approvals prior to the commencement of tower construction, it is often unclear whether certain, particularly local, permits are required and, in some circumstances, local authorities have imposed permit requirements retrospectively. In instances where we acquire assets from third parties, the prior owners of those assets may not have had the requisite federal, national, state and local approvals for certain of the sites we are acquiring. There is sometimes a long lead-time required for processing applications for approvals and licenses from the local authorities, including construction and building permits required from certain state authorities to construct or build any structure and environmental approvals.
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See “Business — Permits and Regulation — License to operate.” Although we make payments in relation to the relevant permits when required, the delay encountered in receiving the permits, licenses or certificates means that we may, therefore, in limited instances, proceed with and complete tower construction and base transmission sites installation for Tenants before all required approvals and licenses have been formally issued by local authorities. As we look to expand our offering to further include and expand on services like fiber connectivity, rural offerings and other verticals, we may be subject to increased regulatory, license and permit obligations (including in respect of active telecommunications elements that may comprise part of the arrangements with customers, such as for rural offerings, which may be based on an “open RAN” architecture). We may or may not be able to meet any and all such obligations.
Although we believe these practices are customary in the telecommunications industry in the countries in which we operate, there can be no assurance that the relevant authorities will issue the licenses or approvals, if required, or that they will be issued in a timely manner or as expected. If such approvals and licenses are required and not obtained, the local or state authorities may impose penalties, such as reprimands, warnings and fines, for non-compliance with the relevant licensing and approval requirements. In addition, in some jurisdictions, federal, national, state and local authorities charge taxes and levies in relation to similar services, for example tenement rates and environmental permits for our sites. This leads to confusion over which authority should be paid the relevant levy and, in many cases, we must wait for a demand to be made before we can make the payment.
Additionally, certain authorities have become more aggressive in setting of permit fees, the enforcement of permits and collection of payments, or may become more so in the event the profile of a business is perceived to have increased. In an extreme case, local authorities may prevent us from entering our sites or demand that we dismantle the unlicensed towers, which has occurred in certain limited cases. For example, in Nigeria, it was publicly reported in 2019 that the Nigeria Civil Aviation Authority (NCAA) threatened to decommission and dismantle a number of Glo towers for safety violations including failure to obtain the statutory aviation height clearance certificate. It is reported that while no towers were ultimately decommissioned or dismantled by the NCAA, this was due to the affected operators complying with demands. In addition, in December 2019, the Federal Capital Development Authority, or FCDA, stopped the issuance of permits to communications infrastructure companies in the Federal Capital Territory while it sought to review and increase fees. The FCDA briefly resumed issuing new permits in 2021 which, following a further stoppage, resumed again during 2022 following the intervention of the regulator, the Nigerian Communications Commission, or NCC. However, while permit issuance has resumed and an agreement in principle has been reached with the FCDA, the final outcome of the intervention is still awaited as the approval of the Minister of the Federal Capital Territory is pending. During previous periods when new permit issuances were on hold, the development and expansion of our business operations in Abuja (where we had 655 Towers as of December 31, 2024) was impacted, which consequently impacted the quality of service of remaining towers in operation in the area.
If we are required to pay additional levies, penalties or fees, or relocate a material number of our Towers and cannot locate replacement sites that are acceptable to our customers, this could adversely affect revenue and cash flow, which in turn could have a material adverse effect on our reputation, business, prospects, financial condition and/or results of operations.
Our business is subject to regulations, including those governing telecommunications, as well as the construction and operation of Towers, and any changes in current or future laws or regulations could restrict our ability to operate our business.
Our business, and that of our customers, is subject to national, state and local regulations governing telecommunications as well as the construction and operation of Towers. These regulations and opposition from local zoning authorities and community organizations against construction in their communities could delay, prevent or increase the cost of new tower construction, modifications, additions of new antennas to a site, or site upgrades, thereby limiting our ability to respond to customer demands and requirements. In addition, certain licenses and permits for the operation of Towers may be subjected to additional terms, conditions or fees/levies (which may be new and unexpected, as a consequence, for example, of a perceived increase in a business’s profile or growth) or new permits imposed on existing sites, with which we cannot comply. As public concern over tower proliferation has grown in recent years, including as a result of concerns about alleged health and environmental risks, some communities now also try to restrict tower construction, delay granting permits or require certain towers to be dismantled and relocated. On the other hand, governments and regulators may impose additional requirements on businesses such as ours or our customers based on wider socio-economic considerations, including, potentially, requirements to construct New Sites in more remote or rural areas (or regulatory actions or pressure on pricing or packages on our customers or us, including potentially imposition of local currency pricing, as may have been seen in some markets) to increase geographical and network coverage to larger parts of a population (which may be less commercially viable for us) or make services available at lower or fixed tariffs. Existing regulatory policies and changes in such policies may materially and adversely affect the associated timing or cost of such projects and/or the costs attributable to our usual business operations, and additional regulations may be adopted which increase delays, or result in additional costs, or that prevent completion of projects in certain locations.
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As we look to expand our offering to further include and expand on services like fiber connectivity, rural offerings and other verticals, we may be subject to increased regulatory, license and permit obligations (including in respect of active telecommunications elements that may comprise part of the arrangements with customers, such as for rural offerings which may be based on an “open RAN” architecture). We may or may not be able to meet any and all such obligations. Any imposition of new regulations, fees or levies, or failure to complete new tower construction, modifications, additions of new antennas to a site, or site upgrades could harm our ability to add additional site space and grow our business, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Our operations are also subject to various other laws and regulations that affect our business, such as those related to labor, tax, employment (including new minimum wage regulations), unions, health and safety, antitrust and competition, environmental protection, consumer protection, data privacy and protection, import/export, foreign exchange or currency, and anti-bribery, corruption and money laundering. We or our employees, subcontractors or agents could take actions that might violate any of these requirements. Violations, or alleged violations, of any such laws or regulations could subject us to criminal or civil enforcement actions and adversely affect our reputation, any of which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We may seek to raise financing to fund future growth opportunities or operating expense reduction strategies and the inability to do so may adversely affect our ability to implement our business strategy.
We may seek to raise financing to fund future growth opportunities, or operating expense reduction strategies, including debt and equity financing. Our ability to secure future debt or equity financing in amounts sufficient for strategic growth or cost reduction opportunities could be adversely affected by many factors, including achieving the requisite shareholder support for certain equity financing, or the possible reluctance of creditors to make commercial loans or to invest in operations in developing markets (including as a result of market or economic conditions or considerations relating to regulatory capital requirements) or otherwise. If our revenue declines, we may not be able to raise additional funds through debt or equity financing (or any debt or equity financing may not be on acceptable terms). Moreover, restrictive debt covenants under current and future indebtedness may limit our ability to raise any such further financing (or refinance existing financing) and also our ability to support our business strategy, including making strategic acquisitions. Additionally, political instability, a downturn in the economy and/or disruption in the financial and credit markets, foreign currency fluctuations, availability of foreign currency in the jurisdictions in which we operate, social unrest or changes in the regulatory environment (including as a result of regulatory capital requirements, or events with a wide-ranging regional or global impact such as health pandemics or epidemics) could increase the cost of borrowing or restrict our ability to obtain financing for future acquisitions and other growth or cost reduction opportunities.
There can be no assurance that we will be successful in obtaining financing from banks and other financial institutions and/or capital markets or that the cost of such financing or the other applicable terms of such financing will not make such financing more onerous than under the facilities available to us at present. If we are unable to raise the necessary financing, we may have to revise our business strategy or forgo certain strategic growth opportunities or operating expense reduction strategies, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Towers with MLL or ROU agreements are subject to termination risk.
As of December 31, 2024, we operated 1,876 towers under license to lease agreements in Cameroon and Côte d’Ivoire. We do not own these towers or the underlying land leases, but have a contractual right to operate the towers, including leasing out additional space on the towers. The MLL agreements may be terminated upon agreement of the parties if we fail to comply with specified obligations in the agreements or, in some cases, at the customer’s option. If we are unable to protect our rights under, or extend, the MLL agreements or they are terminated, we will lose the cash flows derived from such towers, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations. In March 2022, we completed the GTS SP5 Acquisition to acquire 2,115 towers, of which 2,113 were operated under a right-of-use (ROU) agreement, where we did not own the towers or the underlying land leases, but had a contractual right to operate the towers, including leasing out additional space on the towers. The number of towers we have that are subject to such ROU arrangements changes from time to time (including, potentially, as a result of arrangements made as part of the Oi Brazil restructuring plan), and we may be subject to such arrangements on more towers. While ROU arrangements may differ, in many cases, ROU agreements may be terminated upon agreement of the parties, if we fail to comply with specified obligations in the agreements or, in some cases, at the customer’s option. Additionally, if such towers are held under concession licenses with an expiry date, and the relevant tenant holds the ultimate ownership right on those towers, a potential non-renewal of such concession(s) could potentially cause the termination of an ROU agreement.
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If we are unable to protect our rights under, or extend, ROU agreements or they are terminated, we would lose the cash flows derived from such towers, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We provide Managed Services to towers that are owned or operated by third parties. Our inability to access these sites or to perform the services in accordance with our requirements could have a material adverse effect on our business and/or operating results.
We currently provide Managed Services to certain sites for our customers, which includes the provision of maintenance, security or power services, including on sites that we may not own. Sites where we provide Managed Services may be owned by the relevant customer the services are being provided for, or by other third parties. In these instances, we need to coordinate the provision of our services in line with the customer requirements as well as in accordance with the owner or operator of the tower. This includes ensuring that we have appropriate access to the relevant sites and that our equipment is adequately protected. If we are unable to perform our services under our Managed Services agreements (whether to a satisfactory level or otherwise), we may suffer penalties, the termination of such services or the loss of our equipment, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Failure to effectively operate, or successfully execute upgrades to, our group-wide enterprise resource planning, or ERP, system or other critical business applications could have a material adverse effect on our business and/or operating results.
We have been assessing various technology upgrades and enhancements to support our business growth, including potentially upgrading some aspects of our group-wide ERP system. The implementation of new software and hardware, including new technology such as artificial intelligence (AI), involves risks and uncertainties that could cause disruptions, delays or deficiencies in the design, implementation or application of these systems. The failure of our ERP or any of our critical business applications to operate effectively or to integrate with other systems, or a breach in security of these systems, could cause reduced efficiency of our operations, which could negatively impact our financial results. If we experienced any significant disruption to our ERP that we are unable to mitigate, or if any upgrades are significantly delayed or the system does not perform in a satisfactory manner or in line with business requirements it could introduce operational risk, including cybersecurity risks, and other complications, be disruptive and could have a material adverse effect on our operations, including our ability to report accurate, timely and consistent financial results or otherwise maintain adequate internal control over financial reporting, or our ability to integrate new acquisitions into our systems. We may also lose an opportunity to further improve business efficiency, process standardization, and internal controls over financial reporting across our operations.
Furthermore, the potential implementation of any ERP system or critical business application upgrade or any remediation of our key information systems requires investment of capital and human resources, including substantial expenditures for outside consultants, suppliers, system hardware and software in addition to other expenses, the re-engineering of business processes, and the attention of many employees who would otherwise be focused on other areas of our business. We may also experience delays, increased costs and other difficulties, including potential design defects, re-work due to changes in business plans or reporting standards, and the diversion of management’s attention from day-to-day business operations. If we are not able to accurately forecast expenses and capitalized costs related to system upgrades and repairs, our financial condition and operating results may be adversely impacted. The implementation of new initiatives or upgrades and remediation of existing systems may not achieve the anticipated benefits and may divert management’s attention from other operational activities, negatively affect employee morale, or have other unintended consequences.
We also rely on third-party contractors and suppliers to provide various related services (including ongoing support and management of systems and issues) and are therefore exposed to risks relating to the quality and reliability of such services. See “— We rely on third-party contractors for various services, and any disruption in or non-performance of those services would hinder our ability to effectively maintain our tower infrastructure.”
Management has identified a material weakness in our internal control over financial reporting, which could affect our ability to produce accurate financial statements on a timely basis or cause us to fail to meet our future reporting obligations.
We are required to comply with the SEC’s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, which requires management to certify financial and other information in our annual reports and provide an annual management report on the effectiveness of internal control over financial reporting.
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In connection with the audit of our consolidated financial statements, we identified a material weakness in our internal control over financial reporting and, accordingly, concluded that our internal control over financial reporting was not effective as of December 31, 2024. This material weakness was previously reported in our annual reports on Form 20-F for the years ended December 31, 2022 and December 31, 2023. Under Public Company Accounting Oversight Board (PCAOB) standards, a “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis. The material weakness identified is a lack of key accounting personnel with the requisite knowledge and experience to account for complex transactions, particularly in the areas of foreign exchange, business combinations and other complex, judgmental areas, such as goodwill impairment assessment.
We have been working to remediate this material weakness as quickly and efficiently as possible. However, we cannot assure you that the measures we have taken to date or that we are taking will be sufficient to remediate in its entirety the material weakness we identified or avoid the identification of additional material weaknesses in the future. We cannot provide an estimate of the time required or costs expected to be incurred in connection with implementing a remediation plan. Remediation measures may be time consuming, costly, and might place significant demands on our financial and operational resources. If we are unable to successfully remediate this material weakness or if new material weaknesses arise in the future, and if we are unable to produce accurate and timely financial statements, our financial statements could contain material misstatements that, when discovered in the future, could cause us to fail to meet our future reporting obligations.
A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements whether due to error or fraud. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Additionally, as we qualify as an “accelerated filer” or “large accelerated filer” for U.S public company reporting purposes, we must include an attestation report on internal control over financial reporting issued by our independent registered public accounting firm in connection with certain of our U.S. public company filings. Based on the material weakness identified as of December 31, 2024, our independent registered public accounting firm issued an adverse opinion with respect to internal control over financial reporting as of December 31, 2024. In addition, we may be subject to sanctions or investigation by regulatory authorities, such as the SEC or the NYSE on which our ordinary shares are listed. If we do not maintain an effective system of internal control over financial reporting in the future, or otherwise adequately comply with the requirements of Section 404 of the Sarbanes Oxley Act, our independent registered public accounting firm may in the future identify a significant deficiency or material weakness in our internal control over financial reporting, and again issue an adverse opinion with respect to internal control over financial reporting.
As a result of misstatements or restatements in our financial statements or adverse assessment by management or our independent registered public accounting firm about the effectiveness of our internal controls, we may have to delay our filings of our financial statements, and there could be an adverse reaction to the financial statements or the Company due to a loss of confidence in the reliability of our financial statements which could materially adversely affect our business, prospects, financial condition and/or results of operations, and could also cause the price or trading volume of our ordinary shares to decline and there could be a delay in delivering financial statements, which may result in a default under agreements governing our indebtedness.
Our sites contain sensitive and fragile equipment and indemnities obtained from suppliers and contractors may be inadequate to cover any losses or damages to our customers’ property.
Our sites host sensitive and fragile communications equipment, which could be damaged by actions of our maintenance subcontractors, suppliers or the original equipment manufacturer who may be present on our sites during the course of their duties. While we strive to obtain contractual indemnities and insurance protections from our maintenance subcontractors and suppliers with respect to damage to our property and those of our customers, such contractual rights to indemnity may not adequately cover all losses and/or we may not be able to recover such losses due to protracted litigation, defenses successfully raised by the counterparty and/or insolvency of the subcontractor or supplier, which may lead to increased costs and in turn could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
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We rely on key information technology systems, which may be vulnerable to physical or digital/ electronic damage, security breaches or cyberattacks that could have a material adverse effect on our reputation as well as our business, prospects, financial condition and/or results of operations.
We rely on information technology systems, including but not limited to computer systems, hardware, software, technology infrastructure and online sites, and network operations centers which are key to our site maintenance and performance management (collectively, “IT Systems”), to conduct our daily business, financial reporting, procure products, pay suppliers, communicate internally and externally, share files, efficiently and accurately provide services to our customers and monitor our operations. We and certain of our third-party providers may collect, maintain and process data about customers, employees, business partners and others, including information about individuals, as well as proprietary information belonging to our business such as trade secrets (collectively, “Confidential Information”).
While we seek to apply best practice policies and internal controls, and devote significant resources to network and application security and other security measures to protect our IT Systems and Confidential Information, these measures cannot provide absolute security. There can also be no assurance that our cybersecurity risk management program and processes, including our policies, controls or procedures, will be fully implemented, complied with or effective in protecting our IT Systems and Confidential Information.
Cyberattacks are expected to accelerate on a global basis in frequency and magnitude. In addition, the tools used by cyber criminals including artificial intelligence, continue to evolve and are becoming increasingly sophisticated, in order to circumvent such security measures, evade detection, remove forensic evidence, and maximize the potential damage of a successful attack. As a result, we may be unable to detect, investigate, remediate or recover from future attacks or incidents, or to avoid a material adverse impact to our IT Systems, Confidential Information or business.
Some of our IT Systems are also managed by third-party service providers and are not under our direct control. Because we make use of third-party suppliers and service providers, successful cyberattacks that disrupt or result in unauthorized access to third-party IT Systems can materially impact our operations and financial results. Third (and beyond) parties have been a popular attack vector for cyber criminals, and depending on the nature of the relationship with some of these partners, we sometimes use their code, software, human-power, networks, or give them access to our servers and data, among many other scenarios. A security vulnerability at any of these third-party partners could potentially provide an opportunity for a cyber criminal to reach or damage our IT Systems or Confidential Information.
We face numerous and evolving cybersecurity risks that threaten the confidentiality, integrity and availability of our IT Systems and Confidential Information, particularly in times of increased usage and reliance. Despite existing security measures, our IT Systems and certain parts of our infrastructure, including, for example, our fiber infrastructure network for the provision of residential broadband services to consumers, may be vulnerable to attacks from diverse threat actors, such as state-sponsored organizations, opportunistic hackers and hacktivists, that could result in damage, disruptions, or shutdowns due to unauthorized access, software bugs or other vulnerabilities in commercial software that is integrated into our (or our suppliers’ or service providers’) IT Systems, phishing attacks, human or technological errors, computer viruses and malware (including ransomware), malicious code embedded in open-source software, or misconfigurations, cyberattacks, and other security incidents. In addition, many types of cyberattacks are designed to be difficult to detect in order to harvest as much data or cause as much systemic damage as possible before detection. As a result, in the event of a cyberattack, our IT Systems could be compromised without our knowledge for a period of time before the attack is detected and addressed. Furthermore, given the nature of complex systems, software and services like ours, and the scanning tools that we deploy across our networks and products, we regularly identify and track security vulnerabilities. We are unable to comprehensively apply patches or confirm that measures are in place to mitigate all such vulnerabilities, or that patches will be applied before vulnerabilities are exploited by a threat actor.
The performance of our IT Systems may also be impacted by certain operating conditions in our jurisdictions of operation, including lack of reliable power supply, shortages in replacement parts, as well as general security conditions. In addition, as a result of remote and hybrid working arrangements (including at third-party providers), our IT Systems may be particularly strained or increasingly vulnerable, including due to the challenges associated with managing remote computing assets and security vulnerabilities that are present in many non-corporate and home networks. Additionally, any integration of artificial intelligence in our or any service providers’ operations, products or services is expected to pose new or unknown cybersecurity risks and challenges. An attack attempt or security incident, such as a distributed denial of service attack, or damage caused by other means could potentially result in the interruption or cessation of certain or all of our services to our customers, our inability to meet expected levels of service or data transmitted over our customers’ networks being compromised, as well as other unforeseen damages. In the event of a potential breach, while we would endeavor to comply with any applicable requirements to inform impacted parties within a reasonable time, priority may be given to containing and eliminating the cyberattack in order to limit the damage, which as a result could potentially delay our communication of the identified attack to customers, suppliers, concerned regulatory bodies, agencies or authorities or other relevant parties.
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In addition, our collection, storage and processing of Confidential Information makes us a potentially vulnerable target to security incidents. While we have taken steps to protect our Confidential Information, there is no guarantee that our IT Systems or Confidential Information will not be impacted or accessed. Because the techniques used to sabotage or obtain unauthorized access to our IT Systems and Confidential Information change frequently and generally are not recognized until they are launched against a target, we may not be able to anticipate these techniques or implement adequate preventative measures. Any accidental or willful security incident or other unauthorized access to our IT Systems could cause any such Confidential Information to be stolen and used for criminal purposes. Any adverse impact to the availability, integrity or confidentiality of our IT Systems or Confidential Information could also expose us to liability, time-consuming and expensive litigation, and negative publicity. Further, our relationships (in particular, those with our customers) could be severely damaged, and it could have a material adverse effect on our business and operations.
Moreover, as a result of the increasing awareness concerning the importance of safeguarding personal information, the potential misuse of such information and legislation that has been adopted or is being considered in some of our markets regarding the protection, privacy and security of personal information, information-related risks are increasing. Failure to comply with any such data protection laws may result in, among other consequences, fines, litigation or regulatory actions, and efforts to comply with such requirements that may be time-intensive and costly. Any failure or perceived failure by us to prevent information security breaches or to comply with privacy policies or privacy-related legal obligations, or any compromise of security that results in the unauthorized release or transfer of personally identifiable information or other customer or end-user data, could cause our customers to lose trust in us and could expose us to legal claims. The application and interpretation of such requirements are constantly evolving and are subject to change, creating a complex compliance environment. In some cases, these requirements may be either unclear in their interpretation and application or they may have inconsistent or conflicting requirements with each other. Further, there has been a substantial increase in legislative activity and regulatory focus on data privacy and security in the United States and elsewhere, including in relation to cybersecurity incidents. It is possible that new laws, regulations and other requirements, or amendments to or changes in interpretations of existing laws, regulations and other requirements, may require us to incur significant costs, implement new processes, or change our handling of information and business operations, which could ultimately hinder our ability to operate our business and strategy. In addition, any failure or perceived failure by us to comply with laws, regulations and other requirements relating to the privacy, security and handling of information could result in legal claims or proceedings (including class actions), regulatory investigations or enforcement actions. We could incur significant costs in investigating and defending such claims and, if found liable, pay significant damages or fines or be required to make changes to our business. These proceedings and any subsequent adverse outcomes may subject us to significant negative publicity and an erosion of trust. If any of these events were to occur, our business, results of operations and/or financial condition could be materially adversely affected
We and certain of our third-party providers may experience cyberattacks and other incidents, and we expect such attacks and incidents to continue in varying degrees, and we cannot guarantee that material incidents will not occur in the future. We also cannot guarantee that our security and power back-up measures will not be circumvented or fail, resulting in customer network failures or interruptions that could impact our customers’ network availability, potentially resulting in penalties for failure to meet targeted quality levels, as well as otherwise having a material adverse effect on our business, reputation, financial condition and/or operational results. We may be required to spend significant resources to protect against or recover from such threats and attacks. In addition, as we implement new IT Systems, we cannot guarantee that our new security measures will be sufficient. If an actual or perceived breach of our security occurs, the market perception of the effectiveness of our security measures could be harmed, and we could lose customers. Further, the perpetrators of cyber-attacks are not restricted to particular groups or persons. Our employees or external actors operating in any geography may commit these attacks. Any such events could result in legal claims or proceedings (including class actions), regulatory investigations and enforcement actions, fines and penalties, disruption in operations, misappropriation of Confidential Information, damage to our reputation (which could cause us to lose existing or future customers), negative market perception, or costly response measures and future compliance costs, any of which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We could have liability under health, safety and environmental laws or fail to accurately report on or meet our sustainability metrics and targets.
Our operations are subject to the requirements of various environmental and occupational safety and health laws and regulations, including those relating to the management, use, storage, disposal, emission and remediation of, and exposure to, hazardous and non-hazardous substances, materials, waste, as well as items related to our day-to-day operations such as transport and construction. As an operator of communications infrastructure that has a heavy reliance on diesel, we may purchase diesel in large quantities that is then stored at our facilities.
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As the owner, lessee or operator of these facilities, we may be liable for substantial costs or remediation under health, safety and environment laws in the event that there is leakage or spillage from these storage facilities. As the owner, lessee or operator of communications sites, we may be liable for the substantial costs of remediating soil and groundwater contaminated by hazardous materials, without regard to whether we, as the owner, lessee or operator, knew of or were responsible for the contamination. Many of these laws and regulations contain information reporting and record-keeping requirements, which may be burdensome for us or have high costs associated with compliance, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
There can be no assurance that we are or will be in full compliance with all environmental requirements at all times. For example, many of our sites rely on the use of carbon-emitting power systems, and at the time of acquisition, certain towers acquired from other companies may not be compliant with environmental regulations or may lack certain environmental permits. We may be subject to potentially significant fines, penalties or criminal sanctions if we fail to comply with any of these requirements. The requirements of these laws and regulations are complex, change frequently, and could become more stringent in the future. It is possible that liabilities will arise in the future in a manner that could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Failure to provide a safe and healthy working environment in accordance with the relevant applicable legislation, including as a result of health pandemics or epidemics and any related measures imposed in the markets in which we operate, may result in government authorities forcing closure of sites on a temporary or permanent basis or refusing lease or license applications. Working conditions, including aspects such as weather and temperature, can add to the inherent dangers.
While we have invested, and will continue to invest, substantial resources in our occupational health, safety and security programs, there can be no assurance that we will avoid significant liability exposure. We may not be able to deliver a sustained improvement in safety performance if management interventions and training initiatives fail to translate into behavioral change by all employees, contractors and/or suppliers. Non-compliance with critical controls is a common failure in safety incidents which can lead to loss of life, workplace injuries and safety-related stoppages, all of which immediately impact operational performance and, in the long term, threaten our ability to operate as intended.
Given the high degree of operational risk in our industry, we have suffered fatalities in the past and may suffer additional fatalities in the future. Serious accidents, including fatalities, may subject us to civil or criminal fines and penalties, liability to employees and third parties for injury, illness, or death and other financial consequences, which may be significant. In addition, if our safety record were to deteriorate over time or we were to suffer substantial penalties or criminal prosecution for violation of health and safety regulations, our customers could cancel our contracts and elect to procure future services from other providers. Unsafe work sites also have the potential to increase employee turnover, increase the costs of projects for our customers, and raise our operating costs. We could also suffer impairment to our reputation, industrial action or difficulty in recruiting and retaining skilled employees and contractors. Any future changes in laws, regulations or community expectations governing safety of our operations could result in increased compliance and remediation costs.
Any of the foregoing developments could have a material adverse effect on our results of operations, cash flows and/or financial condition. Moreover, there has been increasing public focus, including by investors, customers, environmental activists, the media and governmental and nongovernmental organizations, on a variety of environmental, social and other sustainability matters. For more information, see “— Increased attention to, and evolving expectations for, sustainability and environmental, social, and governance (“ESG”) initiatives and disclosures could increase our costs, harm our reputation, or otherwise adversely impact our business.”
Revenue and/or costs could be adversely affected due to perceived health risks from radio emissions, particularly if these perceived risks are substantiated.
Public perception of possible health risks, including any perceived connection between radio frequency emissions associated with cellular and other wireless communications technology and certain negative health effects, could interrupt or slow the growth of wireless companies. In particular, negative public perception of, and regulations regarding, these perceived health risks could increase opposition to the development and expansion of tower sites. There have been instances in certain telecommunication markets globally where towers have been vandalized due to perceived health risks associated with 5G technology, including potentially related to health pandemics or epidemics (such as during the COVID-19 outbreak) as well. The potential connection between radio frequency emissions and certain negative health effects has been the subject of substantial study by the scientific community in recent years, and numerous health-related lawsuits have been filed around the world against wireless carriers and wireless device manufacturers. If a scientific study or court decision resulted in a finding that radio frequency emissions posed health risks to consumers, it could negatively impact the market for wireless services, which could have a material adverse effect on our business, prospects, financial condition and/or results of operation.
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We do not maintain any significant insurance with respect to these matters.
We may experience local community opposition to some of our sites or other communications infrastructure.
It is normal in the industry to experience, and we may in the future experience, local community opposition to our existing tower sites or the construction of new towers or deployment of other communications infrastructure assets for various reasons, including concerns about alleged health risks and noise or nuisance complaints. See “— Revenue and/or costs could be adversely affected due to perceived health risks from radio emissions, particularly if these perceived risks are substantiated.” As a result of such local community opposition, we could be required by the local authorities to dismantle and relocate certain tower sites or other communications infrastructure. If we are required to relocate certain tower sites or other communications infrastructure and cannot locate replacement sites that are acceptable to our customers, it could materially and adversely affect our revenue and cash flow, which in turn could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Our insurance may not provide adequate coverage for natural disasters, security breaches and other unforeseen events.
We may not carry insurance for all categories of risk that our business may encounter. Our business assets are subject to risks associated with natural disasters, such as windstorms, floods and hurricanes, as well as theft, particularly of diesel or batteries, vandalism, terror attacks and other unforeseen damage. Climate change and other environmental or social pressures may increase the frequency or severity of such events. In certain instances, such as where we store diesel at our facilities, we may be unaware that theft of the diesel is taking place, despite controls that we have in place to prevent this, rendering insurance covering such theft ineffective. In addition, in the event a tower has been constructed in a substandard manner, is overloaded or has not been properly maintained, it may be at risk of collapse or damage. Any damage or destruction to our towers as a result of these or other risks would impact our ability to provide services to our customers. While we maintain insurance to cover the cost of replacing damaged towers, and business interruption insurance and general liability insurance to protect ourselves in the event of an accident involving a tower, we might have claims that exceed our coverage under our insurance policy or claims may be denied and, as a result, the insurance may not be adequate. Insurance may not adequately cover all lost revenue, including revenue lost from new tenants that could have been added to the towers but for the damage. In addition, while we maintain insurance coverage with respect to certain claims, we may not be able to renew or obtain such insurance on acceptable terms in the future, if at all, and any such insurance may not provide adequate coverage against any such claims. Any significant uninsured losses or liabilities may require us to pay substantial amounts, which would reduce our working capital and could have a material adverse effect on our business, financial condition and/or results of operations. If we are unable to obtain adequate insurance coverage or provide services to our customers as a result of damage to our towers, it could lead to customer loss, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
While we seek to purchase insurance from financially strong, reputable insurance companies there can be no guarantee that such insurers will be able to pay claims when they arise due to liquidity or solvency reasons. Any delay or shortfall in receipt of insurance proceeds could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Maintenance of Towers could subject us to liability for property damage or other accidents.
There are risks inherent in the maintenance and use of Towers. Upon acquisition of a new Tower, we update and conduct maintenance to bring such Towers into compliance with our operational and safety standards. The collapse of a Tower, or portion of a Tower, due to known defects we have been unable to address or unforeseen defects, or due to improper maintenance or otherwise, could cause injury to or death of individuals or damage to surrounding property. Further, maintenance work on Towers is inherently dangerous and accidents could result in injury to or death of maintenance workers or other parties. Any such damage or accident could subject us to third-party claims regarding our potential liability, even in cases where we have outsourced maintenance work to third parties. We could incur significant costs defending any such claims and, if we were found liable, paying any resulting claims, either of which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We are subject to the effects of climate change.
There are inherent climate-related risks wherever business is conducted.
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Certain of our facilities, including our Towers, as well as third-party infrastructure on which we rely, are located in areas that have experienced, and are projected to continue to experience, various meteorological phenomena (such as drought, heatwaves, wildfire, storms, and flooding, among others) or other catastrophic events that may disrupt our or our suppliers’ operations, cause damage or loss to our Towers or other assets, limit the availability of resources, result in additional costs, delay or prevent the completion of projects in certain locations, or otherwise adversely impact our business, financial condition, and/or results of operations. For example, certain regions in Nigeria experienced incidents of severe flooding and widespread damage in 2024, including as a result of a collapsed dam, and the recurrence of such extreme weather events and infrastructure challenges could also disrupt local economies, supply chains, and operations, which may also adversely affect our business operations and financial conditions. Climate change may increase the frequency and/or intensity of such events. Climate change may also contribute to various chronic changes in the physical environment, such as sea-level rise or changes in ambient temperature or precipitation patterns, which may also adversely impact our or our suppliers’ operations. Some countries in which we operate rely on the generation of electricity through hydro-electric schemes. If changing weather patterns cause water shortages or prolonged droughts in those countries or regions, that may affect our ability to deliver services to our customers. While we may take various actions to mitigate our business risks associated with climate change, this may require us to incur substantial costs and may not be successful, due to, among other things, the uncertainty associated with the longer-term projections associated with managing climate risk. To the extent catastrophic events become more frequent, it may also adversely impact the availability or cost of insurance.
Additionally, we expect to be subject to risks associated with societal efforts to mitigate or otherwise respond to climate change, including but not limited to increased regulations, evolving stakeholder expectations, and changes in market demand. For more information, see “— Increased attention to, and evolving expectations for, sustainability and environmental, social, and governance (“ESG”) initiatives and disclosures could increase our costs, harm our reputation, or otherwise adversely impact our business.” Any of the foregoing factors could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We have been, are and may in the future become party to disputes and legal, tax and regulatory or law enforcement proceedings or actions.
In the ordinary course of business, we have been, are and may in the future be, face allegations or be named as a defendant or an interested party in legal, tax, regulatory and/or law enforcement actions, proceedings, claims and disputes by governments, regulators, entities or individuals in connection with our business activities or as a result of being a publicly listed company (such as actions of activist shareholders). In certain of the jurisdictions in which we operate and/or as a result of our status as a publicly listed company, there may be a higher likelihood that such allegations, actions, proceedings, claims and disputes may be brought by governments, regulators, entities or individuals, including for fees, taxes or other payments or forms of compensation, even if meritless or frivolous under applicable law, and these allegations, actions, proceedings, claims and disputes may increase as the profile of our business rises along with the continued growth and development of our business. Any such allegations, investigations, actions, litigation, disputes or proceedings, as well as lawsuits initiated by us for the collection of payables, may be costly, may in certain circumstances require us to dismantle tower sites, may be harmful to our reputation and may divert significant management attention and other resources away from the business, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Similarly, any material litigation could have a material adverse effect on our business and we may not have established adequate provisions for any potential losses associated with litigation not otherwise covered by insurance, which could have a material adverse effect on our prospects, business, financial condition and/or results of operations. Additionally, any negative outcome with respect to any legal actions in which we are involved in the future could require payment of fines, penalties or judgments in amounts that could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Disputes with customers have in the past and could again lead to a termination of agreements with customers or a material modification of the terms of those agreements, either of which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Additionally, disputes with our shareholders (some of whom may also be customers) may also have similar consequences, and/or impact our governance structure and processes. If we are forced to resolve any of these disputes through litigation, our relationship with the applicable customer and/or shareholder (or our wider investor base) could end or be damaged, which could lead to, among other things, decreased revenue or increased costs, and could have a material adverse effect on our reputation as well as our business, prospects, financial condition and/or results of operations.
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On June 30, 2023, Oranje-Nassau Developpement S.C.A., FIAR (“Wendel”) formally commenced Court proceedings in the Cayman Islands calling for specific performance and/or an injunction related to our obligations under the shareholders agreement dated as of October 13, 2021 (the “Shareholders Agreement”). On January 16, 2024, we and Wendel announced that we had entered into a settlement agreement in relation to the ongoing litigation. As part of the settlement agreement, certain changes to our articles of association were proposed for shareholders’ approval, and approved, at our annual general meeting for fiscal year 2024. While these proceedings have been settled, there is no assurance that further or other proceedings, by Wendel or other stakeholders, may not take place whether in relation to similar matters or otherwise. The impact or implications of any shareholder actions arising out of or pursuant to such changes to our articles of association cannot be predicted and may be harmful to our reputation and divert significant management attention and other resources away from the business, and may also have a material adverse effect on our business, prospects, financial condition and/or results of operations.
In addition, we have been, are and may in the future be, subject to regulatory and/or law enforcement investigations, actions or proceedings from time to time. In 2017, certain of our bank accounts had “post no debit” restrictions placed on them during the course of certain inquiries by the Nigerian Economic and Financial Crimes Commission, or EFCC, and, until the restriction on the bank accounts was lifted during the latter half of 2018, we were unable to access approximately $197 million. Currently, no amounts remain restricted pursuant to those restrictions (and we were not notified of any formal allegation or investigation against us), however we cannot guarantee that regulators or other authorities or agencies will not take a similar approach should they undertake investigations or inquiries in the future, irrespective of the veracity of any potential claim or severity of any potential outcome.
In 2019, the Federal Competition and Consumer Protection Act, or FCCP Act, became law, introducing competition regulations in Nigeria. Pursuant to the FCCP Act, the Federal Competition and Consumer Protection Commission, or FCCPC, is authorized to designate the market share that would constitute a dominant market share for the purposes of the FCCP Act. The FCCPC has overarching powers to regulate competition in Nigeria, and when its regulatory powers overlap with those of an industry-specific regulator, such as the NCC in the area of competition and consumer protection, the FCCPC takes precedence and the two bodies must otherwise work together to regulate competition in that specific industry. In April 2022, the NCC commenced a study on the level of competition in the colocation and infrastructure sharing market segment of the Nigerian telecoms industry. While we understand that the study has been concluded, the report has not been issued by the NCC. Given that we are the leading provider of passive communications infrastructure services in Nigeria, the FCCPC and/or the NCC may determine that we are in a dominant position in the market and, in an effort to ensure that there is no abuse of market position or if it is deemed that we have abused a dominant position, may commence a regulatory inquiry or action, levy fines, or otherwise require pricing or other modifications of our contract terms or impose restrictions on our ability to build New Sites or operate existing sites. In addition, where we are required to appear before the tribunal of the FCCPC, the tribunal has the power under certain circumstances to order us to sell a portion or all of our shares, interests or assets.
Additionally, in the ordinary course of business, we are subject to regular tax reviews. A number of tax audits have been raised in multiple jurisdictions, some of which are ongoing, including in Nigeria. See “— Changes in our rates of taxation, and audits, investigations and tax proceedings could have a material adverse effect on our financial condition and/or results of operation”.
There could be material adverse tax consequences for our shareholders in the United States if we are classified as a “passive foreign investment company” for United States federal income tax purposes.
Under United States federal income tax laws, if a company is, or for any past period during which a United States shareholder held shares in such company was, a passive foreign investment company, or PFIC, it could have adverse United States federal income tax consequences to such United States shareholder even if the company is no longer a PFIC. We do not believe that we currently are or have been a PFIC for the taxable year ending December 31, 2024, and we do not expect to be a PFIC in the future. However, the determination of whether we are a PFIC is a factual determination made annually based on all the facts and circumstances after the close of each taxable year, and the principles and methodology used in determining whether a company is a PFIC are subject to ambiguities and different interpretations. Therefore, we cannot assure you that we will not be a PFIC for the current taxable year or in the future. If we are a PFIC, United States shareholders would be subject to adverse U.S. federal income tax consequences. United States purchasers of our ordinary shares are urged to consult their tax advisors concerning United States federal income tax consequences of holding our ordinary shares if we are considered to be a PFIC. See the discussion under Item 10.E. “Taxation—Material United States Federal Income Tax Considerations.”
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If a United States person is treated as owning at least 10% of the ordinary shares, such holder may be subject to adverse U.S. federal income tax consequences.
If a United States person is treated as owning (directly, indirectly, or constructively) at least 10% of the value or voting power of the ordinary shares, such person may be treated as a “United States shareholder” with respect to each “controlled foreign corporation” in the Group (if any). A United States shareholder of a controlled foreign corporation may be required to report annually and include in its U.S. taxable income its pro rata share of “Subpart F income,” “global intangible low-taxed income,” and investments in U.S. property by controlled foreign corporations, regardless of whether the Company makes any distributions. An individual that is a United States shareholder with respect to a controlled foreign corporation generally would not be allowed certain tax deductions or foreign tax credits that would be allowed to a United States shareholder that is a U.S. corporation. Failure to comply with these reporting obligations may subject a United States shareholder to significant monetary penalties and may prevent the statute of limitations with respect to such United States shareholder’s U.S. federal income tax return for the year for which reporting was due from starting. The Company cannot provide any assurances that it will assist holders of the ordinary shares in determining whether any of its non-U.S. subsidiaries is treated as a controlled foreign corporation or whether any holder of the ordinary shares is treated as a United States shareholder with respect to any such controlled foreign corporation or furnish to any United States shareholders information that may be necessary to comply with the aforementioned reporting and tax paying obligations. A U.S. Holder (as defined in Item 10.E. “Taxation—Material United States Federal Income Tax Considerations.”) should consult its advisors regarding the potential application of these rules to an investment in the ordinary shares.
Changes in our rates of taxation, and audits, investigations and tax proceedings could have a material adverse effect on our financial condition and/or results of operation.
We are subject to direct and indirect taxes in numerous jurisdictions. We calculate and provide for such taxes in each tax jurisdiction in which we operate. The amount of tax we pay is subject to our interpretation of applicable tax laws in the jurisdictions in which we file. We will seek to run IHS Holding Limited in such a way that it is and remains tax resident in the United Kingdom. We have taken and will continue to take tax positions based on our interpretation of tax laws, but tax and/or accounting often involves complex matters and judgment is required in determining our worldwide provision for taxes and other tax liabilities.
Although we believe that we have complied with all applicable tax laws, there can be no assurance that a taxing authority or other governmental agencies will not have a different interpretation of the law and assess us with additional taxes (and possibly related interest and/or penalties).
We are subject to ongoing tax audits in various jurisdictions, including matters subject to ongoing disputes through judicial or investigative processes. Tax authorities have disagreed, and may in the future disagree, with our judgments. We regularly assess the likely outcomes of these audits to determine the appropriateness of our tax liabilities but there can be no assurance that such ongoing audits or future audits will not result in material liability. Additionally, our judgments might not be sustained as a result of these audits, and the amounts ultimately paid could be different from the amounts previously recorded and such amounts could be material, which could, in turn, have an adverse effect on our business, prospects, financial condition and/or results of operations. In addition, our effective tax rate in the future could be adversely affected by changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities and changes in tax laws. Tax rates in the jurisdictions in which we operate may change as a result of macroeconomic, political or other factors. Increases in the tax rate in any of the jurisdictions in which we operate could have a negative impact on our profitability. In addition, changes in tax laws, treaties or regulations, or their interpretation or enforcement, may be unpredictable, particularly in the types of markets in which we operate (such as emerging markets), and could become more stringent, which could materially adversely affect our tax position. Any of these occurrences could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Future changes to tax laws could materially adversely affect us and reduce net returns to our shareholders.
Our tax treatment is subject to changes in tax laws, regulations, tax policy initiatives and reforms in jurisdictions in which we operate. In addition, our tax treatment may be affected by tax policy initiatives and reforms related to the Organization for Economic Co-Operation and Development, or the OECD, the work of the OECD/G20 Inclusive Framework on Pillar One and Pillar Two of the base erosion and profit shifting (“BEPS”) project and other initiatives.
Such changes may include (but are not limited to) the taxation of operating income, investment income, interest income, dividends received or dividends paid, withholding taxes and value added tax. We are unable to predict what tax reform may be proposed or enacted in the future, possibly with retroactive effect, or what effect such changes would have on us.
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Any such changes could affect our financial position and overall or effective tax rates in countries where we have operations, reduce post-tax returns to our shareholders, and increase the complexity, burden and cost of tax compliance.
For example, legislation has been enacted or is currently under consideration in a number of jurisdictions to adopt and implement Pillar Two of the BEPS project to introduce a global minimum tax rate of 15% for certain multinational enterprises, including the Group. The 15% minimum tax on income under Pillar Two of BEPS has been applicable to the Group since implementation by the UK and The Netherlands. There is a further proposal by the UAE to implement Pillar Two from January 2025 onwards. There may be further changes to the Pillar Two rules as currently enacted and the introduction of Pillar Two rules in other jurisdictions, some of which could impose additional tax liabilities on the Group. In addition, there is currently an ongoing review of the tax regime in Nigeria, which may affect a broad range of taxes, including but not limited to, excise tax on telecommunications services, corporate income tax, value added tax and stamp taxes. As changes such as these are subject to implementation (and in the case of those pursuant to international projects such as BEPS, implementation by each relevant country, which may be different), the timing and ultimate impact of any such changes on our tax obligations remains uncertain.
Certain countries in which we operate may treat the indirect change of ownership of our subsidiaries as triggering tax charges.
Changes in the indirect ownership of our subsidiaries resulting from a transfer of our shares can represent a taxable event in certain circumstances in some jurisdictions in which certain of our subsidiaries are located. The applicable taxes may include taxes on capital gains and transfer taxes.
In several jurisdictions in which we operate, it is possible that the transfer of our shares could give rise to tax liabilities, including for our shareholders. Some of the relevant jurisdictions do not provide clear guidance to exempt the sale of listed shares from the scope of these rules and there may be a higher risk with regards to substantial disposals or acquisitions of our shares. We intend to take all steps which are reasonably available to us within the legislation of the relevant jurisdictions to mitigate such risks but cannot guarantee that the relevant tax authorities will not seek to impose capital gains or transfer taxes in relation to any transfer of our shares. As the applicability of such tax charges are difficult to predict, the timing and ultimate impact of any such charges on our tax obligations, business, financial condition and/or results of operations remains uncertain.
We are exposed to the risk of violations of anti-bribery and anti-corruption laws or other similar regulations.
We operate and conduct business in various emerging and less developed markets (including Africa and Latin America), and we may expand into additional markets, which at times experience high levels of fraud, bribery and corruption. We are subject to the applicable anti- corruption laws and regulations of the markets in which we operate, including the U.S. Foreign Corrupt Practices Act of 1977, or the FCPA, and the UK Bribery Act 2010, or the UK Bribery Act. The FCPA prohibits providing, offering, promising, or authorizing, directly or indirectly, including potentially through third party agents acting on our behalf, anything of value (such as cash and cash equivalents, travel expenses, gifts, entertainments, charitable donations, in-kind services and so on.) to non-U.S. government officials, political parties, or candidates for political office for the purposes of obtaining or retaining business or securing any improper business advantage. As part of our business, we are regularly required to deal with regulators, government ministries, departments and agencies to obtain permits and licenses to operate our business. We also periodically enter into joint ventures with government ministries, departments and agencies in the ordinary course of our business. The employees of these regulators and government ministries, departments and agencies may be considered government officials for the purposes of the FCPA. The provisions of the UK Bribery Act extend beyond bribery of government officials and are broader than the FCPA in a number of other respects, including jurisdiction, non-exemption of facilitation payments and penalties. In particular, the UK Bribery Act (unlike the FCPA) also applies to the active payment of bribes to private persons (i.e., non-government officials) as well as the passive receiving of bribes. Furthermore, unlike the vicarious liability regime under the FCPA, whereby corporate entities can be liable for the acts of its employees, the UK Bribery Act introduced a new offense applicable to corporate entities and partnerships which carry on part of their business in the United Kingdom that fail to prevent bribery, which can take place anywhere in the world, by associated persons who perform services for or on behalf of them, subject to a defense of having adequate procedures in place to prevent the bribery from occurring.
This strict liability offense under the UK Bribery Act can render corporate entities criminally liable for the acts (including those with no criminal intent) of their employees, agents, joint venture partners, or commercial partners even if done without their knowledge.
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Public companies listed in the United States are required to maintain records that accurately and fairly represent their transactions and have an adequate system of internal accounting controls. We maintain internal controls, policies, procedures and training to ensure compliance by us and our directors, officers, employees, representatives, consultants, and agents with the FCPA, UK Bribery Act and other applicable anti-corruption laws and make efforts to ensure their effectiveness. However, we can make no assurance that the controls, policies and procedures, even if enhanced, have been or will be followed at all times or effectively detect and prevent all violations of the applicable laws and every instance of fraud, bribery and corruption. As a result, we could be subject to potential civil or criminal penalties, disgorgement and other sanctions and remedial measures and legal expenses under the relevant applicable law, which could have material adverse effects on our business, prospects, financial condition and/or results of operations if we fail to prevent any such violations or are the subject of investigations into potential violations, which may result in a significant diversion of management’s attention and resources and significant defense costs and other professional fees. In addition, such violations could also negatively impact our reputation and, consequently, our ability to win future business.
Any such violation by competitors, if undetected, could give them an unfair advantage when bidding for contracts. The consequences that we may suffer due to the foregoing could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We are subject to certain export controls, trade and economic sanctions laws and regulations that could impair our ability to compete in international markets and subject us to liability for non-compliance.
Our business activities may, at times, be subject to various export controls and trade and economic sanctions laws and regulations, including, without limitation, the U.S. Export Administration Regulations administered by the Bureau of Industry and Security of the U.S Department of Commerce, the trade and economic sanctions programs administered and enforced by the U.S. Treasury Department’s Office of Foreign Assets Control, or OFAC, and the U.S. State Department’s Nonproliferation Sanctions, collectively, “Trade Controls”. Such Trade Controls may prohibit or restrict our ability to, directly or indirectly, conduct activities or dealings in or with certain countries or territories, as well as with governments, individuals or entities that are the subject of Trade Controls. Further, our sales and services to certain customers may at times trigger reporting requirements under applicable Trade Controls.
For instance, the U.S. government has imposed export control restrictions effectively barring sales of items (including components and software) that are subject to U.S. export controls to, among other parties, Huawei and certain other China-based technology companies with whom we conduct business. Although we maintain policies and procedures reasonably designed to maintain compliance with Trade Controls applicable to us (including those that target Huawei and certain of our other counterparties) we cannot ensure that such policies and procedures will be effective in preventing violations of applicable Trade Controls. Furthermore, any sanctions imposed on us as a result of dealings with Huawei or other organizations that are the target of U.S. export controls (or indirectly as a result of our customers, suppliers and other third-party contractors having such dealings) could have a material adverse effect on our business, prospects, financial condition and/or results of operations. These restrictions, and similar or more expansive restrictions that may be imposed by the United States or other jurisdictions in the future, may also materially impact and could have a material adverse effect on certain of our customers’ abilities to acquire technologies, systems, devices or components that may be critical to their technology infrastructure, service offerings and business operations, which could, in turn, have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Although we have implemented compliance measures designed to comply with applicable Trade Controls, our failure or the failure of our customers, suppliers and third-party contractors to successfully comply with applicable Trade Controls may expose us to negative legal and business consequences, including civil or criminal penalties, government investigations, and reputational harm, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
See “— We rely on third-party contractors for various services, and any disruption in or non-performance of those services would hinder our ability to effectively maintain our tower infrastructure.”
Our risk management policies and procedures may not be fully effective in achieving their purposes.
Our policies, procedures, controls and oversight to monitor and manage our enterprise risks may not be fully effective in achieving their purpose and may leave us exposed to identified or unidentified risks. Past or future misconduct by our employees or contractors could result in violations of law, regulatory sanctions and/or serious reputational harm or financial harm. We monitor our policies, procedures and controls; however, we cannot assure you that our policies, procedures and controls will be sufficient to prevent all forms of misconduct and/or identify all material risks that may impact our business.
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We review our compensation policies and practices as part of our risk management program, but it is possible that our compensation policies could incentivize management and other employees to subject us to inappropriate risk or to engage in misconduct. If such inappropriate risks or misconduct occurs, it is possible that it could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We engage in transactions with certain related parties, and if their support and backing does not continue or a conflict of interest arises, our ability to deliver certain services could be harmed and our results of operations could be materially adversely affected.
We have engaged, and may in the future engage, in transactions with related parties, including our directors, executive officers, significant shareholders, and their affiliates. These transactions may not be conducted on an arm’s length basis and could result in terms that are less favorable than those that could be obtained from unaffiliated third parties. Such related party transactions could create potential conflicts of interest and have an adverse effect on our financial condition and results of operations. For example, MTN Group is one of our shareholders as well as a related party of certain MTN Group operating entities that are our customers in the African countries in which we currently operate. While such customers collectively accounted for 61% and 60% of our revenue for the years ended December 31, 2024, and 2023, respectively, our relationship with each MTN Group operating entity is managed separately through separate contracts for each MTN Group operating entity in each country. There can be no assurance that conflicts of interest, inherent in related party transactions, may not arise, potentially resulting in disadvantages to us or the conclusion of transactions on less satisfactory terms, which could in turn affect our ability to deliver certain services and could have a material adverse effect on our business, prospects, financial condition, reputation and/or results of operations. See “Related Party Transactions.”
A regional or global health pandemic or epidemic, and any governmental action taken in response, could severely affect our business.
A regional or global health pandemic or epidemic, depending upon its duration and severity, could have a material adverse effect on our business. For example, as a result of the COVID-19 pandemic that began in 2020, governmental authorities around the world implemented various measures to reduce the spread of COVID-19, and such measures adversely affected workforces, supply chains, ability to carry out operations, economies and financial markets and led to an economic downturn in many of our markets. As a result of the effects of any future regional or global health emergency or events that have a similar impact on the global economy such as, depreciation of local currencies and/or a lack of sufficient availability of hard/international currencies, we may experience fluctuations in foreign currency exchange rates in many of the markets in which we operate, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations. Global deterioration in economic conditions in light of global health emergencies or events could adversely and materially affect us and/or our customers through disruptions of, among other things, the ability to procure communications equipment or other supplies through the usual supply chains. For instance, shortages of capacity in shipping may occur and could affect the smooth flow of our and/or our customers’ supply chains, increase transportation costs and/or decrease reliability. Global deterioration in economic conditions in light of future outbreaks could also adversely and materially affect the ability of us and/or our customers to maintain liquidity and deploy network capital, with potential decreases in consumer spending contributing to liquidity risks, or even through regulatory interventions or pressure on pricing and services offered that may reduce revenue for periods of time. Any resulting financial difficulties could result in uncollectible accounts receivable or reduced revenue, despite having provided increased services. Resulting supply chain or operational difficulties (including site access) may also result in us being unable to meet the service level agreement targets under our MLAs. See “— We rely on third-party contractors for various services, and any disruption in or non-performance of those services would hinder our ability to effectively maintain our tower infrastructure.” The loss of significant Tenants, or the loss of all or a portion of our anticipated Contracted Revenue from certain Tenants, could have a material adverse effect on our business, financial condition and/or results of operations.
In the past, governments have taken, and may in the future take, unprecedented actions in an attempt to address and rectify these extreme market and economic conditions by providing liquidity and stability to financial markets. If these actions are not successful, the return of adverse economic conditions may cause a significant impact on our ability and the ability of our customers to raise capital, if needed, on a timely basis and on acceptable terms or at all.
To the extent that any future pandemic or epidemic or related events could have a material adverse effect on our or our customers’ business, financial condition, results of operations and/or liquidity, it may also have the effect of heightening many of the other risks described in this “Risk Factors” section.
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If we do not achieve and/or maintain black economic empowerment objectives in our South African businesses, we could jeopardize our ability to continue to do business or to secure future business in South Africa.
The South African government has established a legislative framework for the promotion of Broad-Based Black Economic Empowerment (“B-BBEE”). Achievement of B-BBEE objectives is measured by a scorecard which establishes a weighting for the various components of B-BBEE which relate to ownership, enterprise and supplier development and socio-economic development. B-BBEE objectives are pursued, in significant part, by requiring parties who contract with corporate, governmental and state-owned enterprises in South Africa to achieve B-BBEE compliance through satisfaction of an applicable scorecard. Scorecards are independently reviewed by accredited verification agencies which issue a certificate that presents an entity’s B-BBEE contributor level. This B-BBEE verification process is conducted on an annual basis. As part of the MTN SA Acquisition, we were required, among other things, to achieve and maintain certain B-BBEE contributor levels, including by the Competition Commission of South Africa. While we have entered into a shareholding agreement with a consortium of B-BBEE parties, which closed in January 2025, and satisfied one of the conditions set by the Competition Commission of South Africa, failing to achieve or maintain this or other applicable B-BBEE requirements could jeopardize our ability to continue to do business or to secure future business in South Africa, including a termination of our contractual arrangements with customers, in circumstances where the necessary extensions or waivers are not obtained.
Risks Relating to the Markets in which We Operate
Our current operations are conducted, and many of our customers are located, in various international markets, particularly in emerging markets such as in Africa and Latin America. Accordingly, our business, prospects, financial condition and/or results of operations depend significantly on the economic and political conditions prevailing in such markets, particularly Nigeria, which is our largest market of operation.
Our current and potential markets are subject to greater risks than more developed markets, and financial turmoil in such markets (including those in which we operate) could disrupt our business and cause the price of our ordinary shares to decline.
Investing in securities of issuers in emerging and less developed markets generally involves a higher degree of risk than investments in securities of corporate or sovereign issuers from more developed countries and carries risks that are not typically associated with investing in more mature markets. These risks include, but are not limited to, the types of risks noted in the Risk Factor entitled “— Our current and future markets involve additional risks compared to more developed markets, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.”
Investors should exercise particular care in evaluating the risks involved and must decide for themselves whether, in light of those risks, their investment is appropriate. Generally, investment in securities of issuers operating in emerging and less developed markets is only suitable for sophisticated investors who fully appreciate the significance of the risks involved and investors are urged to consult their own legal and financial advisors before making an investment in our ordinary shares. Investors should also note that emerging and less developed markets such as those in which we operate are subject to rapid change and that the information set forth in this Annual Report may become outdated relatively quickly.
Moreover, financial turmoil in any emerging market or less developed market or country tends to adversely affect prices in the financial markets of such markets, as investors move their money to more stable, developed markets. As has happened in the past, financial problems or an increase in the perceived risks associated with investing in other emerging economies could dampen foreign investment in the countries in which we operate and adversely affect the economies of such countries. In addition, during such times, companies that operate in emerging and less developed markets can face severe liquidity constraints as foreign funding sources, including availability of credit or debt financing, are withdrawn. Thus, even if the economies of the countries in which we operate remain relatively stable, financial turmoil in any emerging or less developed market or country could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Shortage of U.S. dollar, euro or other hard currency liquidity in the markets in which we operate may adversely affect our ability to service our foreign currency liabilities.
There may be shortages in the availability of, or disruptions or other limitations in the supply of, foreign currencies in the countries in which we operate, whether as a result of economic reasons, monetary controls or otherwise.
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See also “— Some of the markets in which we currently, or may in the future, operate are dependent on commodities, and are therefore impacted by global prices and/or demand for such products” and “— Financial authorities in the markets in which we operate may intervene in the currency markets by drawing on external reserves, and their currencies are subject to volatility.” For example, there have historically been periods of significant shortage of U.S. dollar liquidity in Nigeria and the CBN imposed additional currency controls that restricted access to U.S. dollars in the official foreign exchange market. The reduced access to foreign exchange negatively impacted certain sectors of the Nigerian economy. However, since the introduction of the I&E window in April 2017 (now referred to as NFEM), the foreign exchange market generally experienced greater levels of stability; however, there have still been periods of significant U.S. dollar liquidity shortage from time to time, including since 2021, and the foreign exchange market has remained volatile. In Nigeria, we continue to access USD through various sources (including from commercial banks and authorized dealers) and at various rates (which may also be at a premium to NFEM). In this regard, we may suffer adverse economic consequences as a result of a divergence between the rates at which U.S. dollars are available in the market or as a result of the lack of availability or the shortage of U.S. dollars as stated above.
Should such controls and foreign currency liquidity shortages continue and/or occur in the markets in which we operate, we may face difficulties accessing foreign currency from foreign exchange markets or experience increased costs in sourcing foreign currency or otherwise which would impact our ability to obtain foreign currency required for some of our operations or to service some of our foreign currency obligations, which in turn could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We may make acquisitions in or investments into emerging and other less developed markets, and investments in emerging and less developed markets are subject to greater risks than developed markets and could have a material adverse effect on our business, prospects, financial condition and results of operations.
To the extent that we acquire assets or invest in other emerging and/or less developed markets, including in Africa, the Middle East and Latin America, additional risks may be encountered that could adversely affect our business. Such markets tend to have less developed economies and infrastructure and are often more vulnerable to economic and geopolitical challenges and may experience significant fluctuations in gross domestic product, interest rates and currency exchange rates, as well as civil disturbances, government instability, nationalization and expropriation of private assets and the imposition of taxes or other charges by government authorities. In addition, the currencies in which investments are denominated may be unstable, may be subject to significant depreciation and may not be freely convertible or may be subject to the imposition of other monetary or fiscal controls and restrictions (including, for example, the Nigerian Naira (₦) which depreciated by approximately 49% in 2023 (see “— Risks Relating to the Markets in which We Operate — We and our customers face foreign exchange risks, which may be material”). There have been periods of significant U.S. dollar liquidity shortage in Nigeria from time to time, including since 2021, thus limiting our ability to repatriate funds from the country. To the extent the availability of U.S. dollars does not improve, this may have a material adverse effect on our business, financial condition, results of operations, cash flows, liquidity and/or prospects.
Emerging and less developed markets are still in relatively early stages of their development and accordingly may not be highly or efficiently regulated, or the interpretation and enforcement of such regulations may be inconsistent or uncertain within the countries or jurisdictions in which we operate. Moreover, emerging and other less developed markets tend to be shallower and less liquid than more established markets which may adversely affect our ability to realize profits from our assets in these markets when we desire to do so or receive what we perceive to be their fair value in the event of a realization. In some cases, a market for realizing profits from an investment may not exist locally. In addition, companies based in emerging and other less developed markets are not generally subject to uniform accounting and financial reporting standards, practices and requirements comparable to those applicable to companies based in more developed countries, thereby potentially increasing the risk of fraud and other deceptive practices. Settlement of transactions may be subject to greater delay and administrative uncertainties than in developed markets and less complete and reliable financial and other information may be available to investors in emerging and other less developed markets than in developed markets. In addition, economic instability in such markets could adversely affect the value of our assets subject to leases in such countries, or the ability of our lessees or customers, which operate in these markets, to meet their contractual obligations. As a result, lessees or customers that operate in emerging and other less developed market countries may be more likely to default under their contractual obligations than those that operate in developed countries. Liquidity and volatility limitations in these markets may also adversely affect our ability to dispose of our assets at the best price available or in a timely manner.
Should we continue to invest in or acquire assets located in emerging and less developed markets throughout the world, we may be exposed to any one or a combination of these risks, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
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Failure to adequately address the significant infrastructure deficiencies in emerging and less developed markets could adversely affect their economies and growth prospects, and companies operating in emerging and less developed markets may face logistical and operational difficulties.
Decades of under-investment have resulted in significant deterioration of public infrastructure and the absence of, or persistent problems with, basic infrastructure to support and sustain growth and economic development in many emerging and less developed markets, including some of those in which we operate, or may operate. In addition to power generation, transmission and distribution deficiencies, emerging and less developed markets may also suffer from deteriorating road networks, congested ports and obsolete rail infrastructure, which have all severely constrained socioeconomic development, including restricting the movement of people and goods within those regions, thereby increasing the time it takes to mobilize workforces and deliver supplies or equipment. The power sectors of emerging and less developed markets may suffer from numerous problems, such as limited access to infrastructure, low connection rates, inadequate power generation capacity, lack of capital for investment, insufficient transmission and distribution facilities, high transmission and distribution losses and vandalism. Many businesses rely on alternative electricity and water supplies, adding to overall business costs. See “— Some of the markets in which we currently, or may in the future, operate may suffer from chronic electricity shortages.”
Although significant advances have been made in the areas of communications facilities in recent years, the progress of development in these sectors cannot be considered at par with that in more developed economies. For example, Nigeria’s new administration sworn in on May 29, 2023, has set ambitious targets for infrastructure and economic development as part of the continuous process of accelerating development in the country. Some of the most notable reforms associated with those targets include (i) replacing the old regime of multiple foreign exchange rate segments into a single NFEM window within which foreign exchange transactions would be determined by market forces (see “— We and our customers face foreign exchange risks, which may be material”), (ii) removing the petrol motor spirit subsidy that consumed approximately $10 billion of the federal budget in 2022, as reported by Reuters, and (iii) establishing the Renewed Hope Infrastructure Fund, an infrastructure development fund, aimed at funding upgrades in transportation, roads, power as well as other infrastructure projects.
Failure to significantly improve the infrastructure in such markets could adversely affect their economies and growth prospects, including their ability to meet GDP growth targets which, in turn, could have a material adverse effect on our business, prospects, financial condition and/or results of operations. The lack of reliable infrastructure also limits our ability, and that of our commercial partners, contractors, customers and suppliers, to respond quickly to unforeseen situations, which can lead to delays and production stoppages. We may also face operational and logistical challenges as a result of outbreaks of infectious diseases in the regions in which we operate. The occurrence of any of the above could have a material adverse effect on our business, prospects, financial condition and/or results of operations. Furthermore, certain areas/regions in which we operate periodically experience adverse weather conditions and natural disasters, mainly in the form of high winds, floods, erosion and drought, which further limit the use of available infrastructure, particularly during the rainy season in such regions, when the likelihood of delays increases. Climate change may exacerbate these or other infrastructure challenges. See “— We are subject to the effects of climate change.” In addition, flooding in the regions in which we operate has also led to outbreaks of disease, which, coupled with the ongoing security concerns in these regions (See “— There are risks related to political instability, religious differences, ethnicity and regionalism in emerging and less developed markets”), may affect our ability to staff our operations with qualified local and overseas individuals should such individuals be deterred from relocating to these regions, as a result of health or security concerns.
Some of the markets in which we currently, or may in the future, operate may suffer from chronic electricity shortages.
Successfully managing communications towers in many of the types of markets in which we currently, or may in the future, operate (including emerging markets) is dependent on operational competency in power management, and unreliability of grid power presents significant challenges to managing our sites, uptimes and delivering quality service to customers.
For example, despite the abundant energy resources in Nigeria, significant government reform efforts, and investments in the power sector in recent years, lack of sufficient and reliable electricity supply remains a serious impediment to the country’s economic growth and development. Insufficient power generation, aging infrastructure, weak distribution networks, overloaded transformers and acts of sabotage to pipelines and infrastructure by vandals result in frequent power outages, high transmission and distribution losses and poor voltage output. Only 60.5% of Nigeria’s total population has access to the grid electricity supply (according to World Bank data from 2022) due to insufficient generation capacity and inadequate transmission and distribution networks. In addition, other countries in which we operate have also experienced power supply issues, such as South Africa, Zambia and Côte d’Ivoire, which as a result have experienced, and continue to experience, power outages that, among other things, have adversely impacted their economy and economic growth.
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In such cases, where the national electricity grid has been under significant pressure to meet growing demand given insufficient generation capacity, this has resulted in periods of load shedding, where planned supply interruptions take place to reduce pressure on the electricity grid.
Despite initiatives by governments to resolve or mitigate such issues and/or ongoing investment from governments into power generation and transmission, load shedding is expected to continue to occur in the future (including, potentially, in additional markets in which we may operate), and which in turn, may have a material adverse effect on our business, financial condition, results of operations, cash flows, liquidity and/or prospects.
Despite the introduction of power sector reforms and recent incremental improvements in the sector in certain markets, failure to sustain and improve on these efforts in power generation, transmission and distribution infrastructure could lead to lower GDP growth and hamper the development of economies, as well as increase the underlying costs of operating in such markets, many of which may not be recoverable. Such challenges in grid connectivity and/or the consistent provision of power may also be caused by events outside the control of relevant authorities and/or providers, including as a result of the impact of climate-related events on power sources and/or distribution networks or infrastructure. Slow growth in the economies in which we operate may also lessen consumers’ propensity to spend, which would negatively affect our customers. This, in turn, may have a material adverse effect on our business, financial condition, results of operations, cash flows, liquidity and/or prospects.
Unlike communication towers businesses in developed markets, such as the United States and the European Union, where the electricity grid is comparatively extremely reliable, successfully managing communications towers in many of the types of markets in which we currently, or may in the future, operate is dependent on operational competency in power management. Given the intermittent and unreliable grid availability in Nigeria, for example, grid electricity has been rarely used as a source of power for our Towers, with 27% of Towers operated only with generators and 53% operated with hybrid solutions, which alternate between diesel generators and / or solar or battery systems, as of December 31, 2024. In our other African markets, grid availability can also be unreliable, and as of December 31, 2024, 12% of Towers (excluding South Africa as we no longer provide power Managed Services for those sites) were powered only by the grid, with the remainder having either generator or hybrid power systems. The unreliability of the grid power presents significant challenges to managing our tower sites and power uptimes and delivering quality service to customers. Any inability to continue to deliver quality service could harm our relationships with our customers, which, in turn, could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Some of the markets in which we currently, or may in the future, operate are dependent on commodities, and are therefore impacted by global prices and/or demand for such products.
The economies of some of the markets in which we operate may be highly dependent on commodities, such as oil or copper, and therefore on global prices and demand which impact these markets. Reductions in revenue from such commodities could adversely affect the economies of the markets in which we operate. For example, the Nigerian economy is highly dependent on oil production in Nigeria and global prices of oil. According to the Nigerian National Bureau of Statistics, in 2023, the oil sector represented 5.4% of total real GDP, a decrease from the 5.7% and 7.2% recorded in 2022 and 2021, respectively; this however increased to 5.5% of total real GDP in 2024. Reductions in revenues from commodities (including but not limited to oil), particularly in light of measures related to global health events or outbreaks, or geopolitical tensions (such as outbreaks of violence or wars), could have a material adverse effect on the economies of certain markets in which we operate and in turn on our and our customers’ business and our results of operations. Additionally, between 2014 and 2016, a fall in copper prices adversely affected Zambia’s economy, along with increased tensions with mining companies due to related tax increases.
Revenue from commodities is a function of the level of the relevant commodity’s production in the relevant country and prevailing world commodity prices and demand. Commodity prices are subject to wide fluctuations in response to relatively minor changes in the supply of, and demand for, such commodity, market uncertainty, and a variety of additional factors that are beyond the control of the relevant country. These factors include, but are not limited to, political conditions in other relevant regions, internal and political decisions of any regional or international bodies or organizations relating to such commodities, such as OPEC, and other nations producing the relevant commodity as to whether to decrease or increase production, domestic and foreign supplies of the commodity, consumer demand, such as the fall in demand resulting from the global response measures to contain the spread of outbreaks or events with a wide-ranging regional or global impact, weather conditions, domestic and foreign government regulations, transport costs, the price and availability of alternatives and overall economic conditions.
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Declines in commodity prices and/or revenue on which certain of the economies in which we operate rely have had and will continue to have an impact on such economies, and may result in lower economic growth, high rates of unemployment, reduction in foreign exchange and government revenue. For example, the Nigerian government and certain other governments, such as in oil-producing countries, rely heavily on oil revenue to fund their budgets, and the decline in prices immediately following the onset of the COVID-19 pandemic in March 2020 resulted in significantly decreased revenue. Oil prices have also been volatile following the geopolitical conflicts that took place in Europe from 2022 and in the Middle East from 2023, causing revenue instability in oil-reliant countries like those we operate in. Moreover, Nigeria, which has historically been one of the largest oil producers in Africa, produced an average of 2.0 million barrels per day in 2019; however, production levels have since declined to an average 1.37 million barrels per day in 2022, albeit started to increase in 2023 and 2024 to an average 1.43 and 1.50 million barrels per day, respectively, as reported by the Nigerian Bureau of Statistics. The decline can be attributed to, among other things, leakage, militant attacks and decaying infrastructure. A reduction or fluctuation in commodity prices, such as a drop in oil prices, would likely negatively impact export earnings in the relevant country, government revenue, and national disposable income, and lead to budgetary constraints and reduced investment in key projects such as infrastructure. Further, any foreign exchange controls imposed in the jurisdictions in which we operate, whether as a result of reduced foreign exchange revenue from such commodities or related products or otherwise, may lead to a devaluation of our revenue which is received in local currencies and also affect our ability to obtain foreign currency required for some of our operations or to service some of our foreign currency obligations. See “— Financial authorities in the markets in which we operate may intervene in the currency markets by drawing on external reserves, and their currencies are subject to volatility” and “— Shortage of U.S. dollar, euro or other hard currency liquidity in the markets in which we operate may adversely affect our ability to service our foreign currency liabilities.”
Commodity production in the relevant economies may also fluctuate significantly as a result of a decline in global prices, which may affect the economic viability of certain producing assets, and the activities of vandals (such as in the Niger Delta region of Nigeria, in relation to the oil industry) may lead to significant disruptions in the production of commodities on which such economies or businesses there rely upon. For example, the level of oil production and oil revenue in Nigeria and certain other oil producing countries in the Middle East may also be adversely affected by other factors, including changes in oil production quotas by OPEC, the response of international oil companies to changes in the regulatory framework for oil production in the relevant country or region, and theft of crude oil from pipelines and tank farms. Any long-term shift away from certain commodities (such as fossil fuels), including from developed economies seeking to develop alternative sources of energy, could adversely affect commodity prices and demand and the resulting commodity-related revenue of economies in which we operate. Damage to such economies as a result of such downturns may harm our customers and increase costs (such as fuel costs), which may have a material adverse effect on our business, prospects, financial condition and/or results of operations.
High inflation could have a material adverse effect on the economies in which we operate.
Inflation around the world has risen to levels not experienced in recent decades, and the markets in which we operate are exposed to the risk of high inflation. For example, for years ended December 31, 2024 and 2023, Nigeria’s inflation rate stood at 33.2% and 24.7%, respectively, according to the Nigeria Bureau of Statistics. For the years ended December 31, 2024 and 2023, South Africa’s inflation rate was 4.4% and 6.0%, respectively, and for the years ended December 31, 2024 and 2023, Zambia’s inflation rate was 15.0% and 10.9%, respectively. Changes in monetary and/or fiscal policy in the countries in which we operate may result in higher rates of inflation, which could consequently increase our operating costs. There can be no assurance that inflation rates will not rise in the future. While we have contractual inflation-linked escalation provisions under most of our MLAs, there can be no guarantee that the rates of escalation of lease fees will mitigate future inflation, particularly where our MLAs may include fixed, capped or floored escalators.
Brazil could also experience new cycles of high rates of inflation. For the years ended December 31, 2024 and 2023, Brazil’s inflation rate was 4.4% and 4.6%, respectively. Even though inflation has receded and macroeconomic conditions improved following the smooth governmental transition of power in January 2023, moderate appreciation of the Brazilian real against the U.S. dollar, and a meaningful cut in rates by the central bank, the Brazilian government has historically taken significant actions to control inflation. Past inflation control policies and regulations often involved, among other measures, increases or decreases in interest rates, changes in fiscal policies, wage and price controls, foreign exchange rate controls, blocking access to bank accounts, currency devaluations, capital controls and import and export restrictions. Inflation policies adopted to curb inflationary pressures and uncertainties regarding possible future governmental intervention could contribute to economic uncertainty and heightened volatility in the Brazilian economy.
Significant inflation and measures taken by governments to control inflation (such as the significant interest rises) could have a material adverse effect on the economies of the countries in which we operate and, as a result, on our business, prospects, financial condition and/or results of operations.
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In addition, a significant inflationary environment for any of our markets that is deemed to meet the definition of “hyperinflation” under IFRS Accounting Standards may result in the need to adopt “IAS 29 Financial Reporting in Hyperinflationary Economies” in our consolidated financial statements, which could have a broad impact on our financial reporting and our key financial metrics. At present, none of our markets are considered to be hyperinflationary (as defined in IAS 29 Financial Reporting in Hyperinflationary Economies), but the 3 year cumulative inflation rate has increased for Nigeria, and there is the potential for hyperinflation accounting to be applicable in future reporting periods.
Financial authorities in the markets in which we operate may intervene in the currency markets by drawing on external reserves, and their currencies are subject to volatility.
Central banking authorities in the countries in which we operate may intervene in the currency markets by drawing on external reserves (such as in Nigeria, where a significant portion of our operations are based) or adopting policies that may impact the applicable exchange rates and/or amounts of foreign currency that may be obtained. Fluctuations in an economy’s external reserves, its high dependence on certain foreign-currency revenue streams (such as those related to commodities such as oil, or other exports) and high levels of key imports in foreign currency, could result in local currencies remaining or becoming vulnerable to external shocks.
For example, the CBN had historically favored maintaining the Naira within a narrow band with periodic adjustments. Following the devaluation in June 2023, the CBN has made statements that the exchange rate should be governed by a “willing buyer — willing seller” market approach. The gross external reserves have fluctuated in recent years, dropping significantly from a high of $44.2 billion at the end of 2012, to a low of $25.8 billion at the end of 2016, before gradually recovering. As of December 31, 2024, gross external reserves were recorded at $40.9 billion. Given the fluctuations in Nigeria’s external reserves, its high dependence on oil exports and the fact that Nigeria pays for its key imports, such as refined oil, in U.S. dollars, the Naira will remain vulnerable to external shocks that could lead to a sharp decline in its values, as had occurred historically.
In addition, the currencies of the countries in which we operate are subject to volatility. The functional currency of our operating subsidiaries are the Nigerian Naira (₦), West African CFA Franc (XOF), Central African CFA Franc (XAF), Zambian Kwacha (ZMW), Rwandan Franc (RWF), the South African Rand (ZAR), Brazilian Real (BRL) and Colombian Peso (COP). The operating subsidiaries’ financial results are translated into U.S. dollars for reporting purposes. Accordingly, we are subject to fluctuations in the rates of currency exchange. In particular, the Naira has depreciated significantly against the U.S. dollar, due largely to declining oil prices, depletion of external reserves, and the absence of fiscal buffers. In early 2015, the CBN instituted certain currency control policies and pegged the Naira at ₦197 to the U.S. dollar, which increased to approximately ₦305 in 2016, approximately ₦435 as of December, 31, 2021, ₦461.50 as of December 31, 2022, approximately ₦911.7 as of December 31, 2023 and approximately ₦1,546.0 as of December 31, 2024. Similarly, the Zambian Kwacha to U.S. dollar exchange rate increased from ZMW9.99 as of December 31, 2017 to ZMW27.89 as of December 31, 2024 and the Brazilian Real to U.S. dollar exchange rate increased from BRL4.03 as of December 31, 2019, to BRL6.18 as of December 31, 2024. The South African Rand to U.S. dollar exchange rate increased from ZAR16.98 as of December 31, 2022 to ZAR18.81 as of December 31, 2024.
Central banks or monetary authorities in economies where the local currency is subject to such pressures may take various administrative measures aimed at stabilizing the foreign exchange market, including restricting access to the official foreign exchange market or prohibiting the use of foreign currencies in domestic transactions or by other means.
The depreciation or volatility of local currencies of the countries in which we operate may negatively affect their respective economies, which in turn could have a material adverse effect on our and our customers’ business, prospects, financial condition and/or results of operations as well as our liquidity and cash flows. See “Risks Relating to Our Business — We and our customers face foreign exchange risks, which may be material.”
Failure to adequately address actual and perceived risks of corruption may adversely affect the economies of the countries in which we operate, or may operate, and their ability to attract foreign investment.
Corruption is a significant issue in many of the markets in which we operate, as in many other emerging and less developed markets. For example, Nigeria, Cameroon and Zambia placed 140, 140 and 92, respectively out of 180 countries in Transparency International’s 2024 Corruption Perceptions Index. Despite certain reform efforts, however, corruption continues to be a serious problem impacting some of the countries in which we operate, as reflected by several high-profile convictions. Brazil has also experienced recent political instability, including various investigations into allegations of money laundering and corruption being conducted by the Office of the Brazilian Federal Prosecutor which have negatively impacted the Brazilian economy and political environment. In addition, South Africa and Nigeria (since February 2023), Cameroon (since June 2023) and Côte d’Ivoire (since October 2024) were added by the Financial Action Task Force’s (“FATF”) to the “grey list” of countries that need to do more to improve their ability to fight financial crime.
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The addition to the “grey list” will likely increase the cost of doing business in South Africa, Nigeria, Côte d’Ivoire and Cameroon as there is additional scrutiny on transactions by international counterparties in grey list countries.
Corruption has many implications for a country, including difficulty in collecting revenue and controlling expenditure, increasing the risk of political instability, distorting decision-making processes and adversely affecting its international reputation. Failure to address these issues, continued corruption in the public sector and any future allegations of, or perceived risk of, corruption in the markets in which we operate could have adverse effects on their respective economies and may have a negative effect on the ability of these countries to attract foreign investment and, as a result, may have a material adverse effect on our and our customers’ business, prospects, financial condition and/or results of operations.
The policies and reforms of the political administrations in the countries in which we operate may result in political instability or changes in regulatory or other government policies.
Many emerging and less developed markets, including those in which we operate or may operate, face periods of political and economic uncertainty, particularly around the times leading up to elections and/or other political change, including uncertainty as to the manner in which the relevant governing authorities would seek to address the issues facing the relevant country and whether they would alter or reverse certain reforms and actions taken by predecessors or even by incumbents seeking to garner increased favor. Such issues may give rise to uncertainty in the investing community and are likely to reduce inbound investment.
Frequent and intense periods of political instability make it difficult to predict future trends in governmental policies. Any government actions in response to political turmoil, such as shutting down access to the internet in the countries in which we operate, would negatively affect our business and results of operations. In addition, if government or regulatory policies in a market in which we operate were to change or become less business-friendly, our business could be materially adversely affected. In addition, the economic instability experienced in Brazil between 2020 and 2022 contributed to a decline in market confidence in the Brazilian economy as well as to a deteriorating political environment. Despite a reduction in inflation in 2023, following a smooth governmental transition that year, the Brazilian government has in the past intervened in the Brazilian economy and occasionally makes significant changes in policy and regulations. For instance, the Brazilian government’s actions to control inflation and implement macroeconomic policies have often involved increases in interest rates, wage and price controls, currency devaluations, blocking access to bank accounts, imposing capital controls and limits on imports, among other things. In addition, various ongoing investigations into allegations of money laundering and corruption being conducted by the Office of the Brazilian Federal Prosecutor, have negatively impacted the Brazilian economy and political environment and have adversely impacted the image and reputation of those companies that have been implicated. We do not have any control over, and are unable to predict, which measures or policies the Brazilian government may adopt in the future. In addition, in South Africa, presidential elections took place in May 2024, and policies enacted thereafter could adversely affect the economy, hinder or delay progress in minimizing the energy crisis, and ultimately impact our growth and operations in the country. For example, in Nigeria, under President Tinubu’s administration, the implementation of policies such as subsidy removals and tighter foreign exchange controls has the potential to result in further instability. Moreover, some planned reforms may disadvantage certain existing stakeholders, who may seek to curtail such reforms. For example, planned privatization of state-owned enterprises has in some cases been met with strikes or threats of strikes in anticipation of job losses and price increases. Any significant changes in the political climate in the countries in which we operate, including changes affecting the stability of the government or involving a rejection, reversal or significant modification of policies against nationalization or expropriation of privately owned assets, favoring the privatization of state-owned enterprises, reforms in the telecommunications, power, banking and oil and gas sectors or other reforms, may have negative effects on the economy, government revenue or foreign reserves and, as a result, could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
There are risks related to political instability, religious differences, ethnicity and regionalism in emerging and less developed markets.
Our operations are exposed to the political and social environment of the emerging and less developed markets in which we operate (or may in the future operate), which have the potential for civil and political unrest, contributing to an uncertain operating environment. For example, in Nigeria, corruption, policy uncertainty and collapsing infrastructure, as well as terrorist acts by Boko Haram and other groups, together with increased insecurity in different parts of the country, present significant risks to business operations in parts of Nigeria. Terrorism and militant activity are a problem in parts of Nigeria, where a range of terrorist and militant groups with differing goals operate. The Boko Haram sect, a terrorist group based primarily in north-eastern Nigeria, initially became active in 2009 and increasingly received international attention for the number and frequency of attacks against the Nigerian people and villages.
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These attacks led to the deployment of troops to Adamawa, Borno, and Yobe states. Despite progress made in combatting the group, Boko Haram continued to mount attacks throughout 2021 and 2022, particularly in the Lake Chad region. In addition to the instability caused by Boko Haram, the Niger Delta region of Nigeria continues to experience militant activity, creating a challenging environment for companies operating in that region. Cameroon has also faced similar issues, including with political instability in the Anglophone regions of Cameroon and Boko Haram in the Far North region of the country. Such instability has in the past resulted in, and may continue to result in, vandalism of our sites, obstruction or inability to access our Towers and increased security threats to our sites, as well as corresponding lost revenue or increased maintenance and security costs, as well as increased capital expenditures.
Political and social unrest in countries neighboring the markets in which we operate may also pose risks to our business. Instances of terrorist activities or other political and/or social unrest as well as general lawlessness can create a challenging environment for companies operating in the relevant regions. Rwanda has faced similar issues, with rebel groups advancing into, and in certain instances, seizing parts of, the eastern part of the Democratic Republic of Congo. While such activity may be targeted within certain regions or at certain types of industry (such as oil and gas companies), the security situation in such regions can be volatile and may also have an impact on our operations, such as attacks on sites by militant or other groups in order to disrupt communications, and can generally create instability, impacting the relevant regions and economies.
Unless resolved by the government, such conflicts may adversely affect the political and economic stability of the markets in which we operate (or may in the future operate), which may, in turn, further have a material adverse effect on our business, prospects, financial condition and/or results of operations.
The taxation, customs and regulatory systems in emerging and less developed markets may be subject to changes and inconsistencies.
The government policies and regulations of emerging and less developed market economies, such as those in which we operate or may operate, on taxation, customs and excise duties and other regulatory matters may change from time to time. In addition, taxes, customs and excise duties and other fees and fines may increasingly be viewed as major sources of revenue, particularly where other previously prominent sources of revenue (such as those derived from commodities) may have reduced. This may result in the introduction of new taxes, levies or fees where none previously existed (or were not imposed). See: “-- Future changes to tax laws could materially adversely affect us and reduce net returns to our shareholders”. For various reasons, including a potential need to generate revenue from sources other than exports, other foreign governments may take measures to enforce tax compliance, including taking interim measures for alleged tax default, or to impose fees with respect to our operations, even where not permitted by applicable law. While such measures are often successfully challenged, if they are taken in relation to us, this may have a material adverse effect on our financial condition, results of operations, cash flows, and/or liquidity.
Further, the interpretation by the relevant tax or other regulatory authorities of, or decision with respect to, certain sections of tax or other laws may differ on a case-by-case basis, including potentially, against sectors or companies such as ours in the event of a perceived increase in profile or growth.
Changes in government policies on taxation, customs and excise duties or other regulations, as well as inconsistencies or uncertainties in the interpretation of and decisions relating to tax laws, may have a material adverse effect on our cash flows and liquidity, as well as our business, prospects, financial condition and/or results of operations, and on the tax liability of holders of our ordinary shares.
Inefficiencies and corruption in the judicial systems may create an uncertain environment for investment and business activity and affect the ability of investors to find remedies through the relevant jurisdictions’ judicial systems.
The legal systems in certain emerging and less developed markets, such as the ones in which we operate and may in the future operate, are still in their growing phase, and the laws and regulations in such jurisdictions continue to undergo development and face a number of challenges, including corruption and delays in the judicial process since most cases take a considerable period of time to be concluded. Similarly, the enforcement of judgments and/or security in such jurisdictions may be affected by inefficiencies in the judicial system and can result in uncertain positions.
As a result, effective legal redress may be difficult to obtain and there is a high degree of uncertainty due to the discretion of governmental authorities, lack of judicial or administrative guidance on interpreting applicable rules and regulations, inconsistencies or conflicts between and within various laws, regulations, decrees, orders and resolutions and relative inexperience of the judiciary and courts in commercial matters.
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Slow and uncertain judicial process may sometimes affect the enforceability of judgments obtained, or result in judgments or extra-judicial action that may be inconsistent with the expected or applicable legal process, rules or procedures.
Those and other factors that have an impact on the legal systems of the markets in which we operate, make an investment in our ordinary shares subject to greater risks and uncertainties than an investment in a country with a more mature legal system.
Any downgrading of Nigeria’s debt rating by an international rating agency could have a negative impact on our business.
As of the date of this Annual Report, Nigeria’s sovereign rating was B- with a positive outlook (Fitch), B- with stable outlook (S&P) and Caa1 with positive outlook (Moody’s). These ratings reflect an assessment of the government of Nigeria’s overall financial capacity to pay its obligations and its ability or willingness to meet its financial commitments as they become due. This, in combination with any adverse revisions to Nigeria’s credit ratings for domestic and international debt by international rating agencies, may adversely affect the liquidity of the Nigerian financial markets, the ability of the Nigerian government and Nigerian companies, including us, to raise additional financing, and the terms on which we are able to finance future capital expenditure or refinance any existing indebtedness. A downgrade in the sovereign’s rating could also negatively impact the credit rating of the Existing Notes and our credit rating as a result of the linkage between these ratings and the rating of the sovereign. This could have an adverse effect on our capital expenditure plans, business, cash flows and financial performance and prospects.
Risks Relating to our Indebtedness
Our level of indebtedness and the terms of our indebtedness could materially adversely affect our business and liquidity position.
As of December 31, 2024, we had $3,348 million of total borrowings, excluding lease liabilities. We currently use debt financing and plan to continue to use debt financing for our future operations and projects. The terms of the agreements governing our indebtedness limit the circumstances in which we may incur additional indebtedness. However, our indebtedness may increase from time to time in the future for various reasons, including fluctuations in operating results, capital expenditures and potential acquisitions or joint ventures or other investments. As a result, the risks normally associated with debt financing may materially adversely affect our cash flows and liquidity as well as our business, prospects, financial position and/or operating results including because:
| ● | our level of indebtedness may, together with the financial and other restrictive covenants in the agreements governing our indebtedness, significantly limit or impair our ability in the future to obtain financing, refinance any of our indebtedness, sell assets or raise capital on commercially reasonable terms or at all, which could cause us to default on our obligations and materially impair our liquidity; |
| ● | a downgrade in our credit rating (including because of a downgrade in the sovereign credit ratings for the countries in which we have material operations) could restrict or impede our ability to access the capital markets at attractive rates and increase our borrowing costs; |
| ● | our level of indebtedness may increase the difficulty for us to repay our debt, including our ability to pay interest when due and/or the principal amounts due under such indebtedness; |
| ● | our level of indebtedness may reduce our flexibility to respond to changing business and economic conditions or to take advantage of business opportunities that may arise; |
| ● | a portion of our cash flow from operations must be dedicated to interest payments on our indebtedness and is not available for other purposes, which amount would increase if prevailing interest rates rise; |
| ● | our level of indebtedness may place us at a competitive disadvantage relative to competitors that have lower leverage or greater financial resources than we have and restrict us from pursuing our strategy (including acquisitions) or exploiting certain business opportunities; and |
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| ● | our level of indebtedness could make us more vulnerable to downturns in general economic or industry conditions or in our business. |
In addition, market conditions and monetary restrictions may lead to foreign currency liquidity shortages and we may face difficulties in obtaining sufficient quantities of the relevant foreign currency when required to meet our contractual and indebtedness obligations denominated in U.S. dollars or other foreign currencies. See “— Risks Relating to the Markets in which We Operate — Financial authorities in the markets in which we operate may intervene in the currency markets, and their currencies are subject to volatility” and “— Risks Relating to the Markets in which We Operate — Shortage of U.S. dollar, euro or other hard currency liquidity in the markets in which we operate may adversely affect our ability to service our foreign currency liabilities”. Such shortages or lack of availability could increase our borrowing costs and interest expenses, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations as well as cash flows and liquidity. Such issues or increases could also have a material adverse effect on our cash flows and our ability to service our debt or meet interest payments in the longer term. Shortages in the availability of foreign currency may restrict our ability to satisfy our foreign currency-denominated obligations. Although we may seek to enter into agreements to reduce our risk related to access to foreign currencies and applicable exchange rates, we are under no obligation to do so and we cannot assure you that such arrangements would ensure our access to foreign currencies which we need on commercially acceptable terms or at all, or that we will be able to enter into such arrangements on commercially acceptable terms or at all. See Item 5. “Operating and Financial Review and Prospects.” Similarly, certain jurisdictions may also experience liquidity shortages or reductions in the capital available to lend in the market (including, but not limited to, as a result of increased regulatory requirements by central banks), which may prevent us from refinancing indebtedness denominated in such local currency on acceptable terms or at all. See “Item 5. “Operating and Financial Review and Prospects - Liquidity and Capital Resources.”
We are a holding company and conduct limited operations of our own. Repayment of indebtedness, including under the IHS Holding 2024 Dual-Tranche Term Loan, the IHS Holding 2020 Revolving Credit Facility, the 2026 Notes, the 2028 Notes and the IHS Holding Notes, is dependent on the ability of our operating companies to make cash available to us. See “— IHS Holding Limited is a holding company with no operations of its own and, as such, it depends on its subsidiaries for cash to fund its operations and expenses, including future dividend payments, if any.”
In addition, our ability to draw funds from our existing and future local facilities or to refinance our existing local facilities may be materially adversely affected by the relatively high or increasing levels of non-performing loans in the relevant local banking sector. Local banks with a lack of geographic diversification or that have substantial exposure to certain industries which are not performing as well, may see the overall quality of their loan portfolio deteriorate or their provisioning costs increase, which may also impact their net interest income and margins. Any regional or local economic downturn that affects the local banking sector may in turn impact our ability to draw funds from any current and future undrawn local facilities or to refinance existing local facilities and could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
Prevailing interest rates or other factors at the time of refinancing, including the possible reluctance of creditors to make commercial loans, or to invest in operations in developing markets (including as a result of market or economic conditions or considerations relating to regulatory capital requirements), could result in the withdrawal of certain creditors from the pool of available lenders traditionally available to borrowers or issuers of our profile and could also result in higher interest rates, and the increased interest expense could, in the longer term, have a materially adverse effect on our ability to service our debt and to complete our capital expenditure plans, and our financial condition and results of operations could deteriorate as a result.
We are subject to restrictive debt covenants and our failure to comply with these covenants, including as a result of events beyond our control, could result in an event of default that could have a material adverse effect on our financial condition and/or results of operations.
We are party to credit agreements that govern the IHS Holding 2024 Dual-Tranche Term Loan and the IHS Holding 2020 Revolving Credit Facility, indentures that govern the Existing Notes and credit agreements governing our facilities at our operating subsidiaries, and we may provide guarantees under credit agreements governing our facilities at our operating subsidiaries, and therefore are subject to the restrictive covenants under those agreements.
A breach of any covenants, ratios, tests or restrictions in those instruments and agreements, including as a result of events beyond our control, could result in an event of default (which may also trigger cross-default or cross-acceleration clauses in other agreements or financings) that could have a material adverse effect on our financial condition and/or results of operations.
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The instruments governing our indebtedness contain a number of restrictive covenants, including restrictions on our ability to, among other things:
| ● | incur or guarantee additional debt or issue preferred stock; |
| ● | pay dividends on, redeem or repurchase share capital, or make other distributions; |
| ● | purchase equity interests or reimburse or prepay subordinated debt prior to maturity; |
| ● | create or incur liens; |
| ● | make certain investments; |
| ● | agree to limitations on the ability of our subsidiaries to make distributions; |
| ● | engage in sales of assets and subsidiary stock; |
| ● | enter into transactions with affiliates; |
| ● | guarantee other debt; and |
| ● | transfer all or substantially all of our assets or enter into merger or consolidation transactions. |
The restrictions contained in our debt instruments, could affect our ability to operate our business and may limit our ability to react to market conditions or take advantage of potential business opportunities as they arise. For example, these restrictions could have a material adverse effect on our ability to finance our operations, make strategic acquisitions, investments or alliances, restructure our organization, or finance our capital needs. Additionally, our ability to comply with these covenants and restrictions may be affected by events beyond our control. Should market conditions deteriorate or fail to improve, or our operating results decrease in the future, then we may have to request amendments and/or waivers to the covenants and restrictions to which we are subject.
There can be no assurance that we will be able to obtain such relief should it be needed in the future. A breach of any of these covenants or restrictions could result in a default and acceleration that would permit our creditors to declare all amounts incurred to be due and payable, together with accrued and unpaid interest, and the commitments of the relevant creditors to make further extensions of credit could be terminated. Such actions may also trigger cross-default or cross-acceleration provisions in other facilities or agreements, which could multiply and extend the impact of any particular event or series of events across our Group.
If we breach certain of our debt covenants, creditors could declare a default and/or require us to pay the then outstanding debt immediately, and, in the case of any secured debt, creditors could sell the property securing such debt if we are unable to pay the outstanding debt immediately. If an event of default is called or if we default on the payments required by our existing indebtedness, we could trigger cross-default or cross-acceleration provisions under other debt agreements or instruments that could make such indebtedness payable on demand, and we may not have sufficient funds to repay all of our debts. The breach of covenants and the exercise by the relevant creditors of their rights under the various financing agreements could have a material adverse effect on our business, prospects, financial condition and/or results of operations.
We are exposed to interest rate risks as certain of our borrowings bear interest at floating rates that could rise significantly, increasing our interest cost and reducing cash flow.
Outstanding balances and advances under certain of our existing credit facilities would bear interest at rates which vary depending on certain underlying or reference rates, such as the Secured Overnight Financing Rate, or SOFR, the Chicago Mercantile Exchange (CME) Term SOFR, the European interbank offered rate or EURIBOR, the Nigerian Monetary Policy Rate, or MPR, the Johannesburg Interbank Average Rate, or JIBAR, or the Brazilian interbank deposit rate, or CDI. Increases in such reference rates increase our interest expense, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations. Such increases in interest rates could also have a material adverse effect on our cash flows and our ability to service our debt in the longer term. In addition, we may procure additional indebtedness at floating rates in the future.
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The applicable interest rates (including alternative interest rates) could rise significantly in the future, thereby increasing our interest expenses associated with these obligations, reducing cash flow available for capital expenditures and hindering our ability to make payments on our indebtedness.
Although we may hedge the interest rates with respect to certain of our existing credit facilities, we are under no obligation to do so under the documents governing our indebtedness and we may not be able to obtain such hedges, or replace such hedges on terms that are acceptable to us, and any such hedges may not be fully effective, which would expose us to interest rate risk.
We may not be able to generate sufficient cash to service all of our indebtedness, and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.
Our ability to make scheduled payments on or to refinance our debt obligations and to fund planned capital expenditures and working capital requirements depends on our future performance and ability to generate cash, which is subject, among other things, to the success of our business strategy, prevailing economic conditions and financial, competitive, legislative, legal, regulatory and other factors, including those other factors discussed in these “Risk Factors”, many of which are beyond our control.
We can make no assurances that we will be able to generate a level of cash flow from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness, or that future borrowings will be available to us in an amount sufficient to enable us to service and our other indebtedness or to fund our other liquidity needs. If we default on the payments required by indebtedness, that indebtedness, together with debt incurred pursuant to debt agreements or instruments that contain cross-default or cross- acceleration provisions, may become payable on demand, and we may not have sufficient funds to repay all of our debts.
Furthermore, if our cash flows and capital resources are insufficient to service our debt obligations, we may be forced to reduce or delay investments and capital expenditures or to sell assets, seek additional capital or restructure or refinance our indebtedness, any of which will depend on our cash needs, our financial condition at such time, the then prevailing market conditions and the terms of our then existing debt instruments, which may restrict us from adopting some of these alternatives. Any failure to make payments of interest and principal on our outstanding indebtedness on a timely basis would likely result in a reduction of our credit rating, which could also harm our ability to incur additional indebtedness. In addition, any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations, and there can be no assurances that any assets which we could be required to dispose of could be sold or that, if sold, the timing of the sales and the amount of proceeds realized from those sales could be on acceptable terms.
In addition, we maintain the majority of our cash and cash equivalents in accounts with major financial institutions, and our deposits at these institutions may exceed insured limits. Market conditions can impact the viability of these institutions. In the event of failure of any of the financial institutions where we maintain our cash and cash equivalents, there can be no assurance that we would be able to access uninsured funds in a timely manner or at all. Any inability to access or delay in accessing these funds could adversely affect our business and financial position.
Risks Relating to Ownership of our Ordinary Shares
We are a foreign private issuer and, as a result, we are not subject to U.S. proxy rules and are not subject to Exchange Act reporting obligations that, to some extent, are more lenient and less frequent than those of a U.S. domestic public company.
We report under the Exchange Act as a non-U.S. company with foreign private issuer status. Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including (i) the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act, (ii) the sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability for insiders who profit from trades made in a short period of time and (iii) the rules under the Exchange Act requiring the filing with the SEC of current reports on Form 8-K and quarterly reports on Form 10-Q containing unaudited financial and other specified information, although we provide and intend to continue to provide comparable quarterly information on Form 6-K. In addition, foreign private issuers are not required to file their annual report on Form 20-F until 120 days after the end of each fiscal year, while U.S. domestic issuers that are large accelerated filers are required to file their annual report on Form 10-K within 60 days after the end of each fiscal year. Foreign private issuers are also exempt from Regulation FD, which is intended to prevent issuers from making selective disclosures of material information.
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As a result of all of the above, you may not have the same protections afforded to shareholders of a company that is not a foreign private issuer.
We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses.
As discussed above, we are a foreign private issuer, and therefore, we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last business day of an issuer’s most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect to us on June 30, 2025. In the future, we would lose our foreign private issuer status if (i) more than 50% of our outstanding voting securities are owned by U.S. residents and (ii) a majority of our directors or executive officers are U.S. citizens or residents, or we fail to meet additional requirements necessary to avoid loss of foreign private issuer status. If we lose our foreign private issuer status, we will be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer forms, which are more detailed and extensive than the forms available to a foreign private issuer. We will also have to mandatorily comply with U.S. federal proxy requirements, and our officers, directors and principal shareholders will become subject to the short-swing profit disclosure and recovery provisions of Section 16 of the Exchange Act. In addition, we will lose our ability to rely upon exemptions from certain corporate governance requirements under the listing rules of the New York Stock Exchange (“NYSE”). As a U.S. listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer, and accounting, reporting and other expenses in order to maintain a listing on a U.S. securities exchange. These expenses will relate to, among other things, the obligation to present our financial information in accordance with U.S. GAAP in the future.
As we are a “foreign private issuer” and intend to follow certain home country corporate governance practices, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements.
As a foreign private issuer, we have the option to follow certain home country corporate governance practices rather than those of the NYSE, provided that we disclose the requirements we are not following and describe the home country practices we are following. We intend to rely on this “foreign private issuer exemption” with respect to the NYSE rules for shareholder meeting quorums and record dates and the NYSE rules requiring shareholders to approve equity compensation plans and material revisions thereto, neither of which is required under the Cayman Islands law. We may in the future elect to follow home country practices with regard to other matters, including the requirement that listed companies have a majority of independent directors unless the company is a “controlled company” and the requirement that listed companies have a compensation and nominating and corporate governance committee comprised entirely of independent directors. As a result, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements.
We cannot assure you that a market for our ordinary shares will be sustained to provide adequate liquidity, and public trading markets may experience volatility. Investors may not be able to resell their ordinary shares at or above the price they pay.
We cannot assure you that an active trading market for our ordinary shares will be sustained. If a market is not sustained, it may be difficult for you to sell your ordinary shares. Public trading markets may also experience volatility and disruption. This may affect the pricing of the ordinary shares in the secondary market, the transparency and availability of trading prices, the liquidity of the ordinary shares and the extent of regulation applicable to us. We cannot predict the prices at which our ordinary shares will trade. It is possible that, in future quarters, our operating results may be below the expectations of securities analysts and investors. As a result of these and other factors, the price of our ordinary shares may decline, possibly materially.
Our operating results and ordinary share price may be volatile, and the market price of our ordinary shares may drop below the price you pay.
Our quarterly operating results are likely to fluctuate in the future in response to numerous factors, many of which are beyond our control, including each of the factors set forth above.
In addition, securities markets worldwide have experienced, and are likely to continue to experience, significant price and volume fluctuations. This market volatility, as well as general economic, market or political conditions, could subject the market price of our ordinary shares to wide price fluctuations regardless of our operating performance. Our operating results and the trading price of our ordinary shares may fluctuate in response to various factors, including the risks described above.
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These and other factors, many of which are beyond our control, may cause our operating results and the market price and demand for our ordinary shares to fluctuate substantially.
Fluctuations in our quarterly operating results could limit or prevent investors from readily selling their ordinary shares and may otherwise negatively affect the market price and liquidity of ordinary shares. In addition, in the past, when the market price of a stock has been volatile, holders of that stock have sometimes instituted securities class action litigation against the company that issued the shares. If any of our shareholders brought a lawsuit against us, we could incur substantial costs defending the lawsuit. Such a lawsuit could also divert the time and attention of our management from our business, which could significantly harm our profitability and reputation.
Sales of a substantial number of our total issued and outstanding ordinary shares could cause the market price of our ordinary shares to drop significantly, even if our business is doing well.
Sales of a substantial number of our ordinary shares in the public market, or the perception in the market that the holders of a large number of ordinary shares intend to sell, could reduce the market price of our ordinary shares. As of December 31, 2024, we had 333,440,937 ordinary shares outstanding. All of our ordinary shares are freely tradable under the Securities Act without restriction, except for any of our ordinary shares that may be held or acquired by our directors, executive officers and other affiliates, as that term is defined in the Securities Act, which are restricted securities under the Securities Act. Restricted securities may not be sold in the public market unless the sale is registered under the Securities Act or an exemption from registration is available.
Further, we have filed a registration statement on Form S-8 to register our ordinary shares for issuance under our 2021 Omnibus Incentive Plan. Subject to the satisfaction of vesting conditions, shares registered under these registration statements on Form S-8 become available for resale immediately in the public market without restriction. We also entered into a registration rights agreement, pursuant to which we agreed under certain circumstances to file a registration statement to register the resale of the ordinary shares held by certain of our existing shareholders, as well as to cooperate in certain public offerings of such ordinary shares and to reimburse such shareholders for certain expenses incurred in connection therewith. See Item 7.B. “Related Party Transactions.”
In the future, we may also issue additional securities if we need to raise capital or make acquisitions, which could constitute a material portion of our then-issued and outstanding ordinary shares and would result in the dilution of our existing shareholders, which could have a material adverse effect on our business, prospects, financial condition and/or results of operation.
We continue to incur increased costs and have additional obligations as a result of operating as a public company, and our management is required to devote substantially more time to new compliance initiatives and corporate governance practices.
As a public company, we continue to incur significantly more legal, accounting and other expenses than we did as a private company, and have additional obligations such as regulatory financial reporting requirements. The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of the NYSE and other applicable securities rules and regulations impose various requirements on public companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance practices. Our management and other personnel need to devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations continue to increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, these rules and regulations may make it more difficult and more expensive for us to obtain director and officer liability insurance, and could also make it more difficult for us to attract and retain qualified members of our board of directors. We may also face challenges in complying with our increased obligations in the required or expected timeframes.
We continue to evaluate these rules and regulations, and cannot predict or estimate the amount of additional costs we may incur or the timing of such costs. These rules and regulations are often subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices.
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To establish (and ultimately, maintain) the effectiveness of our disclosure controls and procedures and our internal control over financial reporting, we expect that we will need to continue enhancing existing, and implement new, financial reporting and management systems, procedures and controls to manage our business effectively and support our growth in the future. The process of evaluating our internal control over financial reporting requires an investment of substantial time and resources, including by our Chief Financial Officer and other members of our senior management. As a result, this process may divert internal resources and take a significant amount of time and effort to complete.
Inaccurate assumptions in respect of critical accounting judgments could materially adversely affect financial results.
In the course of preparing financial statements our management necessarily makes judgments and estimates that can have a significant impact on our financial statements. The most critical of these relate to impairment of assets, fair value of embedded derivatives and options, contingent liabilities, revenue recognition and certain regulatory accruals. The use of inaccurate assumptions in calculations for any of these estimates could have a material adverse effect on our business, prospects, financial condition and/or results of operations. Our operating results may be adversely affected if the assumptions change or if actual circumstances differ from those in the assumptions, which could cause our operating results to fall below the expectations of securities analysts and investors, resulting in a decline in the price of our ordinary shares.
Because we do not currently pay regular cash dividends on our ordinary shares, you may not receive any return on investment unless you sell your ordinary shares for a price greater than that which you paid for it.
We do not currently pay any regular cash dividends on our ordinary shares. Any decision to declare and pay dividends in the future will be made at the discretion of our board of directors and will depend on, among other things, our results of operations, financial condition, cash requirements, contractual restrictions, strategic direction of the Company and other factors that our board of directors may deem relevant. In addition, our ability to pay dividends is, and may be, limited by covenants of existing and any future outstanding indebtedness we or our subsidiaries incur. Therefore, any return on investment in our ordinary shares is solely dependent upon the appreciation of the price of our ordinary shares on the open market, which may not occur, which could, in turn, have a material adverse effect on our business, prospects, financial condition and/or results of operations. See Item 8.A. “Financial Information—Consolidated Statements and Other Financial Information—Dividend Policy” for more detail.
IHS Holding Limited is a holding company with no operations of its own and, as such, it depends on its subsidiaries for cash to fund its operations and expenses, including future dividend payments, if any.
As a holding company, our principal source of cash flow is distributions or payments from our operating subsidiaries. Therefore, our ability to fund and conduct our business, service our debt and pay dividends, if any, in the future depends on the ability of our subsidiaries and intermediate holding companies to make upstream cash distributions or payments to us, which may be impacted, for example, by their ability to generate sufficient cash flow or limitations on the ability to repatriate funds whether as a result of currency liquidity restrictions, monetary or exchange controls or otherwise. Our operating subsidiaries and intermediate holding companies are separate legal entities, and although they are directly or indirectly wholly owned and/or controlled by us, they have no obligation to make any funds available to us, whether in the form of loans, dividends or otherwise. The ability of our operating subsidiaries and intermediate holding companies to distribute cash to us will also be subject to, among other things, restrictions that may be contained in the agreements governing our indebtedness as entered into from time to time, including the IHS Holding RCF and the Existing Notes, and the facilities of our operating subsidiaries, availability of sufficient funds in such subsidiaries and applicable laws, taxes and regulatory restrictions, including monetary or fiscal controls and restrictions. Claims of any creditors of any of our subsidiaries generally will have priority as to the assets of such subsidiaries over our claims and claims of our creditors and shareholders. To the extent the ability of any of our subsidiaries to distribute dividends or other payments to us is limited in any way, our ability to fund and conduct our business, service our debt and pay dividends, if any, could be harmed.
Our shareholders may face difficulties in protecting their interests because we are a Cayman Islands exempted company.
Our corporate affairs are governed by our Articles, the Companies Act and the common law of the Cayman Islands. The rights of shareholders to take legal action against our directors and us, actions by minority shareholders and the fiduciary responsibilities of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from judicial precedent in the Cayman Islands as well as from English common law, which has persuasive, but not binding, authority on a court in the Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of our directors under the laws of the Cayman Islands are not as clearly defined as under statutes or judicial precedent in existence in jurisdictions in the United States.
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Therefore, you may have more difficulty protecting your interests than would shareholders of a corporation incorporated in a jurisdiction in the United States, due to the comparatively less well-developed Cayman Islands law in this area.
A merger or consolidation may proceed under Cayman Islands law in one of two ways: by a court-sanctioned scheme of arrangement or by a statutory merger. While Cayman Islands law allows a shareholder objecting to a court sanctioned scheme of arrangement to express a view that such scheme of arrangement would not provide fair value for the shareholder’s shares, Cayman Islands statutory and common law in respect of schemes of arrangement does not specifically provide for shareholder appraisal rights in connection with a merger or consolidation effected by a scheme of arrangement of a company that has otherwise received the prescribed shareholder approval. This may make it more difficult for you to assess the value of any consideration you may receive in a merger or consolidation effected by a scheme of arrangement or to require that the acquirer gives you additional consideration if you believe the consideration offered is insufficient. However, in the event of a merger or consolidation under the statutory merger regime, Cayman Islands law does provide a mechanism for a dissenting shareholder to require us to apply to the Grand Court for a determination of the fair value of the dissenter’s shares if it is not possible for the company and the dissenter to agree on a fair price within the time limits prescribed.
Shareholders of Cayman Islands exempted companies such as ours, have no general rights under Cayman Islands law to inspect corporate records and accounts or to obtain copies of lists of shareholders. Our directors have discretion under our Articles to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders. This may make it more difficult for you to obtain information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.
It should be noted that the Cayman Islands law has no legislation specifically dedicated to the rights of investors in securities, and thus no statutorily defined private causes of action to investors in securities such as those found under the Securities Act or the Exchange Act in the United States. Derivative actions have been brought in the Cayman Islands courts, and the Cayman Islands courts have confirmed the availability for such actions. In principle, and subject to certain exceptions, the Company would normally be the proper plaintiff and a derivative action may not be brought by a minority shareholder.
As a result of all of the above, our public shareholders may have more difficulty in protecting their interests in the face of actions taken by our management or members of the board of directors than they would as public shareholders of a company incorporated in the United States.
Our Articles provide, unless we consent in writing to the selection of an alternative forum, the federal courts of the United States shall have exclusive jurisdiction to hear, settle and/or determine any dispute, controversy or claim arising under the provisions of the Securities Act or the Exchange Act, which could increase a shareholder’s cost and limit such shareholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage lawsuits against us and our directors, officers and other employees.
Our Articles provide unless we consent in writing to the selection of an alternative forum (a) the federal courts of the United States shall have exclusive jurisdiction to hear, settle and/or determine any dispute, controversy or claim arising under the provisions of the Securities Act or the Exchange Act, which are referred to as the U.S. Actions; and (b) save for such U.S. Actions, the courts of the Cayman Islands shall have exclusive jurisdiction over any claim or dispute arising out of or in connection with the Articles or otherwise related in any way to each member’s shareholding in us, including but not limited to (i) any derivative action or proceeding brought on behalf of us; (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us (iii) any action asserting a claim arising pursuant to any provision of the Companies Act of the Cayman Islands or the Articles; or (iv) any action asserting a claim against us concerning our internal affairs.
This choice of forum provision may increase a shareholder’s cost and limit the shareholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage lawsuits against us and our directors, officers and other employees. Any person or entity purchasing or otherwise acquiring any of our shares or other securities, whether by transfer, sale, operation of law or otherwise, shall be deemed to have notice of and have irrevocably agreed and consented to these provisions. The enforceability of similar choice of forum provisions in other companies’ charter documents has been challenged in legal proceedings. It is possible that a court could find this type of provision to be inapplicable or unenforceable, and if a court were to find this provision in our Articles to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving the dispute in other jurisdictions, which could have a material adverse effect on our financial condition and/or results of operations.
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Anti-takeover provisions in our organizational documents and Cayman Islands law may discourage or prevent a change of control, even if an acquisition would be beneficial to our shareholders, which could depress the price of our ordinary shares and prevent attempts by our shareholders to replace or remove our current management.
Our Articles contain provisions that may discourage unsolicited takeover proposals that shareholders may consider to be in their best interests. Our board of directors has the ability to designate the terms of and issue preferred shares without shareholder approval. In addition, Board vacancies may be filled by an affirmative vote of the remaining Board members. The directors are divided into three classes designated as Class I, Class II and Class III, respectively. At the annual general meeting of shareholders to be held for the fiscal year ending December 31, 2025 (“the 2025 AGM”), the term of the Class I Directors, the Class II Directors and the Class III Directors shall expire and the Class I Directors, Class II Directors and the Class III Directors appointed at the 2025 AGM shall be elected for a term that shall expire at the next succeeding annual general meeting, following which, the Board shall no longer be classified. A Director whose term has expired may be reappointed in accordance with the terms of the Articles. Our Articles provide that a director may be removed, among other things, by an ordinary resolution of the shareholders (provided that no more than four directors in aggregate may be removed pursuant to that provision in any given period between annual general meetings as described in the Articles) or for “cause” (as defined therein) by notice from not less than 75% of the directors then in office. These provisions may make it more difficult to remove directors. Our Articles contain a prohibition on business combinations with any “interested” shareholder for a period of three years after such person becomes an interested shareholder unless (1) there is advance approval of our Board, (2) the interested shareholder owns at least 85% of our voting shares at the time the business combination commences or (3) the combination is approved by shareholders holding at least two-thirds of the votes attaching to the ordinary shares that are not held by the interested shareholder.
Taken together, these provisions may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our ordinary shares.
There may be difficulties in enforcing foreign judgments against our management or us.
Certain of our directors and management and certain of the other parties named in this Annual Report reside outside the United States. Most of our assets and such persons’ assets are located outside the United States. As a result, it may be difficult or impossible for investors to effect service of process upon us within the United States or other jurisdictions, including judgments predicated upon the civil liability provisions of the federal securities laws of the United States.
In particular, investors should be aware that there is uncertainty as to whether the courts of the Cayman Islands or any other applicable jurisdictions would recognize and enforce judgments of U.S. courts obtained against us or our directors or management predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States or entertain original actions brought in the Cayman Islands or any other applicable jurisdictions courts against us or our directors or officers predicated upon the securities laws of the United States or any state in the United States.
If securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our ordinary shares adversely, the price and trading volume of our ordinary shares could decline.
The trading market for our ordinary shares is influenced by the research and reports that industry or securities analysts publish about us, our business, our market or our competitors. If any of the analysts who cover us or may cover us in the future change their recommendation or price targets regarding our ordinary shares adversely, or provide more favorable relative recommendations about our competitors, the price of our ordinary shares could decline. If any analyst who covers us or may cover us in the future were to cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause the price or trading volume of our ordinary shares to decline.
Item 4. Information on the Company.
A. History and Development of the Company
IHS Holding Limited was originally incorporated in the Republic of Mauritius as a private company limited by shares on July 26, 2012 under the Mauritian Companies Act 2001. On October 13, 2021, IHS Holding Limited ceased to be incorporated in the Republic of Mauritius and was incorporated and registered by way of continuation as an exempted company with limited liability under the Companies Act (as amended) of the Cayman Islands.
Our legal name is IHS Holding Limited and our commercial name is IHS Towers. Our principal executive offices are located at 1 Cathedral Piazza, 123 Victoria Street, London SW1E 5BP, United Kingdom. Our telephone number at this address is +44 20 8106 1600.
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Our website address is www.ihstowers.com. The information contained on, or that can be accessed through, our website is not a part of, and shall not be incorporated by reference into, this Annual Report. We have included our website address as an inactive textual reference only. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers, such as we, that file electronically, with the SEC at www.sec.gov.
For a description of our principal capital expenditures and divestitures for the three years ended December 31, 2024 and for those currently in progress, see Item 5. “Operating and Financial Review and Prospects.”
B. Business Overview
We are one of the largest independent owners, operators and developers of shared communications infrastructure in the world, providing our customers, most of whom are leading MNOs, with critical infrastructure that facilitates mobile communications coverage and connectivity for approximately 644 million people in emerging markets, across two regions and eight countries. We are the largest independent multinational emerging-market-only tower operator and one of the largest independent multinational tower operators globally, in each case by tower count. As of December 31, 2024, we operated 39,229 Towers across six countries in Africa and two countries in Latin America. As of December 31, 2024, we are the largest independent tower operator in six of the eight markets in which we operate, and we are the only independent tower operator of scale in four of these markets.
We have a well-defined organic and inorganic expansion strategy designed to grow in existing markets with our existing and new customers and, given the significant global emerging market opportunities in communications infrastructure, we have historically entered into carefully selected growth-oriented markets with compelling underlying fundamentals. Since 2020, we have complemented our historical investment on the African continent with investments into other regions and adjacent communications infrastructure offerings. We expanded our footprint with our entrance into Latin America via Brazil, Colombia and Peru (which we later disposed of in April 2024 when we completed the disposal of our subsidiary in Peru, IHS Peru S.A.C., to affiliates of SBA Communications Corporation), and into the Middle East via Kuwait, (which we also later sold in December 2024 when we completed the sale of our subsidiary in Kuwait, IHS Kuwait, to Zain Group). Each of these acquisitions supported our inorganic growth strategy of expanding into additional regions that met our investment criteria, which opened up new markets that we believed would provide future organic and inorganic growth opportunities. Our investment criteria suggests that inorganic growth opportunities will be limited for the foreseeable future, as we assess inorganic investment as just one of various forms of capital allocation.
Largest Independent Multinational Tower Companies Globally
Source: Company filings
Note: Tower Count as of December 31, 2024 for ATC, Cellnex, GD Towers, IHS, SBA, PTI and Helios. “ATC” refers to American Tower Corporation, “Cellnex” refers to Cellnex Telecom S.A., “SBA” refers to SBA Communications Corporation, “PTI” refers to Phoenix Towers International and “Helios” refers to Helios Towers plc.
For the years ended December 31, 2024 and 2023, we generated revenue of $1,711 million and $2,126 million, losses for the period of $1,644 million and $1,988 million and Adjusted EBITDA of $928 million and $1,133 million, respectively. See Item 5.A.
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“Operating Results—Key Financial and Operational Performance Indicators—Return Adjusted EBITDA” for a reconciliation of Adjusted EBITDA to income/(loss) for the period, the most directly comparable IFRS measure.
Our core business is providing shared communications infrastructure services to MNOs and other customers, who in turn provide wireless voice, data and fiber services to their end users and subscribers. We provide our customers with opportunities to lease space on existing Towers alongside current Tenants, known as Colocation, to install additional equipment on a Tower or request certain ancillary services, known as Lease Amendments, or to commission the construction of new Towers to the customer’s specifications, known as New Sites. Additionally, through I-Systems, we provide “Fiber-to-the-Home” or “FTTH” fiber connectivity to our customers through a neutral network infrastructure solution for broadband service, and in Nigeria we provide “Fiber-to-the-Tower” or “FTTT” connectivity to our customers. Finally, we lease space to our customers in secure locations within large building complexes, such as shopping malls, stadiums and airports, which we refer to as in-building solutions or distributed antenna systems (“DAS”). In certain strategic instances, we may also provide Managed Services, such as maintenance, security and power supply for Towers owned by third parties. As of December 31, 2024, our owned and operated tower portfolio supported 59,343 Tenants, with a Colocation Rate of 1.51x.
Our primary customers are the leading MNOs in each of our markets. We also provide infrastructure and services to a number of other communications service providers. To support the communications infrastructure needs of our customers, we typically enter into long-term MLAs of 5 to 10 years in duration, which have historically yielded strong renewal rates (see also. “Risk Factors — Risks Relating to Our Business — A significant portion of our revenue is derived from a number of MNOs. Non-performance under or termination, non-renewal or material modification of customer lease agreements with these customers could have a material adverse effect on our business, prospects, financial condition and/or results of operations”). As of December 31, 2024, the average remaining length of our MLAs with our Key Customers, who represented 93% of our Tenants, was 7.0 years. Additionally, these Key Customers had aggregate Contracted Revenue of $11.9 billion and an average remaining lease term of 7.8 years. Since the start of 2023, renewed or extended contracts that cover approximately 72% of 2024 revenue.
Our MLAs typically include annual or semi-annual inflation-linked revenue escalators, limited customer termination rights and, in certain cases, provisions designed to help mitigate foreign exchange risk, such periodic reset mechanisms to adjust for local currency devaluation. We also benefit from power indexation and power pass-through clauses in some of our MLAs, which are intended to help mitigate against increases in diesel and electricity prices. For the years ended December 31, 2024, 2023 and 2022, 47%, 49% and 52%, respectively, of our revenue was linked to the U.S. dollar and euro. For the years ended December 31, 2024, 2023, and 2022, 15%, 13%, and 10%, respectively, of our revenue was linked to power indexation and power pass-through.
Our U.S. dollar-linked revenue is denominated in U.S. dollars in the relevant MLAs, but paid to us in local currency through contractual mechanisms. In such cases, including in Nigeria, Rwanda and Zambia, our MLAs may contain a formula for periodically determining the U.S. dollar to local currency exchange rate. In other cases, such as Côte d’Ivoire and Cameroon, the MLAs are in local currencies that have a fixed exchange rate, or are “pegged”, to the euro. Our South Africa market and Latam segments have MLAs which typically only contain local currency lease fees.
We have historically increased the number of our owned and operated Towers through a combination of constructing New Sites, as well as through acquisitions of tower portfolios from MNOs and independent tower companies. Shortly after entering new markets through acquisitions, we typically begin constructing New Sites.
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IHS Towers Overview by Country
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|
|
|
|
|
Market Share |
||||||
|
|
|
|
|
|
|
|
Estimated |
|
Estimated |
|
|
|
|
|
|
# of IHS |
|
# of IHS |
|
Outsourced |
|
Total |
|
|
|
|
2023 |
|
Towers |
|
Towers |
|
Towers |
|
Towers |
|
|
|
|
Population |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
|
IHS Towers |
Country |
|
(millions) |
|
2024 |
|
2023 |
|
2023 |
|
2023 |
|
Market Position |
Nigeria |
|
226 |
|
16,495 |
|
16,395 |
|
25,601 |
|
41,579 |
|
#1 |
South Africa |
|
61 |
|
5,693 |
|
5,691 |
|
11,367 |
|
25,721 |
|
#1 |
Côte d’Ivoire |
|
29 |
|
2,682 |
|
2,694 |
|
2,694 |
|
5,170 |
|
#1 |
Cameroon |
|
29 |
|
2,443 |
|
2,358 |
|
2,358 |
|
4,188 |
|
#1 |
Zambia |
|
21 |
|
1,875 |
|
1,879 |
|
1,879 |
|
3,737 |
|
#1 |
Rwanda |
|
14 |
|
1,462 |
|
1,434 |
|
1,534 |
|
2,099 |
|
#1 |
Brazil |
|
211 |
|
8,326 |
|
7,663 |
|
61,590 |
|
76,461 |
|
#4 |
Colombia |
|
52 |
|
253 |
|
228 |
|
10,574 |
|
21,087 |
|
not meaningful |
Peru |
|
n/a |
|
n/a |
|
61 |
|
n/a |
|
n/a |
|
n/a |
Kuwait |
|
n/a |
|
n/a |
|
1,672 |
|
n/a |
|
n/a |
|
n/a |
Total |
|
644 |
|
39,229 |
|
40,075 |
|
117,597 |
|
180,042 |
|
— |
Source: Euromonitor International Limited (Economies & Consumers data) for Population, extracted February 2024, Analysys Mason estimates and IHS. South Africa outsourced towers as of December 2023 exclude approximately 4,000 Swiftnet towers reported as of March 2024 since the sale of Swiftnet by Telkom SA SOC Limited only received regulatory approval in September 2024. Market Position of independent tower companies is based on December 31, 2023 figures as per Analysys Mason.
We believe we offer a unique balance between existing infrastructure with visible revenue streams and high potential for revenue growth given the strong growth potential in our countries, the strength of our market positions within each country and our strategically important, unique tower locations. We believe that we are well positioned to improve margins and cash flow, while achieving long-term growth due to:
| ● | a large and scalable platform that provides critical infrastructure to help drive communications activity and broader digital and economic progress; |
| ● | a long-standing and stable operational platform that consistently delivers on our service level agreements to customers with proven network reliability; |
| ● | a well-defined organic expansion strategy designed to grow in existing markets with existing and new customers, complemented when feasible with an inorganic expansion strategy designed; and |
| ● | a comprehensive commitment towards contributing to sustainability and the well-being of our communities and environments where we operate. |
Our footprint is the result of many years of building, acquiring, operating, managing, and owning communications infrastructure in emerging market environments. As one of the pioneers of the tower infrastructure industry in Africa, we have worked with our customers to develop the experience needed to operate and grow a successful business in our sector. Our experience has provided us with years of insight, deep operational expertise, and strong relationships with various stakeholders that we believe will allow us to enhance our leadership position in existing and new markets.
We believe that the underlying communications trends in our markets will continue to drive the need for additional infrastructure and enable us to further augment our growth through continued Colocation, Lease Amendments, New Site construction, adjacent communications infrastructure investments such as fiber, and acquisition activity. New communications infrastructure services such as small cells will further add to our growth opportunities with the roll-out of 5G in some of our markets. As of December 31, 2024, with an average age of our tower portfolio of 7.9 years, based on the date of integration of the sites, and a Colocation Rate of 1.51x, we believe that we have a young portfolio with ample capacity to continue growing organically, as well as to realize further gains on operating margins from operational efficiencies.
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We believe this organic growth will help drive enhanced cash flow generation from our existing assets.
Considering our historical growth and diversification, the table below presents our geographic segment revenue as a percentage of total revenue, for the periods indicated:
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|
As of December 31, |
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|
|
2022 |
|
2023 |
|
2024 |
|
Geographic Segment |
|
|
|
|
|
|
|
Nigeria |
|
69.0 |
% |
65.0 |
% |
58.3 |
% |
SSA |
|
21.0 |
% |
23.7 |
% |
28.3 |
% |
Latin America |
|
8.2 |
% |
9.4 |
% |
10.8 |
% |
Middle East and North Africa |
|
1.8 |
% |
1.9 |
% |
2.6 |
% |
For further discussion regarding the principal markets in which we compete, including a breakdown of total revenue by category of activity and geographic market, please refer to note 5 “Segment Reporting” and note 6 “Revenue” of our audited consolidated financial statements included in this Annual Report.
Our Competitive Strengths
We believe the following strengths position us to deliver operationally for our customers as well as generate strong financial returns and growth:
We are a clear leader in the majority of our current markets, which we support with a high-quality asset base and service.
Large and Growing Telecommunications Markets. We believe the markets in which we currently operate are structurally favorable, as a result of having large, growing populations and low mobile penetration, particularly relating to 4G and 5G SIM penetration. Our eight markets covered approximately 727 million SIMs as of December 31, 2023. Our African markets are generally characterized by low mobile penetration, and a high number of subscribers per tower compared with the U.S. and Western Europe. These markets are also attractive due to an increasing need for 3G and 4G coverage and capacity, with 55% 3G SIM penetration and 31% 4G SIM penetration as of December 31, 2023. Over the longer term, we also expect 5G technology to become more meaningful in these markets. To meet the anticipated telecommunications growth in our African markets, respectively, it is expected that these markets will require over 21,000 new towers and over 98,000 new points of service over the period December 2023 to December 2028. We believe that our Latin America markets also provide exposure to growth and technology trends. It is estimated that these markets will require over 21,000 new towers and over 100,000 new points of service over the period from December 2023 to December 2028. As telecommunication networks in our markets evolve, we believe that there may also be increasing demand for other communications infrastructure, such as fiber connectivity and data centers.
Significant Market Scale. We are the number one independent tower operator in six of our eight markets as of December 31, 2024. As of December 31, 2023, we had an estimated 64% and 50% market share of independently owned or operated sites in Nigeria and South Africa (the sale of Swiftnet by Telkom SA had only received regulatory approval as of September 2024 and is therefore excluded) respectively, which are two of the largest telecommunications markets in Africa by subscribers. In addition, as of December 31, 2024, we are the only independent tower operator of scale in four of our eight markets and we are the largest independent tower operator in Africa, measured by tower count.
As a leader in many of our markets, we benefit from operational efficiencies that help drive financial performance. We have strategically acquired multiple tower portfolios in each of our African markets and have selectively consolidated Towers, where we move Tenants from one Tower to another, to reduce costs. Follow-on transactions in new markets are an important element of our inorganic growth strategy, and we have reinforced our position in our markets, completing follow-on transactions in each of our African markets (excluding South Africa), as well as Brazil and Colombia. We own or operate approximately 37% of all Towers (67% of independent Towers) in our combined African markets as of December 31, 2023 and therefore benefit when MNOs invest in additional coverage and capacity, either on our existing sites or through the share of new sites we deliver in the market. We believe our scale and market position gives us a unique opportunity to increase our revenue per tower through Colocation and Lease Amendments as MNOs upgrade their networks from 2G and 3G to 4G and 5G.
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Substantial and Defensible Market Share. Given the size and scale of our business and our track record of growth and service to our customers, we believe we are well positioned to maintain or even grow our market share. Our market position is backed by long-term contracts that we have a history of successfully maintaining. For the period covering 2022, 2023 and 2024, we have added 12,929 Tenants, 12,547 Lease Amendments and constructed 3,442 New Sites. As of December 31, 2024, we had built over 10,800 New Sites since our inception. We continue to provide quality service and take a partnership approach with our customers in radio frequency planning. We also benefit from high barriers to entry in our industry, including the capital-intensive nature of building new tower portfolios and, in certain instances, zoning rules that restrict Towers and masts from being built within a certain radius of each other. We believe these factors underpin the strength of our market leadership and position us to take advantage of opportunities in our markets.
We have a proven business model with high quality revenue visibility that is backed by long-term, inflation-linked contracts.
Proven business model coupled with recurring revenue and long-term contracts. We offer MNOs reliable services in exchange for monthly lease fees that are underpinned by long-term contracts, creating long-term revenue visibility. For MNOs, there are high costs and potential service interruptions associated with switching tower infrastructure and, historically, we have had a track record of successfully renegotiating and extending our contracts with MNOs, including with Key Customers in our African markets during 2023 and 2024 (see also “Risk Factors — Risks Relating to Our Business — A significant portion of our revenue is derived from a small number of MNOs. Non-performance under or termination, non-renewal or material modification of customer lease agreements with these customers could have a material adverse effect on our business, prospects, financial condition and/or results of operations.”). As of December 31, 2024, we had $11.9 billion of Contracted Revenue from our Key Customers, an average remaining lease term of 7.8 years and an average remaining length of our MLAs of 7.0 years. In many cases, our contracts also include limited customer termination rights, inflation-linked revenue escalators and power indexation and pass-through clauses to mitigate against certain increases in diesel prices and electricity costs. In certain cases, our contracts also include provisions designed to mitigate foreign exchange risk, such as periodic reset mechanisms to adjust for local currency devaluations.
The majority of our revenue comes from MNOs that are subsidiaries of large, publicly listed multinational MNOs. Our Key Customers are primarily the country subsidiaries of publicly listed multinational MNOs such as MTN Group, Airtel Africa, Orange Group, Telecom Italia, America Movil, Telefonica, and Millicom.
Structurally favorable unit economics. The limited competing infrastructure in the vicinity of our Towers helps enable strong demand from existing customers and positions our Towers as the preferred location for potential new demand. Time to market advantages for New Site construction, cost-to-build considerations and in some cases, regulatory restrictions create natural and high barriers to entry into our markets. We are able to achieve favorable unit economics through additional Tenants and Lease Amendments via Colocation that allow us to improve our margins and our return on invested capital. When we add additional Tenants via Colocation, we generally incur limited incremental costs and typically do not provide additional tenant discounts. We also have the ability to reduce certain of our costs per Tenant, which are mostly fixed, with the exception of power costs in our African markets, which are variable. With a Colocation Rate of 1.51x across our portfolio as of December 31, 2024, our sites have the capacity to add additional Tenants.
We have contractual protections against macroeconomic volatility. For the years ended December 31, 2024, 2023 and 2022, 47%, 49%, and 52% respectively, of our revenue was linked to the U.S. dollar and euro. For the years ended December 31, 2024, 2023 and 2022, 15%, 10% and 8% respectively, of our revenue was linked to power indexation and power pass-through. Most of our operating costs are in local currency, and we have structured our contracts to provide certain protections against inflation and, in some cases, local currency devaluation and energy price volatility.
Our MLAs in our Latam segment have local currency lease fees with annual inflation linked escalators. In our SSA and Nigeria segments the local currency components of our lease fees typically adjust with local currency linked inflation provisions and U.S. dollar components of our lease fees present in some of our African market MLAs typically adjust with U.S.-linked inflation provisions. The majority of our costs do not have mechanical indexation, enabling us to both grow our revenue and manage our cost base. Historically, the cost of diesel was mostly paid in U.S. dollars, but in 2024 our diesel expenses were largely incurred and paid in local currency, aligning with our remaining direct and indirect operating expenses which are denominated in and incurred in local currency. Capital expenditures may be linked to U.S. dollars in some instances, but are also incurred in local currency, providing further resilience to macroeconomic volatility.
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We have a track record of both organic and inorganic growth.
We have a number of organic growth opportunities. There are a number of avenues that have driven our historical organic growth and that we believe will continue to drive future organic growth, including Colocation, Lease Amendments and New Sites. These opportunities are typically the result of our customers looking to densify their networks, improve their network coverage and capacity and upgrade their networks with new technologies, in response to growing populations and data demand from end users in our markets. Our MLAs also typically include annual or semi-annual inflation-linked escalations, ensuring contractual increases to revenue.
In response to these growing needs, we benefit from customers choosing Colocation in order to get to market quickly on an existing site of ours. Colocations are a highly attractive opportunity as they enable us to lease-up our existing assets with minimal incremental capital expenditure and operating expenses required. As of December 31, 2024, 2023, and 2022, we achieved a Colocation Rate of 1.51x, 1.49x and 1.48x, respectively. When we acquire towers from mobile operators, these typically have a low Colocation Rate that reduces our overall Colocation Rate, but at the same time these towers result in a further Colocation opportunity for our other customers.
Lease Amendments represent an opportunity for existing Tenants to enhance their existing position or upgrade technology at a Tower by installing additional equipment on that Tower or requesting certain ancillary services. For the years ended December 31, 2024, 2023 and 2022, we added 3,068, 4,929, and 4,550 Lease Amendments, respectively. Colocation and Lease Amendments both support our growth and increase our operating leverage.
We typically construct New Sites after obtaining a commitment for a long-term lease with an initial tenant and, in general, if we are aware of, or believe there is, commercial potential for Colocation. Since our inception up until December 31, 2024, we have built over 10,800 New Sites. For the years ended December 31, 2024, 2023 and 2022, we built 929, 1,329, and 1,184 New Sites, respectively.
We also benefit from the opportunity to generate revenue from adjacent services, including fiber, DAS, small cells and data centers. In terms of fiber services, through I-Systems, we provide FTTH connectivity to our customers through a neutral network infrastructure solution for broadband service, and in Nigeria we provide FTTT connectivity to our customers. These opportunities do not constitute a material contribution to our revenue today, although we look to continue to expand these opportunities as an area of growth in the future, particularly in Brazil, Nigeria, South Africa and Zambia, where 5G roll-out has already commenced.
We have a track record of inorganic growth through acquiring, consolidating and integrating tower portfolios. Since our inception, we have completed 22 transactions for more than 32,500 Towers and fiber assets across 10 countries. These transactions have enabled us to achieve our strong in-market positioning, which is key to both our ability to provide high quality services and to ensure the sustainability of the fundamentals of our business.
Our inorganic growth strategy has focused on entering carefully selected growth-oriented markets with compelling underlying fundamentals, when feasible. A key component of this inorganic growth lies in our strategy to then develop each of the markets that we enter. We aim to execute follow-on, in-market transactions upon entering a new market, in order to solidify our presence as well as extract cost synergies from our operational platform across our large asset base. In addition to building our market presence, this strategy has allowed us to better service our customers through our extensive platform.
We have an established history of delivering high quality service to our customers.
We have long-term relationships with leading MNOs. For most of our Key Customers, our sites are the primary tower infrastructure that supports their operations, making us a key long-term partner to them. Through these partnerships, we have developed deep ties with our customers’ key decision makers. See also, “Risk Factors — Risks Relating to Our Business — A significant portion of our revenue is derived from a small number of MNOs. Non-performance under or termination, non-renewal or material modification of customer lease agreements with these customers could have a material adverse effect on our business, prospects, financial condition and/or results of operations.”
We have a long track record of delivering quality service to MNOs through deeply integrated relationships. Our customers entrust us with this critical infrastructure in part due to our proven record.
For example, in our African businesses, we had average power uptimes of 99.5% (excluding South Africa as we no longer provide power Managed Services for those sites) and average time to repair of under two hours for the year ended December 31, 2024.
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In our African businesses, our innovative power availability solutions are a critical component of our quality of service offering in our current markets, that lack a robust power grid.
We have a modern and efficient global operational management platform. We have differentiated ourselves from our tower competitors over time through our advanced network operating centers (“NOCs”) in our African businesses, with bespoke remote monitoring at 81% of sites covered by our NOCs as of December 31, 2024 (with monitoring of almost all remaining sites through MNO network operating centers), site acquisition and maintenance teams, and a network of partners in the fields of security, power management equipment, site deployment / construction and diesel supply. Our NOCs operate 24 hours a day, seven days a week and monitor a variety of data sent from our Towers. Such data include access and gate status, diesel supply, usage and quality, cabinet temperature and overall power uptime, consumption and supply. We have demonstrated significant uptime improvement in the sites that we have purchased and enabled improved quality of service levels across our portfolio. Given the current operating environment in Latin America with limited service level agreement obligations (such as power uptime or average time to repair) to customers, our businesses in Brazil and Colombia generally do not require NOCs or remote monitoring services.
We have a track record of resilience to volatility.
We have a track record of significantly mitigating the impact of macro-economic volatility on our business, including in relation to foreign exchange rates. Despite the Nigerian Naira (₦) devaluations and the historic economic slowdowns in Nigeria, with real GDP growth at 3.4%, 2.7% and 3.1% for 2024, 2023 and 2022, respectively, we believe we have significantly mitigated the impact on our revenue and segment Adjusted EBITDA for our Nigeria segment during those same periods. Revenue for our Nigeria segment decreased 27.7%, but increased 2.2% and 17.9% for the years ended December 31, 2024, 2023 and 2022, compared to the years ended December 31, 2023, 2022 and 2021, respectively, and segment Adjusted EBITDA for our Nigeria segment decreased by 31.3%, but increased 6.5% and 2.5% over the same periods, despite the Naira depreciating 72.4% from an average rate of ₦410.2 to $1.00 for the year ended December 31, 2021 to an average rate of ₦1,484.3 to $1.00 for the year ended December 31, 2024. In particular, the Naira depreciated 57.0% from an average rate of ₦638.0 to $1.00 for the year ended December 31, 2023 to an average rate of ₦1,484.3 to $1.00 for the year ended December 31, 2024. Despite this significant 57.0% devaluation of the Naira in the year ended December 31, 2024 compared to the year ended December 31, 2023, our revenue decreased 27.7% year-over-year during the same period as foreign exchange resets in our MLAs helped to mitigate the impact of this devaluation on our business.
We have a disciplined capital allocation policy. We employ a prudent approach to discretionary capital allocation. We have a strong focus on maintaining a healthy capital structure through a mix of debt and equity financing. As of December 31, 2024 we had $3.9 billion of debt and lease liabilities under IFRS 16 Leases (“IFRS 16”) and $578 million of cash on our balance sheet. We continue to maintain a prudent approach to leverage, which we believe provides us with strong flexibility to evaluate future investment opportunities and other potential capital allocation alternatives, such as debt and/or equity repurchase programs or divestitures.
We have a founder-led, experienced management team with a differentiated operational skillset and track record, supported by committed, seasoned investors.
Our executive team is led by our founders and other seasoned senior executives with strong relevant experience. Our founders remain in lead executive positions and are deeply involved in day-to-day operations, strategy and leadership. We have a highly experienced management team with a track record of delivering operational performance and strategic growth for our business. With a background in site construction, site management as well as site operation, our management team has experience across the full communications infrastructure value chain. We have added to our leadership team over the years, and together, our management team has deep experience in both developed and emerging markets, towers, telecommunications, finance, governance and mergers and acquisitions. In addition to a strong executive management team, we have developed a seasoned team of in-country managers that help run the day-to-day operations, manage local relationships and expand effectively into new markets.
Our governance and control frameworks underpin our dedication to operational best practices. Since our inception in 2001, we have aimed to establish a rigorous framework, which includes a focus on corporate governance, ethics, environment and sustainability and risk management policies and a platform that combines the strong fundamentals of the communications infrastructure business with attractive long-term growth potential. We review our governance and control frameworks from time to time, which we expect will continue to develop as a result of our continued evolution as a public company and as a result of engagement with investors and stakeholders from time to time.
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We have implemented governance practices at the board of directors and executive levels, including various Board committees (See “Management — Board Committee Composition”) and underlying internal committees such as those focused on ethics and risk management. We have nine directors, eight of whom are independent directors, on our board of directors. We have also developed an ethical compliance framework aligned with converging best practice methodologies.
Our Strategy
Since our inception in 2001, we have established a reputation as a leader in the high growth, emerging market communications infrastructure sector, servicing MNOs and ultimately the growing end- consumer market with critical communications infrastructure, which also benefits the broader communities in our markets through enabling accelerated access to communications. Through the growth of 2G, 3G, 4G and 5G, we have helped the MNOs in our markets provide services to subscribers by owning, operating, sharing and constructing communications infrastructure.
We are pursuing the following key strategies to grow our cash flow and continue to take advantage of our competitive strengths:
Increase revenue, improve margins and grow cash flows by maximizing the use of our existing assets and driving organic growth through Colocation, Lease Amendments and New Sites or other communications infrastructure
Our primary strategy is to expand our revenue-generating asset base and improve utilization on new and existing Towers and other communications infrastructure. We aim to drive organic revenue growth and cash flow generation through Colocation, Lease Amendments, contractual lease fee escalations and New Site or other communications infrastructure construction. In addition, we believe strong operating leverage and initiatives, such as selective decommissioning, will help us drive margins and increase cash flows. Moreover, there may be opportunities to expand FTTH fiber services in Brazil and FTTT fiber connectivity services in Nigeria. As our customers roll-out 5G services, we believe these fiber services, as well as existing services such as DAS and small cells and potentially data centers, will likely increase in prevalence, and will become a core component to our growth thesis.
Seek attractive rates of return and realizations through disciplined organic capital allocation and activity
When feasible, we intend to continue investing capital seeking attractive rates of return. We pursue carefully selected strategies, including New Site or other communications infrastructure construction and selective decommissioning, and have a strong track record of delivering value-enhancing incremental investments that have helped grow our asset base, secure our market leading positions and provide the scale and market share necessary to sustain our growth. We assess acquisition, investment and divestment opportunities using our (i) country attractiveness framework, (ii) strategic importance analysis and (iii) investment appraisal methodologies.
We also announced, in March 2024, that we were undertaking a strategic review process, which includes evaluation of our organizational initiatives, plans and goals to try to ensure they align with our long-term objectives and external environment conditions, and targeted at shareholder value-creation options.
While the review remains ongoing and further initiatives to continue increasing shareholder value may be considered, the initial part of the review so far includes, but is not limited to, initiatives around making commercial progress through contract renewals and extensions, potential further governance improvements, increasing Adjusted EBITDA and cash flow generation, disposal of certain assets or markets, and actively pursuing initiatives to extend maturities, manage interest expense and shift more debt into local currency. It is currently expected that excess cash flow following implementation of these strategic initiatives would primarily be utilized to reduce debt, although we may also consider other uses, including potentially share buybacks and/or introducing a dividend policy.
In existing and new markets, we seek attractive communications infrastructure opportunities with contractual agreements that aim to maximize returns on our investments. We also seek balanced communications market dynamics with service and technology growth opportunities and demand for communications infrastructure services. We consider markets attractive if we believe we can achieve significant scale, and even more so, if we can leverage relationships with multi-national MNOs with whom we may have existing relationships in other markets. If we deem a market attractive, we aim to apply our disciplined approach to organic and potentially inorganic capital allocation, establish a path to scale, gain market leadership within that country or more broadly within that region and diversify our overall portfolio by market and by customer. In contrast, we avoid markets which do not offer chances for meaningful scale or ones that we do not believe have the right fundamental drivers to support our growth strategy.
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In addition to acquiring tower portfolios or seeking to consolidate existing tower companies, we also see the potential for new and related services that will help enhance our value proposition to our customers, reduce their capital expenditure, stabilize their operating costs, help improve their quality of service and enable faster deployment of their networks. We expect to continue to generate cash flows from newly developed service propositions, such as our FTTH and FTTT fiber infrastructure services, where we see significant potential in our markets. We will continually consider opportunities to expand our offering beyond the current infrastructure services, which support MNOs in their intention to build 4G and 5G enabled networks of the future, notably with small cells in urban areas and DAS. We believe that there are opportunities to expand the types of infrastructure partnerships that we could form with our customers, such as investments in Internet-of-Things or edge computing, which could fall within our investment criteria, our infrastructure focus and our business model. We are committed to anticipating and responding to new technology trends and evolving customer needs.
Our investment appraisal of organic and inorganic opportunities includes targeting long term financial metrics to form the basis of our investment appraisal as well as assessing inorganic opportunities for individual strategic merit. In addition, we remain open to potential divestments that align with our capital allocation policy and meet our return-on-investment requirements.
Continued focus on operational excellence, service delivery for customers and adopting an innovative approach to new technology
We plan to continue delivering high levels of performance to our customers in terms of site power availability, site access, equipment monitoring and servicing. We have done this consistently for years and we are increasingly looking to leverage new technology such as artificial intelligence (“AI”), albeit in early stages, to expand the scope of how we monitor and improve the sites while reducing our dependence on diesel-powered generators. Our extensive use of alternative power solutions in our African markets also helps reduce our operating costs and is more environmentally friendly given the reduction in diesel consumption that these solutions deliver. We will also look to leverage this expertise in other markets in which we operate where services such as power or site monitoring may be requested from customers in the future.
In support of these goals, in 2022, we published our Carbon Reduction Roadmap which provided a comprehensive strategy for decreasing our emissions, including a goal to reduce the Scope 1 and Scope 2 kilowatt-hour emissions intensity of our tower portfolio by 50% by 2030, using 2021 emissions data as the baseline. Under Project Green, a significant step in our Carbon Reduction Roadmap, we expect to achieve emissions and financial savings by connecting more sites to the electricity grid and via the deployment and integration of battery storage and solar panel solutions. In scope for Project Green are our operations in Cameroon, Côte d’Ivoire, Nigeria, Rwanda, and Zambia.
Enhancing our impact on our communities and on the environment
Our business model is designed to be more sustainable than various alternatives given we promote infrastructure sharing, drive connectivity across our markets and have invested in hybrid power solutions that reduce operational greenhouse gas (“GHG”) emissions. Additionally, we continuously aim to improve and develop our Sustainability strategy, which focuses on four pillars: (i) environment and climate change; (ii) education and economic growth; (iii) our people and communities; and (iv) ethics and governance. By supporting local schools, education initiatives, health clinics and wider programs, such as improving rural telephony, we seek to make a positive impact in the communities in which we operate and further contribute to the growth and development of our markets.
IHS Towers is a UN Global Compact signatory and is committed to adhering to the “Ten Principles” of the UN Global Compact relating to human rights, labor standards, environment and corruption. We believe that our sustainability programs contribute to nine of the 17 United Nations Sustainable Development Goals, or UN SDGs. Each of these goals feeds into our four-pillar sustainability strategy, which guides our everyday performance and underpins our business.
The impact of our Sustainability strategy continues to be recognized externally. In 2024, IHS Nigeria won in the Telecoms Infrastructure Provider of the Year, Tower Leadership Award, and Telecoms Infrastructure Team of the Year categories at the 2024 Tech Innovation Awards. In addition to receiving the Best Company in Water and Sanitation award at the 2024 Sustainability, Enterprise, and Responsibility Awards Africa CSR and Sustainability Awards. IHS Cameroon received the Tower Initiative of the Year award at the 2024 Africa Digital Economy Awards, and Best Company in Leading Innovative Digital Transformation for Community Progress in Cameroon at the African Economic Agency.
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Our Tower Portfolio
Our Tower Portfolio
Size of portfolio
As of December 31, 2024, we had a portfolio of 35,238 owned Towers and 3,991 Towers that we operate under MLL and ROU arrangements totaling 39,229 Towers owned and operated. With 59,343 Tenants as of December 31, 2024, we had a Colocation Rate of 1.51x. Additionally, as of December 31, 2024, we had 39,671 Lease Amendments. We have historically increased the number of our Towers through a combination of constructing New Sites, along with the acquisition of site portfolios from MNOs and from independent tower companies, namely HTN Towers, CSS, Skysites, Centennial, and GTS SP5.
In connection with the acquisition of multiple portfolios of Towers and in other circumstances, we have also rationalized our portfolio through decommissioning, including the ongoing rationalization program agreed with a Key Customer in Nigeria. Where economically and commercially viable to do so, we migrate Tenants from one Tower onto a nearby Tower as additional Colocation and then decommission the empty site. While the decommissioning of Towers offsets our overall growth in the number of Towers, it allows us to eliminate cost of sales and ongoing maintenance capital expenditures of the decommissioned tower with only a marginal cost of sales increase at our retained sites through increased power consumption.
The following table shows the evolution of our tower portfolio, which is primarily a result of acquired Towers and the construction of New Sites, for the period and as of the dates indicated (December 31, 2024 excludes Kuwait due to the Kuwait Disposal):
|
|
|
||||
|
|
As of December 31, |
||||
|
|
2022 |
|
2023 |
|
2024 |
Towers |
|
|
|
|
|
|
Total (Owned & Operated) |
|
39,652 |
|
40,075 |
|
39,229 |
Acquired in period |
|
7,849 |
|
118 |
|
- |
Built in period |
|
1,184 |
|
1,329 |
|
929 |
Tenancies and Colocation Rate
We provide our customers with opportunities to install active equipment, and receive related services, on existing Towers alongside current Tenants, known as Colocation. The Colocation Rate is the average number of Tenants per Tower that we own or operate across our portfolio at a point in time. With 59,343 Tenants as of December 31, 2024, we had a Colocation Rate of 1.51x.
Our Colocation Rate is an important metric for assessing utilization and capacity on existing Towers, as well as potential for future growth. Our Colocation Rate is a key driver of our gross margins and operating margins, as the addition of further Tenants to existing Towers increases revenue while only marginally increasing our costs (primarily power). Colocation is attractive to our customers, as it provides them with shorter deployment times for their equipment compared to New Site construction arrangements.
The following table shows the number of Tenants in our portfolio and our Colocation Rate as of the dates indicated (December 31, 2024 excludes Kuwait due to the Kuwait Disposal):
|
|
|
||||||||
|
|
As of December 31, |
||||||||
|
|
2020 |
|
2021 |
|
2022 |
|
2023 |
|
2024 |
Tenants |
|
|
|
|
|
|
|
|
|
|
Key Customers |
|
38,739 |
|
42,843 |
|
54,215 |
|
55,915 |
|
55,240 |
Other Customers |
|
4,125 |
|
3,571 |
|
4,358 |
|
3,812 |
|
4,103 |
Total |
|
42,864 |
|
46,414 |
|
58,573 |
|
59,727 |
|
59,343 |
Colocation Rate |
|
1.54x |
|
1.50x |
|
1.48x |
|
1.49x |
|
1.51x |
The Colocation Rate of our Towers is a key indicator of portfolio maturity and operational efficiency.
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Lease Amendments
In addition to Colocation, we also continue to benefit from Lease Amendments as our existing Tenants roll out new technologies or require installation of additional equipment or ancillary services on their existing sites, which includes the deployment of 3G, 4G and 5G technologies. As of December 31, 2024, our customers had deployed over 39,500 Lease Amendments to Towers across our footprint. Given the relative growth potential of the telecommunications markets in which we operate, where 3G and 4G SIM penetration are generally at a low starting base (e.g. 63% and 28%, respectively in Nigeria as of December 31, 2023), the majority of the Lease Amendments that we have added thus far are for 3G and 4G equipment added to a Tower for existing Tenants, albeit in 2024, 5G equipment made up the majority of our new Lease Amendments.
The following table shows the number of Lease Amendments in our portfolio as of the dates indicated (December 31, 2024 excludes Kuwait due to the Kuwait Disposal):
|
|
|
||||||||
|
|
As of December 31, |
||||||||
Lease Amendments |
|
2020 |
|
2021 |
|
2022 |
|
2023 |
|
2024 |
Total |
|
17,983 |
|
27,124 |
|
31,674 |
|
36,603 |
|
39,671 |
Tower Specifications
The following diagram illustrates the standard facilities located on our typical ground-based tower sites in our African markets:
The antennas, microwave dish and the active equipment inside or outside of the shelter are owned and maintained by the customers, while we own and maintain the passive infrastructure, including the mast, the shelter, the site monitoring system, and, if applicable, the diesel generator, the battery backup system or the hybrid power solutions, which include solar and battery systems.
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The site land is generally leased from a land owner or purchased by us. See “— Real Property Leases.” In Latin America and South Africa, the supply of primary power is typically the responsibility of the operators, who have either a grid connection or their own power supply for the site.
The number of antennae that a Tower can accommodate varies depending on the type of Tower (self- supporting monopole, guyed or self-supporting lattice), the height of the Tower, the nature of the services provided by such antenna and the antenna size and weight. The substantial majority of our Towers are self-supporting lattice Towers that can support a large number of antennae, which therefore enables us to market tower space to a diverse group of telecommunications providers and other customers. Ground-based Towers can typically accommodate three or more Tenants. The key criteria in determining how many Tenants the Tower can hold is the wind loading capacity of the Tower. The capacity of a single Tower can be increased by Tower strengthening and height extensions and by adding further antenna mounting poles. The structure of the Tower can be reinforced and the foundation strengthened to accommodate additional Tenants and Lease Amendments.
Our Tower portfolio consists principally of ground-based Towers. As of December 31, 2024, 60% of our Towers were between 30 and 60 meters in height, and 29% of our Towers were smaller than 30 meters, including 10% of which were rooftop sites. We build larger Towers when circumstances require, including when Towers will be located in valleys or require a greater range of transmission. As of December 31, 2024, 9% of our Towers are between 60 and 75 meters, and 3% are taller than 75 meters. As of December 31, 2024, the average age of Towers in our portfolio based on our date of integration was 7.9 years.
Operations
Our core business provides shared communications infrastructure services to MNOs, including power management, to ensure uninterrupted operation of customers’ transmission equipment. MNOs, in turn, use our tower infrastructure to provide wireless voice and data services to their end users. We lease space to customers on existing Towers alongside current Tenants, known as Colocation, as well as lease additional space for the installation of additional equipment or provide additional services to existing Tenants on Towers through Lease Amendments. We commission New Sites for construction to the MNOs’ specifications and lease space on those newly built Towers. In certain of our markets, we also provide customers with the required power for their equipment and provide FTTT services.
Colocation
Colocation is at the core of our business model as it allows us to leverage existing Towers to grow revenue and improve operating margins. We believe that our current tower portfolio and our experience of operating large portfolios of Towers, coupled with our strong customer relationships, will help us to capitalize on expected market growth and Colocation opportunities.
A typical Colocation process usually involves the following steps:
| ● | New customers typically sign an MLA, which governs our relationship with the customer. |
| ● | We work closely with our customers, sharing our updated tower portfolio location details throughout the year, and particularly during the planning phase, to maximize the number of Colocation opportunities. We also have radio frequency planning teams that work with customers with regards to the planning and optimization of their networks. |
| ● | Upon determining to lease tower space for Colocation, the customer delivers a work order requesting us to reserve specific space on a specific Tower. Once the work order has been processed and the tower space is ready for integration (typically approximately 30 days), we issue a notification to the customer, who confirms acceptance of the site. |
| ● | Under certain of our MLAs, an SLA is then signed for the commissioning of the Colocation of each specific Tower, incorporating the provisions of the MLA, and the first invoice is then submitted. |
| ● | The accrual of lease fees depends on the MLA, and usually begins approximately 30 days after notification that the site is ready for installation, or when the tenant installs or activates its equipment. |
| ● | Subsequent invoicing depends upon the particular MLA, and in most cases occurs monthly or quarterly in advance. |
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Lease Amendments
In addition to Colocation, we drive our revenue and operating margins by leasing additional space for equipment or providing certain ancillary services to existing Tenants on sites through Lease Amendments. For example, an existing Tenant may choose to request more space and/or power at the same site the Tenant is leasing, or an existing Tenant may seek to connect fiber to the Tower, which also requires the provision of additional power for that connection.
Our customers utilize different technologies, though active GSM technologies comprise the most prevalent type of technology on our Towers to date. Data demands continue to be a key factor in our markets and certain large MNOs have recently been upgrading their 4G networks and/or have already begun deploying 5G networks. These technologies require increased density for Towers and equipment, increasing the need for additional points of service and amplifying the need for Lease Amendments.
As subscriber density increases, tower operators deploy additional infill sites to deliver further capacity to areas of demand. This densification of the network is driven further by the deployment of 3G, 4G and 5G services, which are typically carried over higher frequency spectrum bands. The cell- sizes for these higher frequency bands are much smaller than, for example, a GSM 900 MHz cell, but the capacity that is delivered over a similar area is much higher and can therefore support high subscriber density and deliver higher voice and data traffic. The deployment of 3G/4G in lower frequency bands does not negate the need for densification, as it allows 3G and 4G coverage to be extended into more rural areas similar to 2G coverage. We expect MNOs in our markets to continue to service 2G, 3G and 4G technologies for many more years.
New Sites
We believe that the timely deployment of New Sites, which includes site acquisition, construction and structural and electrical engineering, has been a critical component in obtaining and completing site orders. We have extensive New Site deployment experience, having built over 10,800 New Sites and have been a major provider to the market in New Sites since 2011. The average cost to build a typical macro New Site as of December 31, 2024 is in the range of $50,000 to $100,000 in our African businesses, and in the range of $40,000 to $80,000 in our Latin America business.
New Sites constructed consist primarily of ground-based towers, but can also include in-building solutions, rooftop and wall-mounted towers and cells-on-wheels. For New Sites, we retain ownership as well as the exclusive right to collocate additional Tenants on the tower. These New Sites always begin operations with at least a single tenant, with Colocation and Lease Amendments expected at future dates. We seek to construct New Sites only in locations where Key Customers are committed to be the initial tenant with optimal additional Colocation capacity, and therefore generally aim to only build Towers for customers in locations that have the potential to attract other customers. We strive to realize the operating leverage inherent in the tower business by leasing up the New Sites with additional tenancies. In Africa (excluding South Africa), we aim to construct New Sites with the appropriate primary power systems for their location, which may include hybrid batteries and solar systems. Given the operating model in Latin America, power systems are less relevant in these markets where the provision of power is a responsibility of the customer.
The entire process from receipt of work order to completion of New Site construction as of December 31, 2024 typically takes approximately 90 to 200 days. The actual time taken and the detailed steps followed can vary depending on the country, customer, the location of the specific site and issues, if any, identified during the site acquisition process.
A typical New Site process, including additional value-added services, involves the following steps:
| ● | A new customer will sign an MLA, or have an existing MLA with the relevant optionality to roll-out New Sites, and inform the marketing unit that it requires a New Site in a certain location (usually a location within a radius of a precise coordinate, referred to as a search ring; in dense urban areas the search ring is generally within 200 meters of the coordinate but in other areas, the search ring can be up to 500 meters from the coordinate). |
| ● | Mapping specialists select the most suitable sites based on a number of factors, including (i) the proximity to central coordinates provided by the customer, (ii) appropriate terrain most suited to broadcasting of uninterrupted signals, (iii) which sites provide the most attractive property lease or purchase terms, with a preference for purchasing the land, (iv) which sites have the highest potential to be approved for aviation and environmental permits in the shortest time frame and (v) which sites may be the most viable location for additional Tenants. Final sites selected are submitted to the customer and, once approved, to our site acquisition department. |
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| ● | Once a location is accepted by the customer, we negotiate and enter into either (i) a long-term ground lease pursuant to which we acquire a leasehold interest in the property, (ii) a contract of sale pursuant to which we acquire title to the property or (iii) an easement agreement pursuant to which we acquire an easement over the property. We may also negotiate an option to purchase or lease the property in the future. Concurrent with the negotiation of appropriate property rights, we obtain a title report on the site, conduct a survey of the site, perform soil analysis of the site and obtain an environmental survey of the site (if relevant). The resultant plan is then submitted to the relevant regulatory authority for approval. We also obtain land use permits necessary to commence construction on the site or install equipment on the site. |
| ● | Upon the customer’s acceptance of the completion of the tower construction, under certain MLAs, a separate SLA is then signed for the commissioning of the individual site, which incorporates the provisions of the MLA. |
The accrual of the lease and maintenance fees generally starts at the time of the customer’s acceptance of the completion of the tower construction. Subsequent invoicing depends on the particular MLA but generally commences within 30 days of the customer’s acceptance or delivery of the site.
Decommissioning sites
Historically, we have grown our portfolio through constructing New Sites, along with the acquisition of site portfolios from MNOs and independent tower companies. As a result of acquisitions of multiple tower portfolios in the same markets, we often have multiple Towers in close proximity to each other. If it is economically and commercially viable to do so, and if agreed to by the tenant, we migrate Tenants from one Tower onto a nearby Tower as additional Colocation and then decommission the empty site. In other circumstances, we may selectively decommission sites of existing customers, including the previous rationalization program agreed with a Key Customer in Nigeria. While the decommissioning of Towers offsets our overall growth in the number of Towers, it allows us to eliminate duplicative cost of sales and ongoing maintenance capital expenditures of the decommissioned tower with only a marginal cost of sales increase at our retained sites through increased power consumption. We aim to continue working with our customers to determine if we can improve our service offerings through further decommissioning.
Site management and maintenance
We deploy a combination of in-house personnel and third-party contractors to manage and maintain our Towers. In-house personnel are responsible for oversight and supervision of all aspects of preventative and corrective maintenance and site management, including managing the operational aspects of customer relationships, managing structural engineering and tower capacity issues, ensuring proper signage, and supervision of independent contractors. We engage numerous suppliers to provide various services in connection with site acquisition, construction, access management, security and preventative and corrective maintenance of tower sites, as well as the supply of diesel to certain of our sites. As of December 31, 2024, we had entered into outsourcing arrangements for certain services in respect of 73% of our sites.
For example, we have outsourced power management, refurbishment, operations and maintenance and security functions at some of our sites to third-party contractors. These power management functions include the supply of diesel to certain sites and deployment of alternative power technologies that we configure and design, such as hybrid and solar power technologies, on certain sites, to help reduce diesel consumption to a contracted volume. Third-party contractors providing material operational services are subject to strict contractual execution targets for both financial and operational performance. By entering into these agreements, we are able to ensure the proper functioning of our sites and fix our costs by setting maximum costs per site (subject to typical inflation escalation) with the third-party contractor providing the services. In addition to the service level agreements that need to be maintained, outsourcing to contractors allows us to budget more effectively.
Site maintenance and management activities include:
Site monitoring and control
Our NOCs are 24-hour fully operational management centers from which our personnel monitor and control the tower sites from a central location. Remote monitoring systems allow us to better monitor, regulate and control site conditions, including, among other things, site AC, DC, load, power consumption per tenant, diesel usage and tank levels, environmental alarms (shelter temperatures, smoke detectors, etc.) and remote access control. We have remote monitoring systems installed in six of our markets covering 81% of our sites within these six countries (with monitoring of almost all remaining sites through MNO network operating centers). Our NOCs are operated 24 hours a day, seven days a week and monitor a variety of data sent from our Towers.
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Such data includes access and gate status, diesel supply, usage and quality, cabinet temperature and overall power uptime, consumption and supply. Given the current operating environment in Latin America and no provision of service levels to customers, our businesses in Brazil and Colombia do not require NOCs.
The activities conducted in the NOCs ensure that we provide our customers with quality service and uptimes. We have averaged a power uptime of 99.5% (excluding South Africa as we no longer provide power Managed Services for those sites) across our tower portfolio in our African markets for the year ended December 31, 2024, with an average mean time to repair of under two hours for the year ended December 31, 2024.
Security
The protection of our sites is key to ensuring the sustainability of our business. We ensure that our Towers generally have fencing and security lights and, where relevant, such as in our African markets, some of our sites are guarded by outsourced security guards. We apply rigorous access control policies at the sites and require each visitor to be pre-approved with customer representatives. Our remote monitoring systems also allow us to track all access to restricted areas on the sites.
Power and Power Management
The reliability of main grid electricity varies considerably across our footprint and determines, along with the requirements of any one site, the most appropriate power system for that site. Specifically in our African markets where there can be a lack of reliable main grid electricity supply, we currently source a substantial amount of our power needs for daily operations from a combination of diesel generators, solar panels, and deep cycle batteries. As of December 31, 2024, in our African markets (excluding South Africa as we no longer provide power Managed Services for those sites), 41% of our sites were powered with hybrid power systems (a combination of diesel generators with solar and/or battery systems), 18% with only generators, 33% with grid connectivity and back-up generators, with the remaining 8% powered through only grid connectivity or solar power and other systems. As of December 31, 2024, 9,025 of our sites in Africa, excluding South Africa, had solar power solutions, representing 36% of our African Tower portfolio (excluding South Africa). We, or third-party contractors we have engaged for certain sites, are responsible for monitoring the diesel levels of our generator tanks and scheduling diesel deliveries. Given the importance of diesel for the operation of our sites in many of our African markets, we may purchase diesel in large quantities, which is then stored at our facilities. In Latin America and South Africa, our sites are typically powered by grid solutions, with back-up power systems in certain instances.
To address the costs associated with diesel generator usage and maintenance in our African markets (excluding South Africa), we deploy as practicable hybrid battery power systems, which involve alternating between power storage sources, such as batteries (VRLA and lithium ion) and diesel generators. On certain sites, we have also switched from using 3-phase AC generators to DC generators or single-phase generators, which consume less diesel. We also deploy hybrid solar power systems on certain sites. We continuously evaluate innovative power management technologies and solutions, including more efficient generators, hybrid battery systems and solar systems. We outsource certain services, including power management and site maintenance for certain of our sites, which includes over 9,000 sites in Nigeria where we had deployed hybrid power systems, prior to Project Green. These systems use batteries and/or solar power systems, along with traditional generators, to reduce fuel costs and create a more consistent energy supply to increase network uptime for our customers. In Nigeria, the deployment of these power management solutions resulted in, on average, an approximately 50% reduction in diesel consumption per tower at the time of deployment on more than 7,400 sites where we had deployed hybrid power solutions, which included solar power.
Given the reliable grid connectivity in our Latin America markets power management is less of a focus in these markets.
Replacement and maintenance of power systems forms a significant part of our annual maintenance capital expenditures, which are in the range of $2,000 to $5,000 per Tower per year as of December 31, 2024 in our African businesses. Given the different power environment in our Latin America business, annual maintenance capital expenditures are currently less than $500 per tower per year.
Fiber Services
In certain of our markets, we have begun providing certain fiber services, including the deployment and operation of fiber access networks and infrastructure. In Brazil, through our I-Systems subsidiary, we deploy and operate a fiber infrastructure that is primarily rented to TIM Brasil (as anchor client) and other customers, for their provision of residential broadband services to consumers, FTTH. As part of the transaction that formed I-Systems, we inherited FTTC that is also being upgraded to FTTH. I-Systems is responsible for the deployment of the relevant fiber node as well as the secondary fiber network connected to that node, including the fiber drop at a consumer’s premises.
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I-Systems is also responsible for the ongoing management and maintenance of that fiber network. As of December 31, 2024, the I-Systems network covers approximately 9.3 million homes passed (of which approximately 6.4 million are FTTH) and spans approximately 22,250 route kilometers. In certain of our African markets, we also provide FTTT services, where we deploy fiber to towers that we own or operate and sell capacity to our customers to generate revenue.
Customer Lease Agreements
We lease space on Towers to our customers pursuant to a combination of MLAs, which provide the commercial terms governing the lease of tower space, MLL agreements, and individual SLAs, where relevant, which act as an appendix to the relevant MLA, and include site-specific terms for each relevant tower.
Customer lease agreements, whether long-term lease agreements, master tower space use agreements or other MLAs such as Managed with License to Lease Agreements, or MLLs, are the principal agreement between the customer and us. These govern the ongoing and long-term customer relationship and provide the commercial terms governing the lease of tower space. As of December 31, 2024, the average remaining length of our MLAs was 7.0 years. An MLA typically has an initial term of 5 to 10 years and will stay in effect until the parties renew or sign a new tower lease agreement. When we acquire portfolios of towers, we typically sign an MLA with a minimum duration of 10 years. A number of the MLAs with our customers are deemed automatically renewed if the customer does not notify us of their intention to not renew before the stated expiration date. The material commercial terms of our MLAs are typical for the tower infrastructure industry in our markets and include contractual provisions setting out, among other things, pricing, renewal clauses, termination clauses, inflation-linked price escalations and, in certain cases, provisions designed to mitigate foreign exchange risk.
In addition to the other types of MLA described above, we also operate sites owned by an MNO through Managed with License to Lease Agreements. Where there is an MLL agreement, we have the right to lease out space on the tower to other MNOs and provide services, generating further revenue for us. The site owner reduces its operating costs, eliminates capital expenditures and frees up management time.
Our MLL agreements typically have a term of 15 years and can typically be renewed for a five- year period. Our two current MLL Agreements also grant the Tenant the option to withdraw from five sites per year, not to exceed 50 sites across the full term, and provided there is no other Tenant on each site. As of December 31, 2024, the average remaining duration of our two MLL agreements was 3.5 years and the total number of Tenants on sites operated under MLL agreements is approximately 3,861.
The table below outlines collectively the typical key contract terms of our tower lease agreements with our Key Customers as of December 31, 2024:
|
|
|
|
Weighted Average |
|
|
|
|
|
|
Remaining |
|
|
|
|
|
|
Duration |
|
|
|
|
|
|
of |
|
|
|
|
|
|
Current |
|
Extension |
Country |
|
Duration of MLA |
|
Term |
|
Option |
Nigeria(1) |
|
5 – 15 years |
|
7.6 years |
|
5 years extendable terms |
South Africa(2) |
|
5 – 10 years |
|
7.9 years |
|
5 – 10 years extendable terms |
Côte d’Ivoire(3) |
|
10 – 15 years |
|
6.0 years |
|
5 years extendable terms |
Cameroon(4) |
|
10 – 15 years |
|
5.9 years |
|
10 years extendable terms |
Zambia(5) |
|
10 years |
|
4.8 years |
|
3–5 years extendable terms |
Rwanda(5) |
|
10 years |
|
7.1 years |
|
3–5 years extendable terms |
Brazil and Colombia(6) |
|
5 – 20 years |
|
6.1 years |
|
5 – 20 years on a site-by-site basis |
(1) |
In February 2024, signed and expanded a contract with Airtel Nigeria until December 2031. In August 2024 renewed and extended all tower MLAs with MTN Nigeria until December 2032. |
(2) |
In May 2024, extended contract with MTN South Africa by another 2 years, to May 2034. |
(3) |
In December 2023, we signed a contract with MTN Côte d’Ivoire until April 2033. |
(4) |
In March 2023, we signed a contract with MTN Cameroon until March 2033. |
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(5) |
In March 2024 and June 2024, signed renewals and amendments with MTN Zambia and MTN Rwanda, respectively, both until April 2034. In January 2025 signed renewal with Airtel Zambia until August 2035. |
(6) |
Includes I-Systems, with remaining MLA term weighted by OLTs. |
For the year ended December 31, 2024, 34% of our revenue was linked to the U.S. dollar, 13% of our revenue was linked to the euro and 15% of our revenue was linked to the cost of power through power indexation and power pass-through clauses.
However, the manner in which these revenues are linked differs by lease agreement. The U.S. dollar- linked contracts with U.S. dollar revenue components typically have a formula for determining the U.S. dollar to local currency exchange rate over a period of time. For example, for the majority of MLAs in Nigeria, the U.S. dollar component of the monthly lease fee is converted to Naira for settlement at a fixed conversion rate for a stated period of time. The conversion rate in such MLAs is reset after a period of one month, three months, six months or a maximum of 12 months. Of our 34% of revenue linked to the U.S. dollar for the year ended December 31, 2024, 5% reset on a monthly basis, 93% reset on a quarterly basis and 1% reset on a semi-annual basis. While we reached agreement in 2020 with our Key Customers in Nigeria to update the reference exchange rate in our contracts to the prevailing market rate available on Bloomberg (which has typically been aligned to the NAFEX and NFEM rates), historically, the conversion rates included in some of our MLAs was different to the rates at which our financial results have been translated into U.S. dollars for reporting purposes. For example, as described under “Risk Factors — Risk Relating to our Business — The existence of multiple foreign exchange markets with different exchange rates may impact the rate at which our operating subsidiaries’ financial results are translated into U.S. dollars for group reporting purposes, which may impact our financial condition and/or results of operations,” in April 2017, the CBN introduced a new foreign exchange window for investors and exporters (the I&E window (now referred to as NFEM), from which the NAFEX rate is also derived) that resulted in the conversion rates for our MLAs for our Nigerian operations to be different from the rates at which our financial results were translated into U.S. dollars for reporting purposes. Historically, our financial results in Nigeria were translated into U.S. dollars based on rates more reflective of the NAFEX rate, which differed from the rates included in some of our MLAs until the amendments to the contracts with certain of our Key Customers in Nigeria to update the reference exchange rates therein to the prevailing market rate available on Bloomberg. Currently, we use the USD/NGN rate published by Bloomberg, which is approximately aligned to the NFEM window rate, for reporting purposes. Certain of our other contracts in Rwanda and Zambia also have portions that are linked to the U.S. dollar while certain of our other contracts, such as in Côte d’Ivoire and Cameroon, are linked to the euro because they are based currencies that are “pegged” to the euro. In South Africa and Latin America, our MLAs are based on local currency pricing with no direct foreign exchange link or conversion mechanism. See also “Risk Factors — Risks Relating to Our Business — We and our customers face foreign exchange risks, which may be material.”
We also benefit from power indexation and power pass-through clauses in some of our MLAs. Such power indexation clauses generally provide for adjustments to a proportion of the fees charged in relation to increased diesel or electricity prices. For example, in certain MLAs where there is a certain percentage increase or decrease in the per liter price of diesel, or the cost of electricity, above or below an agreed base price, such percentage increase or decrease is also applied to a portion of the full monthly lease fee. Some of our MLAs also have power pass-through clauses, where the cost of electricity charged by a utility provider is passed through to the customer. These provisions help us mitigate exposure to volatility in power costs including diesel prices. For the year ended December 31, 2024, 15% of revenue was linked to the cost of power through power indexation and power pass-through clauses across all of our markets.
Except for certain material events of default, our MLAs may only be terminated prior to the agreed termination date according to the agreed notice period. As a result, we believe that revenue earned from lease fees provide a highly visible and recurring revenue stream. As of December 31, 2024, the average remaining length of our MLAs was 7.0 years, with an average remaining lease term of 7.8 years.
While a number of the MLAs with our customers are deemed automatically renewed if the customer does not notify us of their intention to not renew before the stated expiration date, we regularly keep upcoming renewal or expiry dates under review, and engage in discussions with customers from time-to-time regarding such matters. For instance, our MLAs with MTN in Zambia and Rwanda were up for renewal between 2023 and 2024 and were renewed in March and June of 2024, respectively. More recently, our MLAs with MTN Nigeria that were up for renewal between 2024 and 2029 were renewed in August 2024, and extended through December 2032, covering approximately 13,500 tenancies and approximately 23,800 lease amendments. An MLA with a certain customer in South Africa is up for renewal in 2025. Though we have had recent exceptions with respect to a select number of sites (See.
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“Risk Factors — Risks Relating to Our Business — We may experience the loss of tenancies and/or customers, and are exposed to the loss of revenue from the failure or acquisition of any customer or customer consolidation”) we expect that our MLAs and MLLs will generally experience a high renewal rate because (i) the locations of many of the Towers are critical to the efficient and cost effective operation of the Tenants’ telecommunications networks, (ii) there are cost and time implications to our customers associated with re-configuring antenna equipment across multiple towers when relocating, (iii) there are often limited alternative sites and other operators within a required proximity, and (iv) there are site acquisition, regulatory compliance issues and other barriers associated with the construction of New Sites and the relocation of antenna equipment.
Site Lease Agreements
In addition to the MLA, where a customer requests new space for additional Colocation or New Sites, pursuant to some of our existing MLAs, we sometimes also enter into one or more SLAs with that customer, which include certain site-specific arrangements. The tenure of an SLA varies between 5 and 10 years depending on the length of the underlying MLA and sometimes includes additional terms as may be commercially agreed. The material commercial terms will be agreed in the relevant MLA, with the SLA including site-specific terms such as equipment loading. Renewals of SLAs are generally linked to the extension of the term of the related MLA.
Lease Fees
Lease fees for the services we provide are normally invoiced to Tenants in advance or arrears on a monthly or quarterly basis. The average lease fee received from a new tenant is generally fixed for the initial term of the MLA or MLL, which generally include an annual or semi annual inflation-linked escalation, and cover:
| ● | Power requirements (other than any variable power indexation or power pass-through components); |
| ● | Amount of ground and tower space that the Tenants’ equipment and specifications require, including the size of the tenant’s antenna equipment located on the tower and the ground space necessary for the tenant’s electronic and other equipment related to the antenna; and |
| ● | Site location. |
For certain customers, we also charge lease fees on the basis of the type of technology employed by the customer, which includes a defined amount of space and power as necessary for such technology. In most cases, additional fees may be invoiced if such customers require additional space and/or power in excess of these specifications, subject to the terms of the relevant MLA.
Managed Services
For sites that we do not own but operate on behalf of another party, such as an MNO, we provide Managed Services. Managed Services include providing all aspects of preventative and corrective maintenance and site management. We provide our customers with Managed Services through a combination of in-house personnel and third-party contractors.
Real Property Leases
Most of our sites are located on real property which has been leased to us by individual landowners under ground lease agreements. As of December 31, 2024, approximately 89% of our Towers were on leased property. See “— Properties.” Most of our real property leases have durations of 3 to 15 years. The table below shows the number of sites we lease for our Towers and the average lease duration, by country, as of December 31, 2024.
|
|
|
|
Average |
|
|
Number of |
|
remaining |
|
|
leases |
|
duration |
Nigeria |
|
13,483 |
|
7.2 |
South Africa |
|
5,693 |
|
11.0 |
Côte d’Ivoire |
|
2,625 |
|
3.7 |
Cameroon |
|
1,816 |
|
3.9 |
Zambia |
|
1,629 |
|
4.5 |
Rwanda |
|
1,252 |
|
8.6 |
Brazil and Colombia |
|
8,229 |
|
20.3 |
Total |
|
34,727 |
|
10.4 |
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The ground lease contracts that we enter into vary across our markets in terms of the contract structure, tenor and payment frequency. In most of the African markets in which we operate (excluding South Africa), ground lease fees are generally paid in advance, for a one, five, or ten-year portion of the overall duration of the lease, with typically pre-agreed lease fee increases of between 3% and 60% for each subsequent three, five or ten-year period. In our South Africa business where we also have multi-year ground lease contracts, we typically pay our ground leases fees monthly in advance. Since advance payments for ground lease fees typically represent a substantial rental yield for the landlord, in our experience, ground leases are, in most cases, not difficult to obtain or renew. In our Latin American businesses, the lease costs are typically paid monthly in arrear and passed through to the customers.
Our ground leases are typically renewed between three and 12 months prior to expiration. If terminated by the landlord, the unearned portion of the rent is typically reimbursed to us. In the last few years, we have sought to purchase the freehold interest in the tower site land rather than maintain the lease interest. As of December 31, 2024, we own the land for 10% of our sites.
Sales and Marketing
We aim to generate additional Colocation and Lease Amendments through actively promoting tower sharing in our markets. We offer the largest portfolios in many of the countries in which we operate and use our experience and expertise to enable our customers to broaden their range of network leasing options. Our sales and marketing team is in regular discussions with customers to identify whether our existing Towers can fulfill new tenancy demand, or if the customers may require a New Site. In many cases, customers prefer a Colocation option due to a faster time-to-market advantage. However, our expertise in site acquisition, construction, and structural and electrical engineering, as well as regulatory compliance, has been a critical component in obtaining and completing New Site orders on time and within budget.
Our sales and marketing department has the following responsibilities:
| (i) | New business development, focusing on maximizing Colocation, Lease Amendments and New Site opportunities based on the customer’s roll out plans; |
| (ii) | Maintaining and growing business relationships with existing Tenants; |
| (iii) | Collecting feedback regarding the quality of the service and providing prompt assistance in order to maintain the customer’s satisfaction; |
| (iv) | Negotiating commercial contracts, including lease fees, with customers on competitive terms and ensuring accurate billing and timely collection; and |
| (v) | Processing customers’ acceptance of sites and examining the creditworthiness of new customers. |
Customers
Our main customers in each country of operation are leading MNOs in that country. In addition, and to a much smaller extent, we lease space on our Towers to customers providing wireless broadband and data services, to broadcasting companies that use tower infrastructure in the broadcast of television signals, to transmission companies that provide transmission connectivity services and to corporates for the provision of enterprise connectivity. See “Risk Factors — Risks Relating to Our Business — A significant portion of our revenue is derived from a small number of MNOs. Non-performance under or termination, non-renewal or material modification of customer lease agreements with these customers could have a material adverse effect on our business, prospects, financial condition and/or results of operations.”
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The following table sets forth our number of Tenants per country, as of December 31, 2024.
|
|
As of December 31, 2024 |
|
||||
|
|
Number of Key |
|
Number of |
|
Key Customers |
|
|
|
Customer |
|
Total |
|
Percentage |
|
|
|
Tenants |
|
Tenants |
|
of Total |
|
Nigeria |
|
24,471 |
|
25,740 |
|
95% |
|
South Africa |
|
6,860 |
|
7,282 |
|
94% |
|
Côte d’Ivoire |
|
4,276 |
|
4,939 |
|
87% |
|
Cameroon |
|
3,712 |
|
3,899 |
|
95% |
|
Zambia |
|
2,668 |
|
3,308 |
|
81% |
|
Rwanda |
|
2,281 |
|
3,000 |
|
76% |
|
Brazil and Colombia |
|
10,972 |
|
11,175 |
|
98% |
|
Total |
|
55,240 |
|
59,343 |
|
93% |
|
As of December 31, 2024, Key Customer Tenants accounted for 93% of our tenant base, with other customer Tenants accounting for the other 7%.
Churn
Churn refers to the loss of tenancies when services provided by us are terminated, a tenant does not renew its contract or we have ceased recognizing revenue for sites under a customer’s contract. For example, a tenant may Churn if the MLA or SLA is not renewed at the end of its term, the customer ceases operations or switches to a competing tower company. Other than a customer Churning at the end of the term of its MLA or SLA, our MLAs generally contain limited termination clauses. Certain of our customer agreements also contain a contractual right to Churn a limited number of sites each year without penalty. When we decommission a site and move a customer from one of our sites to another site to rationalize our portfolio, this is not included in Churn.
We experienced Churn in the years ended December 31, 2024, 2023 and 2022, of 1,198, 1,334 and 603 Tenants, respectively. Of the 1,198 Tenants churned in 2024, 571 were from our smallest Key Customer in Nigeria on which we were not recognizing revenue. Of the 1,334 Tenants churned in 2023, 731 were from our smallest Key Customer in Nigeria on which we were not recognizing revenue. The Churn that we have historically experienced from our Key Customers has been limited, however in September 2023, prior to agreeing the renewal in August 2024, MTN Nigeria had issued a statement that it had selected ATC Nigeria Wireless Infrastructure Solutions Limited to provide services to approximately 2,500 sites that were owned and managed by the Group in Nigeria. Of these, 1,430 tenancies (including new colocations) were renewed under the terms agreed with MTN Nigeria in August 2024. See also “Risk Factors — Risks Relating to Our Business — We may experience the loss of tenancies and/or customers, and are exposed to the loss of revenue from the failure or acquisition of any customer or customer consolidation.”
Suppliers
We purchase a variety of structural and fabricated products, mechanical and electrical equipment including batteries, generators, power systems and solar systems, electronic equipment such as remote monitoring systems, and diesel fuel to manage our network operations. We operate a procurement and supply chain network with dedicated employees across the countries in which we operate. Our procurement and supply chain operations aim to take advantage of opportunities to leverage our scale across the countries in which we operate, as appropriate, to try to optimize the efficiency of our supply network in a sustainable manner. We purchase from a variety of suppliers and aim to develop the sourcing based in such a way that these products are available from multiple suppliers.
Competition
We believe that competition in the tower infrastructure industry in emerging and less developed markets (including markets such as Africa and Latin America) is based on, among other things, power management expertise, tower location, relationships with telecommunications operators, tower quality and height, pricing or other more favorable or suitable contractual terms, and ability to offer additional services to tenants and operational performance, as well as the size of a company’s site portfolio and its ability to access efficient capital.
We believe we are the market leader in Africa by tower count as of December 31, 2024, with 30,650 towers. ATC is our primary competitor in Africa among independent tower companies, including in Nigeria and South Africa, and Helios Towers Plc and SBA are other notable competitors in Africa.
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In Brazil, the competitive landscape is wider, with ATC, SBA and Highline owning more towers than we do as of December 31, 2024, and numerous smaller tower companies of similar size to or smaller than our business. The Brazilian and South African competitive landscapes present opportunities for consolidation. We also compete to a lesser extent with telecommunications operators who have retained their own towers and continue to manage them and make them available for Colocation or who have formed their own independent companies for the sole purpose of providing tower infrastructure sharing. In certain circumstances, we also compete with owners of alternative site structures such as building rooftops, outdoor and indoor DAS networks, billboards and electric transmission towers. In addition, there may be increased competition in the future from other independent tower companies operating in, or that may enter, our markets.
In our Nigeria and SSA segments, we have over the years built many New Sites, for our major customers. In Brazil, New Sites forms a key part of our organic growth strategy and prior to the CSS Acquisition, the CSS business was a market leader in New Site volumes. For further information regarding the competitive landscape of the tower industry and related risks, please refer to “Risk Factors — Risks Relating to Our Business — Increased competition in the tower infrastructure industry may materially and adversely affect our business.”
Permits and Regulation
Overview
We are subject to regulatory requirements relating to licensing and registration in most of the countries in which we operate. The regulations and procedures guiding the operation, location and leasing of telecommunications towers are generally drawn from national, state and local legislation, regulations and administrative consents from the relevant government or governmental authorities in each jurisdiction in which we operate.
In each relevant jurisdiction, specific consents and/or permits are required to erect and own masts and towers. These consents generally relate to building or construction permits, property or land use permits, environmental permits and aviation clearance permits. As we continue to expand our offering to include services like fiber connectivity, rural offerings and other verticals, we may be subject to increased regulatory, license and permit obligations (including in respect of active telecommunications elements that may comprise part of the arrangements with customers). Non-compliance with applicable regulatory requirements, licenses, consents and permits may lead to shut down and/or decommissioning orders relating to the sites and/or monetary fines and/or an inability to continue our business or pursue new business lines or investments.
License to operate
Most of the jurisdictions in which we currently operate have a license or authorization regime to operate a passive communications infrastructure business. Where applicable, licenses or authorizations are issued by the relevant national regulator which regulates our operations in such country. A summary of some of these key licenses and/or authorizations is as follows:
| ● | Cameroon. IHS Cameroon operates under a five-year renewable license, which was renewed by the Ministry of Posts and Telecommunications (Ministere des Postes et Telecommunications) in November 2022. |
| ● | Côte d’Ivoire. While the licensing regime for the passive communications infrastructure sector is currently in the process of being finalized by the government, IHS Côte d’Ivoire operates under a General Authorization (Autorisation Générale) issued for issued for ten (10) years from July 2023 by ARTCI. |
| ● | Nigeria. The NCC has issued Infrastructure Sharing and Colocation Licenses to each of IHS Nigeria, INT Towers and ITNG. Each such license is granted for a period of 10 years and is renewable at its expiration for a subsequent period of 10 years. The NCC has also issued a Unified Access Service Licence to Global Independent Connect Limited for a period of 15 years, which is renewable at its expiration for a subsequent period of 15 years. |
| ● | Rwanda. The Rwanda Utilities Regulatory Authority, or RURA, has issued a license to each of our Rwanda operating entities. These licenses are valid for an initial period of 15 years and each license can be renewed for successive five-year periods. |
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| ● | South Africa. Tower operators do not require any tower company specific licenses or authorizations issued by the South African regulatory authorities. |
| ● | Zambia. ZICTA has issued a Network (National) License to IHS Zambia, which is valid for an initial period of 15 years and can be renewed for subsequent periods of 10 years after the expiration of its initial term. |
| ● | Brazil. Tower operators do not require any tower company specific licenses or authorizations issued by the Brazilian regulatory authorities. All providers of multimedia communications services (Serviço de Comunicação Multimídia), which includes providers of fiber connectivity, are required to have a license issued by Anatel (Licença SCM — Serviço de Comunicação Multimídia) in order to operate in Brazil. I-Systems holds the required license. |
| ● | Colombia. Our Colombian entities do not require any tower company specific license. |
Land Use
In most of the countries in which we operate, a building permit from the relevant public authority, such as the municipality or local district, is sufficient for building a telecommunications tower. The number of permits, payments and consents relating to land usage tends to be higher in Nigeria and Brazil, largely due to the administrative structure of the Nigerian and Brazilian governments (generally divided between federal, state and local government authorities). In Rwanda, RURA operates as the single provider of all relevant permits and grants any relevant building permit relating to sites after permissions or non-objections have been received from local and environmental authorities.
Consequences for failure to obtain building or construction permits may include a requirement to dismantle a tower which, in some areas, such as Lagos state in Nigeria, may be at the expense of the owner of the tower.
In addition to the permits and authorizations referred to above, we must enter into agreements relating to the right of land usage for each site on which a tower is located. This can take the form of a lease agreement, a concession agreement or title documentation for those sites where we have acquired the underlying land. In some countries, such as Cameroon, Côte d’Ivoire and Nigeria, a lease agreement needs to be registered with the relevant authorities. See “— Real Property Leases.”
Civil Aviation
Aviation regulations may apply to the building and operation of towers. While in the majority of cases, aviation regulations provide for a one-off clearance by the respective civil aviation authority prior to the construction of a site located in the vicinity of an airport, the Nigerian Civil Aviation Authority has a broader remit and requires a yearly renewal approval certificate in addition to prior consent before the construction of towers and masts installed within 15 kilometers of any airport, or within the proximity of helicopter pads and their approaches.
The Brazilian Civil Aviation Authority requires tower sites to obtain an approval certificate that must be renewed yearly. The Civil Aviation regulation in our other countries of operation typically encompasses an obligation to provide security lighting on towers and/or to paint them a certain color.
Others
In most of the countries where we operate, zoning restrictions and certain other restrictions may apply to tower construction. Any applicable radius requirements will largely depend on whether the construction is in an urban or rural area, and sometimes on the height of the structure. For example, in Nigeria, towers in excess of 55 meters in height may not be built within a one kilometer radius of another tower without the Nigerian Communications Commission’s prior consent, and there may also be set-back requirements based on distance to certain controlled access areas, roads or high voltage power transmission lines; in Cameroon, the minimum distance required between sites is generally 750 meters in residential areas and two kilometers in non-residential areas; in Rwanda, the minimum distance required between sites is generally 500 meters in urban areas and one kilometer in rural areas; and in Zambia, the minimum distance required between sites is generally 500 meters.
In addition to the main licenses, permits and consents listed above, additional regulations may also apply to certain operations. For example, depending on the location of a site, a Lagos State Infrastructure Maintenance Agency (previously the Urban Furniture Regulatory Unit) consent may be required in Nigeria, which may require a tower to be painted a certain color or to be disguised, and the Federal Capital Development Authority may require a tower situated in Abuja to be disguised.
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Environmental Regulation
Our operations are subject to various national, state and local environmental laws and regulations, including those relating to the management, use, storage, disposal, emission and remediation of, and exposure to, hazardous and non-hazardous substances, materials and wastes and the siting of our Towers. We may be required to obtain permits, pay additional property taxes, comply with regulatory requirements and make certain informational filings related to hazardous substances or devices used to provide power such as batteries, generators and diesel at our sites. See “Risk Factors — Risks Relating to our Business — We could have liability under health, safety and environmental laws.”
While no specific environmental authorizations are required to build or operate Towers in Côte d’Ivoire, specific regulations and authorizations apply in our other markets. In Cameroon, the construction of a site requires a one-off prior approval from the Ministry of the Environment, Protection of Nature and Sustainable Development (Ministère de l’Environnement, de la Protection de la nature et du Développement durable), In Rwanda and Zambia, the construction of a site requires a one-off prior approval from several environmental and local government authorities (the permit is ultimately granted by RURA, which is the single approver for all regulatory authorizations for our activities in Rwanda, and the Zambia Environmental Management Agency for our activities in Zambia). Similarly, in Brazil and Colombia, prior approval from the local environmental agency may be required before any new site is built and additional environmental authorizations might be required for sites built in protected areas. In Nigeria, environmental authorizations are required at two stages: the Federal Ministry of Environment requires an Environmental Impact Assessment to be issued prior to the construction of a site and every three years after a site is built an Environmental Audit Certificate needs to be issued or renewed by the National Environmental Standards and Regulations Enforcement Agency in respect of such site. In South Africa, the construction of a site requires a one-off environment permit prior approval from the Department of Environmental Affairs.
Insurance
We have insurance policies in relation to (i) property damage, business interruption and erection/ construction, (ii) political violence, (iii) third-party liability and (iv) directors’ and officers’ liability.
We maintain an all-risks policy for property damage, business interruption and erection/ construction. This policy covers against losses that might arise from damage or loss to the tower infrastructure, including earthquakes, windstorms and floods. A political violence policy was also purchased to cover material damage and business interruption caused by terrorist or sabotage acts. We also carry a general third-party liability policy, covering third-party property damage and third-party personal injury where we are found to be legally liable.
Each of our insurance policies is subject to contractual terms and conditions, limits of indemnity, deductibles, and exclusions and therefore we may be prevented from recovering in full for losses or damages that we may suffer.
Sustainability Program
Through our business model, we aim to make a positive impact in society and promote shared values. Our investment in communications infrastructure aims to help connect individuals, businesses and communities to one another. As mobile connectivity reaches more people, and is consumed in more diverse modes, it creates more jobs, and greater opportunities for people, businesses and communities to thrive and prosper. As a critical element of the telecommunications value chain in our markets, we help deliver connectivity across our eight country footprint, which has a combined population of approximately 644 million people. This is crucial in emerging and less developed markets where the need for digital infrastructure and connectivity is particularly high. We provide infrastructure to be shared by multiple customers, rather than duplicating investment and infrastructure build.
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In February 2025, IHS scored 37 out of 100 in the 2024 S&P Global Corporate Sustainability Assessment, and received an updated ESG Risk Rating from Morningstar Sustainalytics1, which places us in the top 17 percent of all companies within their assessment of the Telecommunication Services Industry.
Flagship projects
Our business model allows us to tackle significant community issues through providing our infrastructure, such as a lack of reliable power in our African markets and an over reliance on GHG emitting diesel generators, as well as a lack of digital connectivity in rural communities. To reduce our carbon footprint and provide better end service to our customers, we have historically invested in carbon reduction solutions such as batteries, solar and other clean energy sources at our sites. As of December 31, 2024, approximately 36% of our African sites (excluding South Africa) had solar power available to them, with the remainder relying on a combination of generators, hybrid and recycled batteries, and the grid.
| ● | Our Carbon Reduction Roadmap provides a comprehensive strategy for decreasing our operational emissions, including a goal to reduce the Scope 1 and Scope 2 kilowatt-hour emissions intensity of our tower portfolio by 50% by 2030, using 2021 emissions data as the baseline, which we will review as we expand into new markets or encompass growth, or as needed to reflect significant changes in our organization. |
| ● | As of December 31, 2024 the total capital expenditure incurred on Project Green from commencement was $209.4 million. Emissions and financial savings are achieved by connecting more sites to the electricity grid and via the deployment and integration of battery storage and solar panel solutions. In scope for Project Green are our operations in Cameroon, Côte d’Ivoire, Nigeria, Rwanda, and Zambia. As of December 31, 2024, in our African markets (excluding South Africa as we no longer provide power Managed Services for those sites) 41% of our sites were powered with hybrid power systems (a combination of diesel generators with solar and/or battery systems), 18% with only generators and 33% with grid connectivity and back-up generators. The remaining 8% were powered through only grid connectivity, or by solar power and other systems. As of December 31, 2024, 9,025 of our sites in Africa, excluding South Africa, had solar power solutions, representing 36% of our African tower portfolio. By deploying these solutions, we hope to both help limit outages and further decarbonize our footprint by reducing generator run-time. We currently anticipate additional efforts will be needed to achieve our 2030 emissions intensity goal and plan to consider various options as we roll out efforts to complete Project Green. |
| ● | We continued to expand our rural telephony network services in Nigeria and Cameroon. This solution aims to provide remote communities with 2G and 3G voice and data access so that they can benefit from the socioeconomic opportunities made available by mobile connectivity. By deploying an efficient solar-powered network solution, connected by dedicated very-small- aperture terminal transmission links, as of December 31, 2024, we have established a total of 623 operational rural telephony sites in Nigeria and Cameroon, all powered exclusively by solar. |
| ● | We delivered a one-year program in partnership with the non-profit organization, Limitless Space Institute (LSI), to broaden access to space education. Through this collaboration, 20 STEM teachers from Brazil and Nigeria experienced the Limitless Global Educator Program focused on space education covering a wide range of topics, including the significance of space exploration, the scientific subjects and concepts relevant to space education, its history, the economics of space, as well as sustainable exploration and space ethics. The program was designed to better equip teachers with the skills and knowledge to educate their students in space education, with the aim of encouraging broader student interest in the subject. In July 2024, participants attended the LSI Summer Institute in Houston, Texas, for a one-week training program which included a tour of NASA and workshops delivered by industry experts. In August, the LSI staff travelled to Natal, Brazil, in partnership with the Brazilian Space Agency, followed by a visit in September to Lagos, Nigeria. |
| ● | We completed the final year of our Group-wide partnership with UNICEF on their worldwide Giga initiative. Giga is a partnership between UNICEF’s Office of Innovation and ITU’s Telecommunications Development Bureau, which aims to connect schools worldwide to the internet. Under our three-year partnership, we committed a $4.5 million donation and contribution-in-kind to strengthen Giga’s work to map schools and their connectivity levels on an open- source map, using machine learning and satellite imagery. As providers of communications infrastructure, |
1 Copyright © 2025 Morningstar Sustainalytics. All rights reserved. This section contains information developed by Sustainalytics (www.sustainalytics.com). Such information and data are proprietary of Sustainalytics and/or its third party suppliers (Third Party Data) and are provided for informational purposes only. They do not constitute an endorsement of any product or project, nor an investment advice and are not warranted to be complete, timely, accurate or suitable for a particular purpose. Their use is subject to conditions available at https://www.sustainalytics.com/legal-disclaimers.
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| we play an important and unique role in Giga’s partner ecosystem. Under the ‘contribution-in-kind’ component of our partnership, we concluded the supply of additional data on all IHS tower and fiber sites in Brazil, our second largest market, including tower location, site type, tower height, power topology and technology available. This data continues to help Giga accelerate their mapping capabilities and determine the most efficient and effective ways to connect schools to the internet. The data has also been used to inform and support governments and other stakeholders in the decision-making process for school connectivity. Subsequent to this partnership, IHS South Africa signed an agreement to support’s Giga’s Connectivity Credit pilot in 2025. |
| ● | We entered the fourth year of our Frontline Workers Initiative, a philanthropic program designed to provide education scholarships for children of our frontline workers. We remain committed to helping expand educational opportunities for young women in our markets. In 2024, 11 students received scholarships; of these, 5 are female and 6 are male. This initiative is currently supporting 59 students studying a broad range of subjects at local and international universities. |
Our four-pillar strategy
In addition to the sustainability considerations inherent in our business model and helping the digital agenda in our ten countries of operation advance through infrastructure provision, to support further sustainable growth, we have also developed a sustainability strategy built on four pillars: (i) environment and climate change, (ii) education and economic growth, (iii) our people and communities and (iv) ethics and governance.
Each year, our in-country teams assess local community needs through the lens of these four pillars to help develop our in-country sustainability programs, aiming to identify clear actions and commitments for relevant projects.
Education is a significant priority for our in-country teams, as we believe education is key to social and economic development. We recognize the importance of fostering wider community support, particularly in poorer regions where access to education is significantly more limited. We also believe in improving educational facilities to provide the right learning environment. We concentrate many of our community-building initiatives on strengthening local education systems, particularly in the areas of science, technology, engineering and mathematics, or STEM, in part to help foster the future talent of our industry. We partner with NGOs, universities and governments to provide young people with practical exposure to STEM subjects and contribute to improved teaching in schools. As many STEM-related professions are traditionally male-dominated, we also seek to develop programs that focus on providing young girls and women with access and opportunity to relevant learning and training.
| ● | We participated in several education initiatives relating to ICT, connectivity and digital access in 2024. IHS Brazil continued to provide scholarships to 24 female medalists from the Brazilian Mathematics Olympics for public schools, who are studying STEM subjects at university. In Cameroon, we constructed three tower kiosks in the Northwest and Southwest regions. Each kiosk, powered by the adjacent towers’ hybrid solutions, contains four charging points and provides free internet access to the local community, contributing positively towards their long-term stability and development. In addition, IHS Cameroon announced a new partnership with the United Nations High Commissioner for Refugees and Jesuit Refugee Service to provide digital kiosks with internet connectivity for refugees in the Minawao Camp, in the Far North Region of Cameroon. |
| ● | In Nigeria, we have partnered with the Kwara State Government to develop the Ilorin Innovation Hub, which will run programs for young entrepreneurs and the local community to help foster technological advancement, entrepreneurship, and overall economic growth across the region. |
| ● | IHS South Africa continued to support the NGO Umnotho’s computer literacy program, which teaches digital skills to unemployed young people. The program’s first cohorts graduated in 2024, with 95 pupils receiving their end user computing certificates. |
| ● | IHS Nigeria’s Project Empower provides people from socio-economically disadvantaged backgrounds with training and tools to start businesses. In 2024, it helped 33 micro, small and medium-sized enterprises in Imo and Lagos States to formally register their business and access financial services, business support and marketing opportunities. |
| ● | IHS Brazil continued to work with the NGO Afroreggae on the Afrogames initiative in two ICT centers, with 107 e-sport athletes competing in the online gaming championships in 2024. We also supported and helped judge the |
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| Afrogames Jam, in which 36 young people competed to develop e-games designed to raise awareness on sustainable development. |
| ● | In Côte d’Ivoire, we continued to sponsor the annual Web Art Creativity competition to promote digital and online skills among children, with a total of 205 schools participating, as of December 31, 2024. Organized by Côte d’Ivoire’s Ministry of National Education and Literacy in collaboration with the Directorate of Technologies and Information System, the competition focuses on students’ computer skills and offers a space for high school students to express their creativity and talent in computer programming. In 2024, we donated 15 computers and high-speed internet access to the winning school. |
| ● | Beyond education, a key priority for us is safeguarding and enhancing healthcare provisions, often by working in partnership with international NGOs. In Rwanda, we make annual donations to expand health insurance coverage, and as of December 31, 2024, had funded cover for 3,000 Rwandans. In 2024, IHS Rwanda partnered with WaterAid to construct rainwater harvesting systems at four schools in Nyagambe District. The systems are expected to benefit more than 4,000 children and staff and help enhance their education and wellbeing by providing access to clean water. |
| ● | In Nigeria, we partnered with the NGO Steer for Change to distribute essential supplies to 109 pregnant and nursing women, such as birth kits, baby care products, mosquito nets and medication. IHS Nigeria has also expanded its partnership with the END Fund to help address Neglected Tropical Diseases (NTDs) in two districts. In 2024, our donation helped the END Fund deliver treatment and train 5,396 health workers. |
Under our Generator Recycling Program, we refurbish old generators from our sites and donate them to schools, orphanages, hospitals, medical and community centers. Since the program launched in 2017, we have donated approximately 443 generators, as of December 31, 2024, across our African markets providing a power source where electricity grids are often intermittent and unreliable.
We are committed to supporting the professional development of all our employees. We aim to enable them to build the skills and knowledge required to enhance their careers at IHS. In 2017, we launched the IHS Academy, an online training portal which, as of December 31, 2024, had 17,255 training items available including e-learning courses, videos, how-to guides and other training materials across a variety of areas including professional skills, personal development skills, management, leadership and teamworking skills, as well as a selection of health, safety, environment and compliance courses. In 2024, we continued to manage mentoring projects internally. As of December 2024, 48 new mentoring pairs from Latin America had begun working together as part of the Women in IHS Network (WIIN) mentoring program, to support their careers at IHS.
Finally, ethics is at the heart of all we do, and we are committed to acting with integrity and honesty in everything we do. Our corporate structure provides a strong governance foundation, which is driven from the Board down through the organization.
Sustainability Reporting
We also publish an annual Sustainability Report. We published our sixth annual Sustainability Report in May 2024, using the Global Reporting Initiative (“GRI”) standards. In 2022, we conducted our ESG materiality assessment leveraging the definitions of materiality from the GRI Standards to identify the environmental, social and governance topics that are most important to our business and stakeholders. The most recent assessment was conducted in 2022, building on the first one we completed in 2020 and, in line with best practices, involved input from internal stakeholders and external stakeholder groups. The Report maps our sustainability initiatives to the United Nations’ Sustainable Development Goals. IHS’ approach to sustainability is guided by the UN Global Compact, to which the Company has been a signatory since 2020.
C. Organizational Structure
The legal name of our company is IHS Holding Limited and we are organized under the laws of the Cayman Islands. We are a holding company and conduct substantially all of our business through our operating subsidiaries. Refer to note 30.1 of our audited consolidated financial statements included in this Annual Report contains our subsidiary names, principal activity, place of incorporation and legal ownership at December 31, 2024.
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D. Property, Plant and Equipment
IHS Holding has freehold and leasehold interests in real estate and other tangible assets in numerous countries, but no individual property is significant to the group as a whole.
See Item 4.B. “Business Overview—Our Tower Portfolio” for information regarding the Towers owned and operated by us and Item 4.B. “Business Overview—Real Property Leases” for information regarding our ground lease agreements for the real property on which our Tower sites are located.
Item 4A. Unresolved Staff Comments
None.
Item 5. Operating and Financial Review and Prospects
A. Operating Results
You should read the following discussion of our operating and financial review in conjunction with our consolidated financial statements and the related notes included elsewhere in this Annual Report. The following discussion is based on our financial information prepared in accordance with International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board. Where appropriate these discussions are based on non-IFRS measures which are reconciled to an IFRS measure (refer to the Key Financial and Operational Performance Indicators).
This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described in the “Risk Factors” section of this Annual Report. See “Cautionary Statement Regarding Forward-Looking Statements.” Our actual results could differ materially from those contained in any forward-looking statements.
The information called for by this Item 5, including a discussion of the year ended December 31, 2022 compared to the year ended December 31, 2023 has been reported previously in our Annual Report on Form 20-F filed on March 11, 2024 under the Section “Item 5. Operating and Financial Review and Prospects”.
Overview
We are one of the largest independent owners, operators and developers of shared communications infrastructure in the world, providing our customers, most of whom are leading MNOs, with critical infrastructure that facilitates mobile communications coverage and connectivity for approximately 644 million people in emerging markets, across two regions and eight countries. We are the largest independent multinational emerging-market-only tower operator and one of the largest independent multinational tower operators globally, in each case by tower count. As of December 31, 2024, we operated 39,229 Towers across six countries in Africa and two countries in Latin America. We are the largest independent tower operator in six of the eight markets in which we operate and we are the only independent tower operator of scale in four of these markets.
We have a well-defined organic and inorganic expansion strategy designed to grow in existing markets with our existing and new customers and, given the significant global emerging market opportunities in communications infrastructure, we have historically entered into carefully selected growth-oriented markets with compelling underlying fundamentals. Historically, our business has been predominantly focused on the African continent, however, in 2020, we started complementing this with investment into other regions and adjacent communications infrastructure offerings. We expanded our footprint with our entrance into Latin America via Brazil, Colombia and Peru (which we later exited on April 30, 2024 when we completed the sale of our subsidiary in Peru, IHS Peru S.A.C., to affiliates of SBA Communications Corporation). Each of these acquisitions supported our inorganic growth strategy of expanding into additional regions that met our investment criteria, which opened up new markets that we believed would provide future organic and inorganic growth opportunities. Our investment criteria suggests that inorganic growth opportunities will be limited for the foreseeable future, as we assess inorganic investment as just one of various forms of capital allocation.
Our core business is providing shared communications infrastructure services to MNOs and other customers, who in turn provide wireless voice, data and fiber access services to their end users and subscribers. We provide our customers with opportunities to lease space on existing Towers alongside current Tenants, known as Colocation, to install additional equipment on a Tower or request certain ancillary services, known as Lease Amendments, or to commission the construction of new Towers to the customer’s specifications, known as New Sites.
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Additionally, we lease space to our customers in secure locations within large building complexes, such as shopping malls, stadiums and airports, which we refer to as in-building solutions, or IBS, or distributed antenna systems, or DAS, as well as provide fiber connectivity. In certain strategic instances, we may also provide Managed Services, such as maintenance, security and power supply for Towers owned by third parties. As of December 31, 2024, our owned and operated tower portfolio supported 59,343 Tenants, with a Colocation Rate of 1.51x.
Our primary customers are the leading MNOs in each of our markets. We also provide infrastructure and services to a number of other communications service providers. Our success in establishing deep customer relationships and operational excellence has enabled us to grow both organically and through 22 transactions. Our footprint currently covers Nigeria, Côte d’Ivoire, Cameroon, Rwanda, South Africa, Zambia, Brazil and Colombia.
Strategic Review
We announced, in March 2024, that we were undertaking a strategic review process, which includes evaluation of our organizational initiatives, plans and goals to try to ensure they align with our long-term objectives and external environment conditions and targeted at shareholder value-creation options. While the review remains ongoing and further initiatives to continue increasing shareholder value may be considered, the initial part of the review so far includes, but is not limited to, initiatives around making commercial progress through contract renewals and extensions, potential further governance improvements, increasing Adjusted EBITDA and cash flow generation, disposal of certain assets or markets, and actively pursuing initiatives to reduce debt, otherwise extend debt maturities, manage interest expense and shift more debt into local currency. It is currently expected that excess cash flow following implementation of these strategic initiatives would primarily be utilized to reduce debt, although we may also consider other uses, including share buybacks and/or introducing a dividend policy.
Reportable Segments
Our operations are organized into four segments, which reflect the way our chief operating decision maker, or CODM, is provided with financial information which aligns to internal regional management organizational reporting lines and responsibilities and the way in which the CODM analyzes performance and allocates resources. Our operating segments are Nigeria, which comprises our operations in Nigeria; Sub Saharan Africa, or SSA, which comprises our operations in Cameroon, Côte d’Ivoire, Rwanda, South Africa and Zambia; Latin America, or Latam, which comprises our operations in Brazil and Colombia; and the Middle East and North Africa, or MENA, which comprises our operations in Kuwait and Egypt. We sold our Kuwait operations in December 2024 and do not plan to commence operations in Egypt, therefore we have no operations in MENA as of December 31, 2024, and MENA will not be a reportable segment for the year ended December 31, 2025 and onwards.
We use revenue and segment Adjusted EBITDA to assess the performance of our reportable segments. Segment Adjusted EBITDA is our principal segment measure of profitability.
Our Revenue
We measure revenue in three categories, namely (i) organic, (ii) inorganic and (iii) non-core.
Organic revenue captures the performance of our existing business without the impact of new tower portfolios or businesses acquired since the beginning of the prior year period (except as described as inorganic below). Specifically, organic revenue captures the impact of (i) new Colocation and Lease Amendments; (ii) changes in pricing including from contractual lease fee escalation, power indexation and foreign exchange resets; (iii) New Site construction; (iv) fiber connectivity and (v) any impact of Churn and decommissioning. In the case of an acquisition of new tower portfolios or businesses, the impact of any incremental revenue after the date of acquisition from new Colocation and Lease Amendments or changes in pricing on the Towers acquired, including from contractual lease fee escalation, foreign exchange resets and power indexation, is also captured within organic revenue.
Inorganic revenue captures the impact on revenue from existing Tenants of new tower portfolios or businesses that we have acquired, or tower portfolios or businesses that we have disposed of, since the beginning of the prior period (except as described above). Where tower portfolios or businesses were acquired during the current period under review, inorganic revenue is calculated as the revenue contribution from those acquisitions in their “at acquisition” state (measured as the local currency revenue generated during the first full month following the acquisition) in the current period. Where tower portfolios or businesses were disposed during the period under review, inorganic revenue impact is calculated as the revenue contribution from those tower portfolios or businesses in their reported state (measured in U.S. dollars) in the period. This treatment continues for 12 months following acquisition or disposal.
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Non-core captures the impact of movements in foreign exchange rates on the translation of the results of our local operations from their local functional currency into U.S. dollars, which is measured by the difference in U.S. dollars between (i) revenue in local currency converted at the average foreign exchange rate for that period and (ii) revenue in local currency converted at the average foreign exchange rate for the prior period. This foreign currency impact is then partially compensated for in subsequent periods by foreign exchange reset mechanisms, which are captured in organic revenue.
The organic and non-core components of our revenue cannot be considered independently from each other in assessing, for instance, what the impact on organic revenue would have been in the absence of a change in the foreign exchange rate. In fact, the periodic (monthly and quarterly) nature of our reset mechanisms is such that there is a delay between the period during which a change in foreign exchange rate occurs and the next contractual reset occurs.
Foreign exchange resets are generally included in MLAs where lease fees are linked to currencies other than the local currency (for example, MLAs in Nigeria with U.S. dollar components). MLAs with foreign exchange resets typically contain a mechanism for determining the foreign exchange rate for a set period at which the lease fee linked to the non-local currency (such as U.S. dollar) is translated into local currency and invoiced to the customer. In such cases, the foreign exchange rate determined by this mechanism is reset monthly and quarterly.
The foreign exchange resets function such that the portion of lease fees that is linked to U.S. dollars and the portion of lease fees that is linked to local currency are fixed in local currency for the contractual period between reset dates (for example, for a period of one year if the reset is annual). As a result, in the event of a devaluation, there is a delay between the timing of the devaluation and the next contractual reset.
During the period between the date of the devaluation and the date of the reset, all of our revenue (i.e., both revenue that is contractually linked to the U.S. dollar and revenue that is contractually linked to local currency) would reflect the new, devalued foreign exchange rate and is therefore lower for that period. When the reset is effected, the amount relating to the portion of the lease fees linked to the U.S. dollar, which is invoiced in local currency, is adjusted upward at the relevant time which is reflected in increased revenue for that period that partially offsets the decrease in the prior period due to the devaluation. We experience the same type of effect on our Adjusted EBITDA of currency devaluation in one period followed by a reset in our dollar linked revenue in a subsequent period.
In addition, the conversion rates included in our MLAs may also be different from the rates at which our financial results are translated into U.S. dollars for reporting purposes.
From time to time in the markets in which we operate there have existed situations where there are differing official exchange rates in the market, and we were required to regularly monitor and evaluate which exchange rate is most appropriate to apply in the translation of the Naira books of our Nigerian operations to U.S. dollars for our consolidated group reporting purposes. The determination of which was the most appropriate rate to use at the relevant time we produce financial information depended on a number of factors, including, but not limited to, availability and liquidity in the market generally. The foreign exchange rate that we determined to be the most appropriate for the translation of our results for group reporting purposes may also have differed from the conversion rates contained within our contracts.
In 2020, we reached an agreement with some of our Key Customers in Nigeria to update the reference exchange rate in our contracts to the then prevailing market rate available on Bloomberg (which was typically aligned to the NAFEX rate), should similar circumstances arise again (or continue to exist where there is a divergence between the applicable market rate or translation rates for our financial results and the exchange rates reflected in our contracts with customers, or a divergence between the prevailing market rate on Bloomberg and other exchange rates in the market, including NAFEX), there is no guarantee that we will be able to renegotiate these contracts or enter into new contracts to fully protect against such foreign exchange risks. In addition, other measures taken by the relevant authorities and/or the CBN may further impact the rates available in the market, and we may need to consider such measures for the purposes of our accounts.
In June 2023, the CBN implemented steps to unify the Nigerian foreign exchange market by replacing the old regime of multiple exchange rate segments into a single I&E window within which foreign exchange transactions would be determined by market forces. The Group uses the USD/NGN rate published by Bloomberg, which is approximately aligned to the NFEM window rate, for Group reporting purposes. In October 2023, the CBN changed all references to I&E window to NFEM.
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While a number of the MLAs with our customers are deemed automatically renewed if not canceled by the stated expiration date, we regularly keep upcoming renewal or expiry dates under review, and engage in discussions with customers from time-to-time regarding such matters. For instance, our MLAs with MTN in Zambia and Rwanda were renewed in March and June of 2024, respectively, and extended for 10 years through to 2034. Our MLAs with MTN Nigeria that were up for renewal in 2024 and 2029 were renewed in August 2024, and extended through 2032. An MLA with a customer in South Africa is up for renewal in 2025. No assurance can be given that our customers will renew their customer lease agreements upon expiration of those agreements or that customers will not request unfavorable amendments to existing agreements, or that we will be successful in negotiating favorable terms with these customers.
The renewed and extended contracts with MTN Nigeria include new rebased financial terms, and now include a combination of a Nigerian Naira component (that benefits from semi-annual escalators linked to the Nigerian Consumer Price Index), a USD component (that continues to benefit from annual escalators linked to the U.S. Consumer Price Index and have quarterly foreign exchange resets), and/or a new component indexed to the cost of providing diesel power, introduced to act as a hedge against diesel prices and potentially foreign exchange fluctuations. Prior to the new terms agreed with MTN Nigeria, we did not have a direct hedge on power prices in our use fees with MTN Nigeria, which has now been introduced.
In the second quarter of 2024 we concluded the agreements with MTN South Africa to unwind the power Managed Services agreement and to amend the existing MLA with a revised fee structure, extended by two years through to 2034. The operational impact of the unwind is that the IHS South African business is no longer responsible for providing diesel or alternative power to tower sites other than electricity costs which are fully passed through to customers. The unwind agreement, which is effective from October 1, 2023, has resulted in a one-off reduction of $7.1 million to both gross revenue and cost of sales, reversing amounts previously recognized in the period from October 1, 2023, to December 31, 2023. The new agreement also results in an ongoing reduction in gross revenue and cost of sales. Additionally, continuing power pass-through activities in South Africa are no longer recognized on a gross basis. None of these updates to gross revenue and cost of sales have a net impact on Adjusted EBITDA.
Factors Affecting Our Financial Condition and Results of Operations
Our financial condition and results of operations have been, and will continue to be, affected by a number of important factors, including the following:
New Colocation and Lease Amendments
Colocation and Lease Amendments are key drivers of incremental organic revenue in communications infrastructure sharing. Colocation involves adding new tenants to existing sites, where the addition of an incremental tenant to an existing site can introduce a full additional lease fee. Lease Amendments involve adding additional equipment or providing certain ancillary services at existing sites for existing Tenants and for a recurring lease fee. Examples of Lease Amendments include an existing customer taking more space on a tower, adding equipment for new technologies, such as 3G, 4G/LTE or 5G, adding additional microwave transmission or fiber infrastructure services, as well as certain ancillary services. A Lease Amendment typically increases revenue by a proportionally lower amount than a Colocation given such equipment typically consumes less space and power than a Colocation. However, gross margin contribution of a Lease Amendment is generally comparable to a Colocation.
Colocation and Lease Amendments improve overall gross margins, operating margins and cash flow given the limited incremental cost to deliver such services. Typically, the main incremental cost to deliver Colocation or Lease Amendments is $5,000 to $10,000 in augmentation capital expenditure. Additionally, in our African markets, the main incremental ongoing cost for Colocation and Lease Amendments is power cost for the additional equipment or services. We continually seek to increase Colocation and Lease Amendments for our existing sites through an active sales and marketing process. Our sites that are either at or near structural capacity can also be strengthened to meet future leasing capacity with relatively minor capital investments.
The demand for Colocation and Lease Amendments from MNOs is driven by multiple communications industry characteristics within our individual markets. These characteristics include the MNOs’ need for greater network coverage and network density due to existing capacity- constrained networks, a desire to improve quality-of-service, increasing subscriber demand for wireless voice and data services requiring a denser network than is the case for voice services, as well as changes in and the development of technologies in those markets.
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Contractual lease fee escalation and foreign exchange resets
Our MLAs generally contain inflation-linked escalation provisions under which the underlying lease fees, and therefore our revenue, may increase each year. These contractual escalators are typically linked to the consumer price index, or CPI, of the country of operation and/or the United States, depending on the underlying currency denomination of the lease fee. Lease fee components priced in local currency typically have escalators linked to local CPI applied annually or semi-annually for the subsequent 12 months. Lease fee components priced in U.S. dollars typically have escalators linked to U.S. CPI applied annually for the subsequent 12 months. Our MLAs with certain customers are subject to fixed, capped or floored escalators.
Our MLAs may also contain a portion of lease fees which may be linked to power indexation metrics including diesel and electricity prices. This indexation is typically linked to local power prices and updated quarterly.
Foreign exchange resets are generally included in MLAs where lease fees are linked to currencies other than the local currency (for example, MLAs in Nigeria with U.S. dollar components). For further discussion on these foreign exchange resets, please refer to “— Our Revenue.”
New Site construction
New Site construction is a key driver of incremental organic revenue through the customer revenue we invoice from the date the New Site becomes ready for service. New Site construction is also a component of discretionary capital expenditure. Building New Sites requires capital expenditure, principally including materials for the tower, power equipment, land lease fees or land purchase fees, tower construction activities, including civil work, transportation and labor, as well as ongoing operational expenditures for site operation and maintenance. Therefore, construction of New Sites increases our capital expenditure and cost of sales. We pursue construction of New Sites as a key strategy in growing our tower portfolio and providing future capacity for Colocation and Lease Amendments. We do not engage in speculative building and only construct New Sites after obtaining a commitment for a long-term lease with an initial tenant and, in general, if we are aware of, or believe there is, commercial potential for Colocation.
Demand for New Sites from MNOs is typically driven by multiple communications industry characteristics within our individual markets. These characteristics include the MNOs’ need for greater network coverage and network density due to existing capacity-constrained networks, a desire to improve quality-of-service, increasing subscriber demand for wireless voice and data services and requiring a denser network than is the case for voice services, as well as changes in and the development of technologies in those markets. For example, we often see an increase in demand for New Sites as new technology is rolled out in markets, such as 3G or 4G.
New Sites constructed consist primarily of ground-based towers, but can also include in-building solutions / distributed antenna systems, rooftop towers and cells-on-wheels. These New Sites always begin operations with at least a single Tenant, with Colocation and Lease Amendments expected at future dates. The average cost to build a New Site in our African markets is typically in the range of between $50,000 and $100,000, while in Latin America the cost is typically in the range of between $40,000 and $80,000 depending on the market of operation and specification of the tower.
Consequently, the construction of New Sites generally has a positive effect on revenue, and as Colocation and Lease Amendments occur on the tower, we expect to drive incremental organic revenue and have a positive effect on gross margins and operating margins.
Churn
Churn refers to the loss of tenancies when services provided by us are terminated, a Tenant does not renew its contract or we have ceased recognizing revenue on a site in any particular period, adjusted for the reintegration of previously lost tenancies. For example, a Tenant may Churn if the relevant MLA or SLA is not renewed at the end of its term, the customer ceases operations or switches to a competing tower company. Other than a customer Churning at the end of the term of its MLA or SLA, our MLAs generally contain limited termination clauses. Certain of our customer agreements also contain a contractual right to Churn a limited number of sites each year without penalty.
We experienced Churn in the year ended December 31, 2024, of 1,198 Tenants which includes 571 tenants occupied by our smallest Key Customer in Nigeria on which we were not recognizing revenue.
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Decommissioning
In connection with the acquisition of portfolios of sites, we rationalize our portfolio where we have multiple towers in close proximity to each other. Where economically and commercially viable, we migrate Tenants from one tower onto a nearby tower as an additional Colocation and then subsequently decommission the empty site. Decommissioning spend is a component of discretionary capital expenditure. While the decommissioning of towers offsets our overall growth in the number of towers, it allows us to eliminate cost of sales and ongoing maintenance capital expenditure at the decommissioned towers. The retained sites benefit from lease fees relocated from the decommissioned site and generally only experience a marginal increase in cost of sales due to increased power consumption. The spend associated with decommissioning a site is approximately between $3,200 to $32,000.
Acquisitions/Disposals of tower portfolios and businesses
The acquisition of tower portfolios and businesses from MNOs and independent tower companies results in incremental inorganic revenue during the period in which the acquisitions occur. Acquisitions of tower portfolios and businesses result in the immediate increase in the size of our overall tower portfolio and help expand our footprint in existing and new markets. Once towers are acquired, we receive revenue from the Tenants and Lease Amendments on such sites and we are responsible for future capital expenditure and costs of sales related to the sites. As we acquire new portfolios of towers, we may incur additional administrative expenses, particularly from acquisitions in new markets, which may impact our operating margins.
The disposal of tower portfolios and businesses will reduce revenue going forward from the period in which the disposal occurs, shown through inorganic revenue movements.
Currency exchange rate
Our operations are conducted by subsidiaries in Nigeria, Côte d’Ivoire, Cameroon, Zambia, Rwanda, South Africa, Kuwait (although disposed of in December 2024), Brazil, Colombia and Egypt, and the functional currency of our operating subsidiaries are the Nigerian Naira (₦), West African CFA Franc (XOF), Central African CFA Franc (XAF), Zambian Kwacha (ZMW), Rwandan Franc (RWF), South African Rand (ZAR), Kuwaiti Dinar (KWD), Brazilian Real (BRL), Colombian Peso (COP) and Egyptian Pound (EGP), respectively. A foreign currency transaction is translated into the functional currency using the exchange rate prevailing at the date of the transaction (or the date of valuation where an item is re-measured). The foreign exchange gain or loss resulting from (i) the settlement of such transaction or (ii) the translation of a monetary asset or liability denominated in a foreign currency is recognized at the exchange rate at period end in the statement of loss and other comprehensive income.
Our operating subsidiaries’ financial results are then translated into U.S. dollars for reporting purposes. Income and expenses are translated at the monthly average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions). Assets and liabilities are translated at the exchange rate at period end.
As a result of the translations described above, our results are impacted by fluctuations in foreign exchange rates.
Multiple foreign exchange markets with different exchange rates
From time to time in the markets in which we operate, there have existed situations where there are differing official exchange rates in the market. Accordingly, we regularly monitor and evaluate which exchange rate is most appropriate to apply in the translation of local operations books to U.S. dollars for our consolidated group reporting purposes, in accordance with the requirements of IFRS Accounting Standards.
In determining the appropriate rate, we assess factors such as access to those rates in the future in order to meet payments or make dividends in the appropriate currency. In determining whether it is appropriate to move from one official rate to another, we consider the available rates in official markets for settlement of transactions. The foreign exchange rate that we determined to be the most appropriate for the translation of our results for group reporting purposes may also have differed from the conversion rates contained within our contracts.
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For example, as a result of the previous regime of multiple exchange rate “windows” for different purposes in Nigeria, we agreed with certain of our Key Customers in 2020 to update the reference exchange rate in our contracts to the prevailing market rate available on Bloomberg.
Should similar circumstances arise again or continue to exist where there is a divergence between the applicable market rate or translation rates for our financial results and the exchange rates reflected in our contracts with customers, or a divergence between the prevailing market rate on Bloomberg and other exchange rates in the market, there is no guarantee that we will be able to renegotiate these contracts or enter into new contracts to fully protect against such foreign exchange risks. In addition, other measures taken by the relevant authorities and/or the CBN may further impact the rates available in the market, and we may need to consider such measures for the purposes of our accounts. For further discussion on the impact of this change in exchange rates, please refer to “— Our Revenue.”
Hyperinflation
At present, none of our markets are considered to be hyperinflationary (as defined in IAS 29 Financial Reporting in Hyperinflationary Economies), but the 3 year cumulative inflation rate has increased for Nigeria, and there is the potential for hyperinflation accounting to be applicable in future reporting periods.
Maintenance of sites
We incur capital expenditure in relation to the maintenance of our towers and fiber infrastructure, which is non-discretionary in nature and required in order for us to optimally run our portfolio and to perform in line with our service level agreements with customers. Maintenance capital expenditure includes the periodic repair and replacement of fixtures and fittings of existing sites, and fiber equipment and power equipment at existing sites. A large component of maintenance capital expenditure is for the replacement and servicing of generators and batteries at our sites, which may decrease, should the grid availability in our markets improve.
In addition to this corrective maintenance capital expenditure, maintenance costs are also incurred in cost of sales where these relate to preventive maintenance that includes the replacement of spare parts and routine checks. Maintenance capital expenditure in Latin America is typically lower given the current scope of maintenance required on Towers.
Typically, when we acquire a tower portfolio, it may be necessary to refurbish the newly acquired Towers in order to bring them to the standard of the rest of our portfolio.
Refurbishment capital expenditure typically involves the deployment of a suitable power system for that site, repairs to the site or improvements to the site structure in order to be in line with our safety obligations, and adaptations to site security and monitoring abilities. Refurbishment capital expenditure is one-off in nature, following which those sites should then have normalized maintenance capital expenditure requirements related to the maintenance of sites as described above. Refurbishment capital expenditure is a component of discretionary capital expenditure since it is typically considered in conjunction with the acquisition of tower portfolios. The capital expenditure associated with refurbishment varies from market to market and tower to tower.
Carbon reduction roadmap
On October 24, 2022, we announced our Carbon Reduction Roadmap which provides a comprehensive strategy for decreasing our operational emissions by reducing diesel usage on tower sites, including a goal to reduce the Scope 1 and Scope 2 kilowatt-hour emissions intensity of our tower portfolio by 2030, using 2021 emissions data as the baseline.
Savings will be achieved by connecting more sites to the electricity grid and via the deployment and integration of battery storage and solar panel solutions. In scope for the Carbon Reduction Roadmap are our operations in Cameroon, Côte d’Ivoire, Nigeria, Rwanda, and Zambia. However, our plans in Cameroon, Côte d’Ivoire, Rwanda, and Zambia will only include connecting more sites to the grid.
The total capital expenditure incurred on Project Green from commencement until December 31, 2024, was $209.4 million, of which $2.4 million related to the year ended December 31, 2024.
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Cost and consumption of diesel
Power is our largest single operating expense and, in particular, diesel pricing typically has the largest impact on changes in our operating expense. The largest impact is in our Nigerian operations due to low power grid availability and our South African operations where they are connected to the grid and experience significant load shedding. However, following the unwind of the power Managed Services agreement with MTN South Africa and the new diesel-linked component included in our renewed contracts with MTN Nigeria, we have significantly reduced our exposure to diesel price fluctuations. The operational impact of the unwind is that the IHS South African business is no longer responsible for providing diesel or alternative power to tower sites other than electricity costs which are fully passed through to customers, while in Nigeria, we benefit from power indexation clauses which limit the impact of both increased diesel prices and conversely falling diesel prices. Our overall diesel consumption is also being reduced through targeted investment in power system solutions to provide power to sites more efficiently, including the use of hybrid and solar.
On May 31, 2023, the Nigeria Federal Inland Revenue Service issued a letter to diesel suppliers in Nigeria, informing them they would be required to pay VAT at 7.5% on imported diesel at the point of entry into the country. However, on October 1, 2023, the Federal Government of Nigeria suspended VAT on imported diesel for a period of six months effective from October 1, 2023, through to March 31, 2024. On September 3, 2024, VAT Modification Order 2024 was gazetted which confirms the suspension of VAT on imported diesel with a retrospective effect from October 1, 2023.
Cost of ground leases
The majority of towers we own and operate are on land that we lease from individual landlords. Ground lease fees are generally paid in advance monthly or for a one, three, five, or ten-year portion of the overall duration of the lease (although in our South Africa business, we typically pay our ground leases fees monthly in advance), with typically pre-agreed lease fee increases of between 3% and 60% or variable increases for each subsequent one, three, five or ten-year period. As we roll out additional sites, we are often required to either enter into leases with new landlords, which we endeavor to do under similar terms to those of our existing leases, or acquire the land.
Customer concentration
A significant portion of our revenue in each of our markets of operation is derived from a small number of customers who usually constitute some of the largest MNOs in those markets. In particular, in the year ended December 31, 2024, revenue from our top three MNO customers, considered in each of our individual markets of operation, collectively accounted for 98.5% of our consolidated revenue, with MTN Nigeria and Airtel Nigeria accounting for 46.0% and 11.4%, respectively, of our consolidated revenue for the year ended December 31, 2024. Should there be any negative impact on the businesses of our major customers, including these key MNOs, this in turn could adversely affect their demand for tower space and/or ability to perform their obligations under their lease agreements with us.
Market volatility
We and our customers operate in various international markets, particularly in emerging markets such as in Africa. As a result, we are exposed to economic, political and other uncertainties prevailing in such markets, particularly Nigeria, which is our largest market of operation.
In June 2024, Moody’s affirmed Nigeria’s Long-Term Foreign-Currency Issuer Default Rating at Caa1 with a positive outlook. In November 2024, Fitch affirmed Nigeria’s Long-Term Foreign-Currency Issuer Default Rating at B- with a positive outlook. In January 2025, S&P affirmed Nigeria’s Long-Term Foreign-Currency Issuer Default Rating at B- with a stable outlook.
In July 2024, S&P affirmed IHS Holding Limited’s Long-Term Foreign-Currency Issuer Default Rating and its unsecured debt at B+ with a stable outlook. In February 2025, Fitch affirmed IHS Holding Limited’s Long-Term Foreign-Currency Issuer Default Rating and its unsecured debt at B+ with a stable outlook. In December 2024, IHS ended its engagement with Moody’s for its rating services.
There have been no upgrades, downgrades, or changes in outlook for Nigeria or IHS since then.
As a result of the currency exchange rate fluctuations, particularly in regard to the Nigerian Naira as described further above, our strategic and operational plans need to be continually reassessed to meet the challenges and needs of our businesses in order for us to remain competitive.
93
For instance, we have adopted a more balanced approach to revenue growth and cash generation to counterbalance the recent macroeconomic headwinds across the world, particularly in Nigeria given the significant recent depreciations of the Naira in June 2023 and January 2024. As part of our heightened focus on cash generation, we are pursuing operational efficiencies through productivity enhancements, cost and capital expenditure reductions, and a review of our portfolio of markets and assets. See “Item 3.D. Risk Factors” section of our Annual Report.
Macroeconomic Issues
Global deterioration in economic conditions could adversely and materially affect us and/or our customers through disruptions of, among other things, the ability to procure communications equipment or other supplies through the usual supply chains. For instance, shortages of capacity in shipping may occur and could affect the smooth flow of our and/or our customers’ supply chains, increase transportation costs and/or decrease reliability. Global deterioration in economic conditions could also adversely and materially affect the ability of us and/or our customers to maintain liquidity and deploy network capital, with potential decreases in consumer spending contributing to liquidity risks, or even through regulatory interventions or pressure on pricing and services offered that may reduce revenue for periods of time. Any resulting financial difficulties could result in uncollectible accounts receivable or reduced revenue, despite having provided increased services. Resulting supply chain or operational difficulties (including site access) may also result in us being unable to meet the service level agreement targets under our MLAs. The loss of significant Tenants, or the loss of all or a portion of our anticipated Contracted Revenue from certain Tenants, could have a material adverse effect on our business, financial condition and/or results of operations.
Diesel prices have fluctuated significantly over time, often in parallel to changes in oil prices, and may fluctuate in the future as a result of many factors, including the impact of geopolitical tensions, for example, in connection with the current conflict between Russia and Ukraine and the related economic sanctions. However, following the unwind of the power Managed Services agreement with MTN South Africa and the new diesel-linked component included in our renewed contracts with MTN Nigeria, we have significantly reduced our exposure to diesel price fluctuations. The operational impact of the unwind is that the IHS South African business is no longer responsible for providing diesel or alternative power to tower sites other than electricity costs which are fully passed through to customers, while in Nigeria, we benefit from power indexation clauses which limit the impact in relation to increased diesel prices and conversely falling diesel prices.
Through our international operations, we are also exposed to foreign exchange risk arising from currency exposures other than the U.S. dollar, such as the BRL, NGN, RWF, XAF, XOF, ZAR and ZMW currencies. Any fluctuations in these foreign currency exchange rates could result in a material adverse effect on the cash flow and future profits.
Outstanding balances and advances under certain of our existing credit facilities bear interest at rates which vary depending on certain underlying or reference rates, such as the Secured Overnight Financing Rate, or SOFR, the Chicago Mercantile Exchange (“CME”) Term SOFR, the European interbank offered rate, or EURIBOR, the Nigerian Monetary Policy Rate, or MPR, the Kuwait Interbank Offered Rate, or KIBOR, the Johannesburg Interbank Average Rate, or JIBAR, or the Brazilian interbank deposit rate, or CDI. Increases in such reference rates increase our interest expense, which could have a material adverse effect on our business, prospects, financial condition and/or results of operations. Such increases in interest rates could also have a material adverse effect on our cash flows and our ability to service our debt in the longer term.
In the past, governments have taken, and may in the future take, unprecedented actions in an attempt to address and rectify these extreme market and economic conditions by providing liquidity and stability to financial markets. If these actions are not successful, the return of adverse economic conditions may cause a significant impact on our ability and the ability of our customers to raise capital, if needed, on a timely basis and on acceptable terms or at all.
To the extent that any macroeconomic issues could have a material adverse effect on our or our customers’ business, financial condition, results of operations and/or liquidity, it may also have the effect of heightening many of the other risks described in the “Item 3.D. Risk Factors” section of our Annual Report.
Key Financial and Operational Performance Indicators
We believe that revenue growth, Adjusted EBITDA, Adjusted EBITDA Margin, Return Adjusted EBITDA, the number of Towers in our portfolio and Colocation Rate are key measures to assess our financial and operational performance. These measures demonstrate our ability to grow and generate strong positive cash flows over time. Adjusted EBITDA and Adjusted EBITDA Margin are not measures defined by IFRS Accounting Standards. The most directly comparable IFRS measure to Adjusted EBITDA is our (loss)/income for the period. Adjusted EBITDA and Adjusted EBITDA Margin are not necessarily comparable to similarly referenced measures used by other companies. As a result, investors should not consider these performance measures in isolation from, or as a substitute analysis for, our results of operations as determined in accordance with IFRS Accounting Standards.
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Adjusted EBITDA, Adjusted EBITDA Margin and Return Adjusted EBITDA
We believe Adjusted EBITDA and Adjusted EBITDA Margin are useful to investors and are used by our management for measuring profitability and allocating resources, because they exclude the impact of certain items that have less bearing on our core operating performance such as interest expense and taxes. We believe that utilizing Adjusted EBITDA and Adjusted EBITDA Margin allows for a more meaningful comparison of operating fundamentals between companies within our industry by eliminating the impact of capital structure and taxation differences between the companies.
We believe Return Adjusted EBITDA is important to enable us to measure the effectiveness of our capital allocation strategy. This allows us to quantify how well we generate income relative to the capital we have invested in our business. We monitor the returns generated from capital we have deployed across the business.
We define Adjusted EBITDA (including by segment) as (loss)/income for the period, before income tax expense/(benefit), finance costs and income, depreciation and amortization, net impairment/(reversal of impairment) of withholding tax receivables, impairment of goodwill, business combination transaction costs, net impairment/(reversal of impairment) of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent, reversal of provision for decommissioning costs, net (gain)/loss on sale of assets, share-based payment (credit)/expense, insurance claims, gain on disposal of subsidiary and certain other items that management believes are not indicative of the core performance of our business.
We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue for the applicable period, expressed as a percentage.
We measure our return on invested capital by looking at Return Adjusted EBITDA for the period, which we define as Adjusted EBITDA further adjusted for lease payments made and amortization of prepaid site rent, less withholding tax, income taxes paid, maintenance capital expenditures and corporate capital expenditures, as a function of gross property, plant and equipment, gross intangibles and gross goodwill, as of the end of the period. Management uses this metric in order to measure the effectiveness of our capital allocation strategy. Return Adjusted EBITDA is not a measure defined by IFRS, and other companies may calculate Return Adjusted EBITDA or return on invested capital, differently. As a result, investors should not consider Return Adjusted EBITDA in isolation from, or as a substitute analysis for, our results of operations as determined in accordance with IFRS.
95
Reconciliation from loss for the period to Adjusted EBITDA, Adjusted EBITDA Margin and Return Adjusted EBITDA
The following is a reconciliation of Adjusted EBITDA, Adjusted EBITDA margin and Return Adjusted EBITDA to the most directly comparable IFRS measure which are loss and loss margin, respectively, for the full year ended December 31, 2024 and 2023:
|
|
For the full year ended December 31, |
||
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Loss for the year |
|
(1,644,201) |
|
(1,988,178) |
Divided by: Total revenue |
|
1,711,225 |
|
2,125,539 |
Loss margin for the year |
|
(96.1)% |
|
(93.5)% |
Adjustments: |
|
|
|
|
Income tax expense |
|
33,957 |
|
107,528 |
Finance costs(a) |
|
2,123,138 |
|
2,436,511 |
Finance income(a) |
|
(33,747) |
|
(25,209) |
Depreciation and amortization |
|
362,735 |
|
435,586 |
Impairment of withholding tax receivables(b) |
|
1,081 |
|
47,992 |
Impairment of goodwill |
|
87,894 |
|
- |
Business combination transaction costs |
|
1,280 |
|
2,432 |
Impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent(c) |
|
17,651 |
|
87,696 |
Gain/(loss) on disposal of property, plant and equipment |
|
20,163 |
|
(3,806) |
Share-based payment expense(d) |
|
27,940 |
|
13,370 |
Insurance claims(e) |
|
(73) |
|
(321) |
Gain on disposal of subsidiary |
|
(83,838) |
|
- |
Other costs(f) |
|
14,374 |
|
19,017 |
Other income |
|
- |
|
(83) |
Adjusted EBITDA |
|
928,354 |
|
1,132,535 |
Divided by: Total revenue |
|
1,711,225 |
|
2,125,539 |
Adjusted EBITDA Margin |
|
54.3% |
|
53.3% |
Lease payments made |
|
(129,101) |
|
(135,013) |
Amortization of prepaid site rent |
|
9,938 |
|
9,534 |
Withholding tax(b) |
|
(85,076) |
|
(117,561) |
Income taxes paid |
|
(38,629) |
|
(45,411) |
Maintenance capital expenditures(g) |
|
(71,796) |
|
(139,958) |
Corporate capital expenditures(h) |
|
(785) |
|
(2,180) |
Return Adjusted EBITDA |
|
612,905 |
|
701,946 |
Gross property, plant and equipment(i) |
|
2,462,192 |
|
2,938,489 |
Gross goodwill |
|
578,015 |
|
751,026 |
Gross other intangibles |
|
838,938 |
|
1,113,677 |
| (a) | Finance costs consist of interest expense and loan facility fees on borrowings, the unwinding of the discount on our decommissioning liability and lease liability, realized and unrealized net foreign exchange losses arising from financing arrangements and net realized and unrealized losses from valuations of financial instruments. Finance income consists of interest income from bank deposits, realized and unrealized net foreign exchange gains arising from financing arrangements and net realized and unrealized gains from valuations of financial instruments. |
| (b) | Withholding tax primarily represents amounts withheld by customers in Nigeria and paid to the local tax authority. The amounts withheld may be recoverable in settlement of future corporate income tax liabilities in the relevant operating company. Withholding tax receivables are reviewed for recoverability at each reporting period end and impaired if not forecast to be recoverable. |
| (c) | Represents non-cash charges related to the impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent on the decommissioning of sites. |
| (d) | Relates to share-based compensation expenses which are non-cash and vary from period to period depending on timing of awards and changes to valuation inputs assumptions. |
96
| (e) | Represents insurance claims included as non-operating income. |
| (f) | Other costs included one-off expenses related to strategic initiatives and operating systems of $10.8 million, costs related to internal reorganization of $2.7 million and one-off professional fees related to financing of $0.8 million. |
| (g) | We incur capital expenditures in relation to the maintenance of our towers, which is non-discretionary in nature and required in order for us to optimally run our portfolio and to perform in line with our service level agreements with customers. Non-discretionary capital expenditure is non-revenue generating in nature and consists primarily of maintenance capital expenditure (including the periodic repair, refurbishment and replacement of tower and power equipment at existing sites to keep such assets in service), as well as routine corporate capital expenditure. |
| (h) | Corporate capital expenditures, which are non-discretionary in nature, consist primarily of routine spending on information technology infrastructure. |
| (i) | Excludes the cost of right-of-use assets resulting from leases accounted for under IFRS 16. |
Towers
We measure the number of towers in our portfolio at a given time by counting the number of towers that we own or operate with at least one Tenant. The number of towers in our portfolio excludes towers for which we provide Managed Services. We have historically increased the number of towers in our portfolio through a combination of building New Sites, along with the acquisition of towers from MNOs and an independent tower company. Rationalizing the portfolio through decommissioning towers reduces the number of towers we own and operate.
Colocation Rate
We define Colocation Rate as the average number of Tenants per tower that we own or operate across our tower portfolio at a given point in time, excluding Managed Services. Colocation Rate is an important metric for assessing utilization and capacity on existing Towers. Our Colocation Rate is a key driver of our Adjusted EBITDA Margin, as the addition of further Tenants increases revenue for a proportionally smaller increase in power, our primary variable cost per site. Colocation is achieved at a relatively low incremental capital expense, and is also attractive to our customers as it provides them with shorter deployment times for their equipment compared to New Site alternatives.
Explanation of key line items in the historical consolidated statements of income
Revenue
Our revenue is derived from fees paid by our customers for services from our Colocation business and its ancillary managed services. The Colocation business involves the lease of space on our owned and operated towers and our fixed copper and fiber network infrastructure, which are shared by various MNOs and other communications service providers. A portion of Colocation arrangements for the rental of space on the towers, other assets on tower sites, on which the use of space is dependent, and the use of fixed copper and fiber network infrastructure dedicated to an individual customer is within the scope of IFRS 16. A portion of Colocation arrangements for the provision of services, energy charges and use of shared fixed copper and fiber network infrastructure is within the scope of IFRS 15 Revenue from Contracts with Customers (“IFRS 15”) as a provision of service. Revenue from leasing arrangements is recognized on a straight-line basis over the current lease term of the related lease agreements when collectability is reasonably assured. We also derive revenue from non-lease services, which includes maintenance, security and power supply for Towers owned by third parties. Non-lease revenue is recognized as the service is delivered at an amount that reflects the consideration to which we expect to be entitled in exchange for those services. Such revenue is recognized in the accounting period in which the services are rendered. We assess the probability that defaulting customers will not settle amounts billed and accordingly treat any component that we deem may not be collected as variable consideration, contingent upon the receipt of funds from the customer, an event that is not wholly within our control.
Cost of sales
Cost of sales consists of power generation (including diesel costs), which after depreciation, is our largest single cost item, ground lease rental, tower repairs and maintenance, depreciation and amortization in relation to sites and right-of-use assets, impairment of property, plant and equipment, intangible assets excluding goodwill and prepaid land rent, staff costs and other costs directly related to the provision of services to customers and other site related costs, such as security services, regulatory permits and license costs, insurance, including for customer and network related assets. Depreciation of a tower is calculated using the straight-line method over an estimated useful life of 10 to 20 years.
97
Depreciation of alarms, batteries and generators are also calculated using the straight-line method over a range of estimated useful lives between one and five years, depending on the equipment. Right-of-use assets are depreciated on a straight-line basis over the shorter of the remaining estimated useful life of the tower and the lease term.
Administrative expenses
Administrative expenses are costs not directly related to provision of services to customers, but which support our business as a whole. These overhead expenses primarily consist of administrative staff costs (including key management compensation), impairment of goodwill costs, office rent and related property expenses, insurance, travel costs, professional fees, depreciation and amortization of administrative assets and right-of-use assets where such assets are leased, net loss or gains from sale of assets, allowance for trade and other receivables and other sundry costs. Administrative expenses also includes other corporate overhead expenses related to our acquisition efforts and costs associated with new business initiatives.
Loss allowance on trade receivables
We account for our trade receivables credit risk by appropriately providing for expected credit losses. Loss allowance on trade receivables represents the expected loss from non-payment of amounts due from customers in accordance with the accounting standards applicable to each period. The loss allowance is determined based on our policy for evaluating expected credit losses and any subsequent impairment taking into account historical loss rates, the available information on a customer’s financial position and forward-looking macroeconomic data.
Other income
Other income includes proceeds from insurance claims and net gain on disposal. There were no business disposals in the prior years.
Finance costs and income
Finance costs consist of interest expense and loan facility fees on borrowings, the unwinding of the discount on our decommissioning liability and lease liability, realized and unrealized net foreign exchange losses arising from financing arrangements and net realized and unrealized losses from valuations of financial instruments. Finance income consists of interest income from bank deposits, realized and unrealized net foreign exchange gains arising from financing arrangements and net realized and unrealized gains from valuations of financial instruments.
Taxation
Taxation consists of income tax, education tax and deferred taxes. Income tax is calculated at the domestic tax rate applicable to profits in our respective countries of business. Current and deferred tax is recognized on taxes that are regarded as taxes on corporate income under relevant IFRS accounting standards. This includes Nigerian education tax, which arises at the rate of 3.0% (2023: 3.0%) on taxable profits determined on a basis similar to income tax.
Deferred income tax assets are recognized for deductible temporary differences, including tax losses carried forward, arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements, but only to the extent that the realization of the related tax benefits are expected to be met through the reversal of taxable temporary differences and that it is probable that future taxable profits will be available against which the temporary differences can be utilized. As of December 31, 2024, in Nigeria and certain other jurisdictions that have taxable losses brought forward or arising in the present period, deferred tax assets in respect of those losses are recognized only to the extent they are forecast to be applied against (i) the reversal of taxable temporary differences, or (ii) additional forecast future taxable income.
98
RESULTS OF OPERATIONS
The table below shows our consolidated results of operations for the full year ended December 31, 2024 and 2023:
|
|
For the full year ended December 31, |
||
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Revenue |
|
1,711,225 |
|
2,125,539 |
Cost of sales |
|
(890,533) |
|
(1,183,306) |
Administrative expenses |
|
(429,818) |
|
(404,783) |
Net reversal of loss allowance/(net loss allowance) on trade receivables |
|
25 |
|
(7,202) |
Other income |
|
88,248 |
|
404 |
Operating income |
|
479,147 |
|
530,652 |
Finance income |
|
33,747 |
|
25,209 |
Finance costs |
|
(2,123,138) |
|
(2,436,511) |
Loss before income tax |
|
(1,610,244) |
|
(1,880,650) |
Income tax expense |
|
(33,957) |
|
(107,528) |
Loss for the year |
|
(1,644,201) |
|
(1,988,178) |
Impact of Nigerian Naira devaluation
Following the steps taken by the Central Bank of Nigeria, the Naira devalued between the period immediately prior to the announcement and the month end rate as of June 30, 2023. The Naira continued to devalue in the second half of 2023 and in January 2024, there was a further significant devaluation. During the second and third quarters of 2024, the Naira continued to devalue but at a significantly slower rate as compared to the first quarter of 2024. During the fourth quarter of 2024, this trend reversed resulting in an appreciation of the Naira closing rate at the end of the fourth quarter compared to the end of third quarter of 2024.
In November 2024, the Central Bank of Nigeria directed authorized dealers to use a new trading platform - Bloomberg BMatch as the Electronic Foreign Exchange Matching System (“EFEMS”) for foreign exchange related activities. It is expected the platform would enhance the integrity and operational efficiency of the foreign exchange market by providing greater price discovery.
Set out below are the closing and average rates for the Naira currency relevant to these financial statements:
|
Closing Rate |
Closing Rate Movement (1) |
3- Month Average Rate |
Average Rate Movement (1) |
|
₦:$ |
$:₦ |
₦:$ |
$:₦ |
|
|
|
|
|
June 14, 2023 |
472.3 |
— |
— |
— |
June 30, 2023 |
752.7 |
(37.3)% |
508.0 |
— |
September 30, 2023 |
775.6 |
(2.9)% |
767.7 |
(33.8)% |
December 31, 2023 |
911.7 |
(14.9)% |
815.0 |
(5.8)% |
March 31, 2024 |
1,393.5 |
(34.6)% |
1,315.9 |
(38.1)% |
June 30, 2024 |
1,514.3 |
(8.0)% |
1,391.8 |
(5.4)% |
September 30, 2024 |
1,669.1 |
(9.3)% |
1,601.0 |
(13.1)% |
December 31, 2024 |
1,546.0 |
8.0% |
1,628.5 |
(1.7)% |
| (1) | Movements presented for each period are between that period’s rate and the preceding period rate and are calculated as percentage of the period’s rate. |
Due to the Naira devaluation, Revenue and segment Adjusted EBITDA in the fourth quarter of 2024 were negatively impacted by $259.0 million and $155.2 million, respectively, compared to the same period in 2023. In the fourth quarter of 2024, the foreign exchange resets in some of our contracts partially offset these impacts. However, the appreciation of the Naira in the fourth quarter of 2024 resulted in unrealized foreign exchange gains of $166.9 million on USD denominated intercompany loans advanced to our Nigerian operations (partially offsetting the unrealized losses in the previous quarters of 2024).
99
The unrealized gains and losses are recorded in finance costs, however Group net assets are not impacted since equal and opposite gains and losses are recorded in equity on the retranslation of the Nigerian operations’ assets and liabilities (which include these loans). The assets included property, plant and equipment and the devaluation of the Naira from December 31, 2023 to December 31, 2024 resulted in a $261.5 million reduction in their carrying value.
Results for the full year ended December 31, 2024 versus 2023
In December, 2024, the Company completed the sale of its 70% interest in IHS Kuwait Limited, resulting in 12 fewer trading days for this operation for the full year ended December 31, 2024 when compared to the equivalent year ended December 31, 2023. The revenue from the equivalent 12 day comparative period after December 19, 2023 is captured within inorganic revenue. Given the disposal date of December 19, 2024, as of December 31, 2024 the entire Tower portfolio, Tenants and Lease Amendments in Kuwait had been deconsolidated. Refer to note 31.2 of the financial statements for the further information on the disposal of the Kuwait business.
Revenue
Revenue for the full year ended December 31, 2024 of $1,711.2 million declined 19.5% year-on-year, driven primarily by the devaluation of the NGN versus the U.S. dollar. Organic revenue(1) increased by $1,021.7 million (increased 48.1%) year-on-year driven primarily by foreign exchange resets, power indexation, escalations, and continued growth in revenues from Tenants, Lease Amendments and New Sites. This growth was partially offset by the initial impact of the new financial terms in the renewed and extended contracts with MTN Nigeria, signed during the third quarter of 2024. Aggregate inorganic revenue declined $0.4 million, which related to the sixth stage of the Kuwait Acquisition, offset by the disposal of operations in Kuwait in December 2024 and Peru in April 2024. The increase in organic revenue was more than offset by the non-core impact of adverse movements in foreign exchange rates used to translate the results of foreign operations of $1,435.6 million, or 67.5%, of which $1,394.0 million was due to the devaluation of the NGN.
Refer to the revenue component of the segment results section of this discussion and analysis for further details.
| (1) | Refer to “Item 5. Operating and Financial Review and Prospects” for the definition of organic revenue and additional information. |
Cost of Sales
Set out below is the cost of sales for the years ended December 31, 2024, and 2023:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Power generation |
|
348,831 |
|
396,714 |
Depreciation |
|
304,384 |
|
373,889 |
Tower repairs and maintenance |
|
53,368 |
|
96,258 |
Amortization |
|
42,468 |
|
44,618 |
Staff costs |
|
24,411 |
|
33,149 |
Security services |
|
18,015 |
|
42,512 |
Impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent |
|
14,767 |
|
87,696 |
Regulatory fees |
|
8,148 |
|
37,502 |
Short-term rental |
|
5,797 |
|
8,613 |
Travel costs |
|
5,702 |
|
9,700 |
Insurance |
|
4,524 |
|
4,648 |
Impairment of assets held for sale |
|
2,853 |
|
- |
Short-term other rent |
|
2,043 |
|
2,266 |
Professional fees |
|
1,943 |
|
2,570 |
Vehicle maintenance and repairs |
|
1,814 |
|
2,184 |
Other |
|
51,465 |
|
40,987 |
|
|
890,533 |
|
1,183,306 |
Cost of sales decreased by $292.8 million, or 24.7%, for the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to a decrease in impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent ($72.9 million), depreciation and amortization ($71.7 million), power generation costs ($47.9 million), tower repairs and maintenance costs ($42.9 million), regulatory fees ($29.4 million) and security services costs ($24.5 million), respectively.
100
As described above, since June 2023 the Naira has significantly devalued against the U.S. dollar. This devaluation has been a key driver of the decreases across many cost of sales lines, as described in the Nigeria segmental analysis below.
Impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent decreased by $72.9 million for the year ended December 31, 2024, primarily driven by power equipment assets in our SSA segment being classified as assets held for sale and remeasured at fair value less cost to sell in the year ended December 31, 2023.
Depreciation and amortization costs decreased by $71.7 million for the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to the devaluation of the Naira.
Power generation ($47.9 million), tower repairs and maintenance ($42.9 million), and security costs ($24.5 million) decreased, respectively for the year ended December 31, 2024 compared to the prior year, primarily driven by local currency devaluation in our Nigeria segment and lower costs in our SSA segment due to changes in our agreements with MTN SA on power Managed Services.
Regulatory fees decreased by $29.4 million in the year ended December 31, 2024 compared to the year ended December 31, 2024, primarily relating to a review of current and historical license obligations in our SSA segment.
Other costs increased by $10.5 million in the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily relating to a non-recurring write down of inventory in our Nigeria segment partially offset by a decrease in foreign exchange losses.
Administrative Expenses
Set out below is the administrative expenses for the years ended December 31, 2024, and 2023:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Staff costs |
|
178,433 |
|
186,200 |
Impairment of goodwill |
|
87,894 |
|
- |
Professional fees |
|
49,369 |
|
61,094 |
Facilities, short-term rental and upkeep |
|
31,659 |
|
43,616 |
Net loss/(gain) on disposal of property, plant and equipment and right-of-use assets |
|
20,163 |
|
(3,806) |
Depreciation |
|
11,583 |
|
11,314 |
Travel costs |
|
10,890 |
|
14,124 |
Amortization |
|
4,300 |
|
5,765 |
Business combination costs |
|
1,280 |
|
2,432 |
Net impairment of withholding tax receivables |
|
1,081 |
|
47,992 |
Operating taxes |
|
953 |
|
(1,005) |
Impairment of other fixed assets |
|
31 |
|
- |
Other |
|
32,182 |
|
37,057 |
|
|
429,818 |
|
404,783 |
Administrative expenses for the year ended December 31, 2024 increased by $25.0 million, or 6.2%, which was primarily as a result of an impairment of goodwill of $87.9 million and an increase in loss on disposal of property, plant and equipment and right-of-use assets of $24.0 million, offset by a decrease in impairment of withholding tax receivables, facilities short-term rental and upkeep costs, professional fees and staff costs of $46.9 million, $12.0 million, $11.7 million and $7.8 million, respectively.
Impairment of goodwill for the year ended December 31, 2024, amounted to $87.9 million (2023: $nil). This impairment related to the IHS Latam tower businesses group of CGUs and was primarily driven by the restructuring of our customer Oi Brazil, as well as the disposal of our Peru business, which was finalized on April 30, 2024. In addition, this resulted in an increase in the net loss/(gain) on the disposal of property, plant, and equipment, and right-of-use assets, totaling $24.0 million.
101
The increase was primarily attributed to a lease modification with our customer, Oi Brazil.
Impairment of withholding tax receivables decreased by $46.9 million to $1.1 million for the year ended December 31, 2024, from $48.0 million for the year ended December 31, 2024, due to changes in the revenue withholding tax regulations which impact the Group’s Nigerian businesses. Effective from January 1, 2025, these changes reduce the amounts of revenue tax withheld by customers in Nigeria with respect to colocation and telecommunication tower services from 10% to 2%. Following this announcement, previously impaired revenue withholding tax receivables were reassessed to identify which could be utilized in settlement of future tax liabilities resulting in the reversal of previously impaired revenue withholding tax receivables of $47.4 million.
Facilities, short-term rental and upkeep costs decreased by $12.0 million to $31.7 million in the year ended December 31, 2024, from $43.6 million in the year ended December 31, 2023, mainly driven by a decrease in repairs and maintenance in our Nigeria segment.
Staff costs decreased by $7.8 million to $178.4 million in the year ended December 31, 2024, from $186.2 million in the year ended December 31, 2023, primarily driven by local currency devaluation in our Nigeria segment.
Other administrative expense items decreased by $4.9 million for the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily driven by reduced foreign exchange losses in 2024 in our Nigeria segment partially offset by $7.6 million of share-based payment expense related to B-BBEE transaction recorded in our SSA segment in the fourth quarter of 2024.
Other Income
Other income increased by $87.8 million to $88.2 million for the year ended December 31, 2024 compared to $0.4 million for the year ended December 31, 2023 primarily due to the net gain of $83.9 million from the Kuwait Disposal.
Finance Income/Costs
Set out below are finance income and costs for the years ended December 31, 2024 and 2023:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Interest income - bank deposits |
|
18,660 |
|
25,008 |
Net foreign exchange gain arising from derivative instruments - unrealized |
|
8,147 |
|
- |
Fair value gain on embedded options |
|
6,710 |
|
- |
Fair value gain on interest rate caps |
|
230 |
|
163 |
Net foreign exchange gain arising from derivative instruments - realized |
|
- |
|
38 |
Finance income |
|
33,747 |
|
25,209 |
|
|
|
|
|
Net foreign exchange loss arising from financing - unrealized |
|
(1,610,715) |
|
(1,713,242) |
Interest expenses - third party borrowings |
|
(359,965) |
|
(362,381) |
Interest and finance charges paid/payable for lease liabilities |
|
(68,031) |
|
(61,617) |
Net foreign exchange loss arising from financing - realized |
|
(23,304) |
|
(162,944) |
Net foreign exchange loss on derivative instruments - realized |
|
(23,209) |
|
- |
Interest expenses - withholding tax paid on bond interest |
|
(15,569) |
|
(13,439) |
Fees on borrowings and financial derivatives |
|
(12,917) |
|
(17,821) |
Unwinding of discount on decommissioning liability |
|
(9,191) |
|
(9,156) |
Costs paid on early loan and bond settlement |
|
(237) |
|
- |
Net foreign exchange loss on derivative instruments - unrealized |
|
- |
|
(92,151) |
Fair value loss on embedded options |
|
- |
|
(3,760) |
Finance costs |
|
(2,123,138) |
|
(2,436,511) |
|
|
|
|
|
Net finance costs |
|
(2,089,391) |
|
(2,411,302) |
102
Finance income and costs are typically driven by interest rates on deposits and borrowings. However, for the year ended December 31, 2024 and 2023 finance costs were impacted by significant foreign exchange movements arising on our Nigerian subsidiaries’ U.S. dollar denominated intercompany loans and U.S. dollar denominated letters of credit as a result of the devaluation of the Nigerian Naira versus the U.S. dollar.
Net finance costs for the year-on-year decreased by $321.9 million which was primarily driven by the decrease in net foreign exchange losses arising from financing (realized and unrealized) of $242.2 million due to movements in the NGN and net gain on foreign exchange arising from derivative instruments (realized and unrealized) of $77.1 million primarily due to the contractual rate resets on the NGN foreign exchange swaps.
Adjusted EBITDA
Adjusted EBITDA was $928.4 million in the full year ended December 31, 2024, resulting in an Adjusted EBITDA margin of 54.3%. Adjusted EBITDA decreased 18.0% year-on-year reflecting the decrease in revenue described above, partially offset by a decrease in cost of sales, largely driven by the devaluation of the Naira versus the U.S. dollar. The reduction in cost of sales was primarily due to a decrease in tower repairs and maintenance costs ($42.9 million), power generation costs ($47.9 million), security services costs ($24.5 million), regulatory fees ($29.4 million) and staff costs ($8.7 million). The $59.1 million reduction in administrative costs included within Adjusted EBITDA was primarily driven by the devaluation of the Naira against the U.S. dollar, supported by cost saving initiatives implemented during the period.
Income Tax Expense
Set out below is the income tax expense for the years ended December 31, 2024 and 2023:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Current taxes on income |
|
75,460 |
|
114,430 |
Deferred income taxes |
|
(41,503) |
|
(6,902) |
Total tax expense |
|
33,957 |
|
107,528 |
The $73.6 million decrease in the total income tax expense comprises a reduction in current income tax expense of $39.0 million and a $34.6 million increase in deferred income tax credits.
The reduction in current income tax was primarily driven by a $27.3 million reduction in the tax expense in our Nigeria segment which was largely attributable to the translation impact on the segment results following the devaluation of the Naira, and a decrease in the Group's uncertain tax position provision.
The increase of $34.6 million in deferred income tax credits was primarily due to increases within our Latam and Nigerian segments of $39.6 million and $9.2 million respectively. In the Latam segment, the increase was mainly driven by recognition of deferred tax on tax losses, and in Nigeria, the credits were principally due to the recognition of deferred tax assets in relation to finance costs.
Loss for the year
The year-on-year decrease in the loss for the year of $344.0 million is primarily driven by lower net financing costs of $321.9 million, as a result of a decrease in the unrealized net foreign exchange losses arising from financing linked to lower level of Naira devaluation year-on-year. This decrease is coupled with a net gain of $83.9 million from the Kuwait Disposal. In addition, there was reductions in impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent of $72.9 million, primarily driven by power equipment assets in our SSA segment being classified as assets held for sale and remeasured at fair value less cost to sell in the third quarter of 2023, as well as decreases in in depreciation ($69.2 million), power generation ($47.9 million), net impairment of withholding tax receivables ($46.9 million), tower repairs and maintenance ($42.9 million), regulatory fees ($29.4 million), and security services ($24.5 million). This was partially offset by an impairment of goodwill of $87.9 million related to the IHS Latam tower business which was recognized in the first quarter of 2024 and a decrease in revenue as described above.
103
SEGMENT RESULTS:
Revenue and Adjusted EBITDA by segment
Set out below are Revenue and Adjusted EBITDA for each of our reportable segments for the full year ended December 31, 2024 and 2023:
Revenue
|
|
For the full year ended December 31, |
|
|
|
|
|
||
|
|
2024 |
|
2023 |
|
Change |
|
Change |
|
|
|
$’000 |
|
$’000 |
|
$’000 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
Nigeria |
|
998,466 |
|
1,381,627 |
|
(383,161) |
|
(27.7) |
|
SSA |
|
483,842 |
|
503,049 |
|
(19,207) |
|
(3.8) |
|
Latam |
|
184,030 |
|
200,207 |
|
(16,177) |
|
(8.1) |
|
MENA |
|
44,887 |
|
40,656 |
|
4,231 |
|
10.4 |
|
Total revenue |
|
1,711,225 |
|
2,125,539 |
|
(414,314) |
|
(19.5) |
|
Adjusted EBITDA
|
|
For the full year ended December 31, |
|
|
|
|
|
||
|
|
2024 |
|
2023 |
|
Change |
|
Change |
|
|
|
$’000 |
|
$’000 |
|
$’000 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
Nigeria |
|
588,031 |
|
855,317 |
|
(267,286) |
|
(31.2) |
|
SSA |
|
307,954 |
|
257,072 |
|
50,882 |
|
19.8 |
|
Latam |
|
138,035 |
|
145,754 |
|
(7,719) |
|
(5.3) |
|
MENA |
|
27,561 |
|
22,121 |
|
5,440 |
|
24.6 |
|
Unallocated corporate expenses(1) |
|
(133,227) |
|
(147,729) |
|
14,502 |
|
9.8 |
|
Total Adjusted EBITDA |
|
928,354 |
|
1,132,535 |
|
(204,181) |
|
(18.0) |
|
| (1) | Unallocated corporate expenses primarily consist of costs associated with centralized Group functions including Group executive, legal, finance, tax and treasury services. |
Nigeria
Revenue for the full year ended December 31, 2024 decreased 27.7% year-on-year to $998.5 million primarily driven by devaluation of the Naira versus the U.S. dollar. Organic revenue increased by $1,010.8 million (73.2%) driven primarily by foreign exchange resets and diesel prices, as well as continued growth in revenue from Colocation and Lease Amendments, partially offset by a reduction in revenues related to the new financial terms in the renewed contracts with MTN Nigeria, signed during the third quarter of 2024. The decrease in reported revenue was primarily driven by the non-core impact of negative movements in foreign exchange rates used to translate the results of foreign operations of $1,394.0 million, 100.9% year-on-year.
Tenants decreased by 269 year-on-year, with growth of 528 from Colocation and 96 from New Sites, more than offset by 893 Churned (which includes, for the third quarter of 2024, 529 Tenants occupied by our smallest Key Customer on which we were not recognizing revenue), while Lease Amendments increased by 1,035 primarily due to 3G and fiber upgrades.
Segment Adjusted EBITDA for the full year ended December 31, 2024 declined 31.3% year-on-year to $588.0 million, for a margin of 58.9%. The year-on-year decline in segment Adjusted EBITDA primarily reflects the decrease in revenue discussed above, partially offset by a reduction in cost of sales and administrative expenses included within Segment Adjusted EBITDA, primarily due to the Naira devaluation described above, even though the underlying local costs increased during the period. The reduction in cost of sales was driven by a reduction in the USD equivalent amounts for the cost of diesel ($30.8 million), tower repairs and maintenance costs ($26.9 million), security services costs ($10.2 million), regulatory fees ($8.0 million) and staff costs ($7.5 million). The $5.9 million increase in other cost of sales was primarily driven by a write-down of inventory during the fourth quarter.
104
SSA
Revenue for the full year ended December 31, 2024 decreased 3.8% year-on-year to $483.8 million. Organic revenue increased by $8.2 million as escalations and foreign exchange resets were partially offset by lower power pass-through revenues being recognized after the changes in our agreements with MTN South Africa relating to the provision of power Managed Services. These changes to power pass-through revenue have no impact on Adjusted EBITDA. The overall decrease in revenue was also impacted by the non-core impact of negative movements in foreign exchange rates of $27.4 million, or 5.4%.
Tenants increased by 835 year-on-year, including 814 from Colocation and 127 from New Sites, partially offset by 106 from Churn, while Lease Amendments increased by 1,687.
Segment Adjusted EBITDA for the full year ended December 31, 2024 grew 19.8% year-on-year to $308.0 million, for a margin of 63.6%. The year-on-year increase in segment Adjusted EBITDA primarily reflects a decrease in cost of sales included within Adjusted EBITDA of $68.8 million, driven by regulatory fees ($21.8 million) and reduced tower repairs and maintenance costs ($16.9 million), security services costs ($14.9 million), and power generation costs ($14.5 million) driven by the changes in our agreements with MTN South Africa described above. This was partially offset by the decrease in revenue during the period.
Latam
Revenue for the full year ended December 31, 2024, decreased 8.1% year-on-year to $184.0 million and was driven by the non-core impact of adverse movements in foreign exchange rates of $14.4 million, or 7.2%. Organic revenue declined 0.6% ($1.2 million) year-on-year, driven by a reduction in revenues from our customer Oi Brazil of $22.3 million as a result of their judicial recovery proceedings, but offset by organic growth from Colocation, Lease Amendments, New Sites and fiber.
Tenants increased by 746 year-on-year, including 697 from New Sites and 309 from Colocation, partially offset by 194 Churned and net divestiture of 66, due to the disposal of our Peru operations, while Lease Amendments increased by 346.
Segment Adjusted EBITDA for the full year ended December 31, 2024 declined 5.3% to $138.0 million and primarily reflects the decrease in revenue described above, and an increase in power generation costs ($1.1 million) and tower repairs and maintenance costs ($0.7 million), partially offset by a decrease in site rental costs ($3.7 million).
MENA
On December 19, 2024, the Company completed the disposal of its 70% interest in IHS Kuwait Limited, resulting in 12 fewer trading days for this operation in both the three month and full year periods ended December 31, 2024, when compared to the equivalent periods ended December 31, 2023. The revenue from the equivalent 12 day comparative period after December 19, 2023, is captured within inorganic revenue. Given the disposal date of December 19, 2024, as of December 31, 2024 the entire Tower portfolio, Tenants and Lease Amendments had been deconsolidated. Refer to note 31.2 of the financial statements for the further information on the disposal of the Kuwait business.
Revenue for the full year ended December 31, 2024, increased 10.4% year-on-year to $44.9 million driven primarily by New Sites, Lease Amendments, and escalations, partially offset by the impact of 12 fewer days of IHS Kuwait results following the sale of this operation to Zain Kuwait on December 19, 2024. Revenues grew inorganically in the period by $0.1 million, or 0.3%, driven primarily by the sixth stage of the Kuwait Acquisition, completed in August 2023, offset by the disposal of this operation to Zain Kuwait described above.
Prior to the disposal in December 2024, Tenants increased by 4 for the year, including 9 from New Sites, partially offset by 5 Churned sites, while Lease Amendments increased by 272, resulting in 1,678 Towers, 1,700 Tenants and 272 Lease Amendments. Following completion of the Kuwait Disposal and as of December 31, 2024, these Towers, Tenants and Lease Amendments had been deconsolidated.
Segment Adjusted EBITDA was $27.6 million for the full year ended December 31, 2024, an increase of 24.6% year-on-year. The increase in segment Adjusted EBITDA primarily reflects the increase in revenue described above, with year-on-year growth impacted by 12 fewer days of IHS Kuwait results following the sale of this operation to Zain Kuwait.
105
CAPITAL EXPENDITURE:
Set out below is the capital expenditure for the full year ended December 31, 2024 and 2023 for each of our reporting segments:
|
|
For the full year ended December 31, |
|
|
|
|
|
||
|
|
2024 |
|
2023 |
|
Change |
|
Change |
|
|
|
$’000 |
|
$’000 |
|
$’000 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
Nigeria |
|
90,913 |
|
316,221 |
|
(225,308) |
|
(71.3) |
|
SSA |
|
38,150 |
|
73,769 |
|
(35,619) |
|
(48.3) |
|
Latam |
|
123,145 |
|
187,803 |
|
(64,658) |
|
(34.4) |
|
MENA |
|
1,375 |
|
5,855 |
|
(4,480) |
|
(76.5) |
|
Other |
|
2,293 |
|
2,399 |
|
(106) |
|
(4.4) |
|
Total capital expenditure |
|
255,876 |
|
586,047 |
|
(330,171) |
|
(56.3) |
|
Nigeria
The 71.3% year-on-year decrease for the full year ended December 31, 2024, was primarily driven by decreases of $99.1 million related to Project Green, $57.9 million related to maintenance, $34.2 million related to augmentation and $19.9 million related to the fiber business, respectively.
SSA
The 48.3% year-on-year decrease for the full year ended December 31, 2024 was primarily driven by decreases in refurbishment ($18.6 million), New Sites ($9.1 million) and maintenance ($6.3 million).
Latam
The 34.4% year-on-year decrease for the full year ended December 31, 2024 was primarily driven by decreases related to fiber business ($29.8 million), New Sites ($22.7 million), purchase of land for new or existing sites ($5.7 million) and other capital expenditure ($8.4 million).
MENA
The 76.5% year-on-year decrease for the full year ended December 31, 2024 was primarily due to a decrease related to New Sites ($2.7 million), other capital expenditure ($0.7 million) and maintenance ($0.6 million).
B. LIQUIDITY AND CAPITAL RESOURCES
We generally fund our operations, which include operating expenses and debt service requirements (principal and interest payments), through cash flow from operating activities. We have historically funded acquisitions and other investments in our business, including large scale New Site construction and site improvements, from a combination of external equity raised from shareholders, long-term debt financings and internally generated cash from operations. External equity funding was raised at the IHS Holding Limited level, where it was held in U.S. dollars until required by operating subsidiaries or for acquisitions. As and when operating subsidiaries required these funds, the funding was allocated typically through intercompany loans to those subsidiaries. The proportion of intercompany loans to equity is unique to each operation and determined by commercial funding requirements, local taxation and corporate legislation.
As of December 31, 2024, we had $913.6 million of total liquidity, which was equal to our unrestricted cash and cash equivalents of $578.0 million, availability under the IHS Holding 2020 RCF of $300.0 million, and approximately $35.6 million of availability under other local facilities within the Group.
Our centralized treasury team supervises our cash management. Our cash and cash equivalents are generated within our operating subsidiaries and held either locally or upstreamed to IHS Holding Limited (or intermediaries thereof). As a holding company, our only source of cash to pay our obligations will be distributions with respect to our ownership interests in our subsidiaries or repayment of intercompany loans from (i) the net earnings and cash flow generated by these subsidiaries and (ii) any excess funds from the refinancing of operating company debt financings.
106
For the year ended December 31, 2024, our Nigeria Group alone upstreamed $270.9 million to IHS Holding Limited.
We believe that our available liquidity and cash from operations will be sufficient to satisfy our operating expenses, debt service, capital expenditure requirements and organic growth strategies for a period of at least 12 months from the date of issuance of these results. However, our ability to satisfy our operating expenses, debt service, capital requirements and growth strategies will depend on our future performance, which is subject to general economic, financial, competitive, regulatory and other factors, including those described in the “Risk Factors” section of our Annual Report. If we are unable to generate sufficient cash flow from operating activities in the future, we may have to obtain additional financing. If we obtain additional capital by issuing equity, it could result in the dilution of our existing shareholders. If we incur additional indebtedness, that indebtedness may contain significant financial and other covenants that may significantly restrict our operations. There can be no assurance that such financing will be available to us on commercially reasonable terms or at all.
Additionally, we continuously review our capital structure as well as our funding and maturity profile. As part of this review, we regularly explore opportunities in the global capital markets to try to optimize our funding profile and our mix of funding sources, as well as to try to ensure that we are well positioned to avail ourselves of any refinancing or other opportunities, including for our 2026 and 2027 Notes and our other facilities. We may also, from time to time, consider debt and/or equity repurchase programs, whether in the open market or otherwise, subject to market conditions.
MOVEMENTS IN CASH AND CASH EQUIVALENTS DURING THE PERIOD
Set out below is the cashflows for the years ended December 31, 2024, and 2023:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Net cash generated from operating activities |
|
729,305 |
|
853,453 |
Net cash generated from/(used in) investing activities |
|
63,179 |
|
(722,249) |
Net cash used in financing activities |
|
(430,996) |
|
(162,301) |
Net increase/(decrease) in cash and cash equivalents |
|
361,488 |
|
(31,097) |
Cash and cash equivalents at beginning of year |
|
293,823 |
|
514,078 |
Effect of movements in exchange rates |
|
(77,355) |
|
(189,158) |
Cash and cash equivalents at end of year |
|
577,956 |
|
293,823 |
Net cash generated from operating activities
The year-on-year decrease was $124.1 million, which was primarily driven by a decrease in cashflow from operating income before working capital changes of $193.4 million, partially offset by an improvement in working capital changes of $66.3 million.
Net cash generated from/(used in) investing activities
The year-on-year positive movement was primarily due to lower net short-term deposits of $315.0 million, lower capital expenditure for property, plant and equipment (including advance payments) of $310.9 million and the net cashflow proceeds from the Kuwait Disposal of $114.9 million.
Net cash used in financing activities
The year-on-year negative movement was primarily due to a $237.6 million lower net cash inflow from issuance and repayment of borrowings and higher interest paid of $28.0 million. The receipts from financing for the year ended December 31, 2024, were predominantly utilized to settle outstanding senior notes and bank borrowings, while proceeds from financing for the year ended December 31, 2023, were used partially to repay existing debt and partially retained for operational needs.
107
INDEBTEDNESS
Set out below is the Group’s indebtedness as at December 31, 2024 and 2023:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$'000 |
Non-current |
|
|
|
|
Senior Notes |
|
2,164,209 |
|
1,930,457 |
Debentures and bank term loans |
|
1,055,006 |
|
1,126,239 |
|
|
3,219,215 |
|
3,056,696 |
|
|
|
|
|
Current |
|
|
|
|
Senior Notes |
|
19,326 |
|
26,912 |
Debentures and bank term loans |
|
102,552 |
|
107,110 |
Bank overdraft |
|
— |
|
675 |
Letters of credit |
|
6,856 |
|
319,454 |
|
|
128,734 |
|
454,151 |
|
|
|
|
|
Total borrowings |
|
3,347,949 |
|
3,510,847 |
Refer to note 22 to the financial statements for further details on our indebtedness.
FINANCING ACTIVITIES FOR THE PERIOD
Approximate U.S. dollar equivalent values for non-USD denominated facilities stated below are translated from the currency of the debt at the relevant exchange rates on December 31, 2024.
IHS Holding (2020) Revolving Credit Facility
IHS Holding Limited is party to a $300.0 million revolving credit facility agreement, originally entered into in March 2020 (as amended and/or as amended and restated from time to time, including pursuant to an amendment and restatement agreement entered into in June 2021 and November 2023) (the “IHS Holding 2020 RCF”) and entered into between, amongst others, IHS Holding Limited as borrower, IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Towers NG Limited, IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., INT Towers Limited, IHS Nigeria and (since July 2024) INT Towers NG Finco 1 Plc as guarantors, Citibank Europe PLC, UK Branch as facility agent and certain financial institutions listed therein as original lenders.
The interest rate under the IHS Holding 2020 RCF is equal to Term SOFR and a credit adjustment spread plus a margin of 3.00% per annum. IHS Holding Limited also pays certain other fees and costs, including fees for undrawn commitments, utilization and agent fees.
Funds borrowed under the IHS Holding 2020 RCF can be applied towards general corporate purposes including, but not limited to, the financing of (a) New Site programs and (b) the repayment of indebtedness (including interest and fees on that indebtedness).
Subject to certain conditions, IHS Holding Limited may voluntarily prepay its utilizations and/or permanently cancel all or part of the available commitments by giving five RFR banking days’ prior notice, or in any case any such shorter period as the majority lenders may agree. In addition to voluntary prepayments, the IHS Holding 2020 RCF requires mandatory cancellation, and if applicable, prepayment in full or in part in certain circumstances, including, but not limited to: (i) with respect to any lender, if it becomes unlawful for such lender to perform any of its obligations under the IHS Holding 2020 RCF; and (ii) upon the occurrence of a change of control as defined in the IHS Holding 2020 RCF.
The IHS Holding 2020 RCF contains customary information undertakings, affirmative covenants and negative covenants (including, without limitation, a negative pledge), in each case subject to certain agreed exceptions and materiality carve-outs). The covenants include an interest cover ratio (the ratio of EBITDA for the relevant period to interest expense for the relevant period) and a leverage ratio (the ratio of net financial debt for the relevant period to EBITDA in respect of that relevant period) as financial covenants. These financial covenants are tested quarterly (except where compliance is required at any time and where testing is required upon incurrence) in arrear based on the previous 12 months, by reference to the financial statements delivered and/or each compliance certificate delivered.
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The IHS Holding 2020 RCF contains customary events of default (subject in certain cases to agreed grace periods, thresholds and other qualifications).
In November 2023, the IHS Holding 2020 RCF was amended and restated to, among other things, extend the termination date to October 30, 2026.
As of March 14, 2025, there are no amounts drawn and outstanding under the IHS Holding 2020 RCF.
The IHS Holding 2020 RCF is denominated in U.S. dollars and is governed by English law.
IHS Holding (2022) Bullet Term Loan
IHS Holding Limited entered into a $600.0 million term loan agreement in October 2022 (as amended and/or as amended and restated from time to time, the “IHS Holding 2022 Term Loan”), between, amongst others, IHS Holding Limited as borrower, Citibank Europe plc, UK Branch as facility agent and certain financial institutions listed therein as original lenders. The loan was guaranteed by IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Towers NG Limited, IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., INT Towers Limited and IHS Nigeria.
The interest rate applicable to loans made under the IHS Holding 2022 Term Loan was equal to Term SOFR, a credit adjustment spread plus a margin of 3.75% per annum.
The drawn amount of $430.0 million of the IHS Holding 2022 Term Loan was fully prepaid in October 2024 using the proceeds received from the IHS Holding 2024 Dual-Tranche Term Loan.
The IHS Holding 2022 Term Loan was denominated in U.S. dollars and was governed by English law.
IHS Holding (2024) Term Loan
IHS Holding Limited entered into a $270.0 million loan agreement on March 8, 2024 (as amended and/or restated from time to time, the “IHS Holding 2024 Term Loan”), between, amongst others, IHS Holding Limited as borrower and Standard Chartered Bank (Singapore) Limited as the original lender. The loan was guaranteed by IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Towers NG Limited, IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., INT Towers Limited, IHS Nigeria and (since July 2024) INT Towers NG Finco 1 Plc.
The interest rate per annum applicable to loans made under the IHS Holding 2024 Term Loan was equal to Term SOFR, plus a margin (ranging from 4.50% to 7.00% per annum over the duration of the IHS Holding 2024 Term Loan, based on the relevant margin step-up date).
The IHS Holding 2024 Term Loan was fully prepaid in November 2024 using the proceeds received from the IHS Holding 2024 Notes.
The IHS Holding 2024 Term Loan was denominated in U.S. dollars and was governed by English law.
IHS Holding 2024 Dual-Tranche Term Loan
IHS Holding Limited entered into a dual-tranche term loan agreement in October 2024 (as amended and/or as amended and restated from time to time, the “IHS Holding 2024 Dual-Tranche Term Loan”), between, amongst others, IHS Holding Limited as borrower, FirstRand Bank Limited (acting through its Rand Merchant Bank division) as facility agent and certain financial institutions listed therein as original lenders. The amounts payable under the IHS Holding 2024 Dual-Tranche Term Loan are guaranteed by IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Towers NG Limited, IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., INT Towers Limited, IHS Nigeria and INT Towers NG Finco 1 Plc.
The IHS Holding 2024 Dual-Tranche Term Loan is a $438.6 million equivalent (based on the exchange rate as of October 15, 2024, the draw down date of the IHS Holding 2024 Dual-Tranche Term Loan) split into a U.S. dollar tranche with a total commitment of $255.0 million (the “U.S. Dollar Tranche”), and a ZAR tranche with a total commitment of ZAR 3,246.0 million (the “ZAR Tranche”). Funds borrowed under the IHS Holding 2024 Dual-Tranche Term Loan were applied towards, inter alia, repaying the entirety of IHS Holding 2022 Term Loan and general corporate purposes. The available commitments can be, within 6 months of the date of the facility, increased pursuant to a facility increase clause contained within the loan agreement governing the IHS Holding 2024 Dual-Tranche Term Loan.
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The interest rate applicable to the U.S. Dollar Tranche is equal to Term SOFR plus a margin of 4.50% per annum and under the ZAR Tranche is equal to JIBAR plus a margin of 4.50% per annum. IHS Holding Limited also pays certain other fees and costs, including fees for undrawn commitments and fees to the facility agent.
The IHS Holding 2024 Dual-Tranche Term Loan is scheduled to terminate on the date falling 60 months from the date of the loan agreement governing the IHS Holding 2024 Dual-Tranche Term Loan and is repayable in full on that date. Subject to certain conditions, IHS Holding Limited may voluntarily prepay its utilizations and/or permanently cancel all or part of the available commitments by giving five Business Days’ notice, or such shorter period as the majority lenders may agree. In addition to voluntary prepayments, the IHS Holding 2024 Dual-Tranche Term Loan requires mandatory cancellation, and if applicable, prepayment in full or in part in certain circumstances, including, but not limited to: (i) with respect to any lender, if it becomes unlawful for such lender to perform any of its obligations under the IHS Holding 2024 Dual-Tranche Term Loan and (ii) upon the occurrence of a change of control as defined in the IHS Holding 2024 Dual-Tranche Term Loan.
The IHS Holding 2024 Dual-Tranche Term Loan contains customary information undertakings, affirmative covenants and negative covenants (including, without limitation, a negative pledge) in each case, subject to certain agreed exceptions and materiality carve-outs. The covenants include an interest cover ratio (the ratio of EBITDA for the relevant period to interest expense for the relevant period) and a leverage ratio (the ratio of net financial debt for the relevant period to EBITDA in respect of that relevant period) as financial covenants. These financial covenants are tested quarterly (except where compliance is required at any time and where testing is required upon incurrence) in arrear based on the previous 12 months, by reference to the financial statements delivered and/or each compliance certificate delivered. The IHS Holding 2024 Dual-Tranche Term Loan also contains customary events of default (subject in certain cases to agreed grace periods, thresholds and other qualifications).
The IHS Holding 2024 Dual-Tranche Term Loan is governed by English law.
As of March 14, 2025, the U.S. Dollar Tranche and the ZAR Tranche of the IHS Holding 2024 Dual-Tranche Term Loan were fully drawn down.
IHS Holding 2024 Notes Issuance
On November 29, 2024, IHS Holding Limited issued $550.0 million 7.875% Senior Notes due 2030 (the “2030 Notes”) and $650.0 million 8.250% Senior Notes due 2031 (the “2031 Notes”, and together with the 2030 Notes, the “IHS Holding 2030/31 Notes”), guaranteed by IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., IHS Nigeria Limited, IHS Towers NG Limited, INT Towers Limited and INT Towers NG Finco 1 Plc.
At any time prior to November 29, 2026, for the 2030 Notes, and November 29, 2027, for the 2031 notes, IHS Holding Limited may redeem up to 40% of the notes with the net cash proceeds from certain equity offerings at a redemption price equal to 107.875%, and 108.250%, of the principal amount of the 2030 Notes and 2031 Notes respectively, plus accrued and unpaid interest and additional amounts, if any, to the redemption date, so long as at least 50% of the aggregate original principal amount of the applicable series of notes remains outstanding immediately thereafter. In addition, the notes may, during such periods, be redeemed at a redemption price equal to 100% of the principal amount plus a “make-whole” premium. On or after November 29, 2026, 2027 or 2028, the 2030 Notes may be redeemed (in whole or in part) at a price of 103.93750%, 101.96875% and 100.00000%, respectively. On or after November 29, 2026, 2027 or 2028, the 2031 Notes may be redeemed (in whole or in part) at a price of 104.12500%, 102.06250% and 100.00000%, respectively.
The indenture governing the notes contains customary negative covenants and restrictions, including, but not limited to, our ability to: incur or guarantee additional indebtedness and issue certain preferred stock; make certain restricted payments and investments, including dividends or other distributions; create or incur certain liens; enter into agreements that restrict the ability of restricted subsidiaries to pay dividends; transfer or sell certain assets; merge or consolidate with other entities and enter into certain transactions with affiliates.
The proceeds of the issuance of the IHS Holding 2030/31 Notes were used to partially redeem the principal amount of the 2026 Notes and 2027 Notes and fully prepay the IHS Holding (2024) Term Loan (including accrued and unpaid interest), fees and expenses related to the offering of the notes, and for general corporate purposes.
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The IHS Holding 2030/31 Notes pay interest semi-annually in arrear and the principal is repayable in full on maturity and as of March 14, 2025, the aggregate principal amount outstanding of the IHS Holding 2030/31 Notes is $1,200.0 million.
IHS Netherlands Holdco B.V. Notes
On each of September 18, 2019 and July 31, 2020, our wholly owned subsidiary, IHS Netherlands Holdco B.V. (“Holdco BV”), issued a total of $940.0 million 8.0% Senior Notes due 2027 (the “2027 Notes”) guaranteed by IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., IHS Nigeria, IHS Towers NG Limited and INT Towers Limited, and (since June 22, 2021) IHS Holding Limited. On June 22, 2021, pursuant to a successful consent solicitation, Holdco B.V. also effected certain amendments to the indenture governing the notes to, among other things, expand the “restricted group” to encompass IHS Holding Limited and all of IHS Holding Limited’s subsidiaries (which would then be subject to the covenants and events of default under the indenture), and to make certain other consequential changes to the negative covenants and restrictions resulting from the larger group structure.
The 2027 Notes mature on September 18, 2027, and pay interest semi-annually in arrear, with the principal repayable in full on maturity. On or after September 18, 2023, or 2024, the 2027 Notes may be redeemed (in whole or in part) at a price of 102.000% and 100.000%, respectively.
The indenture contains customary negative covenants and restrictions, including, but not limited to, our ability to: incur or guarantee additional indebtedness and issue certain preferred stock; make certain restricted payments and investments, including dividends or other distributions; create or incur certain liens; enter into agreements that restrict the ability of restricted subsidiaries to pay dividends; transfer or sell certain assets; merge or consolidate with other entities and enter into certain transactions with affiliates.
On November 29, 2024 and December 6, 2024, the 2027 Notes were partially redeemed, in an aggregate principal amount outstanding of $654.0 million following the issuance of the IHS Holding 2030/31 Notes and as of March 14, 2025, the aggregate principal amount outstanding on the 2027 Notes is $286.0 million.
IHS Holding 2021 Notes Issuance
On November 29, 2021, IHS Holding Limited issued $500.0 million 5.625% Senior Notes due 2026 (the “2026 Notes”) and $500.0 million 6.250% Senior Notes due 2028 (the “2028 Notes”, and together with the 2026 Notes, the “IHS Holding 2026/28 Notes”), guaranteed by IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., IHS Nigeria, IHS Towers NG Limited and INT Towers Limited.
At any time prior to November 29, 2024 for the 2028 Notes, IHS Holding Limited may redeem up to 40% of the notes with the net cash proceeds from certain equity offerings at a redemption price equal to 106.250% of the principal amount of the 2028 Notes, plus accrued and unpaid interest and additional amounts, if any, to the redemption date, so long as at least 50% of the aggregate original principal amount of the applicable series of notes remains outstanding immediately thereafter. In addition, the notes may, during such periods, be redeemed at a redemption price equal to 100% of the principal amount plus a “make-whole” premium. On or after November 29, 2023, 2024 or 2025, the 2026 Notes may be redeemed (in whole or in part) at a price of 102.81250%, 101.40625% and 100.00000%, respectively. On or after November 29, 2024, 2025 or 2026, the 2028 Notes may be redeemed (in whole or in part) at a price of 103.1250%, 101.5625% and 100.0000%, respectively.
The indenture governing the notes contains customary negative covenants and restrictions, including, but not limited to, our ability to: incur or guarantee additional indebtedness and issue certain preferred stock; make certain restricted payments and investments, including dividends or other distributions; create or incur certain liens; enter into agreements that restrict the ability of restricted subsidiaries to pay dividends; transfer or sell certain assets; merge or consolidate with other entities and enter into certain transactions with affiliates.
On November 29, 2024, the 2026 Notes were partially redeemed, in an aggregate principal amount outstanding of $300.0 million following the issuance of the IHS Holding 2030/31 Notes and as of March 14, 2025, the aggregate principal amount outstanding on the IHS Holding 2026/28 Notes is $700.0 million.
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Nigeria (2023) Term Loan
IHS Netherlands Holdco B.V., IHS Nigeria, IHS Towers NG Limited, INT Towers Limited and IHS Holding Limited entered into an up to NGN 165.0 billion (approximately $106.7 million) term loan agreement in January 2023 (as amended and/or as amended and restated from time to time the “Nigeria 2023 Term Loan”), and between, amongst others, IHS Netherlands Holdco B.V. as guarantor; IHS Towers NG Limited and INT Towers Limited as borrowers and guarantors; each of IHS Holding Limited, IHS Netherlands NG1 B.V., IHS Nigeria, IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V. and (since July 2024) INT Towers NG Finco 1 Plc as guarantors; Ecobank Nigeria Limited as agent and certain financial institutions listed therein as original lenders.
The interest rate per annum is equal to 20% in the first year moving to a floating rate for the remainder of the term. This floating rate is defined by the Nigerian MPR plus a margin of 2.5% and were, at the time of signing subject to a cap of 24% and floor of 18%. The cap was increased to 27% in August 2024, and subsequently both the cap and the floor were removed in January 2025. The Nigeria 2023 Term Loan amortizes, starting from April 2024, quarterly, until maturity in January 2028. IHS Netherlands Holdco B.V. also pays certain other fees and costs, including agent fees.
The Nigeria 2023 Term Loan contains customary information undertakings, affirmative covenants and negative covenants (including, without limitation, a negative pledge) in each case, subject to certain agreed exceptions and materiality carve-outs. These include an interest cover ratio (the ratio of EBITDA for the relevant period to interest expense for the relevant period) and a leverage ratio (the ratio of net financial debt for the relevant period to EBITDA in respect of that relevant period) as financial covenants. These financial covenants are tested quarterly in arrear based on the previous 12 months, ending on each relevant financial quarter date, by reference to the annual or quarterly (as applicable) financial statements delivered and/or each compliance certificate delivered. The Nigeria 2023 Term Loan also contains customary events of default (subject in certain cases to agreed grace periods, thresholds and other qualifications).
The Nigeria 2023 Term Loan was drawn down for an original principal amount of NGN 124.5 billion (approximately $80.5 million), and funds borrowed under the loan were applied towards, inter alia, refinancing certain indebtedness of INT Towers Limited, IHS Nigeria, and general corporate and working capital purposes.
The Nigeria 2023 Term Loan is scheduled to terminate on the date falling 60 months from the date of the Nigeria 2023 Term Loan and is repayable in instalments. Subject to certain conditions, IHS Netherlands Holdco B.V. and the borrowers may voluntarily prepay utilizations and/or permanently cancel all or part of the available commitments by giving five business days’ prior notice (or such shorter period as the majority lenders may agree). In addition to voluntary prepayments, the Nigeria 2023 Term Loan requires mandatory cancellation, and if applicable, prepayment in full or in part in certain circumstances.
As of January 3, 2023, the total commitments available under the Nigeria 2023 Term Loan were NGN 124.5 billion (approximately $80.5 million), which were increased in February 2023, by NGN 29.0 billion (approximately $18.8 million) and further increased in May 2023, by NGN 11.5 billion (approximately $7.4 million) pursuant to the facility increase clause contained within the loan agreement up to its total NGN 165.0 billion (approximately $106.7 million) capacity.
As of March 14, 2025, NGN 165.0 billion (approximately $106.7 million) has been drawn down under this facility. The proceeds from the drawdown were applied towards, inter alia, refinancing certain indebtedness of INT Towers Limited and IHS Nigeria, and for general corporate and working capital purposes.
The Nigeria 2023 Term Loan is denominated in Naira and is governed by English law.
Nigeria (2023) Revolving Credit Facility
IHS Netherlands Holdco B.V., IHS Nigeria, IHS Towers NG Limited, INT Towers Limited and IHS Holding Limited entered into an up to NGN 55.0 billion (approximately $35.6 million) revolving credit facility agreement in January 2023 (as amended and/or as amended and restated from time to time the “Nigeria 2023 RCF”), and between, amongst others, IHS Netherlands Holdco B.V. as guarantor; IHS Towers NG Limited and INT Towers Limited as borrowers and guarantors; each of IHS Holding Limited, IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V. and (since July 2024) INT Towers NG Finco 1 Plc as guarantors; Ecobank Nigeria Limited as agent and certain financial institutions listed therein as original lenders.
The interest rate per annum is equal to 20% in the first year moving to a floating rate for the remainder of the term. This floating rate is defined by the Nigerian MPR plus a margin of 2.5% and were, at the time of signing, subject to a cap of 24% and floor of 18%.
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The cap was increased to 27% in August 2024, and subsequently both the cap and the floor were removed in January 2025. IHS Netherlands Holdco B.V. also pays certain other fees and costs, including agent fees.
The Nigeria 2023 RCF contains customary information undertakings, affirmative covenants and negative covenants (including, without limitation, a negative pledge) in each case, subject to certain agreed exceptions and materiality carve-outs. These include an interest cover ratio (the ratio of EBITDA for the relevant period to interest expense for the relevant period) and a leverage ratio (the ratio of net financial debt for the relevant period to EBITDA in respect of that relevant period) as financial covenants. These financial covenants are tested quarterly in arrear based on the previous 12 months, ending on each relevant financial quarter date, by reference to the annual or quarterly (as applicable) financial statements delivered and/or each compliance certificate delivered. The Nigeria 2023 RCF also contains customary events of default (subject in certain cases to agreed grace periods, thresholds and other qualifications).
The Nigeria 2023 RCF is scheduled to terminate on the date falling 36 months from the date of the Nigeria 2023 RCF, and is repayable in full on maturity. Subject to certain conditions, IHS Netherlands Holdco B.V. and the borrowers may voluntarily prepay utilizations and/or permanently cancel all or part of the available commitments by giving five business days’ prior notice (or such shorter period as the majority lenders may agree). In addition to voluntary prepayments, the Nigeria 2023 RCF requires mandatory cancellation, and if applicable, prepayment in full or in part in certain circumstances.
As of January 3, 2023, the total commitments available under the Nigeria 2023 RCF were NGN 44.0 billion (approximately $28.5 million), which were further increased in February 2023, by NGN 11.0 billion (approximately $7.1 million) to NGN 55.0 billion (approximately $35.6 million), pursuant to the facility increase clause contained within the loan agreement.
As of March 14, 2025, there are no amounts drawn and outstanding under the Nigeria 2023 RCF.
The Nigeria 2023 RCF is denominated in Naira and is governed by English law.
CIV (2023) Term Loan
IHS Côte d’Ivoire S.A. entered into a facility agreement originally in December 2023 (as amended and/or as amended and restated from time to time) with, amongst others, certain financial institutions listed therein as original lenders, split into one tranche with a total commitment of €88.0 million (approximately $91.6 million) (the “CIV 2023 Euro Tranche”), and another tranche with a total commitment of XOF 11.2 billion (approximately $17.7 million) (the “CIV 2023 XOF Tranche” and, together with the CIV 2023 Euro Tranche, the “CIV 2023 Term Loan”). The CIV 2023 Term Loan is governed by French law. Funds under the facility are to be applied towards, inter alia, refinancing certain indebtedness of IHS Côte d’Ivoire S.A. (including the IHS Côte d’Ivoire S.A. Facility), general corporate and working capital purposes, and funding a settlement of intercompany loans.
The CIV 2023 Term Loan is secured by, among other things, a charge over all onshore accounts of IHS Côte d’Ivoire S.A. and a pledge over the shares of IHS Mauritius Cote d’Ivoire Limited in IHS Côte d’Ivoire S.A. The CIV 2023 Term Loan has an interest rate of 3.50% plus 3 Month EURIBOR on the CIV 2023 Euro Tranche and 6.50% on the CIV 2023 XOF Tranche, and contains customary information and negative covenants, as well as requirements for IHS Côte d’Ivoire S.A. to observe certain customary affirmative covenants (subject to certain agreed exceptions and materiality carve-outs) and maintain specified net debt to EBITDA ratios and interest coverage ratios. The CIV 2023 Term Loan amortizes, starting from June 2024, quarterly, until maturity in December 2028,
The CIV 2023 Term Loan will terminate in December 2028.
As of March 14, 2025, €88.0 million (approximately $91.6 million) and XOF 11.2 billion (approximately $17.7 million) has been drawn down under this facility. Proceeds under the CIV 2023 Term Loan were applied towards, inter alia, the full prepayment of the entity’s existing borrowings maturing in June 2024 and for general corporate purposes.
IHS Zambia Limited Facility
IHS Zambia Limited entered into two facilities with a common terms agreement originally in December 2020 (as amended and/or as amended and restated from time to time, including in February 2021 and January 2023) with a total commitment of $95.0 million with certain financial institutions (the “Zambia Facility”), split into a facility for an aggregate commitment representing $75.0 million and a second facility for an aggregate commitment representing $20.0 million.
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The amounts payable under the Zambia Facility are guaranteed by IHS Holding Limited, and the Zambia Facility was fully utilized as of March 2021. The Zambia Facility is secured by, among other things, a fixed and floating charge, a charge over all onshore accounts of IHS Zambia Limited and a pledge over the shares of IHS Mauritius Zambia Limited in IHS Zambia Limited. The Zambia Facility has an interest rate of 5.0% plus 3 Month Term SOFR and a credit adjustment spread ranging between 0.11% to 0.43% and contains customary information and negative covenants and requires IHS Zambia Limited to observe certain customary affirmative covenants, subject to certain agreed exceptions and materiality carve-outs. The Zambia Facility amortizes, starting from April 2023, quarterly, until maturity in December 2027. The covenants include that IHS Zambia Limited maintain specified net debt to EBITDA ratios and interest coverage ratios, each as defined in the agreement. The respective facilities will terminate in December 2027.
As of March 14, 2025, the total commitment of USD 95.0 million has been drawn down under this facility.
IHS Kuwait Facility
IHS Kuwait Limited entered into a loan agreement originally in April 2020 (as amended and/or as amended and restated from time to time) with a total commitment of KWD 26.0 million (approximately $84.4 million) (the “Kuwait Facility”). The Kuwait Facility had an interest rate of 2.00% plus Central Bank of Kuwait’s Discount Rate, contained customary information and negative covenants, and required IHS Kuwait Limited to observe certain customary affirmative covenants, subject to certain agreed exceptions and materiality carve outs. The covenants included that IHS Kuwait Limited maintain specified net debt to EBITDA ratios, a debt service cover ratio and restrict capital expenditures to levels established within the facility.
The Kuwait Facility was scheduled to terminate in April 2029.
IHS Kuwait Limited was sold as part of the Kuwait Disposal that completed in December 2024.
IHS Brasil - Cessão de Infraestruturas S.A. Debentures
IHS Brasil — Cessão de Infraestruturas S.A. Debentures IHS Brasil — Cessão de Infraestruturas S.A. issued debentures for (i) BRL 1,200.0 million (approximately $194.3 million), in September 2023 (the “IHS 2023 Brasil Debentures”) and (ii) BRL 300.0 million (approximately $48.6 million) in June 2024 (the “IHS 2024 Brasil Debentures”) (both as amended and/or as amended and restated from time to time, and collectively being, the “IHS Brasil Debentures”). The IHS 2023 Brasil Debentures amortize, starting from February 2026, semi-annually, until maturity in August 2031, and the IHS 2024 Brasil Debentures amortize, starting from July 2026, semi-annually, until maturity in June 2032.
The IHS Brasil Debentures contain customary information and financial covenants, including but not limited to the maintenance of specified net debt to EBITDA and interest cover ratios. They also contain customary negative covenants and restrictions including, but not limited to, dividends and other payments to shareholders, intercompany loans and capital reductions.
The IHS Brasil Debentures are secured by a pledge over all shares owned by IHS Netherlands BR B.V. in IHS Brasil — Cessão de Infraestruturas S.A. and a pledge over the bank account where the companies’ receivables are deposited. The IHS 2023 Brasil Debentures have an interest rate of CDI plus 3.10% and will mature in August 2031, whereas the IHS 2024 Brasil Debentures have an interest rate of CDI plus 2.80% (both assuming a 252-day calculation basis) and will mature in June 2032.
The proceeds from the issuance of the IHS 2023 Brasil Debentures were applied towards, inter alia, refinancing certain indebtedness of IHS Brasil — Cessão de Infraestruturas S.A. and general corporate and working capital purposes, and the proceeds of the IHS 2024 Brasil Debentures were applied towards general corporate purposes including working capital purposes.
I-Systems Debentures
I-Systems issued debentures for BRL 160.0 million (approximately $25.9 million) in June 2024 (as amended and/or as amended and restated from time to time, the “I-Systems Debentures”).
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The I-Systems Debentures amortize, starting from November 2026, semi-annually, until maturity in May 2032.
The I-Systems Debentures contain customary information and financial covenants, including but not limited to the maintenance of specified net debt to EBITDA. They also contain customary negative covenants and restrictions including, but not limited to, dividends and other payments to shareholders, intercompany loans and capital reductions.
The I-Systems Debentures are secured by a pledge over the bank account where the companies’ receivables are deposited. The I-Systems Debentures have an interest rate of CDI plus 2.10% and will mature in May 2032.
The proceeds from the issuance of the I-Systems Debentures were applied towards, inter alia, general corporate and working capital purposes.
I-Systems Facility
I-Systems Soluções de Infraestrutura S.A. (“I-Systems”) entered into a BRL 200.0 million (approximately $32.4 million) credit agreement, originally in October 2022 (as amended and/or as amended and restated from time to time, the “I-Systems Facility”). The I-Systems Facility is secured by the chattel mortgage of certain credit rights of I-Systems and contains customary information and negative covenants, including the maintenance of specified net debt to EBITDA ratio. The I-Systems Facility amortizes, starting from October 2026, semi-annually, until maturity in October 2030.
It also contains restrictions on the total debt allowed, dividends, intercompany loans and capital reductions. The I-Systems Facility has an interest rate of CDI plus 2.45% (assuming a 252-day calculation basis), and will terminate in October 2030. The facility was fully drawn down in October 2022.
In October 2022, Itau Unibanco S.A. provided an additional commitment in an aggregate amount of BRL 200.0 million (approximately $32.4 million) on the same terms, available in two tranches. The first tranche of BRL 80.0 million (approximately $13.0 million was drawn down in February 2023 with an interest rate of CDI plus 2.45% (assuming a 252-day calculation basis), and the second tranche of BRL 120.0 million (approximately $19.4 million) was drawn down in March 2023 with an interest rate of CDI plus 2.50% (assuming a 252-day calculation basis).
IHS South Africa Facility
IHS Towers South Africa Proprietary Limited (“IHS SA”) entered into a ZAR 3,470.0 million (approximately $184.5 million) facility agreement originally in May 2022 (as amended and/or as amended and restated from time to time (the “IHS SA Facility”), with, amongst others, certain financial institutions listed therein as original lenders. The IHS SA Facility is governed by South African law and funds borrowed under the facility were partly applied toward the payment of consideration owed pursuant to the MTN SA Acquisition. The remaining funds can be applied toward capital expenditure and general corporate purposes and was available for up to 24 months from the signature date of the agreement. The IHS SA Facility is secured by, among other things, a pledge over all shares owned by IHS South Africa Holding Proprietary Limited in IHS SA, a general notarial bond and a special notarial bond. The IHS SA Facility has an interest rate of 2.75% plus 3 Month JIBAR, and contains customary information and negative covenants, as well as requirements for IHS SA to observe certain customary affirmative covenants (subject to certain agreed exceptions and materiality carve-outs) and maintain specified net debt to EBITDA ratios and interest coverage ratios. The IHS SA Facility amortizes, in relation to tranche A, starting from September 2023, quarterly, until maturity in May 2029 and in relation to tranche B, starting from September 2024, quarterly, until maturity in May 2029.
The IHS SA Facility will terminate in May 2029.
In May 2022, ZAR 3,400.0 million (approximately $180.7 million), was drawn down under the IHS SA Facility. Further drawdown took place in May 2023 for ZAR 70.0 million (approximately $3.7 million).
As of March 14, 2025, ZAR 3,470.0 million (approximately $184.5 million) has been drawn down under this facility.
IHS South Africa Overdraft
IHS SA entered into a ZAR 350.0 million (approximately $18.6 million) overdraft facility agreement in October 2023 (the “IHS SA Overdraft”). The IHS SA Overdraft was governed by South African law and funds borrowed under the facility were applied towards general corporate purposes. The IHS SA Overdraft expired in December 2024.
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Letter of Credit Facilities
As of March 14, 2025, IHS Nigeria has utilized $2.0 million through funding under agreed letters of credit. These letters mature on March 31, 2025, and their interest rates range from 12.00% to 15.55%. These letters of credit are utilized to fund capital and operational expenditure with suppliers.
As of March 14, 2025, INT Towers Limited has utilized $4.8 million through funding under agreed letters of credit. These letters mature on March 31, 2025, and their interest rates range from 12.00% to 15.75%. These letters of credit are utilized to fund capital and operational expenditure with suppliers.
As of March 14, 2025, Global Independent Connect Limited has utilized $0.1 million through funding under agreed letters of credit. These letters mature on March 31, 2025, and their interest rates range from 15.25% to 15.28%. These letters of credit are utilized to fund capital and operational expenditure with suppliers.
C. Research and Development, Patents and Licenses, etc.
The Company does not have any research and development policies or patents. See note 2.13(b) to our audited consolidated financial statements included in this Annual Report for a discussion of our licenses.
D. Trend Information
Other than as disclosed elsewhere in this Annual Report, we are not aware of any trends, uncertainties, demands, commitments or events since December 31, 2024 that are reasonably likely to have a material adverse effect on our revenue, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
E. Critical Accounting Estimates
Our consolidated financial statements are prepared in conformity with IFRS, as issued by the IASB. In preparing our consolidated financial statements, we make judgments, estimates and assumptions about the application of our accounting policies which affect the reported amounts of assets, liabilities, revenue and expenses. Our critical accounting estimates and judgments and sources of estimation uncertainty are described in note 3 to our audited consolidated financial statements, which are included elsewhere in this Annual Report.
Item 6. Directors, Senior Management and Employees
A. Directors and Senior Management
Executive Officers and Directors
The following table presents information about our current executive officers and directors, including their ages as of the date of this Annual Report:
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Executive Officers
The executive officers and directors of the Issuer are set forth below. None of the directors has any potential conflicts of interest between their duties to the Issuer and their private interests and/or their duties to third parties.
Name |
|
Age |
|
Position |
Executive Officers |
|
|
|
|
Sam Darwish |
|
53 |
|
Chairman, Group Chief Executive Officer and Director |
Mohamad Darwish |
|
45 |
|
Executive Vice President, IHS Nigeria Chief Executive Officer |
William Saad |
|
53 |
|
Executive Vice President, Group Chief Operating Officer |
Steve Howden |
|
42 |
|
Executive Vice President, Chief Financial Officer |
Ayotade Oyinlola |
|
50 |
|
Executive Vice President, Chief Human Resources Officer |
Mustafa Tharoo |
|
51 |
|
Executive Vice President, Group General Counsel |
Directors |
|
|
|
|
Ursula Burns |
|
66 |
|
Director |
John Ellis Bush |
|
72 |
|
Director |
Frank Dangeard |
|
67 |
|
Director |
Bashir El-Rufai |
|
71 |
|
Director |
Maria Carolina Lacerda |
|
52 |
|
Director |
Nicholas Land |
|
77 |
|
Director |
Phuthuma Nhleko |
|
64 |
|
Director |
Aniko Szigetvari |
|
55 |
|
Director |
Unless otherwise stated, the current business addresses for our executive officers and directors is c/o IHS Holding Limited, 1 Cathedral Piazza, 123 Victoria Street, London SW1E 5BP, United Kingdom.
Colby Synesael, our former Executive Vice President of Communications, resigned from the Company effective July 15, 2024.
Executive Officers
The following is a brief summary of the business experience of our executive officers.
Sam Darwish is one of our co-founders, our Chairman and Group Chief Executive Officer. An engineer by education, Mr. Darwish has over 25 years’ experience in the telecommunications industry. Before founding the Group in 2001, he worked in various technical and managerial capacities in multiple GSM operators including Libancell SAL, a Lebanese GSM operator, which is currently known as Touch, and Motophone in Nigeria. In addition, Mr. Darwish currently serves as the Founder and Principal of Singularity Investments, a private investment firm with a focus on technology, media and telecommunications companies in the United States and the emerging markets. He is also the Founder and President of DAR Properties, a property investment company, and DAR Telecom, a telecommunications consulting company. Sam Darwish is the brother of Mohamad Darwish, our Executive Vice President and IHS Nigeria Chief Executive Officer.
Mohamad Darwish is one of our co-founders and has served as Executive Vice President of IHS Towers and Chief Executive Officer of IHS Nigeria since January 2023. Mr. Darwish previously served as Senior Vice President of IHS Towers and Chief Executive Officer of IHS Nigeria from November 2015 until December 2022. Prior to this, Mr. Darwish served as the IHS Nigeria Deputy CEO from October 2014 to November 2015. Mr. Darwish has around 20 years of experience in the telecommunications sector. In addition, Mr. Darwish currently serves as the Founder and Principal of Singularity Investments, a private investment firm with a focus on technology, media and telecommunications companies in the United States and the emerging markets. Mohamad Darwish is the brother of Sam Darwish, our Chairman and Group Chief Executive Officer.
William Saad is one of our co-founders and has served as Executive Vice President and Group Chief Operating Officer of IHS Towers since July 2012 and has 28 years’ experience in the telecommunications industry. Before co-founding the Group, Mr. Saad worked in various technical and managerial capacities in multiple GSM operators including Libancell SAL, a Lebanese GSM operator, which is currently known as Touch, and Motophone in Nigeria. Mr. Saad also serves on the board of several private companies as well as the Lebanese-Nigerian Initiative, a non-profit organization.
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Stephen (Steve) Howden has served as Executive Vice President and Chief Financial Officer of IHS Towers since April 2022. Mr. Howden previously served as Senior Vice President and Deputy Chief Financial Officer from June 2019 until March 2022. Since joining the Group in January 2013, Mr. Howden has also served as Group Head of M&A as well as a variety of other senior finance positions. Prior to joining IHS Towers, Mr. Howden was a member of the Ernst & Young M&A department from 2006 to 2013 and in the Corporate Restructuring team at Ernst & Young and Andersen prior to that. Mr. Howden has approximately 18 years of finance and corporate finance experience. Mr. Howden is a qualified Chartered Accountant.
Ayotade Oyinlola has served as Executive Vice President and the Chief Human Resources Officer of IHS Towers since January 2023. Mr. Oyinlola previously served as Senior Vice President and Chief Human Resources Officer of IHS Towers from July 2015 until December 2022. Mr. Oyinlola brings over 20 years of human resources and telecommunications experience to the Group. Prior to joining IHS Towers, Mr. Oyinlola served as Millicom Services UK Head of HR for Africa and Europe from 2013 to 2015. He also served as Ericsson’s West Africa HR Director from 2011 to 2013 and Ericsson’s Sub-Sahara Africa Director for Learning and Development from 2009 to 2011. In addition, Mr. Oyinlola has previously held several senior positions at Shell Petroleum, Bristow Helicopters Atlasco Technologies and Resourcery Limited. Mr. Oyinlola is a Chartered Fellow of the Chartered Institute of Personnel and Development in the United Kingdom, and a member of the Chartered Institute of Personnel Managers in Nigeria.
Mustafa Tharoo has served as Executive Vice President and Group General Counsel of IHS Towers since 2012. Before joining the Group, Mr. Tharoo was a Consultant at ADEPT Chambers in Tanzania from 2009 to 2011. Previously, Mr. Tharoo served as a consultant at Ringo & Associates in Tanzania from 2003 to 2009 and a Partner at Anjarwalla & Khanna in Kenya from 2000 to 2003. Mr. Tharoo has over 20 years of experience in corporate, compliance and regulatory matters as well as major transactions across Africa and the Middle East.
Directors
The following is a brief summary of the business experience of our directors.
Ursula Burns joined the Board of Directors of IHS Holding Limited as a Non-Executive Independent Director in July 2020. Ms. Burns most recently held the position of Chair and CEO of VEON, Ltd, where she was appointed Chair from June 2017 and then made Chair and CEO from December 2018 to June 2020. Ms. Burns is also a founding partner of Integrum Holdings, a private equity firm. She currently serves as a member of the boards of directors of Endeavor Group Holdings Inc., Uber Technologies Inc., Teneo Holdings LLC and Taiwan Semiconductor Manufacturing Company Ltd., amongst others, and provides leadership counsel to several community, educational and non-profit organizations. Ms. Burns served as Chair of the President’s Export Council from 2015 to 2016 after holding the position of Vice Chair from 2010 to 2015. In February 2022, Ms. Burns joined the Biden Administration’s U.S. Department of Commerce’s Advisory Council on Supply Chain Competitiveness. Ms. Burns also has 35 years of experience with Xerox, joining the organization as a mechanical engineer before moving into management, where she served in a number of strategic roles across the company, including as CEO from 2009 to 2016 and as Chair from 2010 to 2017.
John Ellis (Jeb) Bush joined the Board of Directors of IHS Holding Limited as a Non-Executive Independent Director in August 2019. Mr. Bush has served as the President of Jeb Bush & Associates LLC since 2007, and as Chairman and Co-founder of Finback Investment Partners LLC since 2019. Mr. Bush has served on the board of directors of InnovAge Holding Corp. since 2021. Mr. Bush has also served as Chairman of the Foundation for Excellence in Education since 2007. Mr. Bush was previously a senior adviser for Barclays and a board member of Tenet Healthcare Corp. Mr. Bush served as Governor of Florida from 1999 to 2007 and as the Florida Secretary of Commerce from 1986 to 1988.
Frank Dangeard joined the Board of Directors of IHS Holding Limited in September 2020 and since July 2023 has served as a Non-Executive Independent Director. Mr. Dangeard was Chairman & CEO of Thomson from September 2004 to February 2008. Prior to that he was Deputy CEO of France Telecom from September 2002 to September 2004, Deputy CEO and Deputy Chairman of Thomson Multimedia from June 1997 to September 2002, and Managing Director of the investment bank SG Warburg & Co. Ltd from October 1988 to June 1997. Mr. Dangeard currently serves as Chairman of the boards of Gen Digital (previously NortonLifelock), of NatWest Market plc and of NatWest Market N.V., and as a non-executive director of the NatWest Group and the Competition and Markets Authority. Mr. Dangeard has previously served on the boards of RPX, Orange, Equant, Wanadoo, Eutelsat, SonaeCom, Arqiva and on the board of Telenor as Deputy Chairman and Acting Chairman. He has been a member of the Advisory Boards of the Harvard Business School and of Ecole des Hautes Etudes Commerciales, and was a founding board member of Bruegel, the European think-tank.
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Mallam Bashir Ahmad El-Rufai joined the Board of Directors of IHS Holding Limited in June 2013. Mr. El-Rufai also serves on the boards of a number of our subsidiaries. Prior to joining IHS Nigeria, Mr. El-Rufai served as Training and Development Officer and later Assistant Production Manager at Kano State Oil & Allied Product Limited from 1977 to 1979, before joining Nigerian Cereals Processing Company Ltd as Group Marketing Manager from 1981 to 1983. He served as Chief Commercial Officer for the Northern District of Nigerian External Telecommunications Limited from 1983 to 1985 and held several positions at Nigerian Telecommunications Ltd from 1985 to 1996. Mr. El-Rufai was also co-founder and President of Intercellular Nigeria Limited from 1997 to 2009. Mr. El-Rufai currently serves as Chairman of Intercellular Nigeria and has served as Vice Chairman and Corporate Advisor of Intercellular (Nigeria) Limited in 2009. He also served as an Independent Director of FSDH Merchant Bank Limited. Mr. El-Rufai has also chaired several boards, including Channel Distribution (an ICT company), Systemtech (an IT company), Alpha Aluminium and Northstar Chemicals, among others.
Maria Carolina Lacerda joined the Board of Directors of IHS Holding Limited in October 2021 as a Non-Executive Independent Director. Ms. Lacerda has over 25 years of experience in the financial industry and has held various senior management positions throughout her career, including at UBS Investment Bank, UNIBANCO, Deutsche Bank, Merrill Lynch, Inc. and Bear, Stearns & Company, Inc. Ms. Lacerda has served as an independent member of the board of directors of BB Seguridade RI since April 2023, of PagBank PagSeguro since January 2023, of Rumo S.A. since May 2021, of Hypera Pharma since October 2016 and of Vivara Participacoes S.A. since April 2024. Ms. Lacerda previously served as an independent board member of China Three Gorges Brasil from June 2022 to December 2024, as a board member of Vibra Energia (formerly BR Distribuidora) between 2019 and 2022, and between 2012 and 2016 she served as a board member of ANBIMA (Associação Brasileira das Entidades dos Mercados Financeiros e de Capitais), CNF (Confederação Nacional das Instituições Financeiras) and the Listing Chamber at BM&FBovespa in Brazil.
Nicholas Land joined the Board of Directors of IHS Holding Limited in August 2019 as a Non-Executive Independent Director. Mr. Land has served as the Deputy Chair of Thames Water Utilities Ltd since 2017. Mr. Land also serves as a non-executive director of Thames Water Utilities Holdings Ltd. from June 2024 and of Thames Water Utilities Finance plc from May 2024. Mr. Land has also been a member of the Board of Trustees of the Vodafone Group Foundation since 2008, serving as Chair from 2011. He has also been Chair of the Private Equity Reporting Group of the British Venture Capital Association since 2012. Mr. Land served as Chair of The Instant Group Ltd from 2019 to 2024, as an adviser to the Board of Dentons UK EMEA LLP from 2007 to 2023, and on the board of Astro Lighting Holdings Ltd from 2017 to 2022. Mr. Land has also previously served as a non-executive director of Vodafone Group plc, Royal Dutch Shell plc, Alliance Boots GmbH, Ashmore Group plc and Signature Aviation plc. Mr. Land was a Non-Executive Director of the Financial Reporting Council, chairing its Codes and Standards Committee, from 2011 to 2020. Mr. Land is qualified as a UK Chartered Accountant and had a 36 year career with Ernst & Young LLP, retiring as Executive Chairman of the firm in 2006.
Phuthuma Nhleko joined the Board of Directors of IHS Holding Limited in October 2021 as a Non-Executive Independent Director. Mr. Nhleko previously served as Chief Executive of MTN Group from 2002 to 2011 and continued to serve as Non-Executive Director and Chair of the MTN Group board from 2013 to 2019. Mr. Nhleko is currently Chairman of the Phembani Group (PTY) Ltd, a position he has held since 2011. He also currently serves as Chairman of Tullow Oil Plc and of the Johannesburg Stock Exchange, or the JSE. Mr. Nhleko also serves as a director of Engen, TBWA South Africa, and Pembani Remgro Infrastructure Fund Managers. Previously, he served on the boards of BP plc from 2011 to 2016 and Anglo American from 2011 to 2015. In addition, during his tenure as MTN Group CEO, Mr. Nhleko was a non-executive director at the GSM Association, the global trade association for mobile phone operators. Prior to joining MTN Group, Mr. Nhleko served as a director of Nedbank Group Limited and Old Mutual Life (SA).
Aniko Szigetvari served on the Board of Directors of IHS Holding Limited from July 2014 to February 2021 and rejoined the Board of Directors in October 2021 as a Non-Executive Independent Director. Ms. Szigetvari is the founding partner of Atlantica Ventures, an African impact focused venture capital fund investing in early-stage startups building technology and technology-enabled businesses. She serves as board member and advisory board member of various investee companies, including Sendmarc Inc., where she has served on the board as a non-executive director since January 2023 and as Chair since November 2023. Prior to Atlantica Ventures, Ms. Szigetvari had 20 years’ experience with the International Finance Corporation, or IFC, beginning in 1998, where she focused on emerging markets principal investing and financing, primarily in the telecommunication, media, and technology, or TMT, sectors. For eight years she managed IFC’s TMT business, first as the Head of the Africa and Latin America TMT businesses, then including four years as Global Head of the TMT group from 2015 to 2019, leading investment and portfolio activities across all emerging markets. Prior to joining IFC, Ms. Szigetvari held roles at DHL, Kraft Foods and McKinsey & Company.
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Appointment Rights
Pursuant to our shareholders’ agreement with certain of our shareholders, certain of our shareholders were given rights to designate directors for nomination by our board of directors from time to time, based on a minimum shareholding level. Currently, Oranje-Nassau Développement S.C.A. FIAR (“Wendel”) maintains the minimum beneficial ownership requirement to make such a designation for nomination under the shareholders’ agreement, and our current board member, Frank Dangeard, was initially appointed to our board pursuant to such designation right by Wendel. Our Articles also contain certain director nomination rights, subject to certain thresholds and other requirements contained therein.
B. Compensation
We set out below the amount of compensation paid and benefits in kind provided by us or our subsidiaries to our executive officers and members of our board for services in all capacities to us or our subsidiaries for the year ended December 31, 2024, as well as the amount contributed by us or our subsidiaries to retirement benefit plans for our executive officers and members of our board.
Executive Officer and Director Compensation
The compensation for each of our executive officers is comprised of the following elements: base salary, bonus, and contractual benefits such as pension, allowances and, end of service contributions. Total amount of compensation paid and benefits in kind provided to our executive officers and members of our board for the year ended December 31, 2024 was $24,636,500. The company maintains a variety of retention schemes which can include deferred compensation subject to certain criteria being met in the future. Our executive officers are eligible to receive performance and service related bonuses pursuant to the terms of their service agreements or otherwise as approved by the Board, and our executive officers received rights under the 2021 Omnibus Incentive Plan (as defined below) of up to 3,457,231 ordinary shares during the year ended December 31, 2024.
In the year ended December 31, 2024, we did not set aside or accrue any amounts to provide pension, retirement or similar benefits to our executive officers and members of our board.
Share Incentive Plans
Non-Employee Director Grants
In connection with our IPO, certain non-employee directors received restricted stock unit grants over a total of 259,784 ordinary shares all of which have been issued and vested as of December 31, 2024.
2021 Omnibus Incentive Plan
We adopted the IHS Holding Limited 2021 Omnibus Incentive Plan, or the 2021 Omnibus Incentive Plan, on September 30, 2021, and it became effective upon the approval of our shareholders on October 4, 2021, or the Effective Date. If not previously terminated by the Board, the 2021 Omnibus Incentive Plan will terminate on the close of business on the ten-year anniversary of the Effective Date. Under the 2021 Omnibus Incentive Plan, subject to adjustments for certain changes in our capital structure (described below under “Adjustments”), a maximum of 22,120,000 of our ordinary shares may be issued to our eligible employees, consultants, and non-employee directors and of our affiliates. Only our employees or employees of our affiliates are eligible to receive incentive stock options. All shares reserved for issuance under the 2021 Omnibus Incentive Plan may be used for incentive stock options. As of December 31, 2024, there are subsisting conditional rights under the 2021 Omnibus Incentive Plan over up to 9,214,904 ordinary shares.
Types of Awards. The 2021 Omnibus Incentive Plan provides for grants of incentive stock options, non-statutory options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards, and other-cash awards, each an Award, and, collectively, Awards. Each Award will be evidenced by an award agreement which will govern that Award’s terms and conditions.
Plan Administration. The 2021 Omnibus Incentive Plan is generally administered by our Board unless and until the Board delegates administration to a committee of the Board (the “Committee”). The Committee will make all determinations in respect of the 2021 Omnibus Incentive Plan, and will have no liability for any action taken in good faith. The 2021 Omnibus Incentive Plan is administered by our Board with respect to Awards to non-employee directors.
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Adjustments. In the event of a change in the number or class of the outstanding ordinary shares due to split-ups, combinations, mergers, consolidations or recapitalizations, or by reason of stock dividends, the number or class of shares which thereafter may be issued pursuant to Awards granted under the 2021 Omnibus Incentive Plan, both in the aggregate and as to any grantee, and the number and class of shares then subject to outstanding Awards and the exercise price per share of outstanding options or stock appreciation rights, will be adjusted to reflect such change, all as determined by the Committee. In the event of any other change in the number or kind of outstanding shares, or of any stock or other securities or property into which such shares will have been changed, or for which it will have been exchanged, if the Committee determines that such change equitably requires an adjustment in any Award that has been or may be granted under the 2021 Omnibus Incentive Plan, such adjustment will be made in accordance with such determination subject to certain limitations set out in the 2021 Omnibus Incentive Plan. In addition, in the event that (i) we merge or are consolidated with another entity and in connection therewith consideration other than equity is provided to our shareholders or outstanding Awards are not to be assumed by the resulting entity, (ii) all or substantially all of our assets are acquired by another person, (iii) we are reorganized or liquidated or (iv) we enter into a written agreement to undergo a transaction specified in (i), (ii) or (iii) above, the Committee may, in its discretion and upon advance notice to the affected persons, cancel any outstanding Awards and cause the holders thereof to be paid in cash, stock or other property (or any combination thereof) the value of the Awards based on the price per share received or to be received by other shareholders of our company in such event.
Change in Control. In the event of a change in control, notwithstanding any provision in the 2021 Omnibus Incentive Plan to the contrary, the Committee may, in its sole discretion, take any action with respect to all or any portion of a particular outstanding Award, including, but not limited to, the following, in each case, except as otherwise provide in a written agreement between the grantee and the Company: (i) if Awards are not converted, assumed, or replaced by a successor, the Awards will become fully exercisable and vested, with any performance conditions to become satisfied based on the achievement of an assumed level of performance (which may be actual, target or maximum performance), as determined by the Committee; (ii) if the Award is assumed or replaced by a successor with a comparable award, then the new award must (a) provide the grantee with substantially equivalent terms and conditions; and (b) become fully vested and exercisable immediately upon an involuntary termination of the grantee’s employment or service, as applicable, by the Company without cause within eighteen (18) months following the Change in Control, with any performance conditions to be converted based on the achievement of an assumed level of performance (which may be actual, target or maximum performance), as determined by the Committee; (iii) settle Awards previously deferred; (iv) adjust, substitute, convert, settle and/or terminate outstanding Awards as the Committee, in its sole discretion, deems appropriate and consistent with the plan’s purposes; and (v) in the case of any Award with an exercise price that equals or exceeds the price paid for a share of ordinary shares in connection with the change in control, the Committee may cancel the Award without the payment of consideration therefor. To the extent practicable, any actions taken by the Committee may occur in a manner and at a time which allows affected grantees the ability to participate in the change in control transactions with respect to the ordinary shares subject to their Awards. In addition, in the event of a change in control, the Committee may, in its sole discretion and upon at least ten (10) days’ advance notice to the affected persons, cancel any outstanding Awards and pay to the holders thereof, in cash or stock, or any combination thereof, the value of the Awards based upon the price per share of ordinary shares received or to be received by other shareholders of the Company in such change in control.
Amendment. In general, the Board can modify, alter, amend or terminate the 2021 Omnibus Incentive Plan (at any time and with or without retroactive effect) in whole or in part in its discretion without approval of the shareholders or any other person, except that no amendment will become effective unless approved by our shareholders to the extent shareholder approval is necessary to satisfy any applicable law or securities exchange listing requirements. However, no amendment to or termination of the 2021 Omnibus Incentive Plan may materially and adversely affect any rights of any grantee without his or her written consent. The Board may, at any time, amend the terms of an outstanding Award, except that no amendment may impair the rights under any Award without the written consent of the affected grantee.
Indemnification
Executive officers and directors have the benefit of indemnification provisions in our Articles. These provisions provide that our board of directors and officers shall be indemnified from and against all liability which they incur in execution of their duty in their respective offices, except liability incurred by reason of such director’s or officer’s dishonesty, willful default or fraud. Additionally, we entered into indemnification agreements with our executive officers and directors which include specific protections on the indemnification of liabilities for our executive officers and directors.
Insofar as indemnification of liabilities arising under the Securities Act may be permitted to executive officers and directors or persons controlling us pursuant to the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
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C. Board Practices
Board Composition
Our board of directors is composed of 9 members. Sam Darwish serves as the Chairman of our board of directors and John Ellis Bush serves as Lead Independent Director. Frank Dangeard and Phuthuma Nhleko, our current Class I Directors, John Ellis Bush, Bashir El-Rufai and Nicholas Land, our current Class II Directors, and Sam Darwish, Ursula Burns, Maria Carolina Lacerda and Aniko Szigetvari, our current Class III Directors, each have a current term that expires at our 2025 AGM. In accordance with our Articles, the Class I Directors, Class II Directors and the Class III Directors appointed at the 2025 AGM shall be elected for a term that shall expire at the next succeeding annual general meeting, following which, the board of directors shall no longer be classified and our directors shall thereafter be elected annually.
A Director whose term has expired may be reappointed in accordance with the terms of the Articles. At any general meeting where a resolution for the election of directors is proposed, a plurality of the votes cast shall be sufficient to elect a director. In addition, our directors may appoint any person to be a director and assign such director to a class either as a result of a casual vacancy or as an additional director. Our Articles provide that a director may be removed by an ordinary resolution of the shareholders (provided that no more than four directors in aggregate may be removed pursuant to that provision in any given period between annual general meetings as described in the Articles) or for “cause” (as defined therein) by notice from not less than 75% of the directors then in office. Each of our directors holds office until he or she resigns or is removed from office in accordance with our Articles.
Our board of directors has determined that eight Directors qualify as “independent” under the NYSE listing standards: John Ellis Bush, Ursula Burns, Frank Dangeard, Bashir El-Rufai, Nicholas Land, Maria Carolina Lacerda, Aniko Szigetvari and Phuthuma Nhleko.
See Item 6.A. “Directors and Senior Management” for information regarding the periods during which our directors have served on the board of directors.
Foreign Private Issuer Status
We are a “foreign private issuer” (as such term is defined in Rule 3b-4 under the Exchange Act), and our shares are listed on the NYSE. Under the NYSE listing standards, NYSE-listed companies that are foreign private issuers are permitted to follow home country practice in lieu of the corporate governance provisions specified by the NYSE with limited exceptions.
We believe the following to be the significant differences between our corporate governance practices and those applicable to U.S. companies under the NYSE listing standards:
| ● | The NYSE rules require that the quorum for any meeting of the holders of shares should be sufficiently high to ensure a representative vote and give careful consideration to provisions fixing any proportion less than a majority of the outstanding shares as the quorum for shareholders’ meetings. We follow the corporate governance practice of our home country, the Cayman Islands, which permits less than a majority of the outstanding shares as the quorum for shareholders’ meetings. |
| ● | The NYSE rules also require shareholder approval for equity compensation plans and material revisions to those plans. We follow the corporate governance practice of our home country, the Cayman Islands, which does not require shareholder approval for these matters. |
We may in the future decide to use other foreign private issuer exemptions with respect to some or all of the other NYSE listing requirements. For example, under the NYSE rules, U.S. domestic listed, non-controlled companies are required to have a majority independent board, which is not required under the Companies Act of the Cayman Islands, our home country. NYSE rules also require U.S. domestic listed, non-controlled companies to have a compensation committee and a nominating and corporate governance committee, each composed entirely of independent directors, which are not required under our home country laws.
Following our home country governance practices may provide less protection than is given to investors under the NYSE listing requirements applicable to domestic issuers. For more information, see Item 3.D. “Risk Factors — Risks Relating to Ownership of our Ordinary Shares — As we are a “foreign private issuer” and follow certain home country corporate governance practices, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements.”
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Audit Committee
The audit committee consists of Nicholas Land, Ursula Burns and Aniko Szigetvari. Nicholas Land serves as Chair of the committee. The audit committee consists exclusively of independent Directors who are financially literate, and Nicholas Land is considered an “audit committee financial expert” as defined by the SEC. Our board has determined that Nicholas Land, Ursula Burns and Aniko Szigetvari each satisfy the “independence” requirements set forth in Rule 10A-3 under the Exchange Act, and that the simultaneous service by Ursula Burns on the audit committees of three other public companies would not impair her ability to serve on the audit committee. The audit committee is governed by a charter that complies with NYSE listing standards.
The audit committee assists the board in overseeing our accounting and financial reporting processes and the audits of our financial statements, and is responsible for, among other things:
| ● | the appointment, compensation, retention and oversight of any accounting firm engaged for the purpose of preparing or issuing an audit report or performing other audit services; |
| ● | pre-approving the audit services and non-audit services to be provided by our independent auditor before the auditor is engaged to render such services; |
| ● | evaluating the independent auditor’s qualifications, performance and independence, and presenting its conclusions to the full board on at least an annual basis; |
| ● | reviewing and discussing with the board and the independent auditor our annual audited financial statements and any quarterly financial statements prior to the filing of the respective SEC reports; |
| ● | reviewing our compliance with laws and regulations; and |
| ● | approving or ratifying any related party transaction (as defined in our related party transaction policy) in accordance with our related party transaction policy. |
The audit committee meets at least four times per year. The audit committee meets at least once per year with our independent accountant, without our executive officers being present.
Remuneration Committee
The remuneration committee consists of Aniko Szigetvari, John Ellis Bush and Frank Dangeard. Aniko Szigetvari serves as Chair of the committee.
The remuneration committee assists the board in determining CEO remuneration and is responsible for, among other things:
| ● | identifying, reviewing and approving corporate goals and objectives relevant to the compensation of our Chief Executive Officer, evaluating the Chief Executive Officer’s performance in light of these objectives and goals and, based upon that evaluation, setting the Chief Executive Officer’s compensation; |
| ● | reviewing and setting or making recommendations to the Board regarding compensation for our other executive officers; |
| ● | reviewing and setting or making recommendations to the Board regarding director compensation; and |
| ● | overseeing and administering our incentive compensation and equity incentive plans. |
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Nominations and Corporate Governance Committee
The nominations and corporate governance committee consists of John Ellis Bush, Ursula Burns and Nicholas Land. John Ellis Bush serves as Chair of the committee.
The nominations and corporate governance committee assists our board in identifying individuals qualified to become members of our board consistent with criteria established by our board and in developing our corporate governance principles and is responsible for, among other things:
| ● | reviewing and evaluating the composition, function and duties of our board; |
| ● | reviewing our management succession planning; |
| ● | recommending nominees for selection to our board and its corresponding committees; |
| ● | making recommendations to the board as to determinations of director independence; |
| ● | leading the board in a self-evaluation, at least annually, to determine whether it and its committees are functioning effectively; and |
| ● | developing and recommending to the board our corporate governance guidelines and reviewing and reassessing the adequacy of such corporate governance guidelines and recommending any proposed changes to the board. |
Health, Safety, Security and Environmental Committee
The health, safety, security and environmental committee consists of Phuthuma Nhleko, Maria Carolina Lacerda and Frank Dangeard. Phuthuma Nhleko serves as Chair of the committee.
The health, safety, security and environmental committee assists our board in its oversight and support of the implementation and effectiveness of our environmental, health and safety risk-management procedures, policies, programs and initiatives, and is responsible for, among other things:
| ● | reviewing and evaluating the status of our health, safety and environmental performance, including processes to ensure compliance with internal policies and goals and applicable laws and regulations; |
| ● | reviewing management reports regarding its efforts with regard to environmental and social matters, including our policies, programs and strategies related to environmental stewardship, corporate citizenship and other social and public matters of significance to us; |
| ● | reviewing and providing input to us on the management of current and emerging health, safety and environmental issues, policies, laws and regulations; and |
| ● | reviewing, at least annually, processes designed to mitigate key health, safety and environmental risks. |
Risk Management
Our board of directors is responsible for the establishment and oversight of our risk management framework. The audit committee is responsible for discussing our policies with respect to risk assessment and risk management, including guidelines and policies to govern the process by which our exposure to risk is handled. The audit committee oversees how our management monitors compliance with our risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks we face. The audit committee also oversees management of all risks, including with respect to financial reporting, accounting, and audit matters, as well as cybersecurity and data privacy matters. While each committee is responsible for evaluating certain risks and overseeing the management of such risks, the entire board is regularly informed through committee reports about such risks.
Our board of directors is supported by various management functions that check and undertake both regular and ad hoc risk assessment reviews in compliance with established controls and procedures.
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The objective of the risk management process at IHS Towers is to ensure that our board of directors and management are aware of the key risks that could threaten the achievement of business objectives and that appropriate mitigation plans are in place to avoid, eliminate, or minimize the impact of such risks, should they arise. Risk assessments typically consider the potential impacts should a risk occur and the likelihood of the risk occurring, as well as the root causes of individual risks and the need for any additional controls or mitigation actions. Risks are prioritized, and risk profiles will cover a mix of external risks over which management may have little control as well as internal risks that management should be capable of mitigating.
Our internal audit process is a fundamental component of the risk management process. Its objective is to provide reasonable assurance to our board of directors and management that the controls put in place to mitigate our key risks are designed appropriately and operating effectively. A critical input into planning internal audit work is a good understanding of the risk profiles in all our markets, functions, and projects, as well as the key risks facing the company. The results of internal audit reviews are presented to the audit committee. The output of all internal audit work is an important input into the development of the risk assessments we perform.
To be able to appropriately respond to risks when they arise, we have in place regularly updated business continuity plans covering a wide range of risks, such as natural catastrophes, political violence or health risks to employees, that have been developed to provide management with guidance on actions that should be taken in the event an incident occurs threatening business performance.
Communications to our Board of Directors
Shareholders and other interested parties may communicate directly with our independent directors by sending a written communication in an envelope addressed to: Board of Directors (Independent Directors), c/o General Counsel, Legal Department, IHS Holding Limited, 1 Cathedral Piazza, 123 Victoria Street, London SW1E 5BP, United Kingdom.
Shareholders and other interested parties may communicate directly with the full board of directors by sending a written communication in an envelope addressed to: Board of Directors, c/o General Counsel, Legal Department, IHS Holding Limited, 1 Cathedral Piazza, 123 Victoria Street, London SW1E 5BP, United Kingdom.
Corporate Governance Guidelines
Our Board of Directors has adopted corporate governance guidelines (the “Corporate Governance Guidelines”) that serve as a flexible framework within which our Board of Directors and its committees operate. These guidelines cover a number of areas including the size and composition of our Board of Directors, director qualification standards, director responsibilities, role of the lead director, meetings of independent directors, committee responsibilities and assignments, Board member access to management and independent advisors, director communications with third parties, director compensation, director orientation and continuing education, and management succession planning.
The Corporate Governance Guidelines are publicly available under the “Governance” section of our investor relations website at http://www. https://www.ihstowers.com/investors. The information on our website is not incorporated by reference into this Annual Report.
D. Employees
As of December 31, 2024, we had 2,864 employees.
The table below sets out the number of employees, by geography, as of December 31, 2024:
|
|
As of |
Geography |
|
December 31, 2024 |
Nigeria |
|
1,361 |
Côte d’Ivoire |
|
170 |
Cameroon |
|
158 |
Zambia |
|
143 |
Rwanda |
|
84 |
Latin America |
|
500 |
South Africa |
|
128 |
Other |
|
320 |
Total |
|
2,864 |
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The table below sets out the number of employees, by category, as of December 31, 2024:
|
|
As of |
Department |
|
December 31, 2024 |
Finance |
|
344 |
Technical |
|
1,569 |
Information Technology |
|
151 |
Commercial |
|
100 |
Legal |
|
94 |
Human resources |
|
124 |
Executive |
|
52 |
Other |
|
430 |
Total |
|
2,864 |
As of December 31, 2024, we had engaged 426 temporary employees in various departments, including human resources, legal and technical, who performed various functions in support of legal, compliance, operational efficiency, property management and maintenance across our sites.
In Cameroon, we have 45 unionized employees, representing approximately 28% of employees in Cameroon, while in Cote d'Ivoire, we have 50 unionized employees, representing approximately 29% of employees in Cote d'Ivoire. In both countries, we are subject to a National Collective Agreement of Trade. However, this is issued at a country level and is not specific to us as a company. In addition, in Brazil (Latin America), all permanent employees are covered by the same Collective Agreement, as determined by local legislation.
We have never experienced labor-related work stoppages or strikes and believe that our relations with our employees are satisfactory.
E. Share Ownership
For information regarding the share ownership of directors and officers, see Item 7.A. “Major Shareholders and Related Party Transactions—Major Shareholders.” For information as to our equity incentive plans, see Item 6.B. “Director, Senior Management and Employees—Compensation—Share Incentive Plans.”
F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation
None.
Item 7. Major Shareholders and Related Party Transactions
A. Major Shareholders
The following table sets forth information relating to the beneficial ownership of our ordinary shares as of February 14, 2025 by:
| ● | each person, or group of affiliated persons, known by us to beneficially own 5% or more of our outstanding ordinary shares; |
| ● | each of our executive officers and directors; and |
| ● | all of our executive officers and directors as a group. |
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The number of ordinary shares beneficially owned by each entity, person, executive officer or director is determined in accordance with the rules of the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rules, beneficial ownership includes any shares over which the individual has sole or shared voting power or investment power as well as any shares that the individual has the right to acquire within 60 days of February 14, 2024 through the exercise of any option, warrant or other right. Except as otherwise indicated, and subject to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all ordinary shares held by that person.
Ordinary shares that a person has the right to acquire within 60 days of February 14, 2025 are deemed outstanding for purposes of computing the percentage ownership of the person holding such rights, but are not deemed outstanding for purposes of computing the percentage ownership of any other person, except with respect to the percentage ownership of all executive officers and directors as a group. Unless otherwise indicated below, the address for each beneficial owner listed is c/o IHS Holding Limited, 1 Cathedral Piazza, 123 Victoria Street, London SW1E 5BP, United Kingdom.
For further information regarding material transactions between us and principal shareholders, see Item 7.B. “Major Shareholders and Related Party Transactions—Related Party Transactions.”
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Name of beneficial owner |
|
Number |
|
% |
|
5% or Greater Shareholders |
|
|
|
|
|
Mobile Telephone Networks (Netherlands) B.V.(1) |
|
85,176,719 |
|
25.5 |
% |
Entities affiliated with Wendel(2) |
|
62,975,396 |
|
18.9 |
% |
Korea Investment Corporation(3) |
|
21,666,802 |
|
6.5 |
% |
Warrington Investment Pte Ltd(4) |
|
18,055,054 |
|
5.4 |
% |
Executive Officers and Directors |
|
|
|
|
|
Sam Darwish |
|
12,921,750 |
|
3.9 |
% |
Mohamad Darwish |
|
1,922,002 |
|
* |
|
William Saad |
|
3,740,602 |
|
1.1 |
% |
Steve Howden |
|
400,091 |
|
* |
|
Ayotade Oyinlola |
|
290,090 |
|
* |
|
Colby Synesael(5) |
|
195,347 |
|
* |
|
Mustafa Tharoo |
|
640,051 |
|
* |
|
Ursula Burns |
|
37,112 |
|
* |
|
John Ellis Bush |
|
118,556 |
|
* |
|
Frank Dangeard |
|
- |
|
* |
|
Bashir El-Rufai(6) |
|
1,084,516 |
|
* |
|
Maria Carolina Lacerda |
|
37,112 |
|
* |
|
Nicholas Land |
|
37,112 |
|
* |
|
Phuthuma Nhleko |
|
37,112 |
|
* |
|
Aniko Szigetvari |
|
37,112 |
|
* |
|
All executive officers and board members as a group (15 persons) |
|
21,498,565 |
|
6.4 |
% |
* |
Indicates beneficial ownership of less than 1% of the total issued and outstanding ordinary shares. |
| (1) | Based solely on a Schedule 13G filed with the SEC on February 14, 2022, MTN Group Limited, Mobile Telephone Networks Holdings Limited, MTN International (Pty) Limited, MTN International (Mauritius) Limited, MTN (Dubai) Limited, Mobile Telephone Networks (Netherlands) Cooperatieve U.A., and Mobile Telephone Networks (Netherlands) B.V. may be deemed to beneficially own and have shared voting power and shared dispositive power over 85,176,719 ordinary shares. Mobile Telephone Networks (Netherlands) B.V. is ultimately a wholly owned subsidiary of MTN Group Limited, the parent company of each of the reporting persons named in this footnote. The address for MTN Group Limited, Mobile Telephone Networks Holdings Limited and MTN International (Pty) Limited is 216 14th Avenue, Fairland, Johannesburg, South Africa 2195. The address for MTN International (Mauritius) Limited is c/o Rogers Capital Corporate Services Limited, Rogers House, 5 President John Kennedy Street, Port Louis, Mauritius. The address for MTN (Dubai) Limited is Unit OT 08-30, OT 08-31, OT 08-32 , OT 08-33 , OT 08-34 , OT 08-35, Level 8, Central Park Offices, Dubai International Financial Centre, P O Box 506735, Dubai, United Arab Emirates. The address for Mobile Telephone Networks (Netherlands) Coöperatieve U.A. and Mobile Telephone Networks (Netherlands) B.V. is Westerdoksdijk 423, 1013 BX Amsterdam, The Netherlands. |
| (2) | Based solely on a Schedule 13G/A filed with the SEC on February 13, 2023, and information known to the Company (a) Wendel SE may be deemed to beneficially own and has shared voting and dispositive power over 62,975,396 ordinary shares, and (b) Oranje-Nassau Développement S.C.A. FIAR, or OND, may be deemed to beneficially own and has shared voting and dispositive power over 62,975,396 ordinary shares. OND is managed by its general partner Wendel Luxembourg SA ( the “General Partner”). A majority vote of directors is required for any action by the General Partner, and no single director has a veto right. Each of the General Partner and its boards of directors disclaims beneficial ownership of the shares of the Company held by OND. The address for OND is 5, rue Pierre d’Aspelt L1142 Luxembourg. The address for Wendel SE is 89, rue Taitbout, Paris, France, 75009. |
| (3) | Based solely on a Schedule 13G filed with the SEC on February 15, 2022, Korea Investment Corporation may be deemed to beneficially own and has sole voting power and dispositive power over 21,666,802 ordinary shares. Korea Investment Corporation is a statutory juridical corporation established under the Korea Investment Corporation Act of the Republic of Korea. The address for Korea Investment Corporation is 17F-18F State Tower Namsan, 100 Toegye-ro, Jung-gu, Seoul, 04631, South Korea. |
| (4) | Based solely on a Schedule 13G filed with the SEC on February 15, 2022, each of GIC Private Limited (“GIC PL”), GIC Special Investments Private Limited (“GIC SI”) and Warrington Investment Pte Ltd. (“Warrington”) may be deemed to beneficially own and have shared voting and dispositive power over 18,055,054 ordinary shares. GIC SI is |
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| wholly owned by GIC PL and is the private equity investment arm of GIC PL. GIC PL is wholly owned by the Government of Singapore (“GoS”) and was set up with the sole purpose of managing Singapore’s foreign reserves. The GoS disclaims beneficial ownership of such shares. The address for each of GIC PL, GIC SI and Warrington is 168 Robinson Road, #37-01 Capital Tower, Singapore 068912. |
| (5) | Indicates ownership as of July 15, 2024, the effective date of Mr. Synesael’s resignation from the Company. |
| (6) | Includes 1,047,404 ordinary shares owned by African Tower Investment Limited over which Mr. El-Rufai has beneficial ownership. The address for Mr. El-Rufai is c/o IHS GCC Limited, Unit 802, Level 8, The Exchange, Dubai International Financial Centre, P.O. Box 506528, Dubai, United Arab Emirates. |
As a number of our shares are held in book-entry form, we are not aware of the identity of all our shareholders. To our knowledge, as of February 28, 2025, we had 158, 767, 654 ordinary shares held by six US resident shareholders of record.
To our knowledge, other than as provided in the table above, our other filings with the SEC and this Annual Report, there has been no significant change in the percentage ownership held by any major shareholder since January 1, 2022.
The major shareholders listed above do not have voting rights with respect to their ordinary shares that are different from the voting rights of other holders of our ordinary shares, except that for so long as the number of ordinary shares held by MTN Group is greater than 20% of the total number of ordinary shares in issue, each ordinary share held by MTN Group shall entitle MTN Group to the number of votes per ordinary share calculated by dividing 20% of the total number of ordinary shares in issue by the number of ordinary shares held by MTN Group.
We are not aware of any arrangement whereby we are directly or indirectly owned or controlled by another corporation, by any foreign government or by any other natural or legal person severally or jointly, nor are we aware of any arrangement that may, at a subsequent date, result in a change of control of our company.
B. Related Party Transactions
The following is a description of related party transactions since January 1, 2024, other than equity and other compensation, termination, change in control and other arrangements with our key management personnel and close members of such individuals’ families, which are described under Item 6.D. “Directors, Senior Management and Employees – Compensation”.
Shareholders’ Agreement
In connection with our IPO, we and certain of our shareholders entered into a shareholders’ agreement (the “Shareholders’ Agreement”). The Shareholders’ Agreement provides certain rights to our shareholders party to it, including rights to designate directors for nomination by our board of directors, request matters to be added to the agenda for shareholder meetings and approval rights with respect to certain proposed actions of the Company.
Director Designation
Our shareholders party to the Shareholders’ Agreement (and any person who received Subject Shares transferred in compliance with the Shareholders’ Agreement and was thereafter required to comply with the sell-down arrangements contained in the Shareholders’ Agreement) are collectively referred to as the Locked-up Shareholders. For so long as the Locked-up Shareholders beneficially own, directly or indirectly, in aggregate, at least 20% of our issued shares, our Board will consist of a minimum of five and a maximum of 15 directors. Additionally, each of ECP and Wendel is entitled to designate one director for nomination by our board of directors for so long as it beneficially owns, directly or indirectly, at least 10% of our issued shares.
Consent Rights
For so long as the Locked-up Shareholders beneficially own, directly or indirectly, in aggregate, 20% or more of our issued shares, the approval of a resolution passed by a simple majority of the votes cast by the holders of our ordinary shares at a duly convened general assembly (and including the votes of Locked-up Shareholders collectively holding at least 20% or more our issued shares) is required for us to take certain actions, including: (a) entry into or material revisions of certain equity compensation plans; (b) the issuance of shares, or securities convertible into or exchangeable for shares, above certain thresholds; and (c) the issuance of shares, or securities convertible into or exchangeable for shares, to directors, officers and the beneficial owners of more than 5% of our shares above certain thresholds.
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Shareholder Meetings
Any two or more Locked-up Shareholders together holding at least 25% in aggregate of our issued shares are entitled to request additional business be included in the agenda for any general meeting.
As used in this section:
“Management Shareholders” refers to certain members of management.
“Post Greenshoe Shares” refers to a number equal to the sum of all of the Locked-up Shareholder’s Post Greenshoe Shares held by all Locked-up Shareholders.
“Unblocked” refers to actions taken by us with respect to shares such that our registrar will no longer prevent such Shares from being registered on the public trading system. For the avoidance of doubt, reference to such shares being Unblocked shall not alter any status of such shares as restricted securities (within the meaning of Rule 144 under the Securities Act) or other restrictions on transfer to which such shares may be subject by operation of law or regulation.
“Wendel” refers to Oranje-Nassau Développement S.C.A. FIAR and Africa Telecom Towers S.C.S.
Registration Rights Agreement
In connection with our IPO, we and certain of our shareholders entered into a registration rights agreement, or the Registration Rights Agreement. The Registration Rights Agreement entitles the Holders (as defined in the Registration Rights Agreement) to certain “demand” and “piggyback” registration rights as described below.
The Registration Rights Agreement allows one or more Holders together holding at least 5% of the Registrable Securities (as defined in the Registration Rights Agreement) up to three demand registrations (in the aggregate) over any 12-month period. The Registration Rights Agreement allows the Holders to request registration for all or any portion of their Registrable Securities, subject to customary underwriter cutbacks and certain arrangements with the MTN Group, which we refer to as the MTN Shareholder Arrangements. The Holders representing a majority of the Registrable Securities included in such offering may select the underwriters. In addition, MTN and Wendel may jointly nominate for appointment one bookrunner. Subject to certain requirements, we may suspend a request for registration for 90 days in the aggregate up to two times in any 12-month period.
Subject to eligibility, the Registration Rights Agreement also grants one or more Holders holding, alone or in the aggregate, at least 5% of the Registrable Securities the right to require us to file a shelf registration statement on Form F-3 (or any successor form). Additionally, in the event such a shelf registration statement is effective, upon the request of (i) one or more Holders representing, individually or in the aggregate, at least 5% of the Registrable Securities or (ii) any Holder to the extent requested beginning October 13, 2023, we shall be required to undertake an underwritten takedown offering.
When we or another Holder propose to register any of our ordinary shares subject to the terms of the Registration Rights Agreement, each Holder then holding Registrable Securities has the right to request that its Registrable Securities be included in such registration, subject to customary underwriter cutbacks and the MTN Shareholder Arrangements.
Pursuant to the Registration Rights Agreement, we have agreed to pay the fees and expenses associated with registration (excluding stock transfer taxes, underwriting fees, commissions or discounts). The Registration Rights Agreement contains customary provisions with respect to registration proceedings, underwritten offerings, and indemnity and contribution rights.
Relationship with MTN Group
One of our shareholders, MTN Group, is a related party of the MTN Customers. We have entered into MLAs separately with each of the MTN Customers in our relevant countries of operation, that expire in December 2032 in Nigeria, March 2033 in Cameroon, April 2033 in Côte d’Ivoire, March 2034 in Zambia, April 2034 in Rwanda and April 2034 in South Africa. In addition to the MLAs, we also enter into SLAs from time to time with the MTN Customers. The MTN Customers accounted for 46%, 4%, 4%, 1%, 2% and 5% of our revenue for the year ended December 31, 2024, respectively.
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Teneo
During the year ended December 31, 2023, we entered into an arm’s length agreement for the provision of consulting services from Teneo. Ms. Ursula Burns, one of our directors, is the Chairwoman of the Board of Teneo Worldwide, LLC. The total fees paid to Teneo for the year ended December 31, 2024 were $2,309,009.
Sublease of Office Space
During the year ended December 31, 2023, we entered into an agreement to sub-lease office space from a subsidiary company of Wendel Group. The sub-lease agreement was terminated on May 31, 2024. Under the sub-lease agreement, the Group paid rent and utilities for the year ended December 31, 2024 amounting to $134,631 and was refunded the deposit previous paid of $195,298.
K2022644716 (South Africa) Proprietary Limited
In December 2024, the Group received clearance from the Competition Commission of South Africa for the subscription of 30% of the shares in IHS South Africa Holding Proprietary Limited by SA Tower Holdings Pty Limited (“SATH”), a consortium of B-BBEE parties, and the transaction completed in January 2025. The completion of this transaction satisfies one of the conditions set by the Competition Commission of South Africa, to achieve and maintain certain B-BBEE contributor levels. Capgro Trust, a family trust for the Phuthuma Nhleko family, is the sole shareholder of K2022644716 (South Africa) Proprietary Limited, which holds a 45% stake in SATH. Mr. Phuthuma Nhleko, one of our directors, serves as a trustee of the Capgro Trust.
Indemnification agreements
We entered into indemnification agreements with our executive officers and directors.
Our Articles provide for us to indemnify our directors and officers from and against all liability which they incur in execution of their duty in their respective offices, except liability incurred by reason of such director’s or officer’s dishonesty, willful default or fraud. See Item 6.B. “Director, Senior Management and Employees—Compensation — Indemnification” for a description of these indemnification agreements.
Related party transaction policy
Our board of directors has adopted a written related party transaction policy that sets forth the policies and procedures for the review and approval or ratification of related person transactions. This policy covers related party transactions that may be required to be reported under the disclosure rules applicable to us.
C. Interests of Experts and Counsel
Not applicable.
Item 8. Financial Information
A. Consolidated Statements and Other Financial Information
Consolidated Financial Statements
See Item 18. “Financial Statements.”
Legal and Arbitration Proceedings
We are subject to various legal and regulatory proceedings, claims and actions. Although the outcome of these proceedings, claims and actions cannot be predicted with certainty, we do not believe that the outcome of any such proceedings, claims and actions would, in our management’s judgment, have a material adverse effect on our financial condition or results of operation, nor are we aware of any material legal and regulatory proceedings, claims and actions threatened against us.
131
Dividend Policy
We do not anticipate paying any cash dividends on our ordinary shares in the near future. We intend to retain all available funds and any future earnings to fund the development and expansion of our business. However, if we do pay a cash dividend on our ordinary shares in the future, we will pay such dividend out of our profits or share premium (subject to solvency requirements) as permitted under Cayman Islands law.
The amount of any future dividend payments we may make will depend on, among other factors, our strategy, future earnings, financial condition, cash flow, availability or ability under our existing financing arrangements, working capital requirements, capital expenditures and applicable provisions of our Articles. Any profits or share premium we declare as dividends will not be available to be reinvested in our operations.
Moreover, we are a holding company that does not conduct any business operations of our own. As a result, we are dependent upon cash dividends, distributions and other transfers from our subsidiaries to make dividend payments. The ability of certain of our subsidiaries to pay dividends, distributions and other transfers is currently restricted by the terms of the 2027 Notes and IHS Holding Notes and certain of our other debt agreements and instruments and may be further restricted by any future indebtedness we or they incur. See Item 5.B. “Operating and Financial Review and Prospects—Liquidity and Capital Resources—Indebtedness.”
We did not propose or pay dividends in the year ended December 31, 2024.
B. Significant Changes
None.
Item 9. The Offer and Listing
A. Offer and Listing Details
Our ordinary shares trade on the New York Stock Exchange under the trading symbol “IHS”.
B. Plan of Distribution
Not applicable.
C. Markets
Our ordinary shares trade on the New York Stock Exchange under the trading symbol “IHS”.
D. Selling Shareholders
Not Applicable.
E. Dilution
Not applicable.
F. Expenses of the Issue
Not applicable.
Item 10. Additional Information
A. Share Capital
Not applicable.
132
B. Memorandum and Articles of Association
A copy of our Articles is attached as Exhibit 1.1 to this Annual Report. The information called for by this Item is set forth in Exhibit 2.7 to this Annual Report and is incorporated by reference into this Annual Report.
C. Material Contracts
The following is a summary of each material contract, other than contracts entered into in the ordinary course of business, to which we are or have been a party, for the two years immediately preceding the date of this Annual Report:
| ● | Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to Amendment No. 1 to the Company’s Registration Statement on Form F 1 (File No. 333-259593) filed with the SEC on October 4, 2021). |
| ● | 2021 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.2 to Amendment No. 1 to the Company’s Registration Statement on Form F 1 (File No. 333-259593) filed with the SEC on October 4, 2021). |
| ● | Form of Non-Employee Director Restricted Stock Unit Award Agreement (incorporated by reference to Exhibit 99.3 to the Company’s Registration Statement on Form S-8 (File 333-260317) filed with the SEC on October 18, 2021). |
| ● | Amended and Restated Revolving Credit Agreement, dated as of June 2, 2021, among IHS Holding Limited, as borrower, Citibank, N.A., London Branch as global coordinator, Citibank, N.A., London Branch, Absa Bank Limited (acting through its Corporate and Investment Banking division), Goldman Sachs Lending Partners LLC, JPMorgan Chase Bank, N.A., London Branch and Standard Chartered Bank Dubai International Financial Centre Branch, regulated by the Dubai Financial Services Authority, as mandated lead arrangers, Citibank Europe Plc, UK Branch, as facility agent, and the financial institutions listed therein as the original lenders (incorporated by reference to Exhibit 10.3 to Amendment No. 1 to the Company’s Registration Statement on Form F 1 (File No. 333-259593) filed with the SEC on October 4, 2021). |
| ● | Amendment Letter to Amended and Restated Revolving Credit Agreement, dated as of September 29, 2021, among IHS Holding Limited, as borrower, Citibank, N.A., London Branch as global coordinator, Citibank, N.A., London Branch, Absa Bank Limited (acting through its Corporate and Investment Banking division), Goldman Sachs Lending Partners LLC, JPMorgan Chase Bank, N.A., London Branch and Standard Chartered Bank Dubai International Financial Centre Branch, regulated by the Dubai Financial Services Authority, as mandated lead arrangers, Citibank Europe Plc, UK Branch, as facility agent, and the financial institutions listed therein as the original lenders (incorporated by reference to Exhibit 10.4 to Amendment No. 1 to the Company’s Registration Statement on Form F 1 (File No. 333-259593) filed with the SEC on October 4, 2021). |
| ● | Amendment Letter dated September 14, 2022, between IHS Holding Limited and Citibank Europe PLC, UK Branch as facility agent (for and on behalf of the original lenders), in relation to the Amended and Restated Revolving Credit Agreement dated June 2, 2021 (incorporated by reference to Exhibit 99.3 to Form 6-K (File No. 001-40876) furnished to the SEC on November 15, 2022 (second Form 6-K)). |
| ● | Amendment and Restatement Agreement dated November 6, 2023 between IHS Holding Limited and Citibank Europe PLC, UK Branch as facility agent (for and on behalf of the original lenders), in relation to the Amended and Restated Revolving Credit Agreement dated June 2, 2021 (incorporated by reference to Exhibit 99.2 to Form 6-K (File No. 001-40876) furnished to the SEC on November 14, 2023 (second Form 6-K)). |
| ● | Amendment Letter dated March 21, 2024 between IHS Holding Limited and Citibank Europe PLC, UK Branch as facility agent (for and on behalf of the original lenders), in relation to the Amended and Restated Revolving Credit Agreement dated November 6, 2023 (incorporated by reference to Exhibit 99.4 to Form 6-K (File No. 001-40876) furnished to the SEC on May 14, 2024 (second Form 6-K)). |
| ● | Amendment Letter dated April 22, 2024 between IHS Holding Limited and Citibank Europe PLC, UK Branch as facility agent (for and on behalf of the original lenders), in relation to the Amended and Restated Revolving Credit Agreement dated November 6, 2023 (incorporated by reference to Exhibit 99.5 to Form 6-K (File No. 001-40876) furnished to the SEC on May 14, 2024 (second Form 6-K)). |
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| ● | Amendment Letter dated October 22, 2024 between IHS Holding Limited and Citibank Europe PLC, UK Branch as facility agent (for and on behalf of the original lenders), in relation to the Amended and Restated Revolving Credit Agreement dated November 6, 2023 (incorporated by reference to Exhibit 99.2 to Form 6-K (File No. 001-40876) furnished to the SEC on November 12, 2024 (second Form 6-K)). |
| ● | Term Loan Facility Agreement, dated October 28, 2022, among IHS Holding Limited, as borrower, Absa Bank Limited (acting through its Corporate and Investment Banking division), Citibank N.A. London Branch, FirstRand Bank Limited (London Bank) acting through its Rand Merchant Bank division, and Standard Chartered Bank, as bookrunner initial mandated lead arrangers, Citibank Europe plc, UK Branch, as facility agent, and the financial institutions listed therein as the original lenders (incorporated by reference to Exhibit 99.4 to Form 6-K (File No. 001-40876) furnished to the SEC on November 15, 2022 (second Form 6-K). |
| ● | Amendment Letter dated October 2, 2023 between IHS Holding Limited and Citibank Europe PLC, UK Branch as facility agent (for and on behalf of the original lenders), in relation to the Term Loan Facility Agreement dated October 28, 2022 (incorporated by reference to Exhibit 99.3 to Form 6-K (File No. 001-40876) furnished to the SEC on November 14, 2023 (second Form 6-K)). |
| ● | Amendment Letter dated February 5, 2024 between IHS Holding Limited and Citibank Europe PLC, UK Branch as facility agent (for and on behalf of the original lenders), in relation to the Term Loan Facility Agreement dated October 28, 2022 (incorporated by reference to Exhibit 4.12 to Form 20-F (File No.001-40876) filed with the SEC on March 12, 2024). |
| ● | Amendment Letter dated March 22, 2024 between IHS Holding Limited and Citibank Europe PLC, UK Branch as facility agent (for and on behalf of the original lenders), in relation to the Term Loan Facility Agreement, dated October 28, 2022 (incorporated by reference to Exhibit 99.2 to Form 6-K (File No.001-40876) furnished to the SEC on May 14, 2024 (second Form 6-K). |
| ● | Amendment Letter dated April 22, 2024 between IHS Holding Limited and Citibank Europe PLC, UK Branch as facility agent (for and on behalf of the original lenders), in relation to the Term Loan Facility Agreement dated October 28, 2022 (incorporated by reference to Exhibit 99.3 to Form 6-K (File No.001-40876) furnished to the SEC on May 14, 2024 (second Form 6-K). |
| ● | Term Loan Facility Agreement, dated January 3, 2023 among IHS Netherlands Holdco B.V. as guarantor, IHS (Nigeria) Limited, IHS Towers NG Limited, INT Towers Limited as borrowers and guarantors, each of IHS Holding Limited, IHS Netherlands NG1 B.V., IHS Nigeria, IHS Netherlands NG2 B.V., IHS Towers NG Limited, Nigeria Tower Interco B.V. and INT Towers as guarantors, Access Bank Plc, Ecobank Nigeria Limited, Rand Merchant Bank Nigeria Limited and United Bank for Africa Plc as mandated lead arrangers, Ecobank Nigeria Limited as facility agent, and the financial institutions listed therein as the lenders (incorporated by reference to Exhibit 4.8 to Form 20-F (File No. 001-40876) filed with the SEC on March 28, 2023). |
| ● | Amendment Letter dated February 15, 2024 between IHS Netherlands Holdco B.V. and Ecobank Nigeria Limited as facility agent (for and on behalf of the original lenders), in relation to the Term Loan Facility Agreement dated January 3, 2023 (incorporated by reference to Exhibit 4.13 to Form 20-F (File No. 001-40876) filed with the SEC on March 12, 2024). |
| ● | Amendment Letter dated August 5, 2024 between IHS Netherlands Holdco B.V. and Ecobank Nigeria Limited as facility agent (for and on behalf of the original lenders), in relation to the Term Loan Facility Agreement dated January 3, 2023 (incorporated by reference to Exhibit 99.2 to Form 6-K (File No. 001-40876) furnished to the SEC on August 13, 2024 (second Form 6-K)). |
| ● | Amendment Letter dated November 14, 2024 between IHS Netherlands Holdco B.V. and Ecobank Nigeria Limited as facility agent (for and on behalf of the original lenders), in relation to the Term Loan Facility Agreement dated January 3, 2023 (filed as Exhibit 4.6 to this Annual Report on Form 20-F). |
| ● | Amendment Letter dated January 28, 2025 between IHS Netherlands Holdco B.V. and Ecobank Nigeria Limited as facility agent (for and on behalf of the original lenders), in relation to the Term Loan Facility Agreement dated January 3, 2023 (filed as Exhibit 4.7 to this Annual Report on Form 20-F). |
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| ● | Revolving Credit Agreement, dated January 3, 2023 among IHS Netherlands Holdco B.V. as guarantor, IHS (Nigeria) Limited, IHS Towers NG Limited, INT Towers Limited as borrowers and guarantors, each of IHS Holding Limited, IHS Netherlands NG1 B.V., IHS Nigeria, IHS Netherlands NG2 B.V., IHS Towers NG Limited, Nigeria Tower Interco B.V. and INT Towers as guarantors, Access Bank Plc, Ecobank Nigeria Limited, Rand Merchant Bank Nigeria Limited and United Bank for Africa Plc as mandated lead arrangers, Ecobank Nigeria Limited as facility agent, and the financial institutions listed therein as the lenders (incorporated by reference to Exhibit 4.9 to Form 20-F (File No. 001-40876) filed with the SEC on March 28, 2023). |
| ● | Amendment Letter dated February 15, 2024 between IHS Netherlands Holdco B.V. and Ecobank Nigeria Limited as facility agent (for and on behalf of the original lenders), in relation to the Revolving Credit Agreement dated January 3, 2023 (incorporated by reference to Exhibit 4.14 to Form 20-F (File No. 001-40876) filed with the SEC on March 12, 2024). |
| ● | Amendment Letter dated August 5, 2024 between IHS Netherlands Holdco B.V. and Ecobank Nigeria Limited as facility agent (for and on behalf of the original lenders), in relation to the Revolving Credit Agreement dated January 3, 2023 (incorporated by reference to Exhibit 99.2 to Form 6-K (File No. 001-40876) filed with the SEC on August 13, 2024). |
| ● | Amendment Letter dated November 14, 2024 between IHS Netherlands Holdco B.V. and Ecobank Nigeria Limited as facility agent (for and on behalf of the original lenders), in relation to the Revolving Credit Agreement dated January 3, 2023 (filed as Exhibit 4.11 to this Annual Report on Form 20-F). |
| ● | Amendment Letter dated January 28, 2025 between IHS Netherlands Holdco B.V. and Ecobank Nigeria Limited as facility agent (for and on behalf of the original lenders), in relation to the Revolving Credit Agreement dated January 3, 2023 (filed as Exhibit 4.12 to this Annual Report on Form 20-F). |
| ● | Term Loan Facility Agreement, dated March 8, 2024, between, among others, IHS Holding Limited as borrower, Standard Chartered Bank as arranger, and Standard Chartered Bank (Singapore) Limited as the original lender (incorporated by reference to Exhibit 4.15 to Form 20-F (File No. 001-40876) filed with the SEC on March 12, 2024). |
| ● | Amendment Letter dated March 22, 2024 between IHS Holding Limited and Standard Chartered Bank (Singapore) Limited as the original lender, in relation to the Term Loan Facility Agreement, dated March 8, 2024 (incorporated by reference to Exhibit 99.6 to Form 6-K (File No. 001-40876) furnished to the SEC on May 14, 2024 (second Form 6-K)). |
| ● | Amendment Letter dated April 18, 2024 between IHS Holding Limited and Standard Chartered Bank (Singapore) Limited as the original lender, in relation to the Term Loan Facility Agreement, dated March 8, 2024 (incorporated by reference to Exhibit 99.7 to Form 6-K (File No. 001-40876) furnished to the SEC on May 14, 2024 (second Form 6-K)). |
| ● | Amendment Letter dated October 22, 2024 between IHS Holding Limited and Standard Chartered Bank as arranger, in relation to the Term Loan Facility Agreement dated March 8, 2024 (incorporated by reference to Exhibit 99.4 to Form 6-K (File No. 001-40876) furnished to the SEC on November 12, 2024 (second Form 6-K)). |
| ● | Supplemental Indenture, dated as of June 17, 2021, among IHS Netherlands Holdco B.V., as issuer, IHS Holding Limited, IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., IHS Nigeria Limited, IHS Towers NG Limited, Nigeria Tower Interco B.V., INT Towers Limited, as guarantors, and Citibank N.A. London Branch, as Trustee, Principal Paying Agent, Transfer Agent and Registrar (incorporated by reference to Exhibit 4.5 to Amendment No. 1 to the Company’s Registration Statement on Form F 1 (File No. 333-259593) filed with the SEC on October 4, 2021). |
| ● | Indenture, dated as of November 29, 2021, among IHS Holding Limited., as issuer, IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., IHS Nigeria Limited, IHS Towers NG Limited, INT Towers Limited, Nigeria Tower Interco B.V., as guarantors, Lucid Trustee Services Limited, as Trustee, and Citibank N.A. London Branch, as Principal Paying Agent, Transfer Agent and Registrar (incorporated by reference to Exhibit 2.6 to the Company’s Annual Report on Form 20-F/A (File No. 001-40876) filed with the SEC on August 16, 2022). |
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| ● | Term Loan Facility Agreement, dated October 7, 2024, between, among others, IHS Holding Limited as borrower, First Rand Bank Limited (acting through its Rand Merchant Bank division) as facility agent and the financial institutions listed therein as mandated lead arrangers and original lenders (incorporated by reference to Exhibit 99.4 to Form 6-K (File No. 001-40876) furnished to the SEC on November 12, 2024 (second Form 6-K)). |
| ● | Indenture, dated as of November 29, 2024, among IHS Holding Limited, as issuer, IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V, as guarantors, Kroll Trustee Services Limited, as Trustee, and Citibank N.A. London Branch, as Principal Paying Agent, Transfer Agent and Registrar (filed as Exhibit 2.7 to this Annual Report on Form 20-F). |
| ● | Supplemental Indenture, dated as of November 29, 2024 among IHS Netherlands Holdco B.V., as issuer IHS Holding Limited, IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., IHS Nigeria Limited, IHS Towers NG Limited, Nigeria Tower Interco B.V., INT Towers Limited and INT Towers NG Finco 1 Plc, as guarantors, and Citibank N.A. London Branch, as Trustee, Principal Paying Agent, Transfer Agent and Registrar (filed as Exhibit 2.8 to this Annual Report on Form 20-F). |
D. Exchange Controls
There are no Cayman Islands exchange control regulations that would affect the import or export of capital or the remittance of dividends, interest or other payments to non-resident holders of our shares.
E. Taxation
The following summary contains a description of certain Cayman Islands, United Kingdom and U.S. federal income tax consequences of the ownership and disposition of ordinary shares, but it does not purport to be a comprehensive description of all the tax considerations that may be relevant to the ownership of ordinary shares. The summary is based upon the tax laws of the Cayman Islands and regulations thereunder, the tax laws of the United Kingdom and regulations thereunder and on the tax laws of the United States and regulations thereunder as of the date hereof, which are subject to change.
Material Cayman Islands Tax Considerations
The following discussion is a summary of the material Cayman Islands tax considerations relating to the purchase, ownership and disposition of our ordinary shares. There is, at present, no direct taxation in the Cayman Islands and interest, dividends and gains payable to the Company will be received free of all Cayman Islands taxes. The Company received an undertaking from the Government of the Cayman Islands to the effect that, for a period of thirty years from the date of the undertaking, no law that thereafter is enacted in the Cayman Islands imposing any tax to be levied on profits, income or on gains or appreciation shall apply to the Company or its operations, and in addition that no tax to be levied on profits, income gains or appreciations, or which is in the nature of estate duty or inheritance tax shall be payable (i) on or in respect of the shares, debentures or other obligation of the Company; or (ii) by way of the withholding in whole or in part of any relevant payment as defined under the Cayman Islands Tax Concessions Act.
No stamp duty in the Cayman Islands is payable in respect of the issue of any ordinary shares or an instrument of transfer in respect of an ordinary share.
Material UK Tax Considerations
The following statements are of a general nature and do not purport to be a complete analysis of all potential UK tax consequences of acquiring, holding and disposing of ordinary shares. The statements are based on current UK tax law and on the current published practice of His Majesty’s Revenue and Customs, or HMRC (which may not be binding on HMRC), as of the date of this Annual Report, all of which are subject to change, possibly with retrospective effect. They are intended to address only certain UK tax consequences for holders of ordinary shares who are tax resident in (and only in) the United Kingdom, and in the case of individuals, domiciled in (and only in) the United Kingdom (except where expressly stated otherwise) who are the absolute beneficial owners of ordinary shares and any dividends paid on them and who hold ordinary shares as investments (other than in an individual savings account or a self-invested personal pension). They do not address the UK tax consequences which may be relevant to certain classes of holders of ordinary shares such as traders, brokers, dealers, banks, financial institutions, insurance companies, investment companies, collective investment schemes, tax-exempt organizations, trustees, persons connected with the Company or any member of the IHS Towers group for tax purposes, persons holding their ordinary shares as part of hedging or conversion transactions, holders of ordinary shares who have (or are deemed to have) acquired their ordinary shares by virtue of an office or employment, and holders of ordinary shares who are or have been officers or employees of the Company or a company forming part of the IHS Towers group for tax purposes.
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The statements do not apply to any holders of ordinary shares who either directly or indirectly hold or control 10% or more of the Company’s share capital (or class thereof), voting power or profits.
The following is intended only as a general guide and is not intended to be, nor should it be considered to be, legal or tax advice to any particular prospective subscriber for, or purchaser of, ordinary shares. Accordingly, prospective subscribers for, or purchasers of, ordinary shares who are in any doubt as to their tax position regarding the acquisition, ownership and disposition of ordinary shares or who are subject to tax in a jurisdiction other than the United Kingdom should consult their own tax advisers.
The Company
It is the intention of the directors to conduct the affairs of the Company so that the central management and control of the Company is exercised in the United Kingdom. As a result, the Company is expected to be treated as resident in the United Kingdom for UK tax purposes. Accordingly we expect to be subject to UK taxation on our worldwide income and gains, except where an exemption or relief applies.
We may be treated as a dual resident company for UK tax purposes. As a result, our right to claim certain reliefs from UK tax may be restricted, and changes in law or practice in the United Kingdom could result in the imposition of further restrictions on our right to claim UK tax reliefs.
Taxation of Dividends — Withholding tax
The Company will not be required to withhold UK tax at source when paying dividends. The amount of any liability to UK tax on dividends paid by the Company will depend on the individual circumstances of a Shareholder.
Taxation of Dividends — UK Resident Shareholders
An individual holder of ordinary shares who is resident for tax purposes in the UK may, depending on his or her particular circumstances, be subject to UK tax on dividends received from the Company.
All dividends received by a UK resident individual holder of ordinary shares from the Company or from other sources will form part of such holder’s total income for income tax purposes and will constitute the top slice of that income. A nil rate of income tax will apply to the first £500 (tax year 2024/25) of taxable dividend income received by the holder of ordinary shares in a tax year. Income within the nil rate band will be taken into account in determining whether income in excess of the nil rate band falls within the basic rate, higher rate or additional rate tax bands. Where the dividend income is above the nil rate band, any excess amount will be taxed at 8.75% (tax year 2024/25) to the extent that the excess amount falls within the basic rate tax band, 33.75% (tax year 2024/25) to the extent that the excess amount falls within the higher rate tax band and 39.35% (tax year 2024/25) to the extent that the excess amount falls within the additional rate tax band.
Corporate holders of ordinary shares which are resident for tax purposes in the UK should not be subject to UK corporation tax on any dividend received from the Company so long as the dividends qualify for exemption (as is likely) and certain conditions are met (including anti-avoidance conditions). By way of example, dividends paid on shares that are not redeemable and do not carry any present or future preferential rights to dividends or to the Company’s assets on its winding up will generally be exempt.
Taxation of Dividends — Non-UK Resident Shareholders
An individual holder of ordinary shares who is not resident for tax purposes in the United Kingdom should not be chargeable to UK income tax on dividends received from the Company unless he or she carries on (whether solely or in partnership) any trade, profession or vocation in the United Kingdom through a branch or agency to which the ordinary shares are attributable. There are certain exceptions for trading in the United Kingdom through independent agents, such as some brokers and investment managers.
Corporate holders of ordinary shares who are not resident in the United Kingdom will not generally be subject to UK corporation tax on dividends unless they are carrying on a trade, profession or vocation in the United Kingdom through a permanent establishment in connection with which their ordinary shares are used, held, or acquired.
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Taxation of Capital Gains — UK Resident Shareholders
A disposal or deemed disposal of ordinary shares by an individual or corporate holder of such ordinary shares who is tax resident in the United Kingdom may, depending on that holder’s circumstances and subject to any available exemptions or reliefs, give rise to a chargeable gain or allowable loss for the purposes of UK taxation of chargeable gains.
Any chargeable gain (or allowable loss) will generally be calculated by reference to the consideration received for the disposal of ordinary shares less the allowable cost to that holder of acquiring such ordinary shares.
The applicable tax rates for UK resident individual holders of ordinary shares realizing a gain on the disposal of ordinary shares is, broadly, 18% for basic rate taxpayers (tax year 2024/25 for disposals from October 30, 2024) and 24% for higher and additional rate taxpayers (tax year 2024/25 for disposals from October 30, 2024).
For UK resident corporate holders of ordinary shares, corporation tax is generally charged on chargeable gains at the rate applicable to the relevant corporate holder. The main rate of UK corporation tax is currently 25.
Taxation of Capital Gains — Non-UK Shareholders
Holders of ordinary shares who are not resident in the United Kingdom and, in the case of an individual holder of ordinary shares, not temporarily non-resident, should not be liable for UK tax on capital gains realized on a sale or other disposal of ordinary shares unless (i) such ordinary shares are used, held or acquired for the purposes of a trade, profession or vocation carried on in the United Kingdom through a branch or agency or, in the case of a corporate holder of ordinary shares, through a permanent establishment or (ii) where certain conditions are met, the Company derives 75% or more of its gross value from UK land.
Generally, an individual holder of ordinary shares who has ceased to be resident in the United Kingdom for tax purposes for a period of five years or less and who disposes of ordinary shares during that period may be liable on their return to the United Kingdom to UK taxation on any capital gain realized (subject to any available exemption or relief).
UK Stamp Duty and UK Stamp Duty Reserve Tax
The statements below are intended as a general guide to the current position relating to UK Stamp Duty and UK Stamp Duty Reserve Tax and apply to any holders of our ordinary shares irrespective of their place of tax residence.
No UK Stamp Duty, or UK Stamp Duty Reserve Tax, or SDRT, will be payable on the issue of ordinary shares, subject to the comments below.
UK Stamp Duty will in principle be payable on any instrument of transfer of ordinary shares that is executed in the United Kingdom or that relates to any property situated, or to any matter or thing done or to be done, in the United Kingdom. An exemption from UK Stamp Duty is available on an instrument transferring ordinary shares where the amount or value of the consideration is £1,000 or less and it is certified on the instrument that the transaction effected by the instrument does not form part of a larger transaction or series of transactions in respect of which the aggregate amount or value of the consideration exceeds £1,000. Holders of ordinary shares should be aware that, even where an instrument of transfer is in principle subject to UK Stamp Duty, UK Stamp Duty is not required to be paid unless it is necessary to rely on the instrument for legal purposes, for example to register a change of ownership or in litigation in a UK court.
Provided that ordinary shares are not registered in any register maintained in the United Kingdom by or on behalf of us and are not paired with any shares issued by a UK incorporated company, any agreement to transfer ordinary shares will not be subject to SDRT. We currently do not intend that any register of ordinary shares will be maintained in the United Kingdom.
If ordinary shares were to be registered in a register maintained in the United Kingdom by or on behalf of us or paired with any shares issued by a UK incorporated company then the ordinary shares would be treated as chargeable securities for SDRT purposes and subject to certain exemptions, where such ordinary shares are transferred or issued to, or to a nominee or agent for, a person whose business is or includes the provision of clearance services or issuing depositary receipts (but not including CREST), SDRT may be payable at a rate of 1.5% of the amount or value of the consideration payable for or, in certain circumstances, the market value of the ordinary shares. Were such a liability for SDRT to arise, it would strictly be accountable by the clearance service or depositary receipt system, as the case may be, but will, in practice, generally be reimbursed by participants in the clearance service or depositary receipt system.
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Material United States Federal Income Taxation Considerations
The following discussion describes material U.S. federal income tax consequences to U.S. Holders (as defined below) of the ownership and disposition of ordinary shares. This summary applies only to U.S. Holders that hold ordinary shares as capital assets within the meaning of Section 1221 of the Code (as defined below) and have the U.S. dollar as their functional currency.
This discussion is based on the tax laws of the United States as in effect on the date of this Annual Report, including the Internal Revenue Code of 1986, as amended, or the Code, and U.S. Treasury regulations in effect or, in some cases, proposed, as of the date of this Annual Report, as well as judicial and administrative interpretations thereof available on or before such date. All of the foregoing authorities are subject to change, and any such change could apply retroactively and could affect the U.S. federal income tax consequences described below. The statements in this Annual Report are not binding on the U.S. Internal Revenue Service, or the IRS, or any court, and thus we can provide no assurance that the U.S. federal income tax consequences discussed below will not be challenged by the IRS or will be sustained by a court if challenged by the IRS. Furthermore, this summary does not address any estate or gift tax consequences, any state, local or non-U.S. tax consequences, the Medicare tax on net investment income or any other tax consequences other than U.S. federal income tax consequences.
The following discussion does not describe all the tax consequences that may be relevant to any particular holder of our ordinary shares or to persons in special tax situations such as:
| ● | banks and certain other financial institutions; |
| ● | regulated investment companies; |
| ● | real estate investment trusts; |
| ● | insurance companies; |
| ● | broker-dealers; |
| ● | traders that elect to mark to market; |
| ● | tax-exempt entities; |
| ● | persons liable for alternative minimum tax; |
| ● | U.S. expatriates; |
| ● | persons holding ordinary shares as part of a straddle, hedging, constructive sale, conversion or integrated transaction; |
| ● | persons that actually or constructively own 10% or more of the Company’s stock (by vote or value); |
| ● | persons that are resident or ordinarily resident in or have a permanent establishment in a jurisdiction outside the United States; |
| ● | persons who acquired ordinary shares pursuant to the exercise of any employee share option or otherwise as compensation; |
| ● | persons subject to special tax accounting rules as a result of any item of gross income with respect to the ordinary shares being taken into account in an applicable financial statement; or |
| ● | persons holding ordinary shares through partnerships or other pass-through entities. |
HOLDERS OF OUR ORDINARY SHARES ARE URGED TO CONSULT THEIR TAX ADVISORS ABOUT THE APPLICATION OF THE U.S. FEDERAL TAX RULES TO THEIR PARTICULAR CIRCUMSTANCES AS WELL AS THE STATE, LOCAL AND NON-U.S. TAX CONSEQUENCES TO THEM OF THE OWNERSHIP AND DISPOSITION OF ORDINARY SHARES.
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As used herein, the term “U.S. Holder” means a beneficial owner of ordinary shares that, for U.S. federal income tax purposes, is or is treated as:
| ● | an individual who is a citizen or resident of the United States; |
| ● | a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia; |
| ● | an estate whose income is subject to U.S. federal income taxation regardless of its source; or |
| ● | a trust that (1) is subject to the supervision of a court within the United States and the control of one or more U.S. persons or (2) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person. |
The tax treatment of a partner in an entity or arrangement treated as a partnership for U.S. federal income tax purposes that holds ordinary shares generally will depend on such partner’s status and the activities of the partnership. A U.S. Holder that is a partner in such partnership should consult its tax advisor.
Dividends and Other Distributions on Ordinary Shares
Subject to the passive foreign investment company considerations discussed below, the gross amount of distributions made by the Company with respect to ordinary shares (including the amount of any non-U.S. taxes withheld therefrom, if any) generally will be includible as dividend income in a U.S. Holder’s gross income in the year received, to the extent such distributions are paid out of the Company’s current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Because the Company does not maintain calculations of its earnings and profits under U.S. federal income tax principles and does not expect to do so in the future, a U.S. Holder should expect all cash distributions will be reported as dividends for U.S. federal income tax purposes. Such dividends will not be eligible for the dividends-received deduction allowed to U.S. corporations with respect to dividends received from other U.S. corporations. Dividends paid to a non-corporate U.S. Holder may be treated as “qualified dividend income” eligible for the lower capital gains tax rate with respect to non-corporate U.S. Holders. The dividends will not be eligible for the dividends received deduction available to corporations in respect of dividends received from other U.S. corporations.
The amount of any distribution paid in foreign currency will be equal to the U.S. dollar value of such currency, translated at the spot rate of exchange on the date such distribution is received, regardless of whether the payment is in fact converted into U.S. dollars at that time. Any gain or loss realized on a subsequent conversion or other disposition of such foreign currency will be treated as U.S. source ordinary income or loss.
Dividends on the ordinary shares generally will constitute foreign source income for foreign tax credit limitation purposes. Subject to certain complex conditions and limitations, any foreign taxes withheld on any distributions on the ordinary shares may be eligible for credit against a U.S. Holder’s federal income tax liability. For foreign tax credit purposes, dividends distributed by the Company with respect to ordinary shares will generally constitute “passive category income.”
Sale or Other Taxable Disposition of Ordinary Shares
Subject to the passive foreign investment company considerations discussed below, upon a sale or other taxable disposition of ordinary shares, a U.S. Holder will recognize capital gain or loss in an amount equal to the difference between the amount realized and the U.S. Holder’s adjusted tax basis in such ordinary shares. Any such gain or loss generally will be treated as long-term capital gain or loss if the U.S. Holder’s holding period in the ordinary shares exceeds one year.
Non-corporate U.S. Holders (including individuals) generally will be subject to U.S. federal income tax on long-term capital gain at preferential rates. The deductibility of capital losses is subject to significant limitations. Gain or loss, if any, realized by a U.S. Holder on the sale or other disposition of ordinary shares generally will be treated as U.S. source gain or loss for U.S. foreign tax credit limitation purposes.
Passive Foreign Investment Company Considerations
The Company will be classified as a passive foreign investment company, or a PFIC, for any taxable year if either: (a) at least 75% of its gross income is “passive income” for purposes of the PFIC rules or (b) at least 50% of the value of its assets (determined on the basis of a quarterly average) is attributable to assets that produce or are held for the production of passive income.
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For this purpose, the Company will be treated as owning its proportionate share of the assets and earning its proportionate share of the income of any other corporation in which it owns, directly or indirectly, 25% or more (by value) of the stock.
Under the PFIC rules, if the Company were considered a PFIC at any time that a U.S. Holder holds the ordinary shares, the Company would continue to be treated as a PFIC with respect to such investment unless (i) the Company ceased to be a PFIC and (ii) the U.S. Holder made a “deemed sale” election under the PFIC rules.
Based on the composition of the income, assets and operations of the Company and its subsidiaries, the Company does not believe that it currently is or has been a PFIC for the year ending December 31, 2024, and the Company does not expect to be a PFIC in the future. This is a factual determination, however, that can only be made annually after the close of each taxable year. In addition, the principles and methodology used in determining whether a company is a PFIC are subject to ambiguities and different interpretations. Therefore we cannot assure you that the Company will not be classified as a PFIC for the current taxable year. Furthermore, even if the Company is not a PFIC for the current year, the Company may become a PFIC in a future year depending on, for example, the operations of the Company and its subsidiaries.
If the Company is considered a PFIC at any time that a U.S. Holder holds ordinary shares, any gain recognized by the U.S. Holder on a sale or other disposition of the ordinary shares, as well as the amount of any “excess distribution” (defined below) received by the U.S. Holder, would be allocated ratably over the U.S. Holder’s holding period for the ordinary shares. The amounts allocated to the taxable year of the sale or other disposition (or the taxable year of receipt, in the case of an excess distribution) and to any year before the Company became a PFIC would be taxed as ordinary income. The amount allocated to each other taxable year would be subject to tax at the highest rate in effect for individuals or corporations, as appropriate, for that taxable year, and an interest charge would be imposed. For the purposes of these rules, an excess distribution is the amount by which any distribution received by a U.S. Holder on ordinary shares exceeds 125% of the average of the annual distributions on the ordinary shares received during the preceding three years or the U.S. Holder’s holding period, whichever is shorter. In addition, if the Company is a PFIC and any of its subsidiaries is also a PFIC, a U.S. Holder may also be subject to the adverse tax consequences described above with respect to any gain or “excess distribution” realized or deemed realized in respect of such subsidiary PFIC. Certain elections may be available that would result in alternative treatments (such as mark-to-market treatment) of the ordinary shares if the Company is considered a PFIC.
If the Company is considered a PFIC, a U.S. Holder will also be subject to annual information reporting requirements. U.S. Holders should consult their tax advisors about the potential application of the PFIC rules to the ordinary shares.
Information Reporting and Backup Withholding
Dividend payments with respect to ordinary shares and proceeds from the sale, exchange or redemption of ordinary shares may be subject to information reporting to the IRS and U.S. backup withholding. A U.S. Holder may be eligible for an exemption from backup withholding if the U.S. Holder furnishes a correct taxpayer identification number and makes any other required certification or is otherwise exempt from backup withholding. U.S. Holders who are required to establish their exempt status may be required to provide such certification on IRS Form W-9. U.S. Holders should consult their tax advisors regarding the application of the U.S. information reporting and backup withholding rules.
Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a U.S. Holder’s U.S. federal income tax liability, and such U.S. Holder may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing an appropriate claim for refund with the IRS and furnishing any required information.
Additional Information Reporting Requirements
Certain U.S. Holders who are individuals (and certain entities) that hold an interest in “specified foreign financial assets” (which may include the ordinary shares) are required to report information relating to such assets, subject to certain exceptions (including an exception for ordinary shares held in accounts maintained by certain financial institutions). Penalties can apply if U.S. Holders fail to satisfy such reporting requirements. U.S. Holders should consult their tax advisors regarding the applicability of these requirements to their acquisition and ownership of ordinary shares.
THE DISCUSSION ABOVE IS A GENERAL SUMMARY. IT DOES NOT COVER ALL TAX MATTERS THAT MAY BE IMPORTANT TO YOU. EACH HOLDER OF ORDINARY SHARES SHOULD CONSULT ITS OWN TAX ADVISOR ABOUT THE TAX CONSEQUENCES OF OWNING ORDINARY SHARES UNDER THE HOLDER’S OWN CIRCUMSTANCES.
141
F. Dividends and Paying Agents
Not applicable.
G. Statement by Experts
Not applicable.
H. Documents on Display
We are subject to the informational requirements of the Exchange Act. Accordingly, we will be required to file reports and other information with the SEC, including annual reports on Form 20-F and reports on Form 6-K. As a foreign private issuer, we are exempt under the Exchange Act from, among other things, the rules prescribing the furnishing and content of proxy statements, and our officers, directors and principal shareholders are exempt from the reporting and short swing profit recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act. We are required to make certain filings with the SEC. The SEC maintains an internet website that contains reports and other information about issuers, like us, that file electronically with the SEC. The address of that website is www.sec.gov.
I. Subsidiary Information
Not applicable.
J. Annual Report to Securities Holders
Not applicable.
Item 11. Quantitative and Qualitative Disclosures About Market Risk
Our consolidated financial statements are prepared in conformity with IFRS, as issued by the IASB. Our introduction and overview of Group’s risk management are described in note 4 to our audited consolidated financial statements, which are included elsewhere in this Annual Report.
Item 12. Description of Securities Other than Equity Securities
A. Debt Securities
Not applicable.
B. Warrants and Rights
Not applicable.
C. Other Securities
Not applicable.
D. American Depositary Shares
Not applicable.
142
PART II
Item 13. Defaults, Dividend Arrearages and Delinquencies
None.
Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
On June 28, 2024, we adopted our Articles according to our board of directors’ proposal that was approved at our annual general meeting of shareholders.
As a consequence of the adoption of the Articles, (1) our Board was declassified by eliminating its three classes, such that each of our Class I, Class II and Class III directors will be elected for a one-year term to expire at the annual general meeting of shareholders to be held in 2026 and, following that meeting, our Board will no longer be divided into three classes, (2) a shareholder or group of shareholders collectively owning at least 25% in the aggregate of the issued ordinary shares , subject to the terms of the Articles, may requisition in writing a general meeting of shareholders at any time after the annual general meeting of shareholders to be held in 2025 (the “2025 AGM”) and (3) any shareholder owning more than ten percent of the issued ordinary shares and, at any time after the conclusion of the 2025 AGM, any shareholder or group of shareholders owning more than ten percent of the issued ordinary shares, may specify business to be transacted at any general meeting, or nominate directors at any general meeting or annual general meeting, in each case, accordance with the terms of the Articles.
A copy of our Articles is filed as Exhibit 1.1 to this Annual Report. See Item 10.B. “Additional Information—Memorandum and Articles of Association.”
Item 15. Controls and Procedures
Limitations on Effectiveness of Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”)) that are designed to ensure that information required to be disclosed in the Company’s reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2024. Based upon that evaluation and as a result of the material weakness in our internal control over financial reporting described below, our Chief Executive Officer and Chief Financial Officer concluded that, as of December 31, 2024, our disclosure controls and procedures were not effective to accomplish their objectives at the reasonable assurance level.
In light of this fact, our management has performed additional analyses, reconciliations, and other post-closing procedures and has concluded that, notwithstanding the material weakness in our internal control over financial reporting, the consolidated financial statements for the periods covered by and included in this Annual Report on Form 20-F fairly state, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with IFRS.
Management’s Annual Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
143
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In conducting its evaluation of the effectiveness of our internal control over financial reporting, our management, including our principal executive officer and principal financial officer, used the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) 2013.
Based upon that evaluation and as a result of the material weakness described below, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that, as of December 31, 2024, our internal control over financial reporting was not effective.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with IFRS.
In connection with the audits of our historical consolidated financial statements, we identified a material weakness in internal control over financial reporting as of December 31, 2024. This material weakness, which is set out below, was previously reported in our annual reports on Form 20-F for the years ended December 31, 2021, 2022 and 2023:
| ● | Lack of key accounting personnel with the requisite knowledge and experience to account for complex transactions, particularly in the areas of foreign exchange, business combinations and other complex, judgmental areas, such as goodwill impairment assessment. |
Our independent registered public accounting firm, PricewaterhouseCoopers LLP, has audited the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024, as stated in their report which appears herein under Item 18. “Financial Statements”.
Management’s Remediation Activities
During the fiscal year ended December 31, 2024, we continued to take steps to remediate the material weakness and have hired additional qualified accounting and financial reporting personnel and engaged external temporary resources as needed. In addition, we monitored the operation of controls to prevent the future occurrence of similar issues. We have modified and implemented policies and procedures centrally to develop effective internal control through a shared service center along with improvements to controls across the finance function.
During the fiscal year ended December 31, 2024, management completed the design, implementation and testing of newly designed and enhanced controls and determined that, as of December 31, 2024, this material weakness cannot be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.
Attestation Report of Independent Registered Public Accounting Firm
Our independent registered public accounting firm, PricewaterhouseCoopers LLP, has audited the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024, as stated in their report which appears herein under Item 18. “Financial Statements”.
Changes in Internal Control over Financial Reporting
Other than as set forth above, there were no changes in our internal controls over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the period covered by this Annual Report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
144
Item 16. Reserved
Item 16A. Audit Committee Financial Expert
Our Board has determined that Nicholas Land, Ursula Burns and Aniko Szigetvari each satisfy the “independence” requirements set forth in Rule 10A-3 under the Exchange Act. Our board of directors has also determined that Nicholas Land is considered an “audit committee financial expert” as defined in Item 16A of Form 20-F under the Exchange Act.
Item 16B. Code of Ethics
We have adopted a Code of Conduct and Business Principles, which covers a broad range of matters including the handling of conflicts of interest, record-keeping, whistle-blowing, compliance issues and other corporate policies such as equal opportunity and non-discrimination standards. This Code of Conduct and Business Principles applies to all of our executive officers, directors and employees, including our principal executive, principal financial and principal accounting officers. Our Code of Conduct and Business Principles is intended to meet the definition of “code of ethics” under Item 16B of 20-F under the Exchange Act.
We will disclose on our website any amendment to, or waiver from, a provision of our Code of Conduct and Business Principles that applies to our directors or executive officers to the extent required under the rules of the SEC or NYSE.
Our Code of Conduct and Business Principles is available on the Investor Relations page of our website at ihstowers.com/investors. The information contained on our website is not incorporated by reference in this Annual Report.
Item 16C. Principal Accountant Fees and Services
The consolidated financial statements of IHS Holding Limited at December 31, 2024, and 2023, and for each of the two years in the period ended December 31, 2024, appearing in this Annual Report have been audited by PricewaterhouseCoopers LLP, independent registered public accounting firm.
The table below sets out the total amount billed to us by PricewaterhouseCoopers LLP for services performed in the years ended December 31, 2024, and 2023, and breaks down these amounts by category of service:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
Audit Fees |
|
11,918 |
|
12,734 |
All Other Fees |
|
128 |
|
123 |
Total |
|
12,046 |
|
12,857 |
Audit Fees
Audit fees for the years ended December 31, 2024, and 2023 related to the audit of our consolidated and subsidiary financial statements, interim review services and other audit services provided in connection with statutory and regulatory filings or engagements.
All Other Fees
All other fees in the years ended December 31, 2024, and 2023 related to services in connection with non-audit compliance and review work.
Pre-Approval Policies and Procedures
The advance approval of the audit committee or members thereof, to whom approval authority has been delegated, is required for all audit and non-audit services provided by our auditors.
All services provided by our auditors are approved in advance by either the audit committee or members thereof, to whom authority has been delegated, in accordance with the audit committee’s pre-approval policy.
145
Item 16D. Exemptions from the Listing Standards for Audit Committees
Not applicable.
Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers
In August 2023, the Board authorized a stock repurchase program for up to $50.0 million of the Company’s ordinary shares, effective as of August 15, 2023 through August 15, 2025, subject to market conditions, contractual restrictions, regulatory requirements and other factors.
Repurchases under the program may be made in the open market from time to time, in privately negotiated transactions, through accelerated repurchase agreements or otherwise, with the amount and timing of repurchases depending on and subject to market conditions, alternative uses of capital, corporate needs, applicable regulatory requirements and other factors, at management’s discretion. Open market repurchases are structured to occur within the pricing and volume requirements of Rule 10b-18. The Company may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of its shares under this authorization.
This stock repurchase program does not obligate the Company to repurchase any set dollar amount or number of ordinary shares and may be extended, modified, suspended or terminated at any time without prior notice at the Company’s discretion.
No shares were repurchased during the fiscal year ended December 31, 2024.
Item 16F. Change in Registrant’s Certifying Accountant
None.
Item 16G. Corporate Governance
We are a “foreign private issuer” (as such term is defined in Rule 3b-4 under the Exchange Act), and our shares are listed on the NYSE. Under the NYSE rules, NYSE listed companies that are foreign private issuers are permitted to follow home country practice in lieu of the corporate governance provisions specified by the NYSE with limited exceptions.
We believe the following to be the significant differences between our corporate governance practices and those applicable to U.S. companies under the NYSE listing standards.
| ● | The NYSE rules require that the quorum for any meeting of the holders of shares should be sufficiently high to ensure a representative vote and give careful consideration to provisions fixing any proportion less than a majority of the outstanding shares as the quorum for shareholders’ meetings. We follow the corporate governance practice of our home country, the Cayman Islands, which permits less than a majority of the outstanding shares as the quorum for shareholders’ meetings. |
| ● | The NYSE rules also require shareholder approval for equity compensation plans and material revisions to those plans. We follow the corporate governance practice of our home country, the Cayman Islands, which does not require shareholder approval for these matters. |
We may in the future decide to use other foreign private issuer exemptions with respect to some or all of the other NYSE listing requirements. For example, under the NYSE rules, U.S. domestic listed, non-controlled companies are required to have a majority independent board, which is not required under the Companies Act of the Cayman Islands, our home country. NYSE rules also require U.S. domestic listed, non-controlled companies to have a compensation committee and a nominating and corporate governance committee, each composed entirely of independent directors, which are not required under our home country laws.
146
Following our home country governance practices may provide less protection than is given to investors under the NYSE listing requirements applicable to domestic issuers. For more information, see Item 3.D. “Risk Factors — Risks Relating to Ownership of our Ordinary Shares — We are a foreign private issuer and, as a result, we are not subject to U.S. proxy rules and are not subject to Exchange Act reporting obligations that, to some extent, are more lenient and less frequent than those of a U.S. domestic public company” and “Risk Factors — Risks Relating to Ownership of our Ordinary Shares — As we are a “foreign private issuer” and follow certain home country corporate governance practices, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements.”
Item 16H. Mine Safety Disclosure
Not applicable.
Item 16I. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
Item 16J. Insider Trading Policies
The Company has adopted an insider trading policy governing the purchase, sale and other dispositions of the Company’s securities that applies to all of our directors, officers, employees, and other covered persons. The Company also follows procedures for the repurchase of its securities. The Company believes that its insider trading policy and repurchase procedures are reasonably designed to promote compliance with insider trading laws, rules and regulations, and listing standards applicable to the Company. A copy of the Company’s insider trading policy is filed as Exhibit 11.1 to this Form 20-F.
Item 16K. Cybersecurity
Cybersecurity Risk Management and Strategy
We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information.
We design and assess our program based on the National Institute of Standards and Technology Cybersecurity Framework (NIST CSF). This does not imply that we meet any particular technical standards, specifications, or requirements, only that we use the NIST CSF as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business.
Our cybersecurity risk management program is integrated into our overall risk management program, and shares common methodologies, reporting channels and governance processes that apply across the risk management program to other legal, compliance, strategic, operational, and financial risk areas.
Key elements of our cybersecurity risk management program include but are not limited to the following:
| ● | risk assessments designed to help identify material risks from cybersecurity threats to our critical systems and information; |
| ● | a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; |
| ● | the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security processes; |
| ● | cybersecurity awareness training of our employees, including incident response personnel, and senior management; |
| ● | a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and |
147
| ● | a third-party risk management process for key service providers, based on our assessment of their criticality to our operations and respective risk profile. |
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. We face risks from cybersecurity threats that, if realized, are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. See Risk Factors – “We rely on key information technology systems, which may be vulnerable to physical or digital/ electronic damage, security breaches or cyberattacks that could have a material adverse effect on our reputation as well as our business, prospects, financial condition and/or results of operations.”
Cybersecurity Governance
Our Board considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit Committee oversight of cybersecurity risks, including oversight of management’s implementation of our cybersecurity risk management program.
The Audit Committee receives regular reports from management on our cybersecurity risks. In addition, management updates the Audit Committee, where it deems appropriate, regarding cybersecurity incidents it considers to be significant or potentially significant.
The Audit Committee reports to the full Board regarding its activities, including those related to cybersecurity. The full Board also receives briefings from management on our cyber risk management program from time to time. Board members receive presentations on cybersecurity topics from our Group Head of cybersecurity, internal security staff or external experts as part of the Board’s continuing education on topics that impact public companies.
Our information technology function (including our cybersecurity team) are overseen by our management team, and our Chief Information Security Officer reports directly to a member of our management team. Our management team is therefore responsible for assessing and managing our material risks from cybersecurity threats. The team has primary responsibility for our overall cybersecurity risk management program and supervise both our internal cybersecurity personnel and our retained external cybersecurity consultants. Our Group Head of cybersecurity is a subject matter expert on information security, privacy and IT strategy and management with over 25 years of relevant experience across multiple industries.
Our management team takes steps to stay informed about and monitor efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include: briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in our IT environment.
PART III
Item 17. Financial Statements
We have provided financial statements pursuant to Item 18.
Item 18. Financial Statements
The audited consolidated financial statements as required under Item 18 are attached hereto starting on page F-1 of this Annual Report. The audit report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, is included herein preceding the audited consolidated financial statements.
Item 19. Exhibits
List all exhibits filed as part of the registration statement or annual report, including exhibits incorporated by reference.
148
Incorporation by Reference |
|||||||
|---|---|---|---|---|---|---|---|
Exhibit No. |
Description |
Form |
File No. |
Exhibit No. |
Filing Date |
Filed / Furnished |
|
1.1 |
Second Amended and Restated Memorandum and Articles of Association of the Registrant |
6-K |
001-40876 |
99.1 |
06/28/2024 |
||
2.1 |
F-1/A |
333-259593 |
4.1 |
10/4/2021 |
|
||
2.2 |
20-F/A |
001-40876 |
2.2 |
08/16/2022 |
|
||
2.3 |
20-F/A |
001-40876 |
2.3 |
08/16/2022 |
|
||
2.4 |
F-1/A |
333-259593 |
4.4 |
10/4/2021 |
|
||
2.5 |
F-1/A |
333-259593 |
4.5 |
10/4/2021 |
|
||
2.6 |
20-F/A |
001-40876 |
2.6 |
08/16/2022 |
|||
2.7 |
|
|
|
|
* |
||
2.8 |
|
|
|
|
* |
||
2.9 |
|
* |
|||||
4.1† |
F-1/A |
333-259593 |
10.2 |
10/4/2021 |
|
||
4.2† |
Form of Non-Employee Director Restricted Stock Unit Award Agreement |
S-8 |
333-260317 |
99.3 |
10/18/2021 |
|
|
| |||||||
| |||||||
| |||||||
149
Incorporation by Reference |
|||||||
|---|---|---|---|---|---|---|---|
Exhibit No. |
Description |
Form |
File No. |
Exhibit No. |
Filing Date |
Filed / Furnished |
|
4.3 |
20-F |
001-40876 |
4.8 |
03/28/2023 |
|||
4.4 |
20-F |
001-40876 |
4.13 |
03/12/2024 |
|
||
4.5 |
6-K |
001-40876 |
99.2 |
08/13/2024 |
6-K |
||
4.6 |
|
|
|
|
* |
||
4.7 |
|
|
|
|
* |
||
4.8 |
20-F |
001-40876 |
4.9 |
03/28/2023 |
|
||
4.9 |
20-F |
001-40876 |
4.14 |
03/12/2024 |
|
||
4.10 |
6-K |
001-40876 |
99.2 |
08/13/2024 |
6-K |
||
150
Incorporation by Reference |
|||||||
|---|---|---|---|---|---|---|---|
Exhibit No. |
Description |
Form |
File No. |
Exhibit No. |
Filing Date |
Filed / Furnished |
|
4.11 |
|
|
|
|
* |
||
4.12 |
|
|
|
|
* |
||
4.13 |
6-K |
001-40876 |
99.2 |
11/14/2023 |
|
||
4.14 |
6-K |
001-40876 |
99.4 |
05/14/2024 |
|
||
4.15 |
6-K |
001-40876 |
99.5 |
05/14/2024 |
|
||
4.16 |
6-K |
001-40876 |
99.3 |
11/12/2024 |
|
||
4.17 |
20-F |
001-40876 |
4.15 |
03/12/2024 |
|
||
4.18 |
6-K |
001-40876 |
99.6 |
05/14/2024 |
|
||
4.19 |
6-K |
001-40876 |
99.7 |
05/14/2024 |
|
||
4.20 |
6-K |
001-40876 |
99.4 |
11/12/2024 |
|
||
151
Incorporation by Reference |
|||||||
|---|---|---|---|---|---|---|---|
Exhibit No. |
Description |
Form |
File No. |
Exhibit No. |
Filing Date |
Filed / Furnished |
|
4.21 |
6-K |
001-40876 |
99.2 |
11/12/2024 |
|
||
8.1 |
|
|
|
|
* |
||
11.1 |
|
|
|
|
* |
||
12.1 |
Principal Executive Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
|
|
|
* |
|
12.2 |
Principal Financial Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
* |
|
13.1 |
Principal Executive Officer Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
** |
|
13.2 |
Principal Financial Officer Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
** |
|
15.1 |
Consent of PricewaterhouseCoopers LLP, an independent registered public accounting firm. |
|
|
|
|
* |
|
97.1 |
IHS Group Policy for Recovery of Erroneously Awarded Compensation |
20-F |
001-40876 |
97.1 |
03/12/2024 |
|
|
101.INS |
Inline XBRL Instance Document. |
|
|
|
|
* |
|
101.SCH |
Inline XBRL Taxonomy Extension Schema Document. |
|
|
|
|
* |
|
101.CAL |
Inline XBRL Taxonomy Extension Calculation Linkbase Document. |
|
|
|
|
* |
|
101.DEF |
Inline XBRL Taxonomy Definition Linkbase Document. |
|
|
|
|
* |
|
101.LAB |
Inline XBRL Taxonomy Extension Label Linkbase Document. |
|
|
|
|
* |
|
101.PRE |
Inline XBRL Taxonomy Extension Presentation Linkbase Document |
|
|
|
|
* |
|
104 |
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
|
|
|
|
|
|
* |
Filed herewith. |
** |
Furnished herewith. |
† |
Indicates management contract or compensatory plan or arrangement. |
Certain agreements filed as exhibits to this Annual Report contain representations and warranties that the parties thereto made to each other. These representations and warranties have been made solely for the benefit of the other parties to such agreements and may have been qualified by certain information that has been disclosed to the other parties to such agreements and that may not be reflected in such agreements. In addition, these representations and warranties may be intended as a way of allocating risks among parties if the statements contained therein prove to be incorrect, rather than as actual statements of fact. Accordingly, there can be no reliance on any such representations and warranties as characterizations of the actual state of facts. Moreover, information concerning the subject matter of any such representations and warranties may have changed since the date of such agreements.
152
SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.
|
IHS HOLDING LIMITED |
|
|
|
|
|
Date: March 18, 2025 |
|
|
|
|
|
By: |
/s/ Sam Darwish |
|
Name: |
Sam Darwish |
|
Title: |
Chief Executive Officer |
|
|
|
|
By: |
/s/ Steve Howden |
|
Name: |
Steve Howden |
|
Title: |
Executive Vice President and |
153
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Report of independent registered public accounting firm (PCAOB ID: 876) |
F-2 |
Consolidated statement of loss and other comprehensive income |
F-5 |
F-6 |
|
F-7 |
|
F-8 |
|
F-9 |
|
F-79 |
F-1
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders of IHS Holding Limited
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying statements of consolidated financial position of IHS Holding Limited and its subsidiaries (the “Company”) as of December 31, 2024, and 2023, and the related consolidated statements of loss and other comprehensive income, of changes in equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes and financial statement schedule listed in the accompanying index (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Company did not maintain, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO because a material weakness in internal control over financial reporting existed as of that date related to a lack of key accounting personnel with the requisite knowledge and experience to account for complex transactions.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. The material weakness referred to above is described in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 15. We considered this material weakness in determining the nature, timing, and extent of audit tests applied in our audit of the 2024 consolidated financial statements, and our opinion regarding the effectiveness of the Company’s internal control over financial reporting does not affect our opinion on those consolidated financial statements.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in management's report referred to above. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
F-2
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Revenue Recognition - Estimates of Amounts Recoverable and Unbilled
As described in notes 2.5, 3.2 (b), 6 and 19 to the consolidated financial statements, revenue is derived from fees paid by customers for services from the colocation business and its ancillary managed services. Total revenues for the year ended December 31, 2024, were $1.7 billion and accrued revenue as of December 31, 2024, amounted to $135.7 million. Initial recognition of revenue is estimated based on an assessment of the recoverability of revenue taking into account the Company’s contractual rights to consideration, its exposure to each customer’s credit risk and management’s practice of managing credit risk exposure through the occasional negotiation of price concessions with customers. Only amounts expected to be recovered at the point of initial recognition are recognized in revenue, and the remainder is considered variable consideration. Recognition of amounts not expected to be recovered is contingent upon the receipt of funds from the customer. The assessment of amounts expected to be recovered is closely aligned with the assessed credit risk of the customer, determined as part of the assessment of expected credit losses made in accordance with the Company’s IFRS 9 expected credit loss policy. Management also estimates revenue for services provided where billing is not completed, including in respect of 1) tower sites coming into service, or changes in customer implemented technologies since the most recent invoicing cycle, and 2) services subject to ongoing negotiation regarding price or other contract interpretation disputes with customers. For each of these scenarios, revenue is accrued based on management’s expectation of the final billable amounts based primarily on historical experience.
The principal considerations for our determination that performing procedures relating to revenue recognition - estimates of amounts recoverable and unbilled is a critical audit matter are the significant judgment and estimation required by management in determining (i) the recoverability of revenue and the related estimate of variable consideration and (ii) the expected outcome of negotiations with customers regarding unbilled and disputed matters. This in turn led to a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating audit evidence relating to management’s assessment of (i) the amounts expected to be recovered, including significant assumptions related to the credit risk of the customer, and (ii) the expected outcome of negotiations with customers.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to occurrence and accuracy of accrued revenue transactions. These procedures also included, among others: (i) inspecting a sample of contracts to evaluate the treatment of unusual terms; (ii) testing management’s process for estimating the variable consideration and the amount of revenue in respect of disputed matters; (iii) evaluating the appropriateness of the methodology used by management; (iv) testing the accuracy and completeness of underlying data used in the calculation of these estimates; (v) evaluating management’s significant assumptions related to customer credit risk and recoverability when estimating the variable consideration assigned to contracts at initial recognition, which included consideration of payment history; and (vi) considering historical experience in collection of amounts where billing is delayed.
F-3
Goodwill Impairment
As described in notes 2.9, 2.10, 3.2.(a), 8, 15 and 15.1 to the consolidated financial statements, goodwill impairment reviews are undertaken annually or more frequently if events or changes in circumstances indicate a potential impairment. The Company’s goodwill balance as of December 31, 2024, was $403 million. An impairment loss of $87.9 million was recognized in the IHS Latam towers businesses group of cash generating units (CGUs) during the first quarter of 2024. The carrying value of the CGU or group of CGUs containing goodwill is compared to the recoverable amount, which is the higher of its value in use and its fair value less costs of disposal. An impairment loss is recognised for the amount by which the carrying value exceeds the recoverable amount. The recoverable amount of each CGU, or group of CGUs, except for the IHS Latam Tower businesses group of CGUs and the I-Systems CGU was determined based on value in use calculations. The recoverable amount of the IHS Latam Tower businesses group of CGUs and the I-Systems CGU was determined based on fair value less costs of disposal. The key assumptions to which these recoverable amount calculations are most sensitive are revenue growth assumptions (taking into account growth in tenancies, tenancy ratios and, homes connected for the I-Systems CGU), gross margins excluding depreciation and amortization, terminal growth rates, and pre/post-tax weighted average cost of capital.
The principal considerations for our determination that performing procedures relating to goodwill impairment is a critical audit matter are (i) the significant judgment and estimation required by management when developing the estimated recoverable amount; (ii) the high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management’s significant assumptions related to revenue growth assumptions, gross margins excluding depreciation and amortization, terminal growth rates, and pre/post-tax weighted average cost of capital; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge. As described in the “Opinions on the Financial Statements and Internal Control over Financial Reporting” section, a material weakness was identified in relation to this matter.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included, among others: (i) testing management’s process for developing the estimated recoverable amounts; (ii) evaluating the appropriateness of the value in use and fair value less costs of disposal models used by management; (iii) testing the completeness, accuracy and relevance of underlying data used in the estimate; and (iv) evaluating significant assumptions used by management related to revenue growth assumptions, gross margins excluding depreciation and amortization, terminal growth rates, and pre/post-tax weighted average cost of capital. Evaluating significant assumptions used by management involved determining whether the assumptions used by management were reasonable considering: (i) the current and past performance of the relevant CGUs; (ii) the consistency with external market data; and (iii) whether those assumptions were consistent with evidence obtained in other areas of the audit. Professionals with specialized skill and knowledge were used to assist in evaluating the reasonableness of the pre/post-tax weighted average cost of capital, and terminal growth rate assumptions within management’s models.
/s/PricewaterhouseCoopers LLP
London, United Kingdom
March 18, 2025
We have served as the Company’s auditor since 2017.
F-4
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
CONSOLIDATED STATEMENT OF LOSS AND OTHER COMPREHENSIVE INCOME
|
|
|
|
2024 |
|
2023 |
|
2022 |
|
|
Notes |
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
|
|
Revenue |
|
6 |
|
1,711,225 |
|
2,125,539 |
|
1,961,299 |
Cost of sales |
|
7 |
|
(890,533) |
|
(1,183,306) |
|
(1,157,001) |
Administrative expenses |
|
8 |
|
(429,818) |
|
(404,783) |
|
(501,175) |
Net reversal of loss allowance/(net loss allowance) on trade receivables |
|
8 |
|
25 |
|
(7,202) |
|
4,446 |
Other income |
|
9 |
|
88,248 |
|
404 |
|
4,676 |
Operating income |
|
|
|
479,147 |
|
530,652 |
|
312,245 |
Finance income |
|
10 |
|
33,747 |
|
25,209 |
|
15,825 |
Finance costs |
|
11 |
|
(2,123,138) |
|
(2,436,511) |
|
(872,049) |
Loss before income tax |
|
|
|
(1,610,244) |
|
(1,880,650) |
|
(543,979) |
Income tax (expense)/benefit |
|
12 |
|
(33,957) |
|
(107,528) |
|
75,013 |
Loss for the year |
|
|
|
(1,644,201) |
|
(1,988,178) |
|
(468,966) |
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
Owners of the Company |
|
|
|
(1,632,025) |
|
(1,976,609) |
|
(459,007) |
Non-controlling interests |
|
27 |
|
(12,176) |
|
(11,569) |
|
(9,959) |
Loss for the year |
|
|
|
(1,644,201) |
|
(1,988,178) |
|
(468,966) |
|
|
|
|
|
|
|
|
|
Loss per share ($) - basic |
|
13 |
|
(4.90) |
|
(5.93) |
|
(1.39) |
Loss per share ($) - diluted |
|
13 |
|
(4.90) |
|
(5.93) |
|
(1.39) |
|
|
|
|
|
|
|
|
|
Other comprehensive income: |
|
|
|
|
|
|
|
|
Items that may be reclassified to income or loss |
|
|
|
|
|
|
|
|
Exchange gain recycled to income statement on disposal of subsidiary |
|
|
|
(98) |
|
— |
|
— |
Exchange differences on translation of foreign operations |
|
|
|
996,548 |
|
970,808 |
|
72,661 |
Other comprehensive income for the year, net of taxes |
|
|
|
996,450 |
|
970,808 |
|
72,661 |
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the year |
|
|
|
(647,751) |
|
(1,017,370) |
|
(396,305) |
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
Owners of the Company |
|
|
|
(592,196) |
|
(1,025,754) |
|
(399,486) |
Non-controlling interests |
|
|
|
(55,555) |
|
8,384 |
|
3,181 |
Total comprehensive loss for the year |
|
|
|
(647,751) |
|
(1,017,370) |
|
(396,305) |
The accompanying notes are an integral part of these consolidated financial statements.
F-5
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
|
|
|
|
2024 |
|
2023 |
|
|
Notes |
|
$’000 |
|
$’000 |
Non-current assets |
|
|
|
|
|
|
Property, plant and equipment |
|
14 |
|
1,352,645 |
|
1,740,235 |
Right-of-use assets |
|
14 |
|
699,057 |
|
886,909 |
Goodwill |
|
15 |
|
403,242 |
|
619,298 |
Other intangible assets |
|
15 |
|
673,952 |
|
933,030 |
Deferred income tax assets |
|
16 |
|
73,345 |
|
63,786 |
Derivative financial instrument assets |
|
18 |
|
29,410 |
|
1,540 |
Trade and other receivables |
|
19 |
|
121,033 |
|
147,305 |
|
|
|
|
3,352,684 |
|
4,392,103 |
Current assets |
|
|
|
|
|
|
Inventories |
|
17 |
|
30,746 |
|
40,589 |
Income tax receivable |
|
12 |
|
2,250 |
|
3,755 |
Derivative financial instrument assets |
|
18 |
|
— |
|
565 |
Trade and other receivables |
|
19 |
|
313,356 |
|
607,835 |
Cash and cash equivalents |
|
20 |
|
577,956 |
|
293,823 |
Assets held for sale |
|
14 |
|
— |
|
26,040 |
|
|
|
|
924,308 |
|
972,607 |
|
|
|
|
|
|
|
TOTAL ASSETS |
|
|
|
4,276,992 |
|
5,364,710 |
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
Trade and other payables |
|
21 |
|
5,218 |
|
4,629 |
Borrowings |
|
22 |
|
3,219,215 |
|
3,056,696 |
Lease liabilities |
|
23 |
|
470,476 |
|
510,838 |
Provisions for other liabilities and charges |
|
24 |
|
83,876 |
|
86,131 |
Deferred income tax liabilities |
|
16 |
|
100,450 |
|
137,106 |
|
|
|
|
3,879,235 |
|
3,795,400 |
Current liabilities |
|
|
|
|
|
|
Trade and other payables |
|
21 |
|
422,500 |
|
532,627 |
Provisions for other liabilities and charges |
|
24 |
|
182 |
|
277 |
Derivative financial instrument liabilities |
|
18 |
|
10,203 |
|
68,133 |
Income tax payable |
|
12 |
|
49,879 |
|
75,612 |
Borrowings |
|
22 |
|
128,734 |
|
454,151 |
Lease liabilities |
|
23 |
|
82,068 |
|
91,156 |
|
|
|
|
693,566 |
|
1,221,956 |
|
|
|
|
|
|
|
TOTAL LIABILITIES |
|
|
|
4,572,801 |
|
5,017,356 |
|
|
|
|
|
|
|
Stated capital |
|
25 |
|
5,403,139 |
|
5,394,812 |
Accumulated losses |
|
|
|
(6,925,419) |
|
(5,293,394) |
Other reserves |
|
26 |
|
1,067,701 |
|
8,430 |
Equity attributable to owners of the Company |
|
|
|
(454,579) |
|
109,848 |
Non-controlling interests |
|
27 |
|
158,770 |
|
237,506 |
TOTAL EQUITY |
|
|
|
(295,809) |
|
347,354 |
|
|
|
|
|
|
|
TOTAL LIABILITIES AND EQUITY |
|
|
|
4,276,992 |
|
5,364,710 |
The accompanying notes are an integral part of these consolidated financial statements.
F-6
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
|
|
Attributable to owners of the Company |
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Non- |
|
|
|
|
|
|
Stated |
|
Accumulated |
|
Other |
|
|
|
controlling |
|
Total |
|
|
|
|
capital |
|
losses |
|
reserves |
|
Total |
|
interests |
|
Equity |
|
|
Notes |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2022 |
|
|
|
5,223,484 |
|
(2,860,205) |
|
(842,911) |
|
1,520,368 |
|
223,188 |
|
1,743,556 |
Non-controlling interests arising on business combination |
|
27 |
|
— |
|
— |
|
— |
|
— |
|
831 |
|
831 |
Exercise of share options |
|
26 |
|
88,469 |
|
— |
|
(88,469) |
|
— |
|
— |
|
— |
Share-based payment expense |
|
26 |
|
— |
|
— |
|
13,423 |
|
13,423 |
|
— |
|
13,423 |
Other reclassifications related to share-based payment |
|
|
|
— |
|
1,560 |
|
(2,835) |
|
(1,275) |
|
— |
|
(1,275) |
Total transactions with owners |
|
|
|
88,469 |
|
1,560 |
|
(77,881) |
|
12,148 |
|
831 |
|
12,979 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the year |
|
|
|
— |
|
(459,007) |
|
— |
|
(459,007) |
|
(9,959) |
|
(468,966) |
Other comprehensive income |
|
|
|
— |
|
— |
|
59,521 |
|
59,521 |
|
13,140 |
|
72,661 |
Total comprehensive (loss)/income |
|
|
|
— |
|
(459,007) |
|
59,521 |
|
(399,486) |
|
3,181 |
|
(396,305) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2022 |
|
|
|
5,311,953 |
|
(3,317,652) |
|
(861,271) |
|
1,133,030 |
|
227,200 |
|
1,360,230 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2023 |
|
|
|
5,311,953 |
|
(3,317,652) |
|
(861,271) |
|
1,133,030 |
|
227,200 |
|
1,360,230 |
Shares repurchased and canceled through buyback program |
|
25 |
|
(10,037) |
|
— |
|
— |
|
(10,037) |
|
— |
|
(10,037) |
Non-controlling interests arising on business combination |
|
27 |
|
— |
|
— |
|
— |
|
— |
|
1,922 |
|
1,922 |
Exercise of share options |
|
26 |
|
92,896 |
|
— |
|
(92,896) |
|
— |
|
— |
|
— |
Share-based payment expense |
|
26 |
|
— |
|
— |
|
13,168 |
|
13,168 |
|
— |
|
13,168 |
Other reclassifications related to share-based payment |
|
|
|
— |
|
867 |
|
(1,426) |
|
(559) |
|
— |
|
(559) |
Total transactions with owners |
|
|
|
82,859 |
|
867 |
|
(81,154) |
|
2,572 |
|
1,922 |
|
4,494 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the year |
|
|
|
— |
|
(1,976,609) |
|
— |
|
(1,976,609) |
|
(11,569) |
|
(1,988,178) |
Other comprehensive income |
|
|
|
— |
|
— |
|
950,855 |
|
950,855 |
|
19,953 |
|
970,808 |
Total comprehensive (loss)/income |
|
|
|
— |
|
(1,976,609) |
|
950,855 |
|
(1,025,754) |
|
8,384 |
|
(1,017,370) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2023 |
|
|
|
5,394,812 |
|
(5,293,394) |
|
8,430 |
|
109,848 |
|
237,506 |
|
347,354 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2024 |
|
|
|
5,394,812 |
|
(5,293,394) |
|
8,430 |
|
109,848 |
|
237,506 |
|
347,354 |
Non-controlling interests derecognized on disposal |
|
31 |
|
— |
|
— |
|
— |
|
— |
|
(23,181) |
|
(23,181) |
Exercise of share options |
|
26 |
|
8,327 |
|
— |
|
(8,327) |
|
— |
|
— |
|
— |
Share-based payment expense |
|
26 |
|
— |
|
— |
|
27,769 |
|
27,769 |
|
— |
|
27,769 |
Total transactions with owners |
|
|
|
8,327 |
|
— |
|
19,442 |
|
27,769 |
|
(23,181) |
|
4,588 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the year |
|
|
|
— |
|
(1,632,025) |
|
— |
|
(1,632,025) |
|
(12,176) |
|
(1,644,201) |
Other comprehensive income/(loss), net of recycling |
|
|
|
— |
|
— |
|
1,039,829 |
|
1,039,829 |
|
(43,379) |
|
996,450 |
Total comprehensive (loss)/income |
|
|
|
— |
|
(1,632,025) |
|
1,039,829 |
|
(592,196) |
|
(55,555) |
|
(647,751) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2024 |
|
|
|
5,403,139 |
|
(6,925,419) |
|
1,067,701 |
|
(454,579) |
|
158,770 |
|
(295,809) |
The accompanying notes are an integral part of these consolidated financial statements.
F-7
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
CONSOLIDATED STATEMENT OF CASH FLOWS
|
|
|
|
2024 |
|
2023 |
|
2022 |
|
|
Notes |
|
$’000 |
|
$’000 |
|
$’000 |
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Cash from operations |
|
29 |
|
775,856 |
|
902,923 |
|
966,874 |
Income taxes paid |
|
12 |
|
(38,629) |
|
(45,411) |
|
(51,245) |
Payment for rent |
|
|
|
(7,827) |
|
(3,716) |
|
(7,983) |
Payment for tower and tower equipment decommissioning |
|
24 |
|
(95) |
|
(343) |
|
(343) |
Net cash from operating activities |
|
|
|
729,305 |
|
853,453 |
|
907,303 |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
Purchase of property, plant and equipment |
|
|
|
(235,169) |
|
(464,897) |
|
(378,521) |
Payment in advance for property, plant and equipment |
|
|
|
(29,864) |
|
(111,065) |
|
(165,154) |
Purchase of software and licenses |
|
|
|
(3,980) |
|
(22,811) |
|
(15,695) |
Consideration paid on business combinations, net of cash acquired |
|
31 |
|
— |
|
(4,486) |
|
(735,740) |
Proceeds from sale of subsidiaries, net of cash disposed |
|
31 |
|
118,960 |
|
— |
|
— |
Proceeds from disposal of property, plant and equipment |
|
|
|
26,706 |
|
2,919 |
|
1,826 |
Insurance claims received |
|
|
|
73 |
|
321 |
|
2,100 |
Interest received |
|
10 |
|
18,660 |
|
25,008 |
|
15,170 |
Deposit of short-term deposits |
|
|
|
(43,660) |
|
(183,400) |
|
(512,105) |
Refund of short-term deposits |
|
|
|
211,453 |
|
36,162 |
|
270,831 |
Net cash from/(used in) investing activities |
|
|
|
63,179 |
|
(722,249) |
|
(1,517,288) |
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
Transactions with non-controlling interests |
|
|
|
— |
|
— |
|
11 |
Shares repurchased and canceled through buyback program |
|
25 |
|
— |
|
(10,037) |
|
— |
Proceeds received from issuance of borrowings (net of transaction costs) |
|
22 |
|
2,208,375 |
|
986,604 |
|
1,263,272 |
Repayment of borrowings |
|
22 |
|
(2,149,307) |
|
(689,940) |
|
(506,504) |
Fees on borrowings and derivative instruments |
|
|
|
(10,558) |
|
(19,441) |
|
(19,911) |
Interest paid |
|
22 |
|
(326,984) |
|
(299,029) |
|
(234,567) |
Payment for the principal portion of lease liabilities |
|
23 |
|
(55,233) |
|
(72,854) |
|
(76,629) |
Interest paid for lease liabilities |
|
23 |
|
(66,041) |
|
(58,443) |
|
(36,178) |
Margin received on non-deliverable forwards |
|
|
|
— |
|
— |
|
12,854 |
Interest/premium paid on derivative instruments |
|
|
|
(8,834) |
|
— |
|
(910) |
Net (loss)/gain settled on derivative instruments |
|
|
|
(22,414) |
|
839 |
|
(3,197) |
Net cash (used in)/from financing activities |
|
|
|
(430,996) |
|
(162,301) |
|
398,241 |
|
|
|
|
|
|
|
|
|
Net increase/(decrease) in cash and cash equivalents |
|
|
|
361,488 |
|
(31,097) |
|
(211,744) |
Cash and cash equivalents at beginning of year |
|
|
|
293,823 |
|
514,078 |
|
916,488 |
Exchange differences |
|
|
|
(77,355) |
|
(189,158) |
|
(190,666) |
Cash and cash equivalents at end of year |
|
20 |
|
577,956 |
|
293,823 |
|
514,078 |
The accompanying notes are an integral part of these consolidated financial statements.
F-8
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.General information
These consolidated financial statements are the financial statements of IHS Holding Limited (the “Company”) and its subsidiaries (together hereafter referred to as “the Group” or “IHS”). IHS Holding Limited is incorporated in the Cayman Islands under the Companies Act (as amended) as an exempted company with limited liability. The Company is domiciled in the Cayman Islands and the address of its registered office is 190 Elgin Avenue, George Town, Grand Cayman KY1-9008, Cayman Islands.
IHS is principally involved in providing infrastructure for the telecommunications industry. The consolidated financial statements are presented in U.S. dollars ($) and all amounts are rounded to the nearest thousand, except where otherwise indicated.
These consolidated financial statements have been authorized for issue on March 17, 2025, by the Board of Directors.
2.Summary of material accounting policies
The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.
2.1Basis of preparation
The consolidated financial statements of IHS have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS® Accounting Standards”).
The consolidated financial statements have been prepared on a historical cost basis except as indicated for certain financial assets and liabilities (including derivative financial instruments) that have been measured at fair value.
In management’s opinion, the accompanying consolidated financial statements contain all necessary adjustments, consisting solely of normal recurring adjustments, necessary for a fair statement of its consolidated financial position as of December 31, 2024, and 2023. These also fairly reflect the results of operations for the twelve months ended December 31, 2024, 2023, and 2022, as well as the consolidated cash flows and consolidated statement of changes in equity for the same periods. Certain amounts related to financial instruments in the prior period consolidated statement of loss and other comprehensive income, consolidated statement of financial position, and consolidated statement of cash flows have been reclassified to conform to the current year presentation.
2.1.1Changes in accounting policies and disclosures
The accounting policies adopted are consistent with those of the previous financial year, except the new standards, amendments and interpretations adopted by the Group during the year.
The Group has applied the following standards, amendments and interpretations for the first time for its annual reporting period commencing January 1, 2024:
| ● | Classification of Liabilities as Current or Non-current - Deferral of Effective Date (Amendment to: IAS 1 Presentation of Financial Statements (“IAS 1”); |
| ● | Non-current Liabilities with Covenants Amendments to: IAS 1; |
| ● | Lease Liability in a Sale and Leaseback Amendments to: IFRS 16 Leases (“IFRS 16”); |
| ● | Supplier finance arrangements - Amendments to: IAS 7 Statement of Cash Flows (“IAS 7”) and IFRS 7 Financial Instruments: Disclosures (“IFRS 7”); |
F-9
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
| ● | Climate-related Commitments (IAS 37 Provisions, Contingent Liabilities and Contingent Assets (“IAS 37”)); |
| ● | Payments Contingent on Continued Employment during Handover Periods (IFRS 3 Business Combinations (“IFRS 3”)); and |
| ● | Disclosure of Revenues and Expenses for Reportable Segments (IFRS 8 Operating Segments (“IFRS 8”)). |
Refer to note 5 for the updated disclosures related to the Disclosure of Revenues and Expenses for Reportable Segments.
Other than the above, none of the above had a material effect on the Group’s financial statements.
Certain new accounting standards, interpretations and amendments have been published that are not effective for December 31, 2024, reporting period and have not been early adopted by the Group. These are as follows:
| ● | Lack of Exchangeability (Amendments to: IAS 21 The Effects of Changes in Foreign Exchange Rates (“IAS 21”)); |
| ● | Presentation and Disclosure in Financial Statements (IFRS 18 Presentation and Disclosure in Financial Statements (“IFRS 18”)) ; |
| ● | Amendments to the Classification and Measurement of Financial Instruments (Amendments to: IFRS 9 Financial Instruments (“IFRS 9”) and IFRS 7); and |
| ● | Contracts Referencing Nature-dependent Electricity (Amendments to: IFRS 9 and IFRS 7). |
The Company is in the process of analyzing the impact of the above.
2.2.Consolidation
(a)Subsidiaries
The consolidated financial statements include the financial information and results of the Company and those entities in which it has a controlling interest. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are all entities (including structured entities) over which the Group has control. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date the control ceases. All intercompany balances and transactions have been eliminated.
(b)Business acquisitions
For acquisitions that meet the definition of a business combination, the Group applies the acquisition method of accounting where assets acquired and liabilities assumed are recorded at fair value at the date of each acquisition, and the results of operations are included with those of the Group from the dates of the respective acquisitions. Any excess of the purchase price paid by the Group over the amounts recognized for assets acquired and liabilities assumed is recorded as goodwill and any acquisition related costs are expensed as incurred. The Group recognizes any non-controlling interests in the acquiree either at fair value or at the non-controlling interests’ proportionate share of the recognized amounts of the acquiree’s identifiable net assets.
The consideration transferred for the acquisition comprises the fair value of the assets transferred, liabilities incurred, equity interests issued by the Group and any contingent consideration. Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as of the date of acquisition. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.
F-10
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
If the Group gains control in a business combination in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date; any gains or losses arising from such remeasurement are recognized in income or loss.
Where the Group acquires a portfolio of tower assets and associated revenue contracts judgment is required in determining whether the transaction meets the definition of a business combination. The Group makes this judgment on a case by case basis taking into account the specific facts and circumstances of each transaction including the substance of other elements of the transactions such as transferred systems, processes, workforce and novated supplier contracts.
The Group has considered whether any of its business combinations represent a sale and leaseback transaction from a lessor perspective. It has been determined that since the space on towers and associated assets are able to be leased to multiple tenants without restriction, that no such arrangement of the entire tower site portfolio acquired exists.
(c)Transactions with non-controlling interests
The Group treats transactions with non-controlling interests as transactions with equity owners of the Company. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any consideration paid or received is recognized in a separate reserve within equity attributable to owners of the Company.
| (d) | Assets held for sale |
The Group classifies non-current assets and assets and liabilities within a disposal group (“disposal group”) as held for sale if the disposal group is available for sale immediately, the sale is being actively marketed, management is committed to a plan to sell the assets under usual terms, the sale is highly probable and the sale is expected to be completed within 12 months from the date of classification. The Group will not depreciate or amortize assets while it is part of a disposal group classified as held for sale.
| (e) | Disposals |
The difference between the carrying value of the net assets disposed of and the fair value of consideration received is recorded as a gain or loss on disposal. Foreign exchange translation gains or losses relating to subsidiaries that the Group has disposed of and that have previously been recorded in other comprehensive income or expense are also recognized as part of the gain or loss on disposal.
2.3Segment reporting
Operating segments are components of IHS’ business activities about which separate financial statements are available and reported internally to the chief operating decision maker. The Group’s Executive Committee has been identified as the chief operating decision maker, responsible for allocating resources and assessing performance of the operating segments.
The Group’s Executive Committee currently consists of the Chief Executive Officer (“CEO”), the Chief Operating Officer (“COO”), the Chief Financial Officer (“CFO”), the General Counsel, the IHS Nigeria CEO and the Chief Human Resource Officer.
Where operating segments share similar characteristics, they are aggregated into reportable segments. For the current year, the Group has identified four reportable and operating segments as follows: Nigeria, Sub Saharan Africa (“SSA”), Middle East and North Africa (“MENA”) and Latin America (“Latam”). Following the disposal of IHS Kuwait in December 2024, MENA will not be a reportable segment for the year ended December 31, 2025 and onwards.
F-11
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
2.4Foreign currency translation
(a)Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in U.S. dollars.
(b)Exchange rates
The Group assesses the appropriate exchange rate to use for financial reporting purposes taking into account relevant factors. Such factors includes access to those rates in the future to meet payments or dividends, any existence of multiple exchange rates, available rates in official markets for settlement of transactions, etc.
The Group uses the USD/NGN rate published by Bloomberg for the translation of USD transactions and denominated balances in the Nigerian subsidiaries and also for consolidation purposes.
(c)Transactions and balances
Foreign currency transactions are translated into the functional currency of each entity using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in income or loss. Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the consolidated statement of loss and other comprehensive income within finance income or finance cost. Foreign exchange gains and losses that relate to other monetary items are presented in the consolidated statement of loss and other comprehensive income within cost of sales, administrative expense and other income as appropriate.
Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For example, translation differences on non-monetary assets and liabilities such as equities designated as fair value through other comprehensive income are recognized in other comprehensive income.
The results and financial position of all the Group entities (none of which has the currency of a hyper inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:
| ● | assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position; |
| ● | income and expenses for each statement of income/loss and other comprehensive income/loss are translated at the monthly average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and |
| ● | all resulting exchange differences are recognized in other comprehensive income/loss. |
On consolidation, exchange differences arising from the translation of the net investment in foreign operations are taken to other comprehensive income.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate. Exchange differences arising are recognized in other comprehensive income.
F-12
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
2.5Revenue recognition
Our revenue is derived from fees paid by our customers for services from our colocation business and its ancillary managed services.
The colocation business involves the lease of space on IHS owned and leased towers and our fixed copper and fiber network infrastructure, which are shared by various operators and data service providers. Revenue is generated on towers either from anchor tenants (original tenants on towers) or colocation tenants (subsequent tenants) when they install equipment on towers and on cable and fiber networks from tenants when they use the fixed network infrastructure to provide connectivity to/from towers or to provide broadband services to their customers. A portion of colocation arrangements for the rental of space on the towers, other assets on tower sites on which the use of space is dependent and the use of fixed copper and fiber network infrastructure dedicated to an individual customer is within the scope of IFRS 16. A portion of colocation arrangements for the provision of services, energy charges and use of shared fixed copper and fiber network infrastructure is within the scope of IFRS 15 as a provision of service. The Group also offers ancillary services to manage tenant operations of existing customers on a limited basis. Revenue from such managed services is within the scope of IFRS 15.
In determining the amounts of colocation revenue from our contracts with customers that fall within the scope of IFRS 15 or IFRS 16, the Group considers whether there are separate performance obligations to which a portion of the transaction price needs to be allocated and revenue recognized separately.
For colocation services the Group determines the transaction price (including lease and non-lease elements) at contract inception and considers the effects of:
| ● | Variable consideration - The contractual price may be subject to service credits, price indexation, discounts provided on site consolidation and discounts associated with site occupancy. All of these items of variable consideration are considered to relate to individual service periods of series performance obligations, or represent contingent rentals, and are therefore recognized in the future periods in which they arise rather than when estimating the transaction price at contract inception. |
| ● | The existence of significant financing components - Financing components are not expected to be significant as services and payments are generally in line over the period of the contract. |
| ● | Consideration payable to the customer (if any) - Payments to customers (such as rebates and discounts refunded to the customer and payments for exit fees) are deducted from transaction price unless they are payments for a distinct good or service supplied to the Group in return for the payments. |
At the date of contract inception, the Group determines the stand-alone selling prices of the performance obligations (including the lease elements of the contract) using a combination of data on observable prices from comparable managed service arrangements, supplemented by the cost plus a margin approach. The Group allocates the transaction price to these non-lease elements of the contract and between performance obligations within the non-lease element of the contract on the basis of relative stand-alone selling price.
Revenue is typically invoiced quarterly in advance except where a deferral of invoicing has been agreed with a customer such as where there is an ongoing dispute over pricing in which case revenue is recognized upon satisfaction of performance obligations on the basis of the expected outcome of such disputes. Customer contracts typically require payment within 30 to 60 days.
Revenue also includes estimates for services provided where billing is not completed, including in respect of (1) tower sites coming into service, or changes in customer implemented technologies since the most recent invoicing cycle and (2) services subject to ongoing negotiation regarding price or other contract interpretation disputes with customers. For each of these scenarios, revenue is accrued based on management’s expectation of the final billable amounts based primarily on historical experience.
F-13
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
(a)Colocation services revenue (non-lease)
For non-lease revenue, two separate performance obligations have typically been identified, one in respect of the operation of tower infrastructure and one in respect of the provision of maintenance services and power, with each being a series of performance obligations to stand ready to deliver the required services.
The identification of these two performance obligations does not change the timing of revenue recognition of the non-lease component as both are typically satisfied over the same time period. In limited cases, contracts may provide the customer with a right to purchase additional services at a significant discount. In these cases, the material right is also identified as a performance obligation.
On initial recognition of revenue, the Group assesses the recoverability of revenue taking into account our contractual rights and obligations to consideration, our exposure to our customer’s credit risk and our practice of managing credit risk exposure through the occasional negotiation of price concessions with customers and recognizes the revenue, in respect of satisfied performance obligations, which is expected to be recovered. Recognition of amounts not expected to be recovered is considered variable consideration and is contingent upon the receipt of funds from the customer (see note 3.2(b)). The assessment of amounts expected to be recovered are closely aligned with the assumed credit risk of the customer, determined as part of the assessment of expected credit losses made in accordance with the Group’s IFRS 9 expected credit loss policy as described in note 2.12.4.
(b)Colocation services revenue for which the Group is a lessor
The portion of colocation revenue, for which IHS is the lessor, is treated as a lease. Contracts are assessed at inception to determine whether this element of the colocation services are finance or operating leases. At present all arrangements are assessed to be operating leases with revenue including fixed escalation clauses present in non-cancellable lease agreements recognized on a straight line basis over the current lease term of the related lease agreements, when collectability is reasonably assured. The duration of these lease arrangements is typically between 5 and 10 years. Escalation clauses tied to the Consumer Price Index (“CPI”) or other inflation based indices, are excluded from the straight line calculation, however, any fixed increases are included.
Revenue is recognized in the accounting period in which the rental income is earned and services are rendered. Amounts billed or received for services prior to being earned are deferred and reflected in deferred revenue until the criteria for recognition have been met.
(c)Managed services revenue
Revenue from managed services contracts with customers is recognized when the services are delivered at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those services.
Revenue is recognized in the accounting period in which the services are rendered by reference to the stage of completion based on the terms of each contract. Services revenues are derived under contracts or arrangements with customers that provide for billings either on a fixed price basis or a variable price basis, which includes factors such as time and expenses. Revenues are recognized as services are performed. Amounts billed or received for services prior to being earned are deferred and reflected in deferred revenue in the accompanying consolidated statement of financial position until the criteria for recognition have been met.
2.6Leases
The Group is a lessee of various assets, comprising land and buildings, towers, equipment and motor vehicles. The determination whether an arrangement is, or contains, a lease is based on whether the contract conveys a right to control the use of an identified asset for a period of time in exchange for consideration.
The following sets out the Group’s lease accounting policy for all leases with the exception of leases with low-value (i.e. < $5,000) and short-term of less than 12 months for which the Group has taken the exemption under the standard and are expensed to income or loss as incurred.
F-14
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
(a)Lease assets
The Group recognizes right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use under the contract). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments made at or before the commencement date (which do not form part of the lease liability value at the commencement date). Right-of-use assets are depreciated on a straight-line basis over the shorter of their estimated useful life and the lease term.
The right-of-use assets are tested for impairment in accordance with IAS 36 Impairment of Assets (“IAS 36”).
The Group determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised and any periods covered by an option to terminate the lease, if it is reasonably certain that the termination options will not be exercised. The Group has the option under some of its leases to lease the assets for additional periods of up to 10 years. The Group applies judgment in evaluating whether it has a unilateral option to renew the lease for a further period and is reasonably certain to exercise the option to renew (note 3). That is, it considers all relevant factors that create an economic incentive for it to exercise the renewal. After the commencement date, the Group reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise (or not to exercise) the option to renew.
After initial recognition of a lease, the Group only reassesses the lease term when there is a significant event or a significant change in circumstances, which was not anticipated at the time of the previous assessment. Significant events or significant changes in circumstances could include merger and acquisition or similar activity, legal or regulatory changes or detailed management plans indicating a different conclusion on optional periods to the previous assessment. Where a significant event or significant change in circumstances does not occur, the lease term and therefore, the lease liability and right-of-use asset value, will decline over time.
Lease modifications that increase the scope of a lease by adding the right to use one or more underlying assets in return for consideration commensurate with the stand-alone price for the additional lease components are treated as separate leases. If a lease modification decreases the scope of the lease, the Group remeasures both the right-of-use asset and the lease liability and recognises any gain or loss in the income statement. Other lease modifications result in a remeasurement of the lease liability with an adjustment to the right-of-use asset. Remeasured lease liabilities are discounted at the modification date using a current discount rate.
(b)Lease liabilities
At the commencement date of the lease, the Group recognizes lease liabilities measured at the present value of all remaining lease payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments where the contracts specify fixed or minimum uplifts) and variable lease payments that depend on an index or a rate.
The variable lease payments that do not depend on an index or a rate are recognized as an expense in the period in which the event or condition that triggers the payment occurs.
Due to the nature of our leased assets the interest rate implicit in the lease is usually not readily determinable, the Group therefore uses the incremental borrowing rate in calculating the present value of lease payments at the lease commencement date. The incremental borrowing rate is calculated using a series of inputs, including: a local currency cost of debt for each country based on local borrowing (or where not available, an inflation adjusted USD cost of debt which encompasses the country specific adjustment), an adjustment for the duration of the referenced borrowings to arrive at an interest rate for a one-year facility, and an adjustment for the lease term based on local government, US or Eurozone bond yields, as appropriate in the context of each country’s debt markets.
The finance cost is charged to income or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term or a change in the in-substance fixed lease payments.
F-15
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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2.7Interest income
Interest income is recognized in income or loss and is calculated using the effective interest method as set out in IFRS 9.
2.8Property, plant and equipment
These are mainly towers and towers equipment, fiber telecommunications network cables and equipment, land and buildings, furniture and office equipment, motor vehicles and capital work in progress that are used directly by the Group in the provision of services to customers, or for administrative purposes. The assets are carried at historical cost less accumulated depreciation and accumulated impairment losses. Historical cost includes expenditure that is directly attributable to the acquisition of the assets including amounts related to the cost of future decommissioning and site restoration obligations.
Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the asset will flow to the Group and the cost can be measured reliably.
Where an asset is replaced, the carrying amount of the replaced asset is derecognized. All other repairs and maintenance are charged to income or loss during the financial period in which they are incurred.
Freehold land is not depreciated. Depreciation on other assets is calculated using the straight-line method to allocate their cost to their residual values over their estimated useful lives, as follows:
Towers and tower equipment Base station towers (including civil costs and overheads) |
|
|
• Base station equipment (including civil costs and overheads) |
|
10-20 years |
• Base station equipment (other equipment) |
|
15 years |
• Base station equipment (rectifier and solar power) |
|
10 years |
• Base station equipment (alarm and battery) |
|
3-5 years |
• Base station equipment (generator & generator overhaul) |
|
1-5 years |
• Base station equipment (base transmission equipment) |
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8-10 years |
Fiber assets |
|
|
• Fixed line network equipment (including civil works, duct system, cable system and survey costs) |
|
25 years |
• Outdoor cabinet |
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10 years |
Land and buildings, furniture and office equipment, and motor vehicles |
|
|
• Office complex |
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40 years |
• Furniture and office equipment |
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3 years |
• Motor vehicles |
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4 years |
Asset residual values and useful lives are reviewed and adjusted if appropriate, at the end of each reporting period. Where an indication of impairment exists, an asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in income or loss for the period. The Group assesses its property, plant and equipment for possible impairment if there are events or changes in circumstances that indicate that carrying values of the assets may not be recoverable, or at least at the end of every reporting period. Such indicators could include changes in the Group’s business plans, changes in diesel prices, evidence of physical damage and technological changes and impacts of obsolescence including those driven by climate change.
2.9Intangible assets and goodwill
Goodwill arises on the acquisition of businesses and represents the excess of the consideration transferred, the amount of any non-controlling interests in the acquiree and the acquisition date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets acquired. If the total of consideration transferred, non-controlling interests recognized and previously held interest measured at fair value is less than the fair value of the net assets of the subsidiary acquired, in the case of a bargain purchase, the difference is recognized directly in income or loss.
F-16
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash generating units (“CGUs”), or groups of CGUs, that is expected to benefit from the synergies of the combination. Each unit or group of units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at or below the operating segment level. Goodwill impairment reviews are undertaken annually or more frequently if events or changes in circumstances indicate a potential impairment. The carrying value of the CGU, or group of CGUs, containing the goodwill is compared to the recoverable amount, which is the higher of value in use and the fair value less costs of disposal. Any impairment is recognized immediately as an expense and is not subsequently reversed.
(a)Network and customer-related intangible assets
Network related intangible assets represent future income from leasing excess tower capacity to new tenants. Customer-related intangible assets represent customer contracts and relationships. Network and customer-related intangible assets acquired in a business combination are recognized at fair value at the acquisition date. Network and customer-related intangible assets have a finite useful life and are carried at cost less accumulated amortization. Amortization is calculated using the straight-line method to allocate the cost of network and customer-related intangible assets over their estimated useful lives of 14-35 years (2023: 14-35 years, 2022: 14-34 years) and 5-41 years (2023: 5-41 years, 2022: 5-41 years) respectively. The remaining amortization period for network and customer-related assets are between 2-31 years (2023: 3-32 years, 2022: 4-33 years) and 18-38 years (2023: 19-39 years, 2022: 20-40 years) respectively.
(b)Licenses
Separately acquired licenses are shown at historical cost. Licenses acquired in a business combination are recognized at fair value at the acquisition date. Licenses have a finite useful life and are carried at cost less accumulated amortization. Amortization is calculated using the straight-line method over their estimated useful lives of 3-15 years (2023: 3-15 years, 2022: 3-15 years).
(c)Computer software
Costs associated with maintaining computer software programs are recognized as expenses as incurred. Acquired computer software licenses are capitalized at the cost incurred to acquire and bring into use the software. Amortization is calculated using the straight-line method over their estimated useful lives of three to five years.
2.10Impairment of non-financial assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired (note 3). Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and its value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
2.11Inventories
Inventories are stated at the lower of cost and estimated net realizable value. Cost comprises direct materials costs and where applicable, direct labor costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Cost is calculated using the first-in, first-out method. Net realizable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution. If the carrying value exceeds net realizable amount, a write down is recognized. The write-down may be reversed in a subsequent period if the circumstances which caused it no longer exist. In other instances, where the net realizable value of an inventory item is not readily determinable, management assesses the age and the risk of obsolescence of such items in determining net realizable value of such items using an appropriate age/obsolescence factor model.
F-17
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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2.12Financial assets
2.12.1Classification
The Group classifies its financial assets in the following measurement categories:
| ● | those to be measured subsequently at fair value (either through other comprehensive income (OCI) or through income or loss); and |
| ● | those to be measured at amortized cost. |
The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows. The Group reclassifies debt investments when and only when its business model for managing those assets changes.
2.12.2Recognition and derecognition
Regular way purchases and sales of financial assets are recognized on trade-date, the date on which the Group commits to purchase or sell the asset. Financial assets are derecognized when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership.
2.12.3Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss (FVPL), transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs directly attributable to financial assets carried at FVPL are expensed in income or loss.
a)Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset and the cash flow characteristics of the asset. The Group measures its debt instruments at amortized cost as assets are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest. Interest income from these financial assets is included in finance income using the effective interest rate method. Any gain or loss arising on derecognition is recognized directly in income or loss and presented in other gains/(losses) together with foreign exchange gains and losses. Impairment losses are presented as separate line item in the consolidated statement of loss and other comprehensive income.
For the purpose of presentation in the consolidated statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are reflected within borrowings in current liabilities in the consolidated statement of financial position.
b)Equity instruments
The Group subsequently measures all equity investments at fair value. The Group has elected to present fair value gains and losses on equity investments in OCI. There is no subsequent reclassification of fair value gains and losses to income or loss following the derecognition of the investment.
F-18
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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2.12.4Impairment
The Group adopted the simplified approach and evaluates each customer individually for the purpose of estimating the impairment at the reporting date rather than using a portfolio approach. The Group has limited history of losses and given the short duration of receivables, the Group uses the experienced credit judgment (ECJ) approach to estimate the impairment of trade receivables in accordance with the expected credit loss (ECL) requirement of IFRS 9.
The ECJ approach assesses the credit risk of the customer at the reporting date to evaluate the customer’s capacity to meet its contractual cash flow obligations in the near term and combines this with an evaluation of the impact of changes in economic and business conditions on the customer’s ability to pay.
2.12.5Cash and cash equivalents
Cash and cash equivalents comprise of cash balances and bank deposits with an original maturity of three months or less, which are readily convertible to a known amount of cash and subject to an insignificant risk of changes in value.
2.13Financial liabilities
2.13.1Classification
The Group’s financial liabilities are classified at amortized cost. Financial liabilities are recognized initially at fair value and net of directly attributable transaction costs. The Group’s financial liabilities are borrowings and trade and other payables.
Borrowings
Borrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in the consolidated statement of loss and other comprehensive income over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a prepayment for liquidity services and amortized over the period of the facility to which it relates.
Borrowings are derecognized from the consolidated statement of financial position when the obligation specified in the contract is discharged, canceled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in the consolidated statement of loss and other comprehensive income as other income or finance costs. Where the terms of a financial liability are renegotiated and the entity issues equity instruments to a creditor to extinguish all or part of the liability (debt for equity swap), a gain or loss is recognized in the consolidated statement of loss and other comprehensive income, which is measured as the difference between the carrying amount of the financial liability and the fair value of the equity instruments issued.
Borrowings are classified as current liabilities unless the Group has a right to defer settlement of the liability for at least 12 months after the reporting period.
2.14Derivative financial instruments
Derivatives are financial instruments that derive their value from an underlying price or index. A derivative instrument gives one party a contractual right to exchange financial assets and financial liabilities with another party under conditions that are potentially favorable or financial liabilities with another party under conditions that are potentially unfavorable. Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at the end of each reporting period.
F-19
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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Where we have an obligation to purchase non-controlling interests that will be settled for a variable number of own shares, rather than cash, another financial asset, or a fixed number of shares, our policy is to treat this as a derivative transaction and measure it at fair value and any change to fair value is recognized in income or loss.
2.15Embedded derivatives
An embedded derivative is a component of a hybrid (combined) instrument that also includes a non-derivative host contract. An embedded derivative causes some or all of the cash flows that otherwise would be required by the contract to be modified according to a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates or other variable (provided in the case of a non-financial variable that the variable is not specific to a party to the contract).
An embedded derivative is only separated and reported at fair value with gains and losses being recognized in the consolidated statement of loss and other comprehensive income when the following requirements are met:
| ● | where the economic characteristics and risks of the embedded derivative are not clearly and closely related to those of the host contract; |
| ● | the terms of the embedded derivative are the same as those of a stand-alone derivative; and |
| ● | the combined contract is not held for trading or designated at fair value through profit or loss. |
The Group’s listed bonds include embedded put and call features which are bifurcated at the time of issuance of the bonds.
The Group employed valuation techniques commonly used by market participants to evaluate bonds with embedded options, including discounted cash flow and option pricing models, and makes maximum reference to market inputs. The techniques adopted include the major factors that market participants would consider in setting a price and are consistent with accepted economic methodologies for pricing financial instruments. The options are valued equivalent to an American Receiver Swaption under the Hull & White Model.
A significant portion of the Group’s Contracted Revenue pricing is denominated in U.S. dollars and the amount of local currency due is determined by reference to the U.S. dollar amount invoiced, translated at the spot rate or an average rate to the respective subsidiary. This represents an embedded foreign currency derivative in a host contract.
Management’s judgment is that where fees that are priced in USD are translated to local currency at the time of billing using a liquid market exchange rate, derivatives are not bifurcated as of the time the contracts are entered into. They are considered closely related to the host contract since they are denominated in a currency that is commonly used in the regions that the Group operates in (U.S. dollar being a relatively stable and liquid currency that is commonly used for pricing in local business transactions and trade).
Where fees priced in USD are translated to local currency at the time of billing using a fixed, pre-determined exchange rate, or an exchange rate which is not referenced to a liquid market exchange rate, derivatives are bifurcated at the time the contracts are entered into.
2.16Current and deferred income tax
(a)Deferred income tax
Deferred income tax is recognized in full, using the liability method, on all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is crystallized.
F-20
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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Deferred income tax liabilities are not recognized if they arise from initial recognition of goodwill on a business combination. The initial recognition exemption is not applied for transactions that give rise to equal taxable and deductible temporary differences, for example leases within the scope of IFRS 16 and decommissioning provisions.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis. Deferred income tax assets are recognized only to the extent that it is probable that future taxable income will be available against which the temporary differences can be utilized.
(b)Current income tax
Current income tax is recognized in income or loss, except to the extent that it relates to items recognized in other comprehensive income or directly in equity. In this case, the tax is also recognized in other comprehensive income or directly in equity, respectively.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted by the end of the reporting period in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and considers whether it is probable that a taxation authority will accept an uncertain tax treatment. The Group measures its tax balances either based on the most likely amount or the expected value, depending on which method provides a better prediction of the resolution of the uncertainty.
2.17Employee benefits
(a)Defined contribution schemes
The Group operates a number of defined contribution plans which are funded by contributions from the Group and the employees based on the law ruling in each country. The amounts contributed by the Group are recognized as employee benefit expenses and are charged to income or loss in the period to which the contributions relate. The Group has no further payment obligation once the contributions have been paid. Prepaid contributions are recognized as an asset to the extent that a cash refund or a reduction in the future payment is available.
(b)Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognized for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated reliably.
(c)Other long-term employee benefits
The Group’s net obligation in respect of long-term employee benefits is the amount of future benefit that employees have earned in return for their service in the current and prior periods. That benefit is discounted to determine its present value. Remeasurements are recognized in the consolidated statement of loss and other comprehensive income in the period in which they arise.
F-21
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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2.18Share-based payments
The Group operates a number of equity settled, share-based compensation plans, under which the entity receives services from employees as consideration for equity instruments (options) of the Company. Equity settled share-based payment obligations granted to employees are measured at their fair value (at the date of grant or the date of amendment in the case of modification of terms) and the fair value is recognized as an expense in income or loss, with a corresponding increase in equity, over the vesting period of the awards. The amount recognized as an expense is adjusted to reflect the number of awards for which the related service and non-market performance conditions (for example, profitability, sales growth targets are expected to be met), such that the amount ultimately recognized is based on the number of awards that meet the related service and non-market performance conditions at the vesting date.
In the event of a modification of the terms of the equity instruments, if the fair value of the new amended instruments is greater than the fair value of the original instruments as of the modification date, then for options vested at the modification date, the incremental fair value is recognized in income or loss immediately and for unvested options, the incremental amount is recognized in income or loss over the remaining vesting period.
In prior periods, and up to July 10, 2019, the share-based compensation plans operated by the Group were classified and accounted for as cash-settled instruments. Options were measured at their fair value (at the date of grant) and the fair value was recognized as an expense in income or loss with a corresponding liability recognized. Cash settled share-based payment liabilities were remeasured at the end of each reporting period up to the date of settlement, with any changes in fair value recognized in income or loss. At the end of each reporting period and up to July 10, 2019, the Group revised its estimates of the number of options that were expected to vest based on the non-market vesting conditions and service conditions and recognized the impact of the revision to original estimates, if any, in income or loss, with a corresponding adjustment to liability. Refer to note 28 for further information.
To the extent that the Group grants shares or share options in a subsidiary in a B-BBEE transaction and the fair value of the cash and other assets received is less than the fair value of the shares or share options granted, such difference is recognized as a share-based payment expense in the consolidated statement of loss and other comprehensive income. If there are no vesting conditions, then the expense is recognized in full at the grant date.
2.19Decommissioning and site restoration obligations
The Group makes provision for any future cost of decommissioning of its telecommunication towers where required by regulation or land lease terms. These costs are expected to be incurred within a period of up to 20 years depending on the term of the leasehold. The Group estimates this provision using existing technology at current prices as quoted by decommissioning experts, escalated at the relevant inflation factor. The inflated decommissioning provision is subsequently discounted to present value using the Group’s incremental borrowing rate for borrowings over the expected term of the leasehold. The timing of each decommissioning will depend on the term of the lease and whether or not the lessor intends to renew the rental contract. A corresponding amount is recognized as part of property, plant and equipment. This is subsequently depreciated as part of the tower. Other than the unwinding discount on the provision, any change in the present value of the estimated expenditure is reflected as an adjustment to the provision and the corresponding item of property, plant and equipment.
3.Critical accounting estimates and judgments
The preparation of consolidated financial statements requires management to make certain judgments, accounting estimates and assumptions that affect the amounts reported for the assets and liabilities as of the end of the reporting period and the amounts reported for revenues and expenses during the year. The nature of the estimation means that actual outcomes could differ from those estimates. The key sources of judgment and estimation uncertainty that have a significant risk of causing material adjustments to the carrying amounts of assets and liabilities are discussed below.
In preparing these consolidated financial statements, the significant judgments made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty are as follows:
F-22
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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3.1Key accounting judgments
(a)Going Concern
A number of the Group’s operating markets have seen higher interest rates and inflation during 2024 and there was a significant devaluation of the Nigerian Naira in January 2024. In addition, ongoing geopolitical conflicts and wars have impacted global diesel prices as well as the supply chain for raw materials such as steel and for equipment, including batteries.
The below table outlines Management’s assessment of and response to the main risks arising from the current global macro-economic conditions. These risks inherently impact the significant judgments and estimates made by management.
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|---|---|---|
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Assessment |
Risk discussion and response |
Revenue and profitability |
· Limited impact on revenue collections thus far. · Customers continue to perform, and we have not experienced significant deterioration in payments. |
· The Group has long-term revenue contracts with its customers amounting to approximately $12.0 billion in Contracted Revenue. · Our ability to collect revenue from our customers is impacted by our customers’ ability to generate and collect revenues from their operations. Our customers have, in the main, seen an increased demand for their services. · The impact on collections has thus far been limited and the Group remains in constant conversation with customers regarding their liquidity and ability to meet their obligations. · The Group regularly reviews measures for cost savings whilst maintaining its ability to operate effectively and towards strategic goals. · The Group has continued to invest in capital expenditure which supports revenue growth. The Group will make targeted investments in capital expenditure relating to revenue growth during 2025. · Customer revenue contracts include FX reset functions, including on Nigerian Naira contracts. |
Liquidity |
· Sufficient liquidity is available. · No current impact on going concern. |
· The Group has cash and cash equivalents of $578 million as of December 31, 2024, and undrawn facilities at IHS Holding level of $300 million. · Management has assessed current cash reserves and the availability of undrawn facilities and continues to monitor available liquidity in the context of ongoing operational requirements and planned capital expenditure. · In the context of current commitments and available liquidity, management believes that the going concern assumption remains appropriate. · All of the Group’s operations are cash generative. |
Access to USD |
· Moderate risk due to decreased availability. |
· While there was a reduction in U.S. dollar liquidity in the Nigerian market, we were still able to source U.S. dollars locally to fund our U.S. dollar requirements during the year. We noted an improvement in U.S. dollar liquidity towards the end of the year but this may not continue. |
Internal controls |
· Minimal impact to date. |
· Our IT team monitors the increased risk of fraud, data or security breaches, loss of data and the potential for other cyber-related attacks and utilises security measures to mitigate such risks. |
Supply chain |
· Moderate risk due to delays. |
· The Group works closely with suppliers and contractors to ensure availability of supplies on site, especially diesel supplies which are critical to many of our operations. · Regular maintenance of our towers continues while observing strict safety guidelines for our employees and our suppliers and contractors. |
F-23
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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Due to the uncertainty in the Naira exchange rate to the U.S. dollar we will continue to assess the situation. As part of their regular assessment of the Group’s liquidity and financing position, the Directors have prepared detailed forecasts for a period which extends beyond 12 months after the date of approval of these consolidated financial statements. In assessing the forecasts, the Directors have considered:
| ● | the current economic conditions in the operating markets and how those impacts trading; |
| ● | the impact of macroeconomic factors, particularly interest rates and foreign exchange rates; |
| ● | the status of the Group’s financial arrangements (see also note 22); |
| ● | mitigating actions available should business activities fall behind current expectations; and |
| ● | additional sensitivity analysis under a stressed scenario to assess the impact of a severe but plausible downside case. |
Whilst inherently uncertain, and we expect some impact to our operations and performance, we currently do not believe that the ongoing uncertainty with the Naira exchange rate will directly have a material adverse effect on our financial condition or liquidity for the foreseeable future, given the contractual revenue resets. Having carefully considered this and the other factors noted above, the Directors have a reasonable expectation that the Group and the Company have adequate resources to continue in operational existence for at least 12 months from the date of issuance of these consolidated financial statements and to operate within the covenant levels of its current debt facilities. The Directors therefore continue to consider it appropriate to adopt the going concern basis of accounting in preparing the consolidated financial statements.
(b)Determining the lease term of contracts with renewal options
The Group determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain to be exercised and any periods covered by an option to terminate the lease, if it is reasonably certain that the termination options will not be exercised.
The Group has the option under some of its leases to lease the assets for additional periods of up to 10 years. The Group applies judgment in evaluating whether it has a unilateral option to renew the lease for a further period or is otherwise provided that option under the laws governing the lease agreement and is reasonably certain to exercise the option to renew. That is, it considers all relevant factors that create an economic incentive for it to exercise the renewal or for the landlord to accept a renewal, including the nature of the underlying asset, the availability of a similar asset in a similar location, and the expected business impact or relocating its towers. After the commencement date, the Group reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its intention or ability to exercise (or not to exercise) the option to renew.
3.2Key accounting estimates
(a)Goodwill impairment
The Group tests annually whether goodwill has suffered any impairment, in accordance with the accounting policy stated in note 2.10.
The assessment for impairment entails comparing the carrying value of the cash generating unit, or group of cash generating units, with its recoverable amount, that is, the higher of the value in use and the fair value less costs of disposal. Value in use is determined on the basis of discounted estimated future net cash flows. Fair value less costs of disposal is determined on the basis of the income approach, discounting estimated future net cash flows that reflects current market expectations. Determination as to whether and how much an asset is impaired involves management estimates on highly uncertain matters such as future revenue (taking into account tenancy rates for tower businesses and homes passed and homes connected for the fiber business), and the direct effect these have on gross profit margins in the initial five-year forecast period, discount rates, terminal growth rates and cost related to the disposal of a business.
F-24
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IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
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In determining value in use the Group makes estimates and assumptions concerning the future. The assumptions adopted in the computation of the value in use are considered reasonable to the circumstance of each CGU or group of CGUs. The resulting accounting estimates will, by definition, seldom equal the related actual results. Such estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
(b)Revenue recognition - Variable consideration
Initial recognition of revenue is estimated based on an assessment of the recoverability of revenue taking into account our contractual rights to consideration, our exposure to our customer’s credit risk and our practice of managing credit risk exposure through the occasional negotiation of price concessions with customers. Only amounts expected to be recovered at the point of initial recognition are recognized in revenue, and the remainder is considered variable consideration (see note 2.5(a)). Recognition of amounts not expected to be recovered is contingent upon the receipt of funds from the customer. The assessment of the amounts expected to be recovered is closely aligned with the assessed credit risk of the customer, determined as part of the assessment of expected credit losses made in accordance with the Group’s IFRS 9 expected credit loss policy as described in note 2.12.4.
A 10-percentage point change in management’s estimate of the amount of variable consideration that will eventually be received would alter revenue recognized by approximately $10.1 million (2023: $25.5 million, 2022: $17.4 million).
4.Introduction and overview of Group’s risk management
The Group’s activities expose it to a variety of financial risks including market risk (foreign exchange risk and interest rate risk), credit risk and liquidity risk. The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The Group’s Executive Committee is responsible for developing and monitoring the Group’s risk management policies.
The Group’s risk management policies are established to identify and analyze the risks faced by the Group, to establish appropriate risk appetite and controls, and to monitor risks and adherence to our risk appetite. Risk management policies and systems are reviewed regularly by the executive management to reflect changes in market conditions and the Group’s activities. The Group, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.
The Board, through the Audit Committee, oversees how management monitors compliance with the Group’s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the Group. The Board is supported by various management functions that check and undertake both regular and ad hoc reviews of compliance with established controls and procedures.
F-25
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
(a)Derivative instruments
Derivatives are only used for economic hedging purposes and not as speculative investments. Derivatives do not meet the criteria for hedge accounting and are therefore classified as financial instruments through fair value through profit or loss.
| ● | Non-deliverable forwards (NDFs): The calculation of the NDFs fair value is based on the difference between the contracted exchange rate and the anticipated spot exchange rate as of the relevant period. The gain or loss at the settlement date is calculated by taking the difference between the agreed upon contract exchange rate (NGN/USD) and the spot rate at the time of settlement, for an agreed upon notional amount of funds. |
| ● | Embedded options within listed bonds: Where issued fixed maturity borrowings include embedded options which allow early redemption at the option of the issuer and holder upon the occurrence of specified events these are separated from the host contract and accounted for as derivatives at fair value through profit or loss. The calculation of the fair value uses option valuation techniques. |
| ● | Interest rate caps: The calculation of fair value is based on option valuation techniques and recognized at fair value through profit and loss. |
| ● | Foreign Exchange Swaps: The calculation of the Swaps fair value is based on the difference between the contracted exchange rate and the anticipated spot exchange rate as of the relevant period. The gain or loss at the settlement date is calculated by taking the difference between the agreed upon contract exchange rate (NGN/USD) and the spot rate at the time of settlement, for an agreed upon notional amount of funds. |
(b)Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates will affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.
The Group manages market risks by keeping costs low through various cost optimization programs. Moreover, market developments are monitored and discussed regularly, and mitigating actions are taken where necessary.
The Group operates internationally and is exposed to foreign exchange risk arising from currency exposures other than the U.S. dollar. Foreign exchange risk arises from future commercial transactions, recognized assets and liabilities and net investments in foreign operations.
The Group is exposed to risks resulting from fluctuations in foreign currency exchange rates. A material change in the value of any such foreign currency could result in a material adverse effect on the Group’s cash flow and future income. The Group is exposed to foreign exchange risk to the extent that balances and transactions are denominated in a currency other than the functional currency in which they are measured.
In managing foreign exchange risk, the Group aims to reduce the impact of short-term fluctuations on earnings. The Group has no export sales, but it has customers that are either contracted using fees quoted in U.S. dollars or other foreign currencies, but with foreign exchange indexation. The Group’s significant exposure to currency risk relates to its loan facilities that are mainly in foreign currencies. The Group manages foreign exchange risk through the use of derivative financial instruments such as currency swaps and forward contracts. The Group monitors the movement in the currency rates on an ongoing basis.
Currency exposure arising from assets and liabilities denominated in foreign currencies is managed primarily by setting limits on the percentage of net assets that may be invested in such deposits.
F-26
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Sensitivity analysis
The impact on the Group’s loss if the exchange rate of the U.S. dollar weakened or strengthened compared to the following currencies, with all other variables held constant is as follows. The rate of change was determined by an assessment of a reasonable or probable change in the exchange rate being applied as of December 31. The impact is based on external and intercompany loans.
|
|
|
|
Effect on |
|
Effect on |
|
Effect on |
|
Effect on |
|
Effect on |
|
Effect on |
|
|
Effect on |
|
Rwandan |
|
Nigerian |
|
Zambian |
|
South African |
|
Brazilian |
|
Kuwaiti |
|
|
Euro |
|
Franc |
|
Naira |
|
Kwacha |
|
Rand |
|
Real |
|
Dinar |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rate of change |
|
10% |
|
10% |
|
10% |
|
10% |
|
10% |
|
10% |
|
n/a |
Effect of U.S. dollar weakening on loss |
|
(16,039) |
|
(953) |
|
(214,236) |
|
(15,130) |
|
(17,523) |
|
— |
|
n/a |
Effect of U.S. dollar strengthening on loss |
|
16,039 |
|
953 |
|
214,236 |
|
15,130 |
|
17,523 |
|
— |
|
n/a |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rate of change |
|
10% |
|
10% |
|
10% |
|
10% |
|
10% |
|
10% |
|
10% |
Effect of U.S. dollar weakening on loss |
|
(21,911) |
|
(1,311) |
|
(255,956) |
|
(16,038) |
|
(3,996) |
|
— |
|
(1,047) |
Effect of U.S. dollar strengthening on loss |
|
21,911 |
|
1,311 |
|
255,956 |
|
16,038 |
|
3,996 |
|
— |
|
1,047 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rate of change |
|
7% |
|
7% |
|
7% |
|
7% |
|
7% |
|
7% |
|
7% |
Effect of U.S. dollar weakening on loss |
|
(13,153) |
|
(4,402) |
|
(165,880) |
|
(15,528) |
|
(2,809) |
|
(18,898) |
|
(648) |
Effect of U.S. dollar strengthening on loss |
|
13,153 |
|
4,402 |
|
165,880 |
|
15,528 |
|
2,809 |
|
18,898 |
|
648 |
This analysis excludes the natural hedging arising from contracts with customers in the Nigeria, Zambia and Rwanda operations, which are either wholly or partly linked to the U.S. dollar exchange rate. It is, however, impracticable to incorporate the impact of this U.S. dollar component in the above analysis due to the complexity of the contracts and the timing of any devaluation event.
The Group is exposed to foreign exchange exposure that arises on intercompany loans denominated in U.S. dollars and Euro at a subsidiary level as a result of loan revaluations in local functional currency at period ends. The balances, as translated into USD, of the foreign denominated intercompany loans in the local books of the subsidiaries are as follows:
|
|
Nigerian |
|
Rwandan |
|
Zambian |
|
South African |
|
Kuwaiti |
|
|
|
|
Naira |
|
Franc |
|
Kwacha |
|
Rand |
|
Dinar |
|
U.S. Dollar |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
2024 |
|
|
|
|
|
|
|
|
|
|
|
|
U.S. dollar loan |
|
2,135,507 |
|
9,528 |
|
89,123 |
|
— |
|
— |
|
— |
Euro loan |
|
— |
|
— |
|
— |
|
— |
|
— |
|
84,916 |
|
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
U.S. dollar loan |
|
2,240,110 |
|
13,108 |
|
79,081 |
|
39,956 |
|
10,473 |
|
— |
Euro loan |
|
— |
|
— |
|
— |
|
— |
|
— |
|
214,271 |
F-27
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The summary of quantitative data about the Group’s exposure to foreign exchange risk (balances excluding intercompany balances, and in currencies other than the local functional currency) is as follows:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Trade receivables |
|
7,338 |
|
7,330 |
Cash and cash equivalents |
|
20,398 |
|
50,132 |
Trade payables |
|
(5,269) |
|
(44,835) |
Borrowings |
|
(319,738) |
|
(405,592) |
Net exposure |
|
(297,271) |
|
(392,965) |
The Group’s main interest rate risk arises from long term borrowings with variable rates, which expose the Group to cash flow interest rate risk.
The Group’s fixed rate borrowings and receivables are carried at amortized cost. They are therefore not subject to interest rate risk as defined in IFRS 7, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates. The Group manages interest rate risk through the use of derivative financial instruments such as interest rate caps or by issuing fixed rate debt.
The impact on the Group’s post-tax loss if the interest rates increased or decreased by 1% (2023: 1%, 2022: 1%) is as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Effect of 1% (2023 and 2022: 1%) increase on post-tax loss |
|
11,999 |
|
11,412 |
|
6,345 |
Effect of 1% (2023 and 2022: 1%) decrease on post-tax loss |
|
(11,934) |
|
(11,423) |
|
(6,846) |
(c)Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits with banks and financial institutions, as well as credit exposures to customers, including outstanding receivables and committed transactions. Credit risk is managed on a Group basis. The Group accounts for the write-off of a trade receivable when a specific customer is assessed to be uncollectible, based on a review of their specific trading circumstances, credit quality and continuing poor payment performance of the specific customer.
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the end of the reporting period is as follows:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$'000 |
|
|
|
|
|
Other receivables (note 19) |
|
44,434 |
|
317,452 |
Derivative financial instrument assets (note 18) |
|
29,410 |
|
2,105 |
Trade receivables (net) (note 19) |
|
220,893 |
|
212,323 |
Cash and cash equivalents (note 20) |
|
577,956 |
|
293,823 |
|
|
872,693 |
|
825,703 |
F-28
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
No impairment allowance is recorded at December 31, 2024, in respect of cash and cash equivalents and other receivables (2023: $nil). Derivative financial instruments are carried at fair value through profit or loss. Any fair value gains or losses are recognized in income or loss during the period.
Credit ratings
The Group works with approved banks and financial institutions which it believes are financially sound, including by reference to their external ratings.
The credit ratings of the Group’s other receivables at December 31, 2024, and 2023, are based on publicly reported Fitch ratings:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$'000 |
Other receivables |
|
|
|
|
AAA |
|
1,569 |
|
22,485 |
A |
|
123 |
|
— |
B |
|
15,071 |
|
259,702 |
BBB- |
|
79 |
|
— |
C |
|
10 |
|
— |
Not rated |
|
27,582 |
|
35,265 |
|
|
44,434 |
|
317,452 |
Refer to note 18 and note 20 for the credit ratings of derivative financial instrument assets and cash and cash equivalents respectively.
The finance department assesses the credit quality of a customer, taking into account its financial position, past experience and other factors. The compliance with credit limits by customers is regularly monitored by line management.
The Group utilizes data analysis and market knowledge to determine the concentration of its risks by reference to independent and internal ratings of customers. The assessment of the concentration risk is consistent with the overall risk appetite as established by the Group.
The Group’s credit concentration is based on internal ratings. The finance department classifies customers as first tier and second tier customers based on sales revenue from each customer during the period. First tier customers are the two to five customers that contributed 80% and above of total revenue and represent the major mobile network operators in our markets while second tier customers are the customers that contributed 20% and below of total revenue and typically represent ISPs or mobile operators with smaller or regional network footprints.
|
|
Internal Credit rating |
|
|
||
|
|
First tier |
|
Second tier |
|
Total |
|
|
$'000 |
|
$'000 |
|
$'000 |
2024 |
|
|
|
|
|
|
Accrued Revenue |
|
134,223 |
|
1,442 |
|
135,665 |
Not due |
|
22,524 |
|
1,628 |
|
24,152 |
0-30 days |
|
18,762 |
|
8,564 |
|
27,326 |
31-60 days |
|
7,617 |
|
1,392 |
|
9,009 |
61-90 days |
|
4,409 |
|
2,043 |
|
6,452 |
Over 90 days |
|
11,116 |
|
23,512 |
|
34,628 |
Gross trade receivables |
|
198,651 |
|
38,581 |
|
237,232 |
Impairment allowance |
|
(4,854) |
|
(11,485) |
|
(16,339) |
Net trade receivables |
|
193,797 |
|
27,096 |
|
220,893 |
F-29
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
|
|
Internal Credit rating |
|
|
||
|
|
First tier |
|
Second tier |
|
Total |
|
|
$'000 |
|
$'000 |
|
$'000 |
2023 |
|
|
|
|
|
|
Accrued Revenue |
|
86,683 |
|
99 |
|
86,782 |
Not due |
|
57,540 |
|
4,031 |
|
61,571 |
0-30 days |
|
17,632 |
|
2,240 |
|
19,872 |
31-60 days |
|
15,072 |
|
4,532 |
|
19,604 |
61-90 days |
|
1,128 |
|
4,213 |
|
5,341 |
Over 90 days |
|
19,213 |
|
21,145 |
|
40,358 |
Gross trade receivables |
|
197,268 |
|
36,260 |
|
233,528 |
Impairment allowance |
|
(8,647) |
|
(12,558) |
|
(21,205) |
Net trade receivables |
|
188,621 |
|
23,702 |
|
212,323 |
Impairment allowances, derived in accordance with the policy described in note 2.12.4, predominantly relate to provisions representing a significant proportion of the aged balances due from a small number of customers with poor payment history.
The movement in the allowance for impairment in respect of trade receivables during the year is as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
At January 1 |
|
21,205 |
|
25,365 |
|
31,063 |
(Decrease)increase in impairment provision |
|
(25) |
|
7,202 |
|
(4,446) |
Written-off during the year |
|
(43) |
|
(2,597) |
|
(312) |
Exchange differences |
|
(4,798) |
|
(8,765) |
|
(940) |
At December 31 |
|
16,339 |
|
21,205 |
|
25,365 |
(d)Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.
The Group has a clear focus on ensuring sufficient access to capital to finance growth and to refinance maturing debt obligations. As part of the liquidity management process, the Group has various credit arrangements with some banks which can be utilized to meet its liquidity requirements. At the end of the reporting period, the Group had $3.4 billion (2023: $3.2 billion, 2022: $3.1 billion) utilized of $3.7 billion (2023: $3.7 billion, 2022: $3.7 billion) credit facilities with its financiers.
Typically, the credit terms with customers are more favorable compared to payment terms from its vendors in order to help provide sufficient cash on demand to meet expected operational expenses, including the servicing of financial obligations. This excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.
F-30
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The table below analyzes the Group’s financial liabilities including estimated interest payments and excluding the impact of netting agreements into relevant maturity groupings based on the remaining period from the end of the reporting period to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.
|
|
Within 1 year |
|
1 - 3 years |
|
3 - 5 years |
|
Over 5 years |
|
Total |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
2024 |
|
|
|
|
|
|
|
|
|
|
Foreign exchange swaps |
|
14,500 |
|
— |
|
— |
|
— |
|
14,500 |
Trade payables (note 21) |
|
232,930 |
|
— |
|
— |
|
— |
|
232,930 |
Payroll and other related statutory liabilities (note 21) |
|
42,844 |
|
— |
|
— |
|
— |
|
42,844 |
Other payables (note 21) |
|
79,604 |
|
5,218 |
|
— |
|
— |
|
84,822 |
Borrowings |
|
313,252 |
|
1,170,316 |
|
1,870,582 |
|
864,109 |
|
4,218,259 |
Lease liabilities |
|
92,425 |
|
179,774 |
|
173,750 |
|
685,041 |
|
1,130,990 |
|
|
775,555 |
|
1,355,308 |
|
2,044,332 |
|
1,549,150 |
|
5,724,345 |
2023 |
|
|
|
|
|
|
|
|
|
|
Foreign exchange swaps |
|
125,000 |
|
— |
|
— |
|
— |
|
125,000 |
Trade payables (note 21) |
|
330,622 |
|
— |
|
— |
|
— |
|
330,622 |
Payroll and other related statutory liabilities (note 21) |
|
46,282 |
|
— |
|
— |
|
— |
|
46,282 |
Other payables (note 21) |
|
110,706 |
|
4,629 |
|
— |
|
— |
|
115,335 |
Borrowings |
|
670,261 |
|
1,578,329 |
|
1,950,750 |
|
303,397 |
|
4,502,737 |
Lease liabilities |
|
101,709 |
|
193,434 |
|
180,895 |
|
705,421 |
|
1,181,459 |
|
|
1,384,580 |
|
1,776,392 |
|
2,131,645 |
|
1,008,818 |
|
6,301,435 |
(e)Capital risk management and fair value measurements
The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders, and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
The Group monitors capital on the basis of the management consolidated net leverage ratio to optimize market pricing, such that net debt (borrowings plus lease liabilities less cash and cash equivalents) to Adjusted Earnings Before Interest, Tax, Depreciation and Amortization (Adjusted EBITDA), proforma for acquisitions and disposals, would be within a long term target leverage of 3.0x and 4.0x (2023: 3.0x and 4.0x, 2022: 3.0x and 4.0x), subject to various factors such as the availability and cost of capital and the potential long term return on our discretionary investments. We may fall outside of the target range in the shorter term to accommodate acquisitions, other restructurings or significant macro-economic changes.
We define Adjusted EBITDA as (loss)/income for the period, before income tax expense/(benefit), finance costs and income, depreciation and amortization, net impairment/(reversal of impairment) of withholding tax receivables, impairment of goodwill, business combination transaction costs, net impairment/(reversal of impairment) of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent, reversal of provision for decommissioning costs, net (gain)/loss on sale of assets, share-based payment (credit)/expense, insurance claims, gain on disposal of subsidiary and certain other items that management believes are not indicative of the core performance of our business.
F-31
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The following table sets out a reconciliation of our management consolidated net leverage ratio for the full years ended December 31, 2024, and 2023:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$'000 |
|
|
|
|
|
Borrowings(note 22) |
|
3,347,949 |
|
3,510,847 |
Lease liabilities (note 23) |
|
552,544 |
|
601,994 |
Less: Cash and cash equivalents (note 20) |
|
(577,956) |
|
(293,823) |
Net debt |
|
3,322,537 |
|
3,819,018 |
|
|
|
|
|
Segment Adjusted EBITDA (note 5) |
|
1,061,581 |
|
1,280,264 |
Unallocated corporate expenses (note 5) |
|
(133,227) |
|
(147,729) |
Proforma adjustments for disposals |
|
(28,053) |
|
— |
|
|
900,301 |
|
1,132,535 |
|
|
|
|
|
Management consolidated net leverage ratio |
|
3.7x |
|
3.4x |
Fair value hierarchy
The table below analyzes financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:
| ● | Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1); |
| ● | Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2); and |
| ● | Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3). |
As of the end of the reporting period, the Group’s financial instruments held at fair value all had a level 2 classification. These instruments comprise primarily of foreign exchange swaps, interest rate caps and options embedded within listed bonds (see note 18 for further details). Their fair values are determined based on mark to market values provided by the counterparty financial institutions or valuation techniques using observable market data. There were no transfers between different levels during the reporting period and the Group did not change any valuation techniques in determining the level 2 fair values.
The Group’s financial instruments that are measured at fair value at December 31, 2024, and 2023, are as follows:
|
|
Total |
|
|
$'000 |
2024 |
|
|
Embedded options within listed bonds (note 18) |
|
29,410 |
Foreign exchange swaps (note 18) |
|
(10,203) |
|
|
19,207 |
|
|
Total |
|
|
$'000 |
2023 |
|
|
Interest rate caps (note 18) |
|
565 |
Embedded options within listed bonds (note 18) |
|
1,540 |
Foreign exchange swaps (note 18) |
|
(68,133) |
|
|
(66,028) |
F-32
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
|
|
2024 |
|
2023 |
||||
|
|
Carrying |
|
|
|
Carrying |
|
|
|
|
value |
|
Fair value |
|
value |
|
Fair value |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
Financial liabilities |
|
|
|
|
|
|
|
|
Borrowings (note 22) |
|
3,347,949 |
|
3,342,636 |
|
3,510,847 |
|
3,224,775 |
The fair values of borrowings presented above are classified as Level 2 of the fair value hierarchy and are based on discounted cash flows using a current borrowing rate.
Other than borrowings, the fair values of financial assets and financial liabilities are not materially different from their carrying values.
The Group’s financial instruments are categorized as follows:
Financial assets |
|
|
|
|
|
|
|
|
|
|
Fair value |
|
|
|
|
Amortized |
|
through profit |
|
|
|
|
cost |
|
or loss |
|
Total |
|
|
$'000 |
|
$'000 |
|
$'000 |
2024 |
|
|
|
|
|
|
Trade receivables (note 19) |
|
220,893 |
|
— |
|
220,893 |
Other receivables (note 19) |
|
44,434 |
|
— |
|
44,434 |
Cash and cash equivalents (note 20) |
|
577,956 |
|
— |
|
577,956 |
Derivative financial instruments assets (note 18) |
|
— |
|
29,410 |
|
29,410 |
|
|
843,283 |
|
29,410 |
|
872,693 |
|
|
|
|
|
|
|
2023 |
|
|
|
|
|
|
Trade receivables (note 19) |
|
212,323 |
|
— |
|
212,323 |
Other receivables (note 19) |
|
317,452 |
|
— |
|
317,452 |
Cash and cash equivalents (note 20) |
|
293,823 |
|
— |
|
293,823 |
Derivative financial instruments assets (note 18) |
|
— |
|
2,105 |
|
2,105 |
|
|
823,598 |
|
2,105 |
|
825,703 |
The fair values of financial assets are not materially different from their carrying values.
F-33
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Financial liabilities |
|
|
|
Fair value |
|
|
|
|
|
|
through profit |
|
|
|
|
Amortized cost |
|
or loss |
|
Total |
|
|
$'000 |
|
$'000 |
|
$'000 |
2024 |
|
|
|
|
|
|
Borrowings (note 22) |
|
3,347,949 |
|
— |
|
3,347,949 |
Trade payables (note 21) |
|
232,930 |
|
— |
|
232,930 |
Other payables (note 21) |
|
84,822 |
|
— |
|
84,822 |
Derivative financial instruments liabilities (note 18) |
|
— |
|
10,203 |
|
10,203 |
Lease liabilities (note 23) |
|
552,544 |
|
— |
|
552,544 |
|
|
4,218,245 |
|
10,203 |
|
4,228,448 |
|
|
|
|
|
|
|
2023 |
|
|
|
|
|
|
Borrowings (note 22) |
|
3,510,847 |
|
— |
|
3,510,847 |
Trade payables (note 21) |
|
330,622 |
|
— |
|
330,622 |
Other payables (note 21) |
|
115,335 |
|
— |
|
115,335 |
Derivative financial instruments liabilities (note 18) |
|
— |
|
68,133 |
|
68,133 |
Lease liabilities (note 23) |
|
601,994 |
|
— |
|
601,994 |
|
|
4,558,798 |
|
68,133 |
|
4,626,931 |
The fair values of non-current liabilities are based on discounted cash flows using a current borrowing rate. The fair values of trade payable and other current liabilities are not materially different from carrying values.
5.Segment reporting
The Group’s Executive Committee is identified as the CODM that reviews the Company’s internal reporting to assess performance and allocate resources. Management has determined the operating segments based on these reports.
The CODM has identified four reportable and operating segments for the year ended December 31, 2024:
| ● | Nigeria; |
| ● | SSA; |
| ● | Latam; and |
| ● | MENA. |
The basis of segmentation and measurement of segment financial information is consistent with that of the previous financial year and corresponding interim reporting period.
The CODM primarily uses a measure of Adjusted EBITDA (including by segment) as (loss)/income for the period, before income tax expense/(benefit), finance costs and income, depreciation and amortization, net impairment/(reversal of impairment) of withholding tax receivables, impairment of goodwill, business combination transaction costs, net impairment/(reversal of impairment) of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent, reversal of provision for decommissioning costs, net (gain)/loss on sale of assets, share-based payment (credit)/expense, insurance claims, gain on disposal of subsidiary and certain other items that management believes are not indicative of the core performance of our business. The most directly comparable IFRS measure to Adjusted EBITDA is our profit/(loss) for the period. The CODM also regularly receives information about the Group’s revenue, assets and liabilities. The Group has additional corporate costs which do not meet the quantitative thresholds to be separately reported and therefore are not allocated to operating segments. Segment Adjusted EBITDA represents Adjusted EBITDA excluding unallocated corporate expenses.
There are no revenue transactions which occur between operating segments. Intercompany finance income, finance costs and loans are not included in the amounts below.
F-34
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The segment’s assets and liabilities are comprised of all assets and liabilities attributable to the segment, based on the operations of the segment and the physical location of the assets, including goodwill and other intangible assets and are measured in the same way as in the consolidated financial statements. Other assets and liabilities that are not attributable to Nigeria, SSA, Latam and MENA segments consist principally of amounts excluded from specific segments including costs incurred for and by Group functions not attributable directly to the operations of the reportable segments, share based payment and any amounts due on debt held at Group level as the balances are not utilized in assessing each segment’s performance.
Summarized financial information for the year ended December 31, 2024, is as follows:
|
|
Nigeria |
|
SSA |
|
Latam |
|
MENA |
|
Total |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
2024 |
|
|
|
|
|
|
|
|
|
|
Revenues from external customers |
|
998,466 |
|
483,842 |
|
184,030 |
|
44,887 |
|
1,711,225 |
Segment Adjusted EBITDA (note 4(e)) |
|
588,031 |
|
307,954 |
|
138,035 |
|
27,561 |
|
1,061,581 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of information on reportable segments to the amounts reported in the consolidated financial statements: |
|
|
|
|
|
|
|
|
|
|
Segment Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
1,061,581 |
Finance costs (note 11) |
|
|
|
|
|
|
|
|
|
(2,123,138) |
Depreciation and amortization (note 7 and 8) |
|
|
|
|
|
|
|
|
|
(362,735) |
Impairment of goodwill (note 8) |
|
|
|
|
|
|
|
|
|
(87,894) |
Share‑based payment expense (note 8) |
|
|
|
|
|
|
|
|
|
(27,940) |
Net loss on disposal of property, plant and equipment and right-of-use assets (note 8) |
|
|
|
|
|
|
|
|
|
(20,163) |
Impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent (note 7) |
|
|
|
|
|
|
|
|
|
(14,767) |
Other costs(a) |
|
|
|
|
|
|
|
|
|
(14,374) |
Impairment of assets held for sale (note 7) |
|
|
|
|
|
|
|
|
|
(2,853) |
Business combination costs (note 8) |
|
|
|
|
|
|
|
|
|
(1,280) |
Net impairment of withholding tax receivables in Nigeria (note 8) |
|
|
|
|
|
|
|
|
|
(1,081) |
Impairment of other fixed assets (note 8) |
|
|
|
|
|
|
|
|
|
(31) |
Insurance claims (note 9) |
|
|
|
|
|
|
|
|
|
73 |
Finance income (note 10) |
|
|
|
|
|
|
|
|
|
33,747 |
Gain on disposal of subsidiary (note 31.2) |
|
|
|
|
|
|
|
|
|
83,838 |
Unallocated corporate expenses(b) |
|
|
|
|
|
|
|
|
|
(133,227) |
Loss before income tax |
|
|
|
|
|
|
|
|
|
(1,610,244) |
Additions of property, plant and equipment and intangible assets: |
|
|
|
|
|
|
|
|
|
|
- in the normal course of business |
|
125,829 |
|
108,148 |
|
182,102 |
|
6,399 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment assets |
|
885,081 |
|
1,314,039 |
|
1,698,931 |
|
— |
|
|
Segment liabilities |
|
342,659 |
|
858,907 |
|
666,242 |
|
— |
|
|
| (a) | Other costs included one-off expenses related to strategic initiatives and operating systems of $10.8 million, costs related to internal reorganization of $2.7 million and one-off professional fees related to financing of $0.8 million. |
| (b) | Unallocated corporate expenses primarily consist of costs associated with centralized Group functions including Group executive, finance, HR, IT, legal, tax and treasury services. |
F-35
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Each segment's Adjusted EBITDA above includes the following items:
|
|
Nigeria |
|
SSA |
|
Latam |
|
MENA |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
2024 |
|
|
|
|
|
|
|
|
Power generation |
|
251,314 |
|
90,360 |
|
5,411 |
|
1,746 |
Staff costs |
|
31,965 |
|
33,091 |
|
24,159 |
|
5,583 |
Tower repairs and maintenance |
|
19,880 |
|
22,004 |
|
8,424 |
|
3,060 |
Summarized financial information for the year ended December 31, 2023, is as follows:
|
|
Nigeria |
|
SSA |
|
Latam |
|
MENA |
|
Total |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
2023 |
|
|
|
|
|
|
|
|
|
|
Revenues from external customers |
|
1,381,627 |
|
503,049 |
|
200,207 |
|
40,656 |
|
2,125,539 |
Segment Adjusted EBITDA (note 4(e))(c) |
|
855,317 |
|
257,072 |
|
145,754 |
|
22,121 |
|
1,280,264 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of information on reportable segments to the amounts reported in the consolidated financial statements: |
|
|
|
|
|
|
|
|
|
|
Segment Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
1,280,264 |
Finance costs (note 11) |
|
|
|
|
|
|
|
|
|
(2,436,511) |
Depreciation and amortization (note 7 and 8) |
|
|
|
|
|
|
|
|
|
(435,586) |
Impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent (note 7) |
|
|
|
|
|
|
|
|
|
(87,696) |
Impairment of withholding tax receivables in Nigeria (note 8) |
|
|
|
|
|
|
|
|
|
(47,992) |
Other costs(a) |
|
|
|
|
|
|
|
|
|
(19,017) |
Share‑based payment expense (note 8) |
|
|
|
|
|
|
|
|
|
(13,370) |
Business combination costs (note 8) |
|
|
|
|
|
|
|
|
|
(2,432) |
Other non-operating income |
|
|
|
|
|
|
|
|
|
83 |
Insurance claims (note 9) |
|
|
|
|
|
|
|
|
|
321 |
Net gain on disposal of property, plant and equipment and right-of-use assets (note 8) |
|
|
|
|
|
|
|
|
|
3,806 |
Finance income (note 10) |
|
|
|
|
|
|
|
|
|
25,209 |
Unallocated corporate expenses(b) |
|
|
|
|
|
|
|
|
|
(147,729) |
Loss before income tax |
|
|
|
|
|
|
|
|
|
(1,880,650) |
|
|
|
|
|
|
|
|
|
|
|
Additions of property, plant and equipment and intangible assets: |
|
|
|
|
|
|
|
|
|
|
- through business combinations |
|
— |
|
— |
|
— |
|
8,566 |
|
|
- in the normal course of business |
|
320,027 |
|
96,905 |
|
247,580 |
|
18,034 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment assets |
|
1,441,240 |
|
1,406,675 |
|
2,216,873 |
|
186,586 |
|
|
Segment liabilities |
|
866,996 |
|
815,769 |
|
766,687 |
|
111,751 |
|
|
| (a) | Other costs included one-off consulting fees related to corporate structures and operating systems of $10.6 million, one-off consulting services of $1.7 million, costs related to internal reorganization of $4.7 million and one-off professional fees related to financing of $0.3 million. |
| (b) | Unallocated corporate expenses primarily consist of costs associated with centralized Group functions including Group executive, finance, HR, IT, legal, tax and treasury services. |
| (c) | Re-presented to exclude the unallocated corporate expenses. |
F-36
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Each segment's Adjusted EBITDA above includes the following items:
|
|
Nigeria |
|
SSA |
|
Latam |
|
MENA |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
2023 |
|
|
|
|
|
|
|
|
Power generation |
|
284,965 |
|
104,905 |
|
4,278 |
|
2,566 |
Staff costs |
|
53,019 |
|
29,463 |
|
27,340 |
|
5,571 |
Tower repairs and maintenance |
|
46,792 |
|
38,952 |
|
7,770 |
|
2,744 |
Summarized financial information for the year ended December 31, 2022, is as follows:
|
|
Nigeria |
|
SSA |
|
Latam |
|
MENA |
|
Total |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
2022 |
|
|
|
|
|
|
|
|
|
|
Revenues from external customers |
|
1,352,402 |
|
412,824 |
|
160,008 |
|
36,065 |
|
1,961,299 |
Segment Adjusted EBITDA (note 4(e))(c) |
|
802,822 |
|
230,066 |
|
114,434 |
|
16,021 |
|
1,163,343 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of information on reportable segments to the amounts reported in the consolidated financial statements: |
|
|
|
|
|
|
|
|
|
|
Segment Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
1,163,343 |
Finance costs (note 11) |
|
|
|
|
|
|
|
|
|
(872,049) |
Depreciation and amortization (note 7 and 8) |
|
|
|
|
|
|
|
|
|
(468,904) |
Impairment of goodwill (note 8) |
|
|
|
|
|
|
|
|
|
(121,596) |
Impairment of withholding tax receivables in Nigeria (note 8) |
|
|
|
|
|
|
|
|
|
(52,334) |
Impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent (note 7) |
|
|
|
|
|
|
|
|
|
(38,157) |
Business combination costs (note 8) |
|
|
|
|
|
|
|
|
|
(20,851) |
Share‑based payment expense (note 8) |
|
|
|
|
|
|
|
|
|
(13,265) |
Other costs(a) |
|
|
|
|
|
|
|
|
|
(4,873) |
Net loss on disposal of property, plant and equipment and right-of-use assets (note 8) |
|
|
|
|
|
|
|
|
|
(3,382) |
Insurance claims (note 9) |
|
|
|
|
|
|
|
|
|
2,092 |
Other non-operating income |
|
|
|
|
|
|
|
|
|
2,584 |
Finance income (note 10) |
|
|
|
|
|
|
|
|
|
15,825 |
Unallocated corporate expenses(b) |
|
|
|
|
|
|
|
|
|
(132,412) |
Loss before income tax |
|
|
|
|
|
|
|
|
|
(543,979) |
|
|
|
|
|
|
|
|
|
|
|
Additions of property, plant and equipment and intangible assets: |
|
|
|
|
|
|
|
|
|
|
- through business combinations |
|
— |
|
719,219 |
|
386,460 |
|
3,650 |
|
|
- in the normal course of business |
|
400,430 |
|
101,154 |
|
135,069 |
|
23,532 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment assets |
|
2,270,656 |
|
1,639,254 |
|
1,931,317 |
|
178,471 |
|
|
Segment liabilities |
|
935,387 |
|
912,875 |
|
555,885 |
|
109,087 |
|
|
| (a) | Other costs included $2.3 million costs related to internal reorganization. |
| (b) | Unallocated corporate expenses primarily consist of costs associated with centralized Group functions including Group executive, finance, HR, IT, legal, tax and treasury services. |
| (c) | Re-presented to exclude the unallocated corporate expenses. |
F-37
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Each segment's Adjusted EBITDA above includes the following items:
|
|
Nigeria |
|
SSA |
|
Latam |
|
MENA |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
2022 |
|
|
|
|
|
|
|
|
Power generation |
|
342,259 |
|
72,572 |
|
1,701 |
|
2,619 |
Staff costs |
|
55,041 |
|
26,010 |
|
19,725 |
|
5,620 |
Tower repairs and maintenance |
|
53,539 |
|
27,774 |
|
6,436 |
|
2,377 |
Geographical information
The following countries in which the Group operates contribute material (10% or more) revenue and/or have material non-current assets are as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
Revenue |
|
|
|
|
|
|
Nigeria |
|
998,466 |
|
1,381,627 |
|
1,352,402 |
Brazil |
|
178,372 |
|
n/a as less than 10% |
|
n/a as less than 10% |
Rest of world |
|
534,387 |
|
743,912 |
|
608,897 |
|
|
1,711,225 |
|
2,125,539 |
|
1,961,299 |
Non‑current assets(a) |
|
|
|
|
|
|
Nigeria |
|
557,108 |
|
898,264 |
|
1,597,989 |
Brazil |
|
1,399,990 |
|
1,875,098 |
|
1,648,863 |
South Africa |
|
491,275 |
|
493,651 |
|
652,492 |
Rest of world |
|
680,523 |
|
912,459 |
|
953,607 |
|
|
3,128,896 |
|
4,179,472 |
|
4,852,951 |
(a) |
Non-current assets exclude financial instruments, non-current trade and other receivables and deferred tax assets. |
Revenue from two tier one customers represent 10% or more of the Group’s total revenue as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Customer A |
|
61% |
|
60% |
|
62% |
Customer B |
|
15% |
|
17% |
|
17% |
F-38
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
6.Revenue
The Group’s revenue accrues from providing telecommunication support services. The Group provides infrastructure sharing and leasing known as colocation (which includes colocation rental revenue and colocation services) and to a limited extent, managed services.
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Lease component |
|
1,075,544 |
|
1,736,864 |
|
1,534,415 |
Services component |
|
635,681 |
|
388,675 |
|
426,884 |
|
|
1,711,225 |
|
2,125,539 |
|
1,961,299 |
The Group leases space on its towers under leases over periods ranging between 5 and 20 years.
The lease component of future minimum receipts expected from tenants under non-cancellable agreements in effect at December 31, are as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Within one year |
|
1,012,165 |
|
1,597,832 |
|
1,589,439 |
1-2 years |
|
933,097 |
|
1,311,962 |
|
1,478,221 |
2-3 years |
|
861,635 |
|
1,236,565 |
|
1,194,924 |
3-4 years |
|
770,930 |
|
1,197,965 |
|
1,136,303 |
4-5 years |
|
722,373 |
|
1,129,060 |
|
1,098,901 |
After 5 years |
|
2,822,391 |
|
3,980,847 |
|
4,008,713 |
|
|
7,122,591 |
|
10,454,231 |
|
10,506,501 |
The following table shows unsatisfied performance obligations which represents the services component of future minimum receipts expected from customers under non-cancellable agreements in effect at December 31, as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Within one year |
|
626,634 |
|
302,046 |
|
418,137 |
1-2 years |
|
572,748 |
|
271,463 |
|
386,416 |
2-3 years |
|
567,005 |
|
214,028 |
|
309,326 |
3-4 years |
|
513,524 |
|
203,051 |
|
288,244 |
4-5 years |
|
496,592 |
|
184,186 |
|
276,816 |
After 5 years |
|
1,678,305 |
|
704,110 |
|
1,149,649 |
|
|
4,454,808 |
|
1,878,884 |
|
2,828,588 |
Certain customer contracts allow for the cancellation of a proportion of sites during the contract term without payment of termination penalties. The minimum service and lease revenue in the tables above assumes that each customer will fully utilize this Churn available to them under the contract. Where rentals are denominated in U.S. dollar, which is not the functional currency of the subsidiary, they have been included in the above table at the exchange rate at the end of the reporting period.
F-39
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
7.Cost of sales
|
|
2024 |
|
2023 |
|
2022 |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Power generation |
|
348,831 |
|
396,714 |
|
419,151 |
Depreciation (note 14)(a) |
|
304,384 |
|
373,889 |
|
411,579 |
Tower repairs and maintenance |
|
53,368 |
|
96,258 |
|
90,126 |
Amortization (note 15) |
|
42,468 |
|
44,618 |
|
42,050 |
Staff costs (note 8.2) |
|
24,411 |
|
33,149 |
|
33,229 |
Security services |
|
18,015 |
|
42,512 |
|
43,448 |
Impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent |
|
14,767 |
|
87,696 |
|
38,157 |
Regulatory fees |
|
8,148 |
|
37,502 |
|
33,999 |
Short-term rental |
|
5,797 |
|
8,613 |
|
14,111 |
Travel costs |
|
5,702 |
|
9,700 |
|
5,343 |
Insurance |
|
4,524 |
|
4,648 |
|
5,109 |
Impairment of assets held for sale (note 14) |
|
2,853 |
|
— |
|
— |
Short-term other rent |
|
2,043 |
|
2,266 |
|
2,813 |
Professional fees |
|
1,943 |
|
2,570 |
|
3,460 |
Vehicle maintenance and repairs |
|
1,814 |
|
2,184 |
|
1,968 |
Other(b) |
|
51,465 |
|
40,987 |
|
12,458 |
|
|
890,533 |
|
1,183,306 |
|
1,157,001 |
| (a) | Presented net of related indirect tax receivable in Brazil of $1.2 million (2023: $1.3 million, 2022: $0.9 million). Refer to note 14. |
| (b) | Included in Other are $30.7 million (2023: $31.1 million, 2022: $0.8 million) of foreign exchange losses on cost of sales. |
8.Administrative expenses
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Staff costs(a) (note 8.2) |
|
178,433 |
|
186,200 |
|
165,262 |
Impairment of goodwill (note 15) |
|
87,894 |
|
— |
|
121,596 |
Professional fees |
|
49,369 |
|
61,094 |
|
38,964 |
Facilities, short-term rental and upkeep |
|
31,659 |
|
43,616 |
|
34,203 |
Net loss/(gain) on disposal of property, plant and equipment and right-of-use assets |
|
20,163 |
|
(3,806) |
|
3,382 |
Depreciation (note 14) |
|
11,583 |
|
11,314 |
|
9,995 |
Travel costs |
|
10,890 |
|
14,124 |
|
15,535 |
Amortization (note 15) |
|
4,300 |
|
5,765 |
|
5,280 |
Business combination costs |
|
1,280 |
|
2,432 |
|
20,851 |
Net impairment of withholding tax receivables(b) (note 19) |
|
1,081 |
|
47,992 |
|
52,334 |
Operating taxes |
|
953 |
|
(1,005) |
|
963 |
Impairment of other fixed assets |
|
31 |
|
— |
|
— |
Other(c) |
|
32,182 |
|
37,057 |
|
32,810 |
|
|
429,818 |
|
404,783 |
|
501,175 |
| (a) | Includes amounts related to key management personnel (excluding Non-Executive directors) and share-based payment expense. Costs for comparative years are re-presented on this basis. |
| (b) | Withholding tax receivables are assessed for recoverability based on a five year cash flow projection and an analysis of the utilization of withholding tax balances in settlement of future income tax liabilities. |
| (c) | In the current year, includes a share based payment expense of $7.6 million in relation to the B-BBEE transaction which was cleared by the Competition Commission South Africa in December 2024 (note 28.2). |
F-40
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Foreign exchange gains and losses on administrative expenses are included in Other.
8.1Net reversal of loss allowance/(net loss allowance) on trade receivables
The reversal of loss allowance for the year is $0.03 million (2023: loss allowance of $7.2 million, 2022: reversal of loss allowance of $4.4 million). This represents the net impact of new or increased provisions for balances now assessed as doubtful partially offset by the reversal of allowances made in previous periods in respect of balances recovered in the period or no longer considered doubtful.
8.2Staff costs:
Amounts presented below include costs in relation to key management personnel (excluding Non-Executive directors), and costs for comparative years are re-presented on this basis.
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Salaries and wages |
|
150,001 |
|
173,881 |
|
155,325 |
Other benefits |
|
20,904 |
|
19,877 |
|
18,768 |
Share-based payment expense (note 28.1) |
|
20,343 |
|
13,370 |
|
13,265 |
Pension costs |
|
11,596 |
|
12,221 |
|
11,133 |
|
|
202,844 |
|
219,349 |
|
198,491 |
Other benefits are comprised of employee related insurance, employee training costs, staff entertainment and internal reorganization costs.
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Administrative expenses |
|
178,433 |
|
186,200 |
|
165,262 |
Cost of sales |
|
24,411 |
|
33,149 |
|
33,229 |
|
|
202,844 |
|
219,349 |
|
198,491 |
9.Other income
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Gain on disposal of subsidiary (note 31.2) |
|
83,838 |
|
— |
|
— |
Other income |
|
4,337 |
|
83 |
|
2,584 |
Insurance claims |
|
73 |
|
321 |
|
2,092 |
|
|
88,248 |
|
404 |
|
4,676 |
F-41
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
10.Finance income
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Interest income - bank deposits |
|
18,660 |
|
25,008 |
|
15,170 |
Net foreign exchange gain arising from derivative instruments - unrealized |
|
8,147 |
|
— |
|
— |
Fair value gain on embedded options |
|
6,710 |
|
— |
|
— |
Fair value gain on interest rate caps |
|
230 |
|
163 |
|
— |
Net foreign exchange gain arising from derivative instruments - realized |
|
— |
|
38 |
|
655 |
|
|
33,747 |
|
25,209 |
|
15,825 |
11.Finance costs
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Net foreign exchange loss arising from financing - unrealized |
|
1,610,715 |
|
1,713,242 |
|
157,836 |
Interest expenses - third party borrowings |
|
359,965 |
|
362,381 |
|
256,208 |
Interest and finance charges paid/payable for lease liabilities |
|
68,031 |
|
61,617 |
|
52,234 |
Net foreign exchange loss arising from financing - realized |
|
23,304 |
|
162,944 |
|
206,329 |
Net foreign exchange loss on derivative instruments - realized |
|
23,209 |
|
— |
|
— |
Interest expenses - withholding tax paid on bond interest |
|
15,569 |
|
13,439 |
|
12,197 |
Fees on borrowings and financial derivatives |
|
12,917 |
|
17,821 |
|
18,673 |
Unwinding of discount on decommissioning liability |
|
9,191 |
|
9,156 |
|
7,084 |
Costs paid on early loan and bond settlement |
|
237 |
|
— |
|
— |
Net foreign exchange loss on derivative instruments - unrealized |
|
— |
|
92,151 |
|
1,599 |
Fair value loss on embedded options |
|
— |
|
3,760 |
|
159,889 |
|
|
2,123,138 |
|
2,436,511 |
|
872,049 |
The net foreign exchange loss arising from financing - unrealized in both 2024 and 2023 is predominantly due to the significant devaluation in the exchange rate between the Naira and the U.S. dollar during the year (2022: net foreign exchange loss arising from financing - unrealized in 2022 is primarily due to significant fluctuations in exchange rates predominantly between the Kwacha and the U.S. dollar, the Naira and the U.S. dollar rate and the Brazilian Real and the U.S. dollar). This arises on commercial bank and intercompany loans denominated in U.S. dollars at subsidiary level as a result of loan revaluations in local functional currency at period ends. Refer to note 4(b) for further information.
F-42
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
12.Income tax expense/(benefit)
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
Current taxes |
|
|
|
|
|
|
Current year |
|
75,339 |
|
114,055 |
|
109,044 |
Prior years |
|
121 |
|
375 |
|
(202) |
Total current tax charge |
|
75,460 |
|
114,430 |
|
108,842 |
|
|
|
|
|
|
|
Deferred income taxes (note 16) |
|
|
|
|
|
|
Current year |
|
(34,803) |
|
(32,048) |
|
(183,495) |
Prior years |
|
(6,700) |
|
25,146 |
|
(360) |
Total deferred income tax credit |
|
(41,503) |
|
(6,902) |
|
(183,855) |
|
|
|
|
|
|
|
Total taxation charge/(credit) |
|
33,957 |
|
107,528 |
|
(75,013) |
|
|
|
|
|
|
|
Reconciliation of effective tax charge/(credit) |
|
|
|
|
|
|
Loss before income tax |
|
(1,610,244) |
|
(1,880,650) |
|
(543,979) |
|
|
|
|
|
|
|
Tax calculated at domestic tax rates applicable to income in respective countries |
|
(528,810) |
|
(638,254) |
|
(193,643) |
Tax effects of: |
|
|
|
|
|
|
Income not subject to taxation(a) |
|
(40,361) |
|
(21,771) |
|
(6,687) |
Expenses not deductible for tax purposes |
|
70,353 |
|
89,958 |
|
75,197 |
Movement in deferred tax assets not recognized(b) |
|
516,234 |
|
633,448 |
|
79,477 |
Change in tax base(c) |
|
— |
|
1,769 |
|
(74,291) |
Prior year (over)/under provision(d) |
|
(6,622) |
|
25,521 |
|
(562) |
Goodwill impairment(e) |
|
30,688 |
|
— |
|
40,937 |
Withholding tax on subsidiary dividends |
|
5,169 |
|
3,742 |
|
5,967 |
Effects of changes in tax rates |
|
— |
|
(849) |
|
(4,845) |
Movement in uncertain tax positions |
|
(12,438) |
|
9,524 |
|
6,501 |
Other |
|
(256) |
|
4,440 |
|
(3,064) |
Total tax charge/(credit) |
|
33,957 |
|
107,528 |
|
(75,013) |
Current income tax receivables |
|
2,250 |
|
3,755 |
|
1,174 |
Current income tax payables |
|
(49,879) |
|
(75,612) |
|
(70,008) |
|
|
(47,629) |
|
(71,857) |
|
(68,834) |
| (a) | Income not subject to taxation in the year ended December 31, 2024, includes $21.6 million relating to the gain on the disposal of the Group’s 70% interest in IHS Kuwait Limited. For the year ended December 31, 2023, income not subject to taxation primarily related to profits of Global Independent Connect Limited, a subsidiary in Nigeria, which are exempt from tax since this subsidiary benefits from pioneer status. |
| (b) | Deferred tax assets are recognized for deductible temporary differences and tax losses carried forward only to the extent that the realization of the related tax benefits are expected to be met through the reversal of taxable temporary differences and future taxable income. |
The movement in deferred tax assets not recognized decreased from $633.4 million in the year ended December 31, 2023, to $516.2 million in the year ended December 31, 2024. In both years, significant finance costs arose principally in relation to unrealized foreign exchange losses arising on intragroup loans owed by the Group’s Nigerian subsidiaries resulting from the devaluation of the Naira. These gave rise to potential temporary differences which were only partially recognized.
| (c) | Change of tax base amounts relate to the legal mergers in 2021, 2022, and 2023 of businesses acquired by the Group in Brazil with Group holding companies. |
| (d) | For the year the year ended December 31, 2023, the prior year under provision of $25.5 million primarily related to the derecognition of $20.6 million of deferred tax assets as a result of obtaining greater clarity on the treatment of certain expenses arising in 2022 with respect to Brazil. |
F-43
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
| (e) | As a result of goodwill impairment in the Latam tower businesses group of of CGUs for the year, the Group reassessed recoverability of the related deferred tax assets and determined that no change to the position that deferred tax assets are recognized was required. Accordingly, a $30.7 million adjusting item arose in the year ended December 31, 2024. |
Based on the Group’s Safe Harbour assessment and calculations of GloBE income in cases where it is not considered sufficiently probable this test will be passed, no material top-up tax is due under the OECD Pillar Two model rules for the year ended December 31, 2024. The Group will continue to monitor legislative developments and reassess any potential impact in future periods. The Group applies the exception to recognizing and disclosing deferred tax assets and liabilities related to Pillar Two income taxes, as provided in the amendments to IAS 12 Income Taxes (“IAS 12”) issued in May 2023. In line with IAS 12, the Group has applied this temporary exception and has not recognized deferred tax related to Pillar Two. There was no material Pillar 2 tax expense during the year due to the availability of deductible expenses in all relevant jurisdictions.
For the years ended December 31, 2024, 2023, and 2022, the statutory rates for the Group’s largest markets by turnover are:
Nigeria 33.0%, 33.0%, 32.5%, respectively, (due to a combination of corporate income tax and education tax); and
Brazil 34.0%, 34.0%, and 34.0%, respectively, (due to a combination of corporate income tax and social contribution on income taxes).
South Africa 27.0%, 27.0%, and 28.0%, respectively.
The statutory tax rates in other markets range from 15.0% to 35.0% in 2024 (2023: 15.0% to 35.0%, 2022: 15.0% to 40.0%).
The movement in the current income tax is as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
At January 1 |
|
(71,857) |
|
(68,834) |
|
(68,706) |
Charged to income or loss |
|
(75,460) |
|
(114,430) |
|
(108,842) |
Paid during the year |
|
38,629 |
|
45,411 |
|
51,245 |
Withholding tax netting off |
|
40,991 |
|
57,565 |
|
54,878 |
Exchange differences |
|
20,068 |
|
8,431 |
|
2,591 |
At December 31 |
|
(47,629) |
|
(71,857) |
|
(68,834) |
Deferred income tax assets are recognized for deductible temporary differences and tax losses carried forward only to the extent that the realization of the related tax benefits are expected to be met through the reversal of taxable temporary differences and future taxable income. Refer to note 16 for deferred income tax.
F-44
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
13.Loss per share
Basic loss per share is calculated by dividing the (income)/loss for the year attributable to owners of the Company by the weighted average number of ordinary shares outstanding during the year.
Diluted loss per share is calculated by dividing the (income)/loss attributable to owners of the Company by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.
The reported basic and diluted loss per share were as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$ |
|
$ |
|
$ |
|
|
|
|
|
|
|
Basic |
|
(4.90) |
|
(5.93) |
|
(1.39) |
Diluted |
|
(4.90) |
|
(5.93) |
|
(1.39) |
The following tables set out the data used in the basic and diluted loss per share calculations:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
Loss for the year |
|
(1,644,201) |
|
(1,988,178) |
|
(468,966) |
Less: loss for the year attributable to non-controlling interests |
|
12,176 |
|
11,569 |
|
9,959 |
Loss for the year attributable to owners of the Company |
|
(1,632,025) |
|
(1,976,609) |
|
(459,007) |
|
|
|
|
|
|
|
|
|
2024 |
|
2023 |
|
2022 |
|
|
number |
|
number |
|
number |
|
|
(’000) |
|
(’000) |
|
(’000) |
|
|
|
|
|
|
|
Weighted average number of ordinary shares outstanding |
|
333,063 |
|
333,176 |
|
330,963 |
Weighted average number of potential ordinary shares |
|
2,060 |
|
1,980 |
|
5,083 |
Potential ordinary shares relate to options granted under the Group’s share-based compensation schemes (note 28.1). Under IAS 33 Earnings per Share (“IAS 33”), potential ordinary shares are treated as dilutive when, and only when, their conversion into ordinary shares would decrease earnings per share or increase loss per share from continuing operations. For the years presented, the Group reported a loss for the year and accordingly there were no potentially dilutive shares.
F-45
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
14.Property, plant and equipment and right-of-use assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
Towers |
|
|
|
|
|
Furniture and |
|
|
|
Capital |
|
(excluding |
|
|
|
|
and tower |
|
Fiber |
|
Land and |
|
office |
|
Motor |
|
work in |
|
right-of-use |
|
Right-of-use |
|
|
equipment |
|
assets |
|
buildings |
|
equipment |
|
vehicles |
|
progress |
|
assets) |
|
assets |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
Cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2022 |
|
2,829,528 |
|
250,690 |
|
56,268 |
|
22,198 |
|
23,458 |
|
146,353 |
|
3,328,495 |
|
650,504 |
Additions during the year(a) |
|
(20,994) |
|
70,905 |
|
1,489 |
|
7,453 |
|
6,961 |
|
350,512 |
|
416,326 |
|
100,832 |
Additions through business combinations(b) |
|
266,110 |
|
— |
|
885 |
|
— |
|
— |
|
— |
|
266,995 |
|
478,602 |
Reclassification |
|
176,625 |
|
10,991 |
|
1,992 |
|
4,231 |
|
— |
|
(193,839) |
|
— |
|
— |
Transfer from advance payments |
|
100,578 |
|
16,412 |
|
6,754 |
|
33 |
|
— |
|
2,008 |
|
125,785 |
|
— |
Disposals(c) |
|
(239,350) |
|
— |
|
— |
|
(459) |
|
(1,286) |
|
— |
|
(241,095) |
|
(17,755) |
Exchange differences |
|
(150,930) |
|
15,184 |
|
(3,802) |
|
(1,148) |
|
(1,856) |
|
(17,876) |
|
(160,428) |
|
(47,003) |
At December 31, 2022 |
|
2,961,567 |
|
364,182 |
|
63,586 |
|
32,308 |
|
27,277 |
|
287,158 |
|
3,736,078 |
|
1,165,180 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2023 |
|
2,961,567 |
|
364,182 |
|
63,586 |
|
32,308 |
|
27,277 |
|
287,158 |
|
3,736,078 |
|
1,165,180 |
Additions during the year(a) |
|
64,165 |
|
32,293 |
|
3,017 |
|
3,775 |
|
4,481 |
|
351,362 |
|
459,093 |
|
123,281 |
Additions through business combinations (note 31)(b) |
|
5,576 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
5,576 |
|
— |
Reclassification |
|
208,363 |
|
81,929 |
|
5,210 |
|
(2,300) |
|
337 |
|
(293,539) |
|
— |
|
— |
Transfer from advance payments |
|
67,978 |
|
2,529 |
|
2,164 |
|
— |
|
— |
|
16,643 |
|
89,314 |
|
— |
Disposals(c) |
|
(122,022) |
|
(35,575) |
|
— |
|
(1,743) |
|
(2,216) |
|
— |
|
(161,556) |
|
(52,271) |
Exchange differences |
|
(880,175) |
|
3,431 |
|
(34,697) |
|
(7,589) |
|
(10,497) |
|
(148,759) |
|
(1,078,286) |
|
(117,853) |
Reclassified to assets held for sale |
|
(111,551) |
|
— |
|
— |
|
(52) |
|
— |
|
(127) |
|
(111,730) |
|
(1,347) |
At December 31, 2023 |
|
2,193,901 |
|
448,789 |
|
39,280 |
|
24,399 |
|
19,382 |
|
212,738 |
|
2,938,489 |
|
1,116,990 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2024 |
|
2,193,901 |
|
448,789 |
|
39,280 |
|
24,399 |
|
19,382 |
|
212,738 |
|
2,938,489 |
|
1,116,990 |
Additions during the year(a) |
|
28,675 |
|
8,605 |
|
2,144 |
|
2,571 |
|
1,086 |
|
181,557 |
|
224,638 |
|
154,459 |
Reclassification |
|
141,509 |
|
39,902 |
|
351 |
|
20,789 |
|
— |
|
(202,551) |
|
— |
|
— |
Transfer from advance payments |
|
38,898 |
|
14,740 |
|
169 |
|
— |
|
— |
|
(2,001) |
|
51,806 |
|
— |
Disposals(c) |
|
(19,885) |
|
(538) |
|
— |
|
(1,292) |
|
(741) |
|
— |
|
(22,456) |
|
(99,606) |
Disposal of subsidiary |
|
(61,738) |
|
— |
|
— |
|
(1,065) |
|
— |
|
(672) |
|
(63,475) |
|
(52,032) |
Exchange differences |
|
(452,347) |
|
(119,820) |
|
(14,403) |
|
(6,694) |
|
(5,184) |
|
(68,362) |
|
(666,810) |
|
(200,283) |
At December 31, 2024 |
|
1,869,013 |
|
391,678 |
|
27,541 |
|
38,708 |
|
14,543 |
|
120,709 |
|
2,462,192 |
|
919,528 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated depreciation and impairment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2022 |
|
1,575,315 |
|
5,354 |
|
1,637 |
|
17,157 |
|
14,771 |
|
— |
|
1,614,234 |
|
129,853 |
Charge for the year(d) |
|
268,999 |
|
54,152 |
|
315 |
|
5,800 |
|
4,610 |
|
— |
|
333,876 |
|
88,615 |
Impairment |
|
34,702 |
|
201 |
|
— |
|
— |
|
— |
|
— |
|
34,903 |
|
3,151 |
Disposals(c) |
|
(234,117) |
|
— |
|
— |
|
(301) |
|
(1,272) |
|
— |
|
(235,690) |
|
(13,237) |
Exchange differences |
|
(83,573) |
|
(675) |
|
(119) |
|
(1,219) |
|
(1,100) |
|
— |
|
(86,686) |
|
(8,221) |
At December 31, 2022 |
|
1,561,326 |
|
59,032 |
|
1,833 |
|
21,437 |
|
17,009 |
|
— |
|
1,660,637 |
|
200,161 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2023 |
|
1,561,326 |
|
59,032 |
|
1,833 |
|
21,437 |
|
17,009 |
|
— |
|
1,660,637 |
|
200,161 |
Charge for the year(d) |
|
216,776 |
|
65,246 |
|
358 |
|
4,173 |
|
4,017 |
|
— |
|
290,570 |
|
95,895 |
Impairment |
|
85,567 |
|
464 |
|
— |
|
— |
|
— |
|
— |
|
86,031 |
|
1,663 |
Disposals(c) |
|
(120,503) |
|
(34,506) |
|
— |
|
(1,723) |
|
(2,141) |
|
— |
|
(158,873) |
|
(23,920) |
Exchange differences |
|
(587,037) |
|
6,143 |
|
(958) |
|
(4,826) |
|
(6,135) |
|
— |
|
(592,813) |
|
(43,018) |
Reclassified to assets held for sale |
|
(87,290) |
|
— |
|
— |
|
(8) |
|
— |
|
— |
|
(87,298) |
|
(700) |
At December 31, 2023 |
|
1,068,839 |
|
96,379 |
|
1,233 |
|
19,053 |
|
12,750 |
|
— |
|
1,198,254 |
|
230,081 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2024 |
|
1,068,839 |
|
96,379 |
|
1,233 |
|
19,053 |
|
12,750 |
|
— |
|
1,198,254 |
|
230,081 |
Charge for the year(d) |
|
150,067 |
|
49,067 |
|
271 |
|
20,184 |
|
2,185 |
|
— |
|
221,774 |
|
95,383 |
Impairment |
|
11,603 |
|
441 |
|
— |
|
31 |
|
4 |
|
— |
|
12,079 |
|
1,828 |
Disposals(c) |
|
(17,423) |
|
(429) |
|
— |
|
(989) |
|
(558) |
|
— |
|
(19,399) |
|
(35,329) |
Disposal of subsidiary |
|
(25,169) |
|
— |
|
— |
|
(413) |
|
— |
|
— |
|
(25,582) |
|
(27,456) |
Exchange differences |
|
(231,477) |
|
(36,790) |
|
(471) |
|
(5,634) |
|
(3,207) |
|
— |
|
(277,579) |
|
(44,036) |
At December 31, 2024 |
|
956,440 |
|
108,668 |
|
1,033 |
|
32,232 |
|
11,174 |
|
— |
|
1,109,547 |
|
220,471 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net book value |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2022 |
|
1,400,241 |
|
305,150 |
|
61,753 |
|
10,871 |
|
10,268 |
|
287,158 |
|
2,075,441 |
|
965,019 |
At December 31, 2023 |
|
1,125,062 |
|
352,410 |
|
38,047 |
|
5,346 |
|
6,632 |
|
212,738 |
|
1,740,235 |
|
886,909 |
At December 31, 2024 |
|
912,573 |
|
283,010 |
|
26,508 |
|
6,476 |
|
3,369 |
|
120,709 |
|
1,352,645 |
|
699,057 |
F-46
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
(a) |
Includes net movements in assets relating to the decommissioning and site restoration provision. |
(b) |
Includes subsequent asset acquisitions on business combination transactions. |
(c) |
The disposals value of right-of-use assets represents disposals due to terminated leases and the impact of remeasurement of lease assets as a result of changes in lease terms. The amount for the year ended December 31, 2024, includes a reduction in lease term for certain assets in the IHS Latam tower business following the Oi judicial proceedings as described in note 15.1. |
(d) |
The charge for the period does not agree to the charge in the consolidated statement of income/(loss) and other comprehensive income/(loss) due to the indirect taxes benefit of $1.2 million (2022: $0.9 million, 2021: $0.4 million) in IHS Brasil Cessão de Infraestruturas S.A. claimed through depreciation over the useful life of the asset. |
Capital work-in-progress comprises mainly of tower and tower equipment still under construction and not yet available for use. The Group transfers such assets to the appropriate class once they are available for use. There were no qualifying borrowing costs capitalized during the year.
The impairment in the year ended December 31, 2023, includes $71.0 million from power equipment assets in the SSA segment being classified as assets held for sale and remeasured at fair value less cost to sell. In May 2024, the sale of these assets was concluded and an additional impairment of $2.6 million was recognized due to certain warranty claims received. Assets were not depreciated while they were classified as held for sale. The impairment in the year ended December 31, 2022, is primarily driven by the rationalization program agreed with a Key Customer which resulted in the impairment of the related Towers. It was determined that the recoverable amounts were nil and therefore their carrying amounts were written down to the recoverable amount. The impairment losses have been recognized in cost of sales in the consolidated statement of loss and other comprehensive income.
Depreciation expense included in cost of sales and administrative expenses in the consolidated statement of loss and other comprehensive income is as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Cost of sales (note 7) |
|
304,384 |
|
373,889 |
|
411,579 |
Administrative expense (note 8) |
|
11,583 |
|
11,314 |
|
9,995 |
|
|
315,967 |
|
385,203 |
|
421,574 |
Analysis of right-of-use assets
The carrying value of right-of-use assets at December 31, 2024, are comprised of vehicles of $0.8 million (2023: $2.4 million, 2022: $3.5 million) and land and building assets, the majority being leased land on which our towers are situated.
F-47
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
15.Goodwill and other intangible assets
|
|
|
|
Customer- |
|
Network - |
|
|
|
|
|
|
|
|
|
|
|
|
related |
|
related |
|
|
|
|
|
|
|
|
|
|
|
|
intangible |
|
intangible |
|
|
|
|
|
Right of way |
|
|
|
|
Goodwill |
|
assets |
|
assets |
|
Licenses |
|
Software |
|
and use |
|
Total |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
Cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2022 |
|
780,147 |
|
877,764 |
|
107,202 |
|
17,706 |
|
23,798 |
|
— |
|
1,806,617 |
Additions during the year |
|
— |
|
— |
|
— |
|
14,772 |
|
6,413 |
|
— |
|
21,185 |
Additions through business combinations(a) |
|
119,035 |
|
171,765 |
|
72,932 |
|
— |
|
— |
|
— |
|
363,732 |
Disposals |
|
— |
|
— |
|
— |
|
(4) |
|
(395) |
|
— |
|
(399) |
Exchange differences |
|
(13,543) |
|
(18,163) |
|
(4,844) |
|
(1,886) |
|
(572) |
|
— |
|
(39,008) |
At December 31, 2022 |
|
885,639 |
|
1,031,366 |
|
175,290 |
|
30,588 |
|
29,244 |
|
— |
|
2,152,127 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2023 |
|
885,639 |
|
1,031,366 |
|
175,290 |
|
30,588 |
|
29,244 |
|
— |
|
2,152,127 |
Additions during the year |
|
— |
|
— |
|
— |
|
3,007 |
|
12,110 |
|
— |
|
15,117 |
Additions through business combinations (note 31)(a) |
|
— |
|
2,224 |
|
766 |
|
— |
|
— |
|
— |
|
2,990 |
Disposals |
|
— |
|
(16,219) |
|
(1,758) |
|
(117) |
|
(14,928) |
|
— |
|
(33,022) |
Exchange differences |
|
(134,613) |
|
(119,291) |
|
(13,619) |
|
(45) |
|
(4,670) |
|
— |
|
(272,238) |
Reclassified to assets held for sale |
|
— |
|
— |
|
— |
|
— |
|
(271) |
|
— |
|
(271) |
At December 31, 2023 |
|
751,026 |
|
898,080 |
|
160,679 |
|
33,433 |
|
21,485 |
|
— |
|
1,864,703 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2024 |
|
751,026 |
|
898,080 |
|
160,679 |
|
33,433 |
|
21,485 |
|
— |
|
1,864,703 |
Additions during the year |
|
— |
|
— |
|
— |
|
188 |
|
4,177 |
|
646 |
|
5,011 |
Disposals |
|
— |
|
(4,540) |
|
(237) |
|
(4) |
|
(9,108) |
|
(333) |
|
(14,222) |
Disposal of subsidiary |
|
(12,192) |
|
(50,976) |
|
(17,557) |
|
(9) |
|
(81) |
|
— |
|
(80,815) |
Exchange differences |
|
(160,819) |
|
(172,287) |
|
(20,822) |
|
(2,676) |
|
(1,088) |
|
(32) |
|
(357,724) |
At December 31, 2024 |
|
578,015 |
|
670,277 |
|
122,063 |
|
30,932 |
|
15,385 |
|
281 |
|
1,416,953 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated amortization and impairment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2022 |
|
251 |
|
131,568 |
|
21,885 |
|
6,877 |
|
20,411 |
|
— |
|
180,992 |
Charge for the year |
|
— |
|
36,169 |
|
6,936 |
|
2,598 |
|
1,627 |
|
— |
|
47,330 |
Impairment charge for the year(b) |
|
121,596 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
121,596 |
Disposals |
|
— |
|
— |
|
— |
|
(4) |
|
(394) |
|
— |
|
(398) |
Exchange differences |
|
404 |
|
(8,335) |
|
(1,245) |
|
(395) |
|
(313) |
|
— |
|
(9,884) |
At December 31, 2022 |
|
122,251 |
|
159,402 |
|
27,576 |
|
9,076 |
|
21,331 |
|
— |
|
339,636 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2023 |
|
122,251 |
|
159,402 |
|
27,576 |
|
9,076 |
|
21,331 |
|
— |
|
339,636 |
Charge for the year |
|
— |
|
34,044 |
|
7,217 |
|
6,288 |
|
2,834 |
|
— |
|
50,383 |
Disposals |
|
— |
|
(16,219) |
|
(1,758) |
|
(117) |
|
(13,328) |
|
— |
|
(31,422) |
Exchange differences |
|
9,477 |
|
(43,850) |
|
(7,335) |
|
351 |
|
(4,827) |
|
— |
|
(46,184) |
Reclassified to assets held for sale |
|
— |
|
— |
|
— |
|
— |
|
(38) |
|
— |
|
(38) |
At December 31, 2023 |
|
131,728 |
|
133,377 |
|
25,700 |
|
15,598 |
|
5,972 |
|
— |
|
312,375 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2024 |
|
131,728 |
|
133,377 |
|
25,700 |
|
15,598 |
|
5,972 |
|
— |
|
312,375 |
Charge for the year |
|
— |
|
31,972 |
|
6,359 |
|
4,005 |
|
4,195 |
|
237 |
|
46,768 |
Impairment charge for the year(b) |
|
87,894 |
|
— |
|
— |
|
887 |
|
— |
|
— |
|
88,781 |
Disposals |
|
— |
|
(4,540) |
|
(237) |
|
(4) |
|
(9,107) |
|
(71) |
|
(13,959) |
Disposal of subsidiary |
|
— |
|
(9,031) |
|
(3,000) |
|
(1) |
|
(71) |
|
— |
|
(12,103) |
Exchange differences |
|
(44,849) |
|
(32,643) |
|
(5,363) |
|
(1,240) |
|
1,995 |
|
(3) |
|
(82,103) |
At December 31, 2024 |
|
174,773 |
|
119,135 |
|
23,459 |
|
19,245 |
|
2,984 |
|
163 |
|
339,759 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net book value |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2022 |
|
763,388 |
|
871,964 |
|
147,714 |
|
21,512 |
|
7,913 |
|
— |
|
1,812,491 |
At December 31, 2023 |
|
619,298 |
|
764,703 |
|
134,979 |
|
17,835 |
|
15,513 |
|
— |
|
1,552,328 |
At December 31, 2024 |
|
403,242 |
|
551,142 |
|
98,604 |
|
11,687 |
|
12,401 |
|
118 |
|
1,077,194 |
(a) |
Includes subsequent asset acquisitions on business combination transactions. |
(b) |
The carrying amount of the IHS Latam tower businesses group of CGUs was reduced to its recoverable amount through the recognition of an impairment loss against goodwill. This loss is included in administrative expenses in the consolidated statement of income or loss. |
F-48
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Network related intangible assets represent future income from leasing excess tower capacity to new tenants. Customer-related intangible assets represent customer contracts and relationships.
Amortization expense included in cost of sales and administrative expenses in the consolidated statement of loss and other comprehensive income is as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Cost of sales (note 7) |
|
42,468 |
|
44,618 |
|
42,050 |
Administrative expenses (note 8) |
|
4,300 |
|
5,765 |
|
5,280 |
|
|
46,768 |
|
50,383 |
|
47,330 |
15.1Allocation of goodwill
Management reviews the business performance based on the geographical location of business. It has identified IHS Nigeria Limited, INT Towers Limited, IHS Towers NG Limited, IHS Cameroon S.A., IHS Côte d’Ivoire S.A., IHS Rwanda Limited, IHS Zambia Limited, IHS Kuwait Limited, IHS South Africa Proprietary Limited, the IHS Latam tower businesses and I-Systems Soluções de Infraestrutura S.A. (“I-Systems”) as the main CGUs/Group of CGUs relevant for the allocation of goodwill. During 2023, the three CGUs in Nigeria were grouped together for the purpose of goodwill impairment testing, as this reflects the level at which management reviews performance and manages its operations in the region. This group of CGUs is identified as IHS Nigeria. IHS Nigeria group of CGUs relate to the Nigeria operating segment, IHS Cameroon S.A, IHS Côte d’Ivoire S.A, IHS Zambia Limited, IHS South Africa Proprietary Limited and IHS Rwanda Limited CGUs related to the SSA operating segment, IHS Kuwait Limited CGU related to the MENA operating segment, and the IHS Latam tower businesses group of CGUs and the I-Systems CGU relate to the Latam operating segment. Goodwill is monitored by management at a CGU/group of CGU level as noted above.
F-49
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The following is a summary of goodwill allocation for each CGU or group of CGUs.
|
|
|
|
Additions through |
|
|
|
Effects of |
|
|
|
|
|
|
business combinations |
|
|
|
movements in |
|
|
|
|
|
|
and derecognitions |
|
|
|
exchange rates and |
|
|
|
|
At January 1 |
|
through disposals |
|
Impairment |
|
other movements |
|
At December 31 |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
2024 |
|
|
|
|
|
|
|
|
|
|
IHS Nigeria |
|
151,727 |
|
— |
|
— |
|
(62,136) |
|
89,591 |
IHS Cameroon S.A. |
|
43,288 |
|
— |
|
— |
|
(2,478) |
|
40,810 |
IHS Côte d’Ivoire S.A. |
|
21,468 |
|
— |
|
— |
|
(1,229) |
|
20,239 |
IHS Zambia Limited |
|
32,817 |
|
— |
|
— |
|
(2,545) |
|
30,272 |
IHS Rwanda Limited |
|
9,504 |
|
— |
|
— |
|
(843) |
|
8,661 |
IHS Kuwait Limited |
|
12,211 |
|
(12,192) |
|
— |
|
(19) |
|
— |
IHS South Africa Proprietary Limited |
|
54,414 |
|
— |
|
— |
|
(1,297) |
|
53,117 |
IHS Latam tower businesses |
|
202,529 |
|
— |
|
(87,894) |
|
(25,834) |
|
88,801 |
I-Systems |
|
91,340 |
|
— |
|
— |
|
(19,589) |
|
71,751 |
|
|
619,298 |
|
(12,192) |
|
(87,894) |
|
(115,970) |
|
403,242 |
2023 |
|
|
|
|
|
|
|
|
|
|
IHS Nigeria |
|
299,457 |
|
— |
|
— |
|
(147,730) |
|
151,727 |
IHS Cameroon S.A. |
|
41,741 |
|
— |
|
— |
|
1,547 |
|
43,288 |
IHS Côte d’Ivoire S.A. |
|
20,701 |
|
— |
|
— |
|
767 |
|
21,468 |
IHS Zambia Limited |
|
46,718 |
|
— |
|
— |
|
(13,901) |
|
32,817 |
IHS Rwanda Limited |
|
11,186 |
|
— |
|
— |
|
(1,682) |
|
9,504 |
IHS Kuwait Limited |
|
12,223 |
|
— |
|
— |
|
(12) |
|
12,211 |
IHS South Africa Proprietary Limited |
|
58,832 |
|
— |
|
— |
|
(4,418) |
|
54,414 |
IHS Latam tower businesses |
|
187,572 |
|
— |
|
— |
|
14,957 |
|
202,529 |
I-Systems |
|
84,958 |
|
— |
|
— |
|
6,382 |
|
91,340 |
|
|
763,388 |
|
— |
|
— |
|
(144,090) |
|
619,298 |
2022 |
|
|
|
|
|
|
|
|
|
|
IHS Nigeria Limited |
|
59,768 |
|
— |
|
— |
|
(3,432) |
|
56,336 |
INT Towers Limited |
|
214,775 |
|
— |
|
— |
|
(12,316) |
|
202,459 |
IHS Towers NG Limited |
|
43,138 |
|
— |
|
— |
|
(2,476) |
|
40,662 |
IHS Cameroon S.A. |
|
44,388 |
|
— |
|
— |
|
(2,647) |
|
41,741 |
IHS Côte d’Ivoire S.A. |
|
22,012 |
|
— |
|
— |
|
(1,311) |
|
20,701 |
IHS Zambia Limited |
|
50,709 |
|
— |
|
— |
|
(3,991) |
|
46,718 |
IHS Rwanda Limited |
|
11,867 |
|
— |
|
— |
|
(681) |
|
11,186 |
IHS Kuwait Limited |
|
12,369 |
|
— |
|
— |
|
(146) |
|
12,223 |
IHS South Africa Proprietary Limited |
|
— |
|
64,394 |
|
— |
|
(5,562) |
|
58,832 |
IHS Latam tower businesses |
|
241,451 |
|
54,641 |
|
(121,596) |
|
13,076 |
|
187,572 |
I-Systems |
|
79,419 |
|
— |
|
— |
|
5,539 |
|
84,958 |
|
|
779,896 |
|
119,035 |
|
(121,596) |
|
(13,947) |
|
763,388 |
The recoverable amount of each CGU or group of CGUs, except for the IHS Latam tower businesses group of CGUs and the I-Systems CGU, was determined based on value in use calculations. The recoverable amount of the IHS Latam tower businesses group of CGUs and the I-Systems CGU was determined based on fair value less costs of disposal.
F-50
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
(a)Recoverable amounts based on value in use
These calculations used pre-tax local currency cash flow projections based on the financial budgets approved by management covering a five-year period. Within the five-year period, revenue growth assumptions are based on past experience and expected future developments in the Group’s CGUs. Cash flows beyond the five-year period were valued using the estimated terminal growth rates stated below.
The key assumptions to which the value in use calculations are most sensitive are as follows:
| ● | pre-tax weighted average cost of capital; |
| ● | terminal growth rates; |
| ● | revenue growth assumptions (taking into account tenancy ratios), and the direct effect these have on gross profit margins in the five-year forecast period; and |
| ● | gross margin excluding depreciation and amortization. |
|
|
Pre-tax weighted |
|
Terminal |
|
Tenancy |
|
Gross margins |
|
|||||
|
|
of capital |
|
growth rate |
|
ratio(a) |
|
amortization(a) |
|
|||||
2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IHS Nigeria |
|
30.5 |
% |
4.0 |
% |
3.98 |
x - |
6.13 |
x |
|
45.7 |
% - |
74.7 |
% |
IHS Cameroon S.A. |
|
15.4 |
% |
4.0 |
% |
2.81 |
x - |
3.55 |
x |
|
55.1 |
% - |
64.1 |
% |
IHS Côte d’Ivoire S.A. |
|
10.6 |
% |
4.0 |
% |
3.86 |
x - |
4.47 |
x |
|
48.1 |
% - |
58.3 |
% |
IHS Zambia Limited |
|
23.9 |
% |
4.0 |
% |
2.84 |
x - |
3.73 |
x |
|
54.3 |
% - |
67.8 |
% |
IHS Rwanda Limited |
|
17.6 |
% |
4.0 |
% |
2.06 |
x - |
2.91 |
x |
|
70.3 |
% - |
75.0 |
% |
IHS South Africa Proprietary Limited |
|
13.3 |
% |
4.0 |
% |
1.79 |
x - |
2.88 |
x |
|
82.1 |
% - |
88.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IHS Nigeria |
|
29.5 |
% |
4.0 |
% |
4.05 |
x - |
8.32 |
x |
|
54.4 |
% - |
75.5 |
% |
IHS Cameroon S.A. |
|
14.1 |
% |
4.0 |
% |
2.64 |
x - |
2.94 |
x |
|
55.0 |
% - |
59.2 |
% |
IHS Côte d’Ivoire S.A. |
|
10.8 |
% |
4.0 |
% |
3.40 |
x - |
4.04 |
x |
|
48.9 |
% - |
56.7 |
% |
IHS Zambia Limited |
|
26.4 |
% |
4.0 |
% |
2.63 |
x - |
3.11 |
x |
|
64.0 |
% - |
70.2 |
% |
IHS Rwanda Limited |
|
17.1 |
% |
4.0 |
% |
1.69 |
x - |
2.58 |
x |
|
66.1 |
% - |
72.6 |
% |
IHS Kuwait Limited |
|
7.6 |
% |
2.8 |
% |
1.01 |
x - |
2.00 |
x |
|
63.6 |
% - |
71.8 |
% |
IHS South Africa Proprietary Limited |
|
15.1 |
% |
4.0 |
% |
1.40 |
x - |
2.94 |
x |
|
42.5 |
% - |
50.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IHS Nigeria Limited |
|
24.4 |
% |
3.2 |
% |
3.76 |
x - |
7.74 |
x |
|
62.5 |
% - |
78.7 |
% |
INT Towers Limited |
|
25.4 |
% |
3.2 |
% |
3.93 |
x - |
4.79 |
x |
|
61.7 |
% - |
74.0 |
% |
IHS Towers NG Limited |
|
24.9 |
% |
3.2 |
% |
3.65 |
x - |
4.73 |
x |
|
65.3 |
% - |
72.3 |
% |
IHS Cameroon S.A. |
|
13.7 |
% |
4.0 |
% |
2.56 |
x - |
3.10 |
x |
|
56.6 |
% - |
65.5 |
% |
IHS Côte d’Ivoire S.A. |
|
11.0 |
% |
4.0 |
% |
3.35 |
x - |
4.00 |
x |
|
54.8 |
% - |
61.5 |
% |
IHS Zambia Limited |
|
30.2 |
% |
4.0 |
% |
2.61 |
x - |
3.24 |
x |
|
65.4 |
% - |
72.8 |
% |
IHS Rwanda Limited |
|
18.1 |
% |
4.0 |
% |
2.04 |
x - |
2.64 |
x |
|
69.0 |
% - |
73.2 |
% |
IHS Kuwait Limited |
|
6.3 |
% |
3.6 |
% |
1.01 |
x - |
1.53 |
x |
|
56.6 |
% - |
62.6 |
% |
IHS South Africa Proprietary Limited |
|
13.9 |
% |
3.3 |
% |
1.25 |
x - |
2.28 |
x |
|
42.9 |
% - |
66.4 |
% |
| (a) | Tenancy ratios and gross margins (excluding depreciation & amortization) disclosed are for the forecast period 2025 - 2029. The tenancy ratios refer to the average number of tenants plus lease amendments (also including extra power and space) per tower that is owned or operated across a tower portfolio at a given point in time. |
F-51
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Management has considered and assessed reasonably possible changes for key assumptions on all markets. Any one of the following changes in assumptions could represent a reasonably possible scenario:
| ● | 1% increase in the pre-tax weighted average cost of capital; |
| ● | 1% decrease in the terminal growth rate; |
| ● | 50% decrease in tenancy ratio; and |
| ● | 10% decrease in gross margin excluding depreciation and amortization. |
Management has concluded that none of the reasonably possible scenarios listed above could give rise to impairment. In prior year, one reasonably possible scenario, being a 10% decrease in gross margin, for the IHS Zambia Limited CGU was determined to give rise to a $8.5 million impairment.
(b)Recoverable amount based on fair values less costs of disposal
The recoverable amounts of the IHS Latam tower businesses group of CGUs and the I-Systems CGU were based on fair value less costs of disposal.
Fair value less costs of disposal is determined on the basis of the income approach, discounting estimated future net local currency cash flows that reflects current market expectations (Level 3).
The key assumptions to which the fair value less costs of disposal calculation for the Latam tower businesses are most sensitive are:
| ● | post-tax weighted average cost of capital; |
| ● | terminal growth rates; |
| ● | revenue growth assumptions (taking into account tenancy growth) and the direct effect these have on gross profit margins in the ten-year forecast period for the IHS Latam tower businesses group of CGUs; and |
| ● | revenue growth assumptions (including homes connected) and the direct effect these have on gross profit margins in the ten-year forecast period for the I-Systems CGU. |
|
|
Post-tax weighted |
|
Terminal |
|
Tenancy |
|
Homes |
|
2024 |
|
|
|
|
|
|
|
|
|
IHS Latam tower businesses |
|
9.6 |
% |
4.7 |
% |
5.6 |
% |
n.a |
|
I-Systems |
|
9.4 |
% |
4.7 |
% |
n.a |
|
0.7 - 3.1 |
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
IHS Latam tower businesses |
|
11.0 |
% |
4.4 |
% |
6.4 |
% |
n.a |
|
I-Systems |
|
10.7 |
% |
4.4 |
% |
n.a |
|
1 - 3.1 |
|
| (a) | Tenancy growth disclosed is for the average annual growth rate for tenancies over the forecast period 2025 - 2034. |
F-52
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
An impairment loss of $87.9 million (2023: $nil) was recognized in the IHS Latam Tower business group of CGUs during the first quarter of 2024. This was mainly due to the restructuring of our customer, Oi S.A. (“Oi”), in Brazil. On April 19, 2024, an Oi restructuring plan was presented to court in Brazil and was agreed upon by creditors including IHS, in relation to Oi’s ongoing judicial recovery proceedings. As a result of the agreed upon terms, the carrying amount of the IHS Latam tower businesses group of CGUs has been reduced to its recoverable amount, through the recognition of an impairment loss against goodwill. This loss is included in administrative expenses in the consolidated statement of loss and other comprehensive income. The annual goodwill impairment review did not result in any further losses.
An impairment loss of $121.6 million was recognized in the IHS Latam Tower business group of CGUs due to macroeconomic conditions which had deteriorated over the year ended December 31, 2022, increasing the discount rate, and a reduction in the cash flows in the outer years of the forecast used for impairment testing.
Management has determined the reasonably possible changes in key assumptions as follows:
| ● | 1% increase in the post-tax weighted average cost of capital; |
| ● | 1% decrease in the terminal growth rate; |
| ● | 15% decrease in tenancy growth; and |
| ● | 15% decrease in growth in homes connected. |
For the Latam Towers businesses group of CGUs the reasonably possible change scenarios that would individually result in an impairment charge (2023: individually increase the impairment charge) are as follows:
|
|
1% increase |
|
1% decrease |
|
15% decrease |
|
|
in post-tax |
|
in terminal |
|
in tenancy |
|
|
discount rate |
|
growth rate |
|
growth |
|
|
$'000 |
|
$'000 |
|
$'000 |
2024 |
|
|
|
|
|
|
IHS Latam Towers businesses |
|
48,144 |
|
— |
|
— |
|
|
|
|
|
|
|
2023 |
|
|
|
|
|
|
IHS Latam Towers businesses |
|
139,955 |
|
71,817 |
|
88,368 |
For the I-Systems CGU management has concluded that no reasonably possible scenario could give rise to an impairment.
F-53
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
16.Deferred income tax
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes relate to the same fiscal authority and are classified on a net basis within either deferred tax assets or deferred tax liabilities. These net country amounts are aggregated according to their asset or liability position and presented as then aggregated in the consolidated statement of financial position.
The Group recognizes deferred tax assets to the extent that it is probable that sufficient future taxable income will arise against which these deductible temporary differences can be utilized. As of December 31, 2024, a net deferred tax asset of $66.8 million (2023: $57.9 million) has been recognized with respect to the Brazil tower business, which includes tax losses and other deductible temporary differences. The Group has performed an assessment of recovery of deferred tax assets for this entity using forecasted future taxable income and considers that it is probable that sufficient future taxable income will arise against which these losses and deductible temporary differences can be utilized.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date, and reflects uncertainty related to income taxes, if any.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unutilized |
|
|
|
|
|
|
Property, |
|
|
|
|
|
|
|
|
|
capital |
|
|
|
|
|
|
plant and |
|
Intangible |
|
|
|
Lease |
|
Right-of-use |
|
allowances |
|
Finance costs |
|
|
|
|
equipment |
|
assets |
|
Provisions |
|
liability |
|
assets |
|
and tax losses |
|
and other |
|
Total |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
Net deferred income tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2022 |
|
(166,020) |
|
(166,157) |
|
69,428 |
|
144,972 |
|
(138,846) |
|
92,847 |
|
5,721 |
|
(158,055) |
Additions through business combinations |
|
(61,184) |
|
(76,680) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(137,864) |
Tax income |
|
49,634 |
|
59,702 |
|
3,859 |
|
2,737 |
|
8,752 |
|
27,429 |
|
31,742 |
|
183,855 |
Foreign exchange and other movements |
|
4,831 |
|
5,516 |
|
(1,638) |
|
5,965 |
|
(5,713) |
|
(1,560) |
|
(486) |
|
6,915 |
At December 31, 2022 |
|
(172,739) |
|
(177,619) |
|
71,649 |
|
153,674 |
|
(135,807) |
|
118,716 |
|
36,977 |
|
(105,149) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2023 |
|
(172,739) |
|
(177,619) |
|
71,649 |
|
153,674 |
|
(135,807) |
|
118,716 |
|
36,977 |
|
(105,149) |
Tax income/(charge) |
|
24,045 |
|
(9,239) |
|
(8,943) |
|
17,322 |
|
(12,090) |
|
(9,737) |
|
5,544 |
|
6,902 |
Foreign exchange and other movements |
|
36,443 |
|
42,111 |
|
(12,482) |
|
(36,434) |
|
32,198 |
|
(26,550) |
|
(10,359) |
|
24,927 |
At December 31, 2023 |
|
(112,251) |
|
(144,747) |
|
50,224 |
|
134,562 |
|
(115,699) |
|
82,429 |
|
32,162 |
|
(73,320) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2024 |
|
(112,251) |
|
(144,747) |
|
50,224 |
|
134,562 |
|
(115,699) |
|
82,429 |
|
32,162 |
|
(73,320) |
Tax income/(charge) |
|
(9,267) |
|
8,519 |
|
(1,496) |
|
2,728 |
|
(1,818) |
|
41,928 |
|
909 |
|
41,503 |
Foreign exchange and other movements |
|
42,743 |
|
12,686 |
|
(9,899) |
|
32,161 |
|
(33,480) |
|
(23,624) |
|
(15,875) |
|
4,712 |
At December 31, 2024 |
|
(78,775) |
|
(123,542) |
|
38,829 |
|
169,451 |
|
(150,997) |
|
100,733 |
|
17,196 |
|
(27,105) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Classified as: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred Income tax assets |
|
(4,807) |
|
23,386 |
|
3,490 |
|
84,886 |
|
(73,400) |
|
30,668 |
|
(437) |
|
63,786 |
Deferred Income tax liabilities |
|
(107,444) |
|
(168,133) |
|
46,734 |
|
49,676 |
|
(42,299) |
|
51,761 |
|
32,599 |
|
(137,106) |
|
|
(112,251) |
|
(144,747) |
|
50,224 |
|
134,562 |
|
(115,699) |
|
82,429 |
|
32,162 |
|
(73,320) |
At December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred Income tax assets |
|
(57,208) |
|
253 |
|
21,156 |
|
99,029 |
|
(87,763) |
|
74,289 |
|
23,589 |
|
73,345 |
Deferred Income tax liabilities |
|
(21,567) |
|
(123,795) |
|
17,673 |
|
70,422 |
|
(63,234) |
|
26,444 |
|
(6,393) |
|
(100,450) |
|
|
(78,775) |
|
(123,542) |
|
38,829 |
|
169,451 |
|
(150,997) |
|
100,733 |
|
17,196 |
|
(27,105) |
The Group’s significant recognized deferred tax assets at December 31, 2024, primarily comprised $70.9 million (2023: $46.1 million) in relation to tax losses arising in the Brazil tower and fiber business, $25.2 million (2023: $25.0 million) in relation to unutilized capital allowances of the Group’s Nigerian subsidiaries and $28.4 million (2023: $14.1 million) in relation to finance costs of the Group’s Nigerian subsidiaries. Tax deductions for finance costs, which comprise interest paid and realized exchange losses, are restricted under Nigerian tax legislation and are carried forward for future relief.
In the case of the Brazilian and Nigerian deferred tax assets described above, the Group has performed an assessment of their recovery using forecasted future taxable income and has recognized deferred tax assets to the extent it is considered probable that sufficient future taxable income will arise against which these losses and deductible temporary differences can be utilized.
The Other category within Finance costs and other includes withholding tax on undistributed profits and on unrealized derivative instruments income.
F-54
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The Group has $2.2 billion (2023: $2.4 billion, 2022: $1.8 billion) in deductible temporary differences for which no deferred tax is recognized. These amounts primarily relate to finance costs incurred by the Group’s Nigerian subsidiaries. No deferred tax is recognized for these costs, which are subject to restrictions on their deductibility, because, in the case of interest, it is not considered probable that sufficient forecast future taxable income will arise to utilize these deductions, or in the case of exchange losses, which are deductible when realized, because it is not considered probable that there will be sufficient forecast taxable income to utilize those losses which are realized in the future. The amounts are due to expire as follows:
| ● | within one year: $3.6 million (2023: $91.1 million, 2022: $222.3 million); |
| ● | between one and two years: $53.9 million (2023: $138.9 million, 2022: $180.0 million); |
| ● | between two and three years: $27.5 million (2023: $63.6 million, 2022: $274.3 million); and |
| ● | between three and four years: $3.8 million (2023: $39.4 million, 2022: $99.4 million). |
As of December 31, 2024, there were $nil (2023: $6.5 million, 2022: $122.2 million) of temporary differences associated with undistributed earnings of subsidiaries for which deferred tax liabilities have not been recognized.
17.Inventories
|
|
2024 |
|
2023 |
|
|
$'000 |
|
$'000 |
|
|
|
|
|
Stock of materials |
|
30,746 |
|
40,589 |
Inventories are measured at lower of cost and net realizable value. Diesel is held at cost and consumables are held at cost less provision for obsolescence. During the year, an inventory write-down expense of $11.9 million was recognized (2023: $0.4 million, 2022: $1.7 million). The value of inventory recognized as an expense during the year is $285.5 million (2023: $321.4 million, 2022: $371.8 million).
18.Derivative financial instruments
The derivative instruments have been classified as fair value through profit or loss. The instruments are measured at fair value with the resultant gains or losses recognized in the consolidated statement of loss and other comprehensive income. The related net foreign exchange gain/(loss) is included in finance income (note 10) and finance costs (note 11).
The underlying contractual notional amounts for the derivative instruments are as follows, as of December 31, for each of the following years:
|
|
2024 |
|
2023 |
|
|
$'000 |
|
$'000 |
Derivative instruments |
|
|
|
|
Embedded options within listed bonds(a) |
|
2,186,000 |
|
1,940,000 |
Foreign exchange swaps(b) |
|
14,500 |
|
125,000 |
Interest rate caps |
|
— |
|
100,000 |
|
|
2,200,500 |
|
2,165,000 |
| (a) | This relates to early redemption clauses within the Group’s Senior Notes (see note 22 - Borrowings). On or after November 29, 2023, 2024, or 2025, the 2026 Notes may be redeemed (in whole or in part) at a price of 102.81250%, 101.40625% and 100.00000%, respectively. On or after September 18, 2024, the 2027 Notes may be redeemed (in whole or in part) at a price of 100.00000%. On or after November 29, 2024, 2025 or 2026, the 2028 Notes may be redeemed (in whole or in part) at a price of 103.12500%, 101.56250% and 100.00000%, respectively. On or after November 29, 2026, 2027 or 2028, the 2030 Notes may be redeemed (in whole or in part) at a price of 103.93750%, 101.96875% and 100.00000%, respectively. On or after November 29, 2027, 2028 or 2029, the 2031 Notes may be redeemed (in whole or in part) at a price of 104.12500%, 102.06250% and 100.00000%, respectively. |
| (b) | These foreign exchange swaps are expected to be settled in the next 12 months from December 31, 2024 (2023: December 31, 2023). |
F-55
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The fair value balances are as follows:
|
|
2024 |
|
2023 |
|
|
$'000 |
|
$'000 |
Derivative instruments |
|
|
|
|
Embedded options within listed bonds |
|
29,410 |
|
1,540 |
Foreign exchange swaps |
|
(10,203) |
|
(68,133) |
Interest rate caps |
|
— |
|
565 |
|
|
19,207 |
|
(66,028) |
The change in fair value of the derivative instruments has been recorded in the consolidated statement of loss and other comprehensive income as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$'000 |
|
$'000 |
|
$'000 |
Derivative instruments |
|
|
|
|
|
|
Foreign exchange swaps |
|
8,147 |
|
(92,151) |
|
(1,599) |
Embedded options within listed bonds |
|
6,710 |
|
(3,760) |
|
(159,889) |
Interest rate caps |
|
230 |
|
163 |
|
(89) |
|
|
15,087 |
|
(95,748) |
|
(161,577) |
The credit ratings of the Group’s derivative financial instrument assets at December 31, 2024, and 2023, based on publicly reported Fitch ratings are as follows:
|
|
2024 |
|
2023 |
|
|
$'000 |
|
$'000 |
Derivative financial instrument assets |
|
|
|
|
Not rated |
|
29,410 |
|
2,105 |
|
|
29,410 |
|
2,105 |
Refer to note 4(a) for further information on the derivative financial instruments.
Reconciliation of movements is as follows:
|
|
2024 |
|
2023 |
|
|
$'000 |
|
$'000 |
Foreign exchange swaps |
|
|
|
|
At January 1 |
|
(68,133) |
|
(1,393) |
Fair value gain/(loss) (unrealized foreign exchange on open contracts) |
|
8,147 |
|
(92,151) |
Exchange differences |
|
26,574 |
|
25,831 |
Cash flow on settlement |
|
23,209 |
|
(420) |
At December 31 |
|
(10,203) |
|
(68,133) |
F-56
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
19.Trade and other receivables
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$'000 |
Non-current |
|
|
|
|
Accrued revenue and lease incentive |
|
73,519 |
|
71,904 |
Other tax receivables |
|
5,605 |
|
7,116 |
Payment in advance for property, plant and equipment |
|
24,558 |
|
61,874 |
Withholding tax receivables(a) |
|
14,913 |
|
— |
Contingent consideration receivable(b) |
|
2,438 |
|
6,411 |
|
|
121,033 |
|
147,305 |
Current |
|
|
|
|
Trade receivables |
|
237,232 |
|
233,528 |
Less: allowance for expected credit losses |
|
(16,339) |
|
(21,205) |
Net trade receivables(c) |
|
220,893 |
|
212,323 |
Other receivables(d) |
|
44,434 |
|
317,452 |
Prepaid land rent |
|
771 |
|
1,016 |
Other prepaid expenses |
|
14,521 |
|
29,979 |
Advance payments |
|
10,947 |
|
33,364 |
Withholding tax receivables(a) |
|
10,258 |
|
1,362 |
VAT receivables |
|
9,929 |
|
12,339 |
Contingent consideration receivable(b) |
|
1,603 |
|
— |
|
|
313,356 |
|
607,835 |
| (a) | Withholding tax receivables are assessed for recoverability based on a five year cash flow projection and an analysis of the utilization of withholding tax balances in settlement of future income tax liabilities. Withholding tax receivables increased for the year ended December 31, 2024, due to changes in the revenue withholding tax regulations which impact the Group’s Nigerian businesses. Effective from January 1, 2025, these changes reduce the amounts of revenue tax withheld by customers in Nigeria with respect to colocation and telecommunication tower services from 10% to 2%. Following this announcement in October 2024, previously impaired revenue withholding tax receivables were reassessed to identify which could be utilized in settlement of future tax liabilities resulting in the reversal of previously impaired revenue withholding tax receivables of $25.2 million. |
| (b) | Receivable on the I-Systems Soluções de Infraestrutura S.A. acquisition. |
| (c) | The fair value is equal to their carrying amount. |
| (d) | Included in other receivables are short-term fixed deposits which are not classified as cash and cash equivalents as it exceeds the three-month maturity period. Most of these deposits were repaid in the current period and reclassified to cash and cash equivalents. |
Included in trade receivables is $135.7 million (2023: $84.9 million, 2022: $86.2 million) relating to accrued revenue of which $54.4 million (2023: $19.5 million, 2022: $17.7 million) relates to contract assets, with the remainder being accrued lease rental income.
Payment in advance for property, plant and equipment relates to the future supply of tower and tower equipment and fiber assets. All non-current receivables are due within twenty years from the end of the reporting period. All current trade and other receivables are due within 12 months from the end of the reporting period. The Group does not secure any collateral for its trade receivables. Refer to note 4 (c) for further information on trade and other receivables.
Prepaid land rent is capitalized to the right-of-use asset insofar as it relates to leases accounted for under IFRS 16. The prepaid land rent for leases that are exempt from being accounted for under IFRS 16, under the Group’s accounting policy, are accounted for as short-term prepayments.
F-57
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
20.Cash and cash equivalents
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$'000 |
|
|
|
|
|
Cash and bank deposits(a) |
|
577,956 |
|
293,823 |
Cash and cash equivalents |
|
577,956 |
|
293,823 |
| (a) | Includes $175.0 million (2023: $105.4 million) of fixed term bank deposits. |
The credit ratings of the Group’s principal banking partners as of December 31, 2024, and 2023, based on publicly reported Fitch ratings, are as follows. The Group regularly monitors its credit risk with banking partners and did not incur any losses during 2024 and 2023 as a result of bank failures.
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$'000 |
Cash and cash equivalents |
|
|
|
|
AAA (F1+) |
|
16,718 |
|
16,030 |
AA |
|
— |
|
2 |
A+ |
|
31 |
|
15,686 |
A (F1) |
|
282,279 |
|
67,505 |
A- |
|
— |
|
216 |
BBB+ |
|
184 |
|
15,889 |
BBB- |
|
55,856 |
|
88 |
B+ |
|
— |
|
7,611 |
B |
|
200,318 |
|
169,517 |
C/not rated |
|
22,570 |
|
1,279 |
|
|
577,956 |
|
293,823 |
21.Trade and other payables
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$'000 |
Non-current |
|
|
|
|
Other payables |
|
5,218 |
|
4,629 |
|
|
5,218 |
|
4,629 |
Current |
|
|
|
|
Trade payables |
|
232,930 |
|
330,622 |
Deferred revenue |
|
64,883 |
|
41,462 |
Withholding tax payable |
|
2,239 |
|
3,555 |
Payroll and other related statutory liabilities |
|
42,844 |
|
46,282 |
VAT payables |
|
29,921 |
|
37,829 |
Other payables |
|
49,683 |
|
72,877 |
|
|
422,500 |
|
532,627 |
|
|
|
|
|
Included in deferred revenue is $18.9 million (2023: $7.9 million, 2022: $22.9 million) which relates to contract liabilities.
The contract liabilities relating to December 31, 2023, were fully recognized in revenue during the year end December 31, 2024.
F-58
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
22.Borrowings
Borrowings comprised the following:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$'000 |
Non-current |
|
|
|
|
Senior Notes |
|
2,164,209 |
|
1,930,457 |
Debentures and bank term loans(a) |
|
1,055,006 |
|
1,126,239 |
|
|
3,219,215 |
|
3,056,696 |
|
|
|
|
|
Current |
|
|
|
|
Senior Notes |
|
19,326 |
|
26,912 |
Debentures and bank term loans(a) |
|
102,552 |
|
107,110 |
Bank overdraft |
|
— |
|
675 |
Letters of credit |
|
6,856 |
|
319,454 |
|
|
128,734 |
|
454,151 |
|
|
|
|
|
Total borrowings |
|
3,347,949 |
|
3,510,847 |
| (a) | The above amounts are shown net of pledged deposits as security (2024: Current $12.1 million, Non-current $23.4 million and 2023: $nil) |
Reconciliation of cash and non-cash changes is as follows:
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
At January 1 |
|
3,510,847 |
|
3,344,402 |
Interest expense (note 11) |
|
359,965 |
|
362,381 |
Interest paid |
|
(326,984) |
|
(299,029) |
Proceeds received from issuance of borrowings (net of transaction costs) |
|
2,209,050 |
|
985,992 |
Repayment of borrowings |
|
(2,149,307) |
|
(689,940) |
Bank overdraft |
|
(675) |
|
612 |
Other transaction costs |
|
(10,558) |
|
(19,441) |
Disposal of subsidiary |
|
(53,065) |
|
— |
Exchange differences |
|
(191,324) |
|
(174,130) |
At December 31 |
|
3,347,949 |
|
3,510,847 |
F-59
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
22.1Analysis of borrowings
Borrowings comprised the following:
|
|
Principal |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
amount |
|
|
|
|
|
|
|
|
|
Carrying amount |
||
|
|
December 31, |
|
|
|
Issue |
|
Maturity |
|
|
|
December 31, |
|
December 31, |
|
|
2024 |
|
Currency |
|
date |
|
date |
|
Interest rate |
|
2024 |
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
$’000 |
|
$’000 |
Senior Notes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IHS Holding Limited |
|
200.0M |
|
USD |
|
Nov'21 |
|
Nov'26 |
|
5.625% |
|
200,777 |
|
498,920 |
IHS Holding Limited |
|
500.0M |
|
USD |
|
Nov'21 |
|
Nov'28 |
|
6.250% |
|
499,422 |
|
498,635 |
IHS Holding Limited |
|
550.0M |
|
USD |
|
Nov'24 |
|
May'30 |
|
7.875% |
|
545,440 |
|
— |
IHS Holding Limited |
|
650.0M |
|
USD |
|
Nov'24 |
|
Nov'31 |
|
8.250% |
|
644,180 |
|
— |
IHS Netherlands Holdco B.V. |
|
286.0M |
|
USD |
|
Sep'19 |
|
Sep'27 |
|
8.000% |
|
293,716 |
|
959,814 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debentures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IHS Brasil - Cessão de Infraestruturas S.A. |
|
1.2B |
|
BRL |
|
Sep'23 |
|
Aug'31 |
|
3.10% + CDI |
|
177,635 |
|
252,341 |
IHS Brasil - Cessão de Infraestruturas S.A. |
|
300.0M |
|
BRL |
|
Jun'24 |
|
Jun'32 |
|
2.80% + CDI |
|
43,959 |
|
— |
I-Systems Soluções de Infraestrutura S.A. |
|
160.0M |
|
BRL |
|
Jun'24 |
|
May'32 |
|
2.10% + CDI |
|
24,291 |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank Term Loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IHS Côte d’Ivoire S.A. |
|
— |
|
XOF |
|
Jun'22 |
|
Jun'24 |
|
5.00% |
|
— |
|
6,570 |
IHS Côte d’Ivoire S.A. |
|
— |
|
EUR |
|
Jun'22 |
|
Jun'24 |
|
3.00% + 3M EURIBOR |
|
— |
|
4,841 |
IHS Côte d’Ivoire S.A. |
|
9.4B |
|
XOF |
|
Dec'23 |
|
Dec'28 |
|
6.50% |
|
14,378 |
|
— |
IHS Côte d’Ivoire S.A. |
|
74.1M |
|
EUR |
|
Dec'23 |
|
Dec'28 |
|
3.50% + 3M EURIBOR |
|
75,473 |
|
— |
IHS Holding Limited |
|
— |
|
USD |
|
Oct'22 |
|
Oct'25 |
|
3.75% + CAS + 3M SOFR |
|
— |
|
370,935 |
IHS Holding Limited |
|
255.0M |
|
USD |
|
Oct'24 |
|
Oct'29 |
|
4.50% + 3M SOFR |
|
256,640 |
|
— |
IHS Holding Limited |
|
3.2B |
|
ZAR |
|
Oct'24 |
|
Oct'29 |
|
4.50% + 3M JIBAR |
|
175,230 |
|
— |
IHS Kuwait Limited |
|
— |
|
KWD |
|
Apr'20 |
|
Apr'29 |
|
2.00% + CBK Discount Rate |
|
— |
|
61,354 |
IHS Towers South Africa Proprietary Limited |
|
3.3B |
|
ZAR |
|
May'22 |
|
May'29 |
|
2.75% + 3M JIBAR |
|
174,776 |
|
185,404 |
IHS Zambia Limited |
|
61.8M |
|
USD |
|
Dec'20 |
|
Dec'27 |
|
5.00% + CAS + 3M SOFR |
|
62,179 |
|
81,297 |
INT Towers Limited |
|
134.1B |
|
NGN |
|
Jan'23 |
|
Jan'28 |
|
2.50% + MPR, 18% - 27% collar |
|
91,594 |
|
186,302 |
I-Systems Soluções de Infraestrutura S.A. |
|
400.0M |
|
BRL |
|
Oct'22 |
|
Oct'30 |
|
2.45%- 2.50% + CDI |
|
61,403 |
|
84,305 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revolving Credit Facilities and overdrafts(a) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IHS Holding Limited |
|
300.0M |
|
USD |
|
Mar'20 |
|
Oct'26 |
|
3.00% + CAS + 3M SOFR |
|
— |
|
— |
IHS Nigeria Limited |
|
55.0B |
|
NGN |
|
Jan'23 |
|
Jan'26 |
|
2.50% + MPR, 18% - 27% collar |
|
— |
|
— |
IHS Towers South Africa Proprietary Limited |
|
— |
|
ZAR |
|
Oct'23 |
|
Dec'24 |
|
PRIME minus 0.25% |
|
— |
|
675 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Letters of Credit(a) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IHS Nigeria |
|
356.5M |
|
USD |
|
Feb'22 |
|
Mar'25 |
|
12.00% - 15.75% |
|
6,856 |
|
319,454 |
|
|
|
|
|
|
|
|
|
|
|
|
3,347,949 |
|
3,510,847 |
| (a) | Principal amount for revolving credit facilities, overdrafts and letters of credit are the available facilities at December 31, 2024. |
All Group borrowings (except letters of credit) contain customary affirmative and negative covenants, events of default and financial covenant ratios (generally tested quarterly, with some exceptions). The borrowing entity may also voluntarily prepay its utilizations and/or cancel all or part of the available commitments on these borrowings by giving notice. Mandatory cancellation and full or partial prepayment may be required in certain circumstances including events of default. The majority of borrowings are supported by intercompany guarantees or secured by pledges over certain assets.
Financing activities and liquidity during the reporting period
The Group is in compliance with its debt covenants related to the listed bonds and covenants related to external borrowings as of December 31, 2024. Approximate U.S. dollar equivalent values for non-USD denominated facilities stated below are translated from the currency of the debt at the relevant exchange rates on December 31, 2024.
In February 2024, a first draw down of €56.1 million (approximately $58.4 million) and XOF 7,109.0 million (approximately $11.3 million) was made by IHS Côte d’Ivoire S.A. under the CIV (2023) Term Loan. These proceeds were applied towards, inter alia, the full prepayment of the entity’s pre-existing borrowings maturing in June 2024 and for general corporate purposes.
F-60
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
In June 2024, the remaining €31.9 million (approximately $33.2 million) and XOF 4,042.3 million (approximately $6.4 million) were drawn down on this term loan. These proceeds were applied towards, inter alia, the full prepayment of the entity’s existing borrowings maturing in June 2024 and for general corporate purposes.
| (ii) | IHS Brasil - Cessão de Infraestruturas S.A. and I-Systems Soluções de Infraestrutura S.A. 2024 Debentures |
In June 2024, IHS Brasil - Cessão de Infraestruturas S.A. and I-Systems Soluções de Infraestrutura S.A. issued debentures for BRL 300.0 million (approximately $48.6 million) and BRL 160.0 million (approximately $25.9 million), respectively. These debentures amortize, starting from July 2026 and November 2026, semi-annually until maturity in June 2032 and May 2032, respectively.
Both debentures are secured by a pledge over the bank account where the companies’ receivables are deposited. In addition, the IHS Brasil - Cessão de Infraestruturas S.A. debentures are secured by a pledge over all shares owned by IHS Netherlands BR B.V. in IHS Brasil - Cessão de Infraestruturas S.A.
In August 2024, the interest rate cap on the NGN 165.0 billion (approximately $106.7 million) loan and the NGN 55.0 billion (approximately $35.6 million) facility, both entered into in January 2023, was increased from 24% to 27%.
In October 2024, IHS Holding Limited entered into and drew down on a dual-tranche $255.0 million and ZAR 3,246.0 million loan agreement (together totaling approximately $427.6 million). This syndicated facility is scheduled to terminate in October 2029. The majority of the proceeds were applied toward the repayment of the IHS Holding (2022) Bullet Term Loan and general corporate purposes.
| (v) | IHS Holding (2022) Bullet Term Loan |
In March 2024, the available commitments under the Company’s October 2022 loan facility were voluntarily reduced by $70.0 million and the remaining available commitments of $60.0 million were drawn down in April 2024, with the proceeds applied towards general corporate purposes, resulting in the facility being fully drawn at $430.0 million.
This drawn amount of $430.0 million was fully prepaid in October 2024 using the proceeds received from the IHS Holding 2024 Dual-Tranche Term Loan.
In November 2024, IHS Holding Limited issued $550.0 million 7.875% Senior Notes due 2030 (the “2030 Notes”) and $650.0 million 8.250% Senior Notes due 2031 (the “2031 Notes”, and together with the 2030 Notes, the “IHS Holding 2030/31 Notes”), guaranteed by IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., IHS Nigeria Limited, IHS Towers NG Limited, INT Towers Limited and INT Towers NG Finco 1 Plc.
The proceeds of the issuance of the IHS Holding 2030/31 Notes were used to partially redeem the principal amount of the 2026 Notes and 2027 Notes and fully prepay the IHS Holding (2024) Term Loan (including accrued and unpaid interest), fees and expenses related to the offering of the notes, and for general corporate purposes. The IHS Holding 2030/31 Notes pay interest semi-annually in arrear and the principal is repayable in full on maturity.
In November 2024, the 2026 Notes were partially redeemed, in an aggregate principal amount outstanding of $300.0 million following the issuance of the IHS Holding 2030/31 Notes and as of December 31, 2024, the aggregate principal amount outstanding on the IHS Holding 2026/28 Notes is $700.0 million.
F-61
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
In November 2024 and December 2024, the 2027 Notes were partially redeemed, in an aggregate principal amount outstanding of $654.0 million following the issuance of the IHS Holding 2030/31 Notes and as of December 31, 2024, the aggregate principal amount outstanding on the 2027 Notes was $286.0 million.
In March 2024, the Company entered into a $270.0 million loan agreement with Standard Chartered Bank (Singapore) Limited as the original lender. This facility was scheduled to terminate in March 2026 and was repayable in installments.
This facility was fully drawn in March 2024 and the majority of the proceeds were applied toward the repayment of the Letter of Credit Facilities in Nigeria. In November 2024, this facility was fully prepaid using the proceeds received from the IHS Holding 2030/31 Notes.
IHS Kuwait Limited was sold as part of the Kuwait Disposal that completed in December 2024.
This overdraft facility, entered into in October 2023, expired in December 2024.
Letters of credit
The Group has utilized letters of credit for its Nigerian entities to fund capital and operational expenditure with suppliers. This utilization has significantly reduced in the year ended December 31, 2024, compared to the prior year. Letters of credit are presented within Borrowings and as of January 1, 2024, and December 31, 2024, all the suppliers had received payment.
Below are further details by entity as of December 31, 2024:
| ● | IHS Nigeria Limited has utilized $2.0 million (2023: $98.9 million) through funding under agreed letters of credit. These letters mature on March 31, 2025 (2023: March 31, 2024) and their interest rates range from 12.00% to 15.55% (2023: 12.00% to 15.55%). |
| ● | INT Towers Limited has utilized $4.8 million (2023: $219.4 million) through funding under agreed letters of credit. These letters mature on March 31, 2025 (2023: March 31, 2024) and their interest rates range from 12.00% to 15.75% (2023: 12.00% to 15.75%). |
| ● | Global Independent Connect Limited has utilized $0.1 million (2023: $1.1 million) through funding under agreed letters of credit. These letters mature on March 31, 2025 (2023: March 31, 2024) and their interest rates range from 15.25% to 15.28% (2023: 13.25% to 15.49%). |
| ● | IHS Towers NG Limited has utilized no funding (2023: $0.02 million) under agreed letters of credit. These letters matured on March 31, 2024, and incurred interest at a rate of 15.49%. |
The range of payment due date for liabilities that are part of the arrangement is up to 5 days after invoice date and for comparable trade payables that are not part of an arrangement is up to 30 days after invoice date.
F-62
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
23.Lease liabilities
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Non-current |
|
470,476 |
|
510,838 |
Current |
|
82,068 |
|
91,156 |
Total lease liabilities |
|
552,544 |
|
601,994 |
Lease liabilities represent the net present value of future payments due under long term land leases for leasehold land on which our towers are located and for other leasehold assets such as warehouses and offices. During the period, payments of $121.3 million (2023: $131.3 million, 2022: $112.8 million) were made in respect of recognized lease liabilities. These lease liabilities are unwound using incremental borrowing rates which represent the credit risk of the lessee entity and the length of the lease agreement.
Reconciliation of cash and non-cash changes is as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
At January 1 |
|
601,994 |
|
605,558 |
|
376,101 |
Additions through business combinations |
|
— |
|
— |
|
216,218 |
Additions through new leases or remeasurements(a) |
|
188,047 |
|
159,624 |
|
118,609 |
Interest on lease liabilities (note 11) |
|
68,031 |
|
61,617 |
|
52,234 |
Payments for the principal portion of lease liabilities |
|
(55,233) |
|
(72,854) |
|
(76,629) |
Interest paid for lease liabilities |
|
(66,041) |
|
(58,443) |
|
(36,178) |
Terminations |
|
(79,998) |
|
(67,547) |
|
(37,718) |
Disposal of subsidiary (note 31.2) |
|
(22,581) |
|
— |
|
— |
Exchange differences |
|
(81,675) |
|
(25,961) |
|
(7,079) |
At December 31 |
|
552,544 |
|
601,994 |
|
605,558 |
| (a) | This value includes the impact of remeasurement of lease liabilities as a result of changes in lease terms. |
Amount recognized in the consolidated statement of loss and other comprehensive income is as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
Interest on lease liabilities (note 11) |
|
68,031 |
|
61,617 |
|
52,234 |
Expenses relating to short-term leases and low value assets (note 7) |
|
7,840 |
|
10,879 |
|
16,924 |
Depreciation for right-of-use assets (note 14) |
|
95,383 |
|
95,895 |
|
88,615 |
|
|
171,254 |
|
168,391 |
|
157,773 |
F-63
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The undiscounted contractual payments under the lease liabilities as of December 31, are as follows:
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
Carrying |
|
contractual |
|
Within |
|
1 - 3 |
|
3 - 5 |
|
Over 5 |
|
|
value |
|
cash flows |
|
1 year |
|
years |
|
years |
|
years |
|
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
2024 |
|
|
|
|
|
|
|
|
|
|
|
|
Lease liabilities |
|
552,544 |
|
1,130,990 |
|
92,425 |
|
179,774 |
|
173,750 |
|
685,041 |
|
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
Lease liabilities |
|
601,994 |
|
1,181,459 |
|
101,709 |
|
193,434 |
|
180,895 |
|
705,421 |
Lease obligations contractual cash flows are disclosed with the same renewal expectation assumption assessed for lease accounting under IFRS 16. The average remaining lease term remaining at December 31, 2024, is 13 years.
24.Provisions for other liabilities and charges
|
|
2024 |
|
2023 |
|
2022 |
|
|
$'000 |
|
$'000 |
|
$'000 |
Decommissioning and site restoration provisions |
|
|
|
|
|
|
At January 1 |
|
86,408 |
|
85,016 |
|
71,941 |
Additions through business combinations |
|
— |
|
— |
|
34,419 |
Provisions for new sites and remeasurements of existing sites |
|
2,940 |
|
(505) |
|
(24,898) |
Utilization |
|
(95) |
|
(343) |
|
(343) |
Disposal of subsidiary |
|
(3,299) |
|
— |
|
— |
Unwinding of discount |
|
9,191 |
|
9,156 |
|
7,084 |
Exchange differences |
|
(11,087) |
|
(6,916) |
|
(3,187) |
At December 31 |
|
84,058 |
|
86,408 |
|
85,016 |
|
|
|
|
|
|
|
Analysis of total decommissioning and site restoration provisions |
|
|
|
|
|
|
Non-current |
|
83,876 |
|
86,131 |
|
84,533 |
Current |
|
182 |
|
277 |
|
483 |
|
|
84,058 |
|
86,408 |
|
85,016 |
The provision relates to the probable obligation that the Group may incur to restore existing leased sites to their original state through the decommissioning, dismantling and removal of assets. The amount initially recognized is the present value of the estimated costs, discounted using a rate appropriate for the relevant operation and lease term.
Estimates are based on management’s experience having taken into account assumptions regarding the current economic environment, construction requirements, technology, price levels and expected plans for remediation. Management believes that these assumptions are a reasonable basis upon which to estimate the future liability. The estimates are reviewed regularly and updated to take into account any significant changes in the assumptions. Remeasurements are reflected in the provision and the related asset within property, plant and equipment.
Actual decommissioning and site restoration costs for the required works will reflect market prices and conditions at the relevant time. Furthermore, the timing of the works will likely depend on when the lease term is terminated without renewal which itself will depend upon technological changes in the local and international telecommunication industries which are inherently uncertain.
F-64
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The discount rates applied have been in line with the weighted average borrowing rate for the respective entities in the periods the assets were constructed/acquired. Discount rates applied by each entity are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IHS |
|
IHS Côte |
|
IHS |
|
IHS |
|
IHS |
|
|
|
|
|
|
Nigerian |
|
Cameroon |
|
d’Ivoire |
|
Zambia |
|
South Africa |
|
Rwanda |
|
Brazilian |
|
IHS Kuwait |
|
|
entities |
|
S.A. |
|
S.A. |
|
Limited |
|
Proprietary Limited |
|
Limited |
|
entities |
|
Limited |
|
|
% |
|
% |
|
% |
|
% |
|
% |
|
% |
|
% |
|
% |
Discount rates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
11.1 |
|
7.8 |
|
5.9 |
|
14.0 |
|
11.0 |
|
13.5 |
|
14.0 |
|
n/a |
2023 |
|
11.1 |
|
7.4 |
|
5.9 |
|
14.0 |
|
12.2 |
|
13.5 |
|
15.1 |
|
6.3 |
A 1% movement in the rate used to discount the estimated decommissioning and site restoration costs is estimated to impact the loss as follows:
|
|
Increase/(decrease) |
||||
|
|
in provision |
||||
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
1% increase |
|
(4,422) |
|
(2,562) |
|
(2,066) |
1% decrease |
|
2,568 |
|
1,189 |
|
1,606 |
25.Stated capital
|
|
|
|
|
|
Stated |
|
|
|
|
|
|
capital net |
|
|
Number of |
|
Stated |
|
of issue |
|
|
shares |
|
capital |
|
costs (a) |
|
|
000’s |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
At January 1, 2022 |
|
327,820 |
|
5,253,508 |
|
5,223,484 |
Shares issued on exercise of options |
|
4,100 |
|
88,469 |
|
88,469 |
At December 31, 2022 |
|
331,920 |
|
5,341,977 |
|
5,311,953 |
|
|
|
|
|
|
|
Shares issued on exercise of options |
|
2,478 |
|
92,896 |
|
92,896 |
Shares repurchased and canceled through buyback program |
|
(1,879) |
|
(10,037) |
|
(10,037) |
At December 31, 2023 |
|
332,519 |
|
5,424,836 |
|
5,394,812 |
|
|
|
|
|
|
|
Shares issued on exercise of options |
|
922 |
|
8,327 |
|
8,327 |
At December 31, 2024 |
|
333,441 |
|
5,433,163 |
|
5,403,139 |
As of December 31, 2024, stated capital was made up of share capital of $100,032,281 and share premium of $5,303,107,140.
F-65
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
In August 2023, the Company’s board of directors (the “Board”) authorized a stock repurchase program for up to $50.0 million of the Company’s ordinary shares, effective as of August 15, 2023 through August 15, 2025, subject to market conditions, contractual restrictions, regulatory requirements and other factors. During the third quarter of 2023, the Company repurchased 948,101 shares, at an average price of $5.04 per share, for $4.8 million under its stock repurchase program. During the fourth quarter of 2023, the Company repurchased a further 930,556 shares, at an average price of $5.61 per share, for $5.2 million. No shares were repurchased during the fiscal year ended December 31, 2024. All shares repurchased were canceled.
Summarized below are the terms of the shares for the year end December 31, 2024, and 2023:
| ● | There is only one class of ordinary shares. |
| ● | Ordinary shares have a par value of $0.30 each. |
| ● | The holders of our ordinary shares are entitled to such dividends as may be declared by our board of directors subject to the Companies Act and our Articles. Dividends and other distributions on issued and outstanding ordinary shares may be paid out of the funds of the Company lawfully available for such purpose, subject to any preference of any outstanding preferred shares. Dividends and other distributions will be distributed among the holders of our ordinary shares on a pro rata basis. |
| ● | Voting at any shareholders’ meeting is by way of poll. On a poll every shareholder present in person or by proxy shall have one vote for each ordinary share on all matters upon which the ordinary shares are entitled to vote except that, for so long as the number of ordinary shares held by Mobile Telephone Networks (Netherlands) B.V. or an affiliate of it or MTN Group is greater than twenty percent (20%) of the total number of ordinary shares in issue, each ordinary share held by MTN Group shall entitle MTN Group to the number of votes per ordinary share calculated by dividing 20% of the total number of ordinary shares in issue by the number of Shares held by MTN Group. |
| ● | Any of our shareholders may transfer all or any of his or her ordinary shares by an instrument of transfer in the usual or common form or any other form approved by our board of directors, subject to the applicable restrictions of our Articles, such as the suspension of transfers for a period immediately preceding a general meeting, or the determination that a proposed transfer is not eligible, as well as restrictions in our Shareholders’ Agreement and our Registration Rights Agreement. |
| ● | On a return of capital on winding up or otherwise (other than on conversion, redemption or purchase of ordinary shares), assets available for distribution among the holders of ordinary shares shall be distributed among the holders of the ordinary shares on a pro rata basis. |
The authorized share capital of the Company is 1,700,000,000 shares with par value of $0.30 each. All ordinary shares issued were fully paid up and non-assessable as of December 31, 2024, and 2023.
F-66
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
26.Other reserves
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign |
|
|
|
|
Restruct- |
|
Share-based |
|
Loss on |
|
exchange |
|
|
|
|
uring |
|
payment |
|
transactions |
|
translation |
|
|
|
|
reserve |
|
reserve |
|
between owners |
|
reserve |
|
Total |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
|
|
|
|
At January 1, 2022 |
|
4,019 |
|
176,698 |
|
(840,359) |
|
(183,269) |
|
(842,911) |
Other comprehensive income |
|
— |
|
— |
|
— |
|
59,521 |
|
59,521 |
Recognition of share-based payment expense |
|
— |
|
13,423 |
|
— |
|
— |
|
13,423 |
Exercise of share options |
|
— |
|
(88,469) |
|
— |
|
— |
|
(88,469) |
Other reclassifications related to share-based payment |
|
— |
|
(2,835) |
|
— |
|
— |
|
(2,835) |
At December 31, 2022 |
|
4,019 |
|
98,817 |
|
(840,359) |
|
(123,748) |
|
(861,271) |
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income |
|
— |
|
— |
|
— |
|
950,855 |
|
950,855 |
Recognition of share-based payment expense |
|
— |
|
13,168 |
|
— |
|
— |
|
13,168 |
Exercise of share options |
|
— |
|
(92,896) |
|
— |
|
— |
|
(92,896) |
Other reclassifications related to share-based payment |
|
— |
|
(1,426) |
|
— |
|
— |
|
(1,426) |
At December 31, 2023 |
|
4,019 |
|
17,663 |
|
(840,359) |
|
827,107 |
|
8,430 |
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income, net of recycling |
|
— |
|
— |
|
— |
|
1,039,829 |
|
1,039,829 |
Recognition of share-based payment expense |
|
— |
|
27,769 |
|
— |
|
— |
|
27,769 |
Exercise of share options |
|
— |
|
(8,327) |
|
— |
|
— |
|
(8,327) |
At December 31, 2024 |
|
4,019 |
|
37,105 |
|
(840,359) |
|
1,866,936 |
|
1,067,701 |
Restructuring reserve
This reserve is the excess of consideration over net assets acquired in business combinations under common control arising from Group restructuring. This is a non-distributable reserve.
Share-based payment reserve
This reserve represents the cumulative amounts charged in respect of unsettled options issued to employees of the Group and the impact of the B-BBEE share-based payment transaction as described in note 28.2. This is a non-distributable reserve.
Loss on transactions between owners
This reserve is the accumulated loss arising from transactions between parent and non-controlling interests shareholders.
Foreign exchange translation reserve
This non-distributable reserve is the accumulated exchange gains and losses arising from the translation of foreign operations from those operations’ functional currencies to the Group’s reporting currency. This is net of any foreign exchange gains or losses recycled to the income statement upon the disposal of subsidiaries.
F-67
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
27.Non-controlling interests
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
At January 1 |
|
237,506 |
|
227,200 |
|
223,188 |
Non-controlling interests arising on business combinations(a) |
|
— |
|
1,922 |
|
831 |
Non-controlling interests derecognized on disposal (note 31.2) |
|
(23,181) |
|
— |
|
— |
Loss for the year |
|
(12,176) |
|
(11,569) |
|
(9,959) |
Other comprehensive income |
|
(43,379) |
|
19,953 |
|
13,140 |
At December 31 |
|
158,770 |
|
237,506 |
|
227,200 |
(a) |
Includes non-controlling interests arising on subsequent asset acquisitions on business combination transactions. |
Summarized financial information for the I-Systems subsidiary, being the only subsidiary that has non-controlling interests that is material to the Group, is as follows. The amounts disclosed are before intercompany eliminations.
Summarized balance sheet and cash flows are as follows: |
|
|
|
|
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Non-current assets |
|
406,058 |
|
527,592 |
Non-current liabilities |
|
(100,577) |
|
(114,681) |
Non-current net assets |
|
305,481 |
|
412,911 |
|
|
|
|
|
Current assets |
|
50,475 |
|
83,274 |
Current liabilities |
|
(30,029) |
|
(53,797) |
Current net assets |
|
20,446 |
|
29,477 |
|
|
|
|
|
Net assets |
|
325,927 |
|
442,388 |
|
|
|
|
|
Accumulated non-controlling interests at the end of the year |
|
159,704 |
|
216,770 |
|
|
|
|
|
Summarized statement of comprehensive income for the year is as follows: |
|
|
|
|
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Revenue |
|
76,488 |
|
73,556 |
Loss for the year |
|
(27,130) |
|
(22,712) |
Other comprehensive (loss)/income |
|
(89,303) |
|
31,819 |
Total comprehensive (loss)/income |
|
(116,433) |
|
9,107 |
|
|
|
|
|
Loss allocated to non-controlling interests during the year |
|
(13,294) |
|
(11,129) |
|
|
|
|
|
|
|
2024 |
|
2023 |
|
|
$’000 |
|
$’000 |
|
|
|
|
|
Cash flows from operating activities |
|
70,772 |
|
59,827 |
Cash flows used in investing activities |
|
(68,639) |
|
(100,771) |
Cash flows from financing activities |
|
11,343 |
|
24,483 |
Net increase/(decrease) in cash and cash equivalents |
|
13,476 |
|
(16,461) |
F-68
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
28.Share-based payments
28.1 Employee share-based payments
Legacy employee share-based payment scheme
The terms of the IHS share-based payment plans for employees were amended on July 10, 2019, such that the exercise prices of the share option were removed and the number of shares an option holder will receive was reduced on a pro-rata basis (taking into account their relative values). The amended terms are:
| ● | No exercise price. |
| ● | On a liquidity event (sale or IPO), the options will be converted and replaced with a fixed pool of shares. |
| ● | In the event of a Sale option holders will receive the entirety of their options in shares. |
| ● | In the event of an IPO: |
| o | Option holders will be awarded two thirds (66.7%) of their options as shares. |
| o | Option holders will further be entitled to receive up to an additional 33.3% of their shares subject to achieving the performance conditions below: |
| ◾ | 50% issued annually if the Group achieves 5% Adjusted EBITDA growth and Adjusted funds from operations (“AFFO”) growth compared to the prior 12 month period where AFFO is defined as the income/(loss) for the period, before income tax expense/(benefit), finance costs and income, depreciation and amortization, impairment of property, plant and equipment, intangible assets excluding goodwill and prepaid land rent on the decommissioning of sites, net (income)/loss on sale of assets, share-based payment (credit)/expense, insurance claims, exceptional items income, exceptional items expense and other non-operating income and expenses, amortization of prepaid site rent, adjusted to take into account interest paid, interest income received, revenue withholding tax, income taxes paid, lease payments made, amortization of prepaid site rent, maintenance capital expenditures and corporate capital expenditures. |
| ◾ | 50% issued annually on a sliding scale basis for Adjusted EBITDA growth and AFFO growth between 5 and 10% compared to the prior 12 month period. |
No share options expired during the year.
On October 14, 2021, the Company announced the pricing of its initial public offering on the New York Stock Exchange (NYSE). In accordance with the terms above option holders were awarded two thirds (66.7%) of their options as shares. 50% of the remaining third (33.3%) were awarded in the year ended December 2022 as the performance conditions stated above had been met. The other 50% of the remaining third were awarded in the year ended December 2023 as the performance conditions stated above were met.
Omnibus employee share-based payment scheme
Between February 4, 2022, and February 7, 2022, a total of 1,147,500 awards, of which 237,060 awards have been forfeited due to employee leavers, were issued as part of the new Omnibus employee share-based payment plan. The plan will be deemed equity settled and comprise of:
| ● | Restricted stock units (“RSU”), which do not include performance conditions and vest in three equal portions on October 15, 2022, 2023, and 2024. |
| ● | Performance stock units (“PSU”), part with an Adjusted Levered Free Cash Flow (“ALFCF”) target and part with a cumulative total shareholder return (“TSR”) target. The ALFCF target is a non-market-based performance condition, assessed annually over a three-year period. The cumulative TSR target is market-based, was valued based on a Monte Carlo model for a three-year performance period, an approach that is commonly used for IFRS 2 Share-based Payment (“IFRS 2”) valuations. |
F-69
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The PSUs with a cumulative TSR target include a vesting period up to October 15, 2024. The PSUs with an ALFCF target include a vesting period up to December 31, 2024.
At the end of the vesting period for the PSUs with the cumulative TSR target, this target was not met and all awards were forfeited. However, the share-based payment charge will not be reversed for these forfeiture awards, as the market condition was not met.
On June 9, 2022, a total of 1,700,446 awards, of which 98,903 awards have been forfeited due to employee leavers, were issued as part of the existing Omnibus employee share-based payment plan. The plan will be deemed equity settled and comprise of:
| ● | Restricted stock units (“RSU”), which do not include performance conditions and vest in three equal portions on March 31, 2023, 2024, and 2025. |
| ● | Performance stock units (“PSU”), part with an ALFCF target and part with a cumulative TSR target. The ALFCF target is a non-market-based performance condition, assessed annually over a three-year period up to December 31, 2024. The cumulative TSR target is market-based, was valued based on a Monte Carlo model for a three-year performance period, an approach that is commonly used for IFRS 2 valuations. The PSUs include a vesting period which is 3 years up to March 31, 2025. |
On October 14, 2022, a total of 94,876 awards were issued as part of the existing Omnibus employee share-based payment plan. The plan was deemed to be equity settled and comprised of Restricted stock units (“RSU”) which do not include performance conditions. The plan was set to vest in three equal portions on June 1, 2023, 2024, and 2025, but due to employee leavers, the final vesting was accelerated and settlement took place in 2024.
On May 25, 2023, a total of 2,132,134 awards, of which 152,039 awards have been forfeited due to employee leavers, were issued as part of the existing Omnibus employee share-based payment plan. The plan will be deemed equity settled and comprise of:
| ● | Restricted stock units (“RSU”), which do not include performance conditions and vest in three equal portions on April 6, 2024, 2025, and 2026. |
| ● | Performance stock units (“PSU”), part with an ALFCF target and part with a cumulative TSR. The ALFCF target is a non-market-based performance condition, assessed annually over a three-year period. The cumulative TSR target is market-based, was valued based on a Monte Carlo model for a three-year performance period, an approach that is commonly used for IFRS 2 valuations. The PSUs include a vesting period which is 3 years up to April 6, 2026. |
On May 16, 2024, a total of 6,339,851 awards, of which 44,500 awards have been forfeited due to employee leavers, were issued as part of the existing Omnibus employee share-based payment plan. The plan will be deemed equity settled and comprise of:
| ● | Restricted stock units (“RSU”), which do not include performance conditions and vest in three equal portions on March 15, 2025, 2026 and 2027. |
| ● | Performance stock units (“PSU”), part with an ALFCF target and parti with a cumulative total shareholder return target. The ALFCF target is a non-market-based performance condition, assessed annually over a three-year period. The cumulative TSR target is market-based, was valued based on a Monte Carlo model for a three-year performance period, an approach that is commonly used for IFRS 2 valuations. The PSUs include a vesting period which is 3 years up to March 15, 2027. |
F-70
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Total charge included in the consolidated statement of loss and other comprehensive income is as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
Expense under equity settled classification from date of amendment |
|
20,343 |
|
13,370 |
|
13,265 |
|
|
2024 |
|
|
Omnibus |
|
|
plan |
|
|
000’s |
|
|
|
Authorized |
|
10,470 |
|
|
|
Issued |
|
|
At January 1 |
|
4,130 |
Issued |
|
6,340 |
Forfeited |
|
(321) |
Exercised during the year |
|
(885) |
At December 31 |
|
9,264 |
|
|
2023 |
||||||||
|
|
Incentive |
|
Incentive |
|
Incentive |
|
Incentive |
|
Omnibus |
|
|
plan 1 |
|
plan 2 |
|
plan 2B |
|
plan 3 |
|
plan |
|
|
000’s |
|
000’s |
|
000’s |
|
000’s |
|
000’s |
|
|
|
|
|
|
|
|
|
|
|
Authorized |
|
634 |
|
2,560 |
|
768 |
|
10 |
|
4,750 |
|
|
|
|
|
|
|
|
|
|
|
Issued |
|
|
|
|
|
|
|
|
|
|
At January 1 |
|
634 |
|
2,560 |
|
768 |
|
10 |
|
2,618 |
Issued |
|
— |
|
— |
|
— |
|
— |
|
2,132 |
Forfeited |
|
(317) |
|
(1,280) |
|
(384) |
|
(5) |
|
(127) |
Exercised during the period |
|
(317) |
|
(1,280) |
|
(384) |
|
(5) |
|
(493) |
At December 31 |
|
— |
|
— |
|
— |
|
— |
|
4,130 |
(b)The valuation assumptions used to carry out the valuation of the scheme
The share option plans have been valued using a Black Scholes model, an approach that is commonly used for similar IFRS 2 valuations.
Valuation assumptions - legacy employee share-based payment scheme
At the modification date of July 10, 2019, the exercise price term was amended to $nil and no dividends were expected to be paid in the near future, as a result the options were deep in the money and the Black Scholes model returned the value of the share price for the value of the option. The share price assumption used was $22.04. A forfeiture rate of 10% and 5% was assumed for the LTIP1 and LTIP2 plans respectively and 0% for LTIP2B and LTIP3.
F-71
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
Further options were issued as follows:
| ● | March 9, 2020: 120,228 options were issued, valued at $2.2 million at issue using a share price assumption of $21.20. |
| ● | July 14, 2020: 33,405 options were issued, valued at $0.7 million at issue using a share price assumption of $22.14. |
| ● | July 1, 2021: 159,369 options were issued, valued at $3.7 million at issue using a share price assumption of $23.19. |
Assumptions regarding forfeiture rates and dividends were consistent with those used at the modification date of the original legacy employee scheme, except for 2021 issuance where 0% forfeiture rate was assumed.
The above information has been adjusted for the reverse share split that took place in October 2021.
Valuation assumptions - Omnibus employee share-based payment scheme
The Omnibus awards issued were valued at $71.4 million at issue using a share price assumption within a range of $3.39 - $11.55 depending on the grant date. The fair value of the RSUs and PSUs with non-market conditions determined using share price at grant date amounted to $29.5 million and $29.3 million respectively while the fair value of the PSUs with market conditions determined using the Monte Carlo model amounted to $12.6 million. At December 31, 2024, a forfeiture rate range of 6% to 7% was assumed resulting in an expected charge over the remaining term of the awards of $17.5 million. Volatility within a range of 35.9% and 58.31% was determined by calculating the observed historical volatilities over the end of the performance period of the grants. No dividend was taken into account in performing the valuation since IHS Holding Limited has never paid dividends and no dividends are planned to be paid in the near future.
(iii)Weighted-average remaining contractual life
The weighted-average remaining contractual life in the table as follows is simply the period of time from the year end date to the expiry date of each of the awards.
|
|
2024 |
|
|
|
2023 |
|
|
|
|
Weighted |
|
Number of |
|
Weighted |
|
Number of |
|
|
average |
|
awards in force |
|
average |
|
awards in force |
|
|
remaining |
|
at year end |
|
remaining |
|
at year end |
|
|
contractual life(a) |
|
|
|
contractual life(a) |
|
|
Year of grant |
|
|
|
|
|
|
|
|
2022 |
|
0.26 |
|
1,266,575 |
|
1.02 |
|
2,041,836 |
2023 |
|
1.16 |
|
1,734,542 |
|
1.96 |
|
2,088,008 |
2024 |
|
1.86 |
|
6,263,368 |
|
— |
|
— |
|
|
|
|
9,264,485 |
|
|
|
4,129,844 |
| (a) | The contractual remaining life has been determined using vesting dates as all awards are expected to be exercised on vesting date. |
28.2 Other share-based payments
B-BBEE Transaction
In December 2024, the Group received clearance from the Competition Commission of South Africa for the subscription of 30% of the shares in its subsidiary, IHS South Africa Holding Proprietary Limited (“IHS South Africa”) by SA Tower Holdings Proprietary Limited (“SATH”), a consortium of B-BBEE parties. The transaction completed in January 2025 and forms part of our B-BBEE compliance. Consideration for the shares is funded through a notional vendor loan arrangement, whereby the loan can be reduced by future dividends due to SATH as a minority shareholder.
F-72
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The agreement to provide shares at a fixed amount, settled in the future through notional vendor financing is accounted for together as an equity-settled share based payment arrangement under IFRS 2. As there were no vesting conditions, the fair value of the award of $7.6 million was expensed in full at the grant date, which was determined to be the date of clearance by the Competition Commission of South Africa. The grant date was the date of this approval as both parties also had a shared understanding of the terms and conditions of the arrangement. The expense is recognized within Administrative expenses.
29.Cash from operations
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$'000 |
|
$'000 |
Reconciliation |
|
|
|
|
|
|
Loss before taxation |
|
(1,610,244) |
|
(1,880,650) |
|
(543,979) |
Adjustments |
|
|
|
|
|
|
Depreciation of property, plant and equipment (note 7 and 8) |
|
315,967 |
|
385,203 |
|
421,574 |
Amortization of intangible assets (note 7 and 8) |
|
46,768 |
|
50,383 |
|
47,330 |
Amortization of prepaid site rent |
|
9,938 |
|
9,534 |
|
9,631 |
Impairment of property, plant and equipment, intangible assets excluding goodwill and related prepaid land rent (note 7 and 8) |
|
14,798 |
|
87,696 |
|
38,157 |
Impairment of assets held for sale (note 7) |
|
2,853 |
|
— |
|
— |
Impairment of goodwill (note 8) |
|
87,894 |
|
— |
|
121,596 |
Net impairment of withholding tax receivables (note 8) |
|
1,081 |
|
47,992 |
|
52,334 |
Impairment of inventory |
|
11,910 |
|
— |
|
138 |
Net loss/(gain) on disposal of property, plant and equipment and right-of-use assets (note 8) |
|
20,163 |
|
(3,806) |
|
3,382 |
(Net reversal of loss allowance)/net loss allowance on trade receivables (note 8.1) |
|
(25) |
|
7,202 |
|
(4,446) |
Insurance claim income (note 9) |
|
(73) |
|
(321) |
|
(2,092) |
Gain on disposal of subsidiary (note 9) |
|
(83,838) |
|
— |
|
— |
Finance income (note 10) |
|
(33,747) |
|
(25,209) |
|
(15,825) |
Finance costs (note 11) |
|
2,123,138 |
|
2,436,511 |
|
872,049 |
Share‑based payment expense (note 28) |
|
27,940 |
|
13,370 |
|
13,265 |
Operating income before working capital changes |
|
934,523 |
|
1,127,905 |
|
1,013,114 |
|
|
|
|
|
|
|
Changes in working capital |
|
|
|
|
|
|
(Increase)/decrease in inventory |
|
(14,967) |
|
11,249 |
|
(37,750) |
Increase in trade and other receivables |
|
(200,588) |
|
(295,260) |
|
(141,723) |
Increase in trade and other payables |
|
56,888 |
|
59,029 |
|
133,233 |
Net movement in working capital |
|
(158,667) |
|
(224,982) |
|
(46,240) |
|
|
|
|
|
|
|
Cash from operations |
|
775,856 |
|
902,923 |
|
966,874 |
F-73
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
30Related parties
30.1Subsidiaries
IHS Holding Limited (“the Parent”) is the ultimate parent of the related parties at the year-end, which are as follows:
|
|
|
|
|
|
|
|
Ownership |
|
|
|
|
|
|
|
|
|
|
|
interests |
|
Ownership |
|
|
|
|
|
|
|
|
|
held |
|
interests held |
|
|
|
|
|
|
|
Country of |
|
by the Group |
|
by the Group |
|
Entity name |
|
|
|
Principal activity(a) |
|
incorporation |
|
2024 |
|
2023 |
|
IHS Fiber Brasil - Cessão de Infraestruturas Ltda. |
|
|
|
Holding company |
|
Brazil |
|
100 |
% |
100 |
% |
IHS Brasil - Cessão de Infraestruturas S.A. |
|
|
|
Operating |
|
Brazil |
|
100 |
% |
100 |
% |
IHS Brasil Serviços de Infraestrutura Ltda. |
|
(b) |
|
Operating |
|
Brazil |
|
100 |
% |
100 |
% |
I-Systems Soluções de Infraestrutura S.A. |
|
|
|
Operating |
|
Brazil |
|
51 |
% |
51 |
% |
San Gimignano Imoveis e Adminsitracao Ltda. |
|
|
|
Provision of land management |
|
Brazil |
|
100 |
% |
100 |
% |
Centennial Towers of Colombia Ltd. |
|
|
|
Financing company |
|
British Virgin Islands |
|
100 |
% |
100 |
% |
IHS Cameroon S.A. |
|
|
|
Operating |
|
Cameroon |
|
100 |
% |
100 |
% |
Centennial Towers Colombia S.A.S. |
|
|
|
Operating |
|
Colombia |
|
100 |
% |
100 |
% |
IHS Towers Colombia S.A.S |
|
|
|
Operating |
|
Colombia |
|
100 |
% |
100 |
% |
Polar Breeze Colombia S.A.S |
|
|
|
Operating |
|
Colombia |
|
100 |
% |
100 |
% |
IHS Côte d’Ivoire S.A. |
|
|
|
Operating |
|
Côte d’Ivoire |
|
100 |
% |
100 |
% |
IHS Telecom Towers Egypt S.A.E. |
|
|
|
Operating |
|
Egypt |
|
80 |
% |
80 |
% |
IHS KSA Limited |
|
(c) |
|
Operating |
|
Kingdom of Saudi Arabia |
|
— |
% |
100 |
% |
IHS Kuwait Limited |
|
(c) |
|
Operating |
|
Kuwait |
|
— |
% |
100 |
% |
IHS Mauritius Cameroon Limited |
|
|
|
Holding company |
|
Mauritius |
|
100 |
% |
100 |
% |
IHS Mauritius Côte d’Ivoire Limited |
|
|
|
Holding company |
|
Mauritius |
|
100 |
% |
100 |
% |
IHS Mauritius Netherlands Limited |
|
|
|
Holding company |
|
Mauritius |
|
100 |
% |
100 |
% |
IHS Mauritius Rwanda Limited |
|
|
|
Holding company |
|
Mauritius |
|
100 |
% |
100 |
% |
IHS Mauritius Zambia Limited |
|
|
|
Holding company |
|
Mauritius |
|
100 |
% |
100 |
% |
Centennial Towers Brasil Cooperatief U.A. |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
Centennial Towers of Brasil B.V. |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
IHS Netherlands (Interco) Coöperatief U.A. |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
IHS Netherlands BR B.V |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
IHS Netherlands Connect B.V. |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
IHS Netherlands EGY B.V. |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
IHS Netherlands GCC B.V. |
|
(c) |
|
Holding company |
|
Netherlands |
|
— |
% |
100 |
% |
IHS Netherlands KSA B.V. |
|
(c) |
|
Holding company |
|
Netherlands |
|
— |
% |
100 |
% |
IHS Netherlands NG1 B.V. |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
IHS Netherlands NG2 B.V. |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
IHS Netherlands PHP B.V |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
IHS Netherlands RSA B.V |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
Nigeria Tower Interco B.V. |
|
|
|
Holding company |
|
Netherlands |
|
100 |
% |
100 |
% |
IHS Netherlands Holdco B.V. |
|
|
|
Provision of finance |
|
Netherlands |
|
100 |
% |
100 |
% |
Global Independent Connect Limited |
|
|
|
Operating |
|
Nigeria |
|
100 |
% |
100 |
% |
IHS Nigeria Limited |
|
|
|
Operating |
|
Nigeria |
|
100 |
% |
100 |
% |
IHS Towers NG Limited |
|
|
|
Operating |
|
Nigeria |
|
100 |
% |
100 |
% |
INT Towers Limited |
|
|
|
Operating |
|
Nigeria |
|
100 |
% |
100 |
% |
INT Towers NG Finco 1 PLC |
|
|
|
Provision of finance |
|
Nigeria |
|
100 |
% |
n/a |
|
IHS E-Services (NG) Limited |
|
|
|
Provision of management services |
|
Nigeria |
|
100 |
% |
100 |
% |
IHS Peru S.A.C. |
|
(c) |
|
Operating |
|
Peru |
|
— |
% |
100 |
% |
IHS Rwanda Limited |
|
|
|
Operating |
|
Rwanda |
|
100 |
% |
100 |
% |
Rwanda Towers Limited |
|
|
|
Operating |
|
Rwanda |
|
100 |
% |
100 |
% |
IHS South Africa Holding Proprietary Limited |
|
|
|
Holding company |
|
South Africa |
|
100 |
% |
100 |
% |
IHS Towers South Africa Proprietary Limited |
|
|
|
Operating |
|
South Africa |
|
100 |
% |
100 |
% |
IHS GCC MAR Holding Limited |
|
|
|
Holding company |
|
United Arab Emirates |
|
100 |
% |
100 |
% |
IHS FinCo Management Limited |
|
|
|
Provision of finance |
|
United Arab Emirates |
|
100 |
% |
100 |
% |
IHS GCC Limited |
|
|
|
Provision of management services |
|
United Arab Emirates |
|
100 |
% |
100 |
% |
IHS SSC FZE |
|
|
|
Provision of management services |
|
United Arab Emirates |
|
100 |
% |
100 |
% |
IHS GCC KW Holding Limited |
|
(c) |
|
Provision of management services |
|
United Arab Emirates |
|
— |
% |
70 |
% |
IHS Africa (UK) Limited |
|
|
|
Provision of management services |
|
United Kingdom |
|
100 |
% |
100 |
% |
IHS Towers Inc. |
|
|
|
Provision of management services |
|
United States of America |
|
100 |
% |
100 |
% |
IHS Zambia Limited |
|
|
|
Operating |
|
Zambia |
|
100 |
% |
100 |
% |
The shares of the Parent are widely owned by various investors. No investor has the full controlling right over the Company.
F-74
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
30.2Key management personnel
Key management personnel comprise the Non-Executive Directors of the Company and the Group’s Executive Officers. The compensation in relation to key management personnel is as follows:
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$’000 |
|
$’000 |
Key management compensation |
|
|
|
|
|
|
Short‑term employee benefits |
|
22,712 |
|
18,354 |
|
19,980 |
Post-employment benefits |
|
674 |
|
154 |
|
1,723 |
Termination benefits |
|
1,250 |
|
— |
|
— |
|
|
24,636 |
|
18,508 |
|
21,703 |
Share-based payments |
|
10,012 |
|
6,696 |
|
5,380 |
|
|
34,648 |
|
25,204 |
|
27,083 |
30.3Other related party transactions and balances
As described in note 28.2, in December 2024, the Group received clearance from the Competition Commission of South Africa for the subscription of 30% of the shares in its subsidiary, IHS South Africa, by SATH, a consortium of B-BBEE parties. The transaction completed in January 2025. The completion of this transaction satisfies one of the conditions set by the Competition Commission of South Africa, to achieve and maintain certain B-BBEE contributor levels.
Capgro Trust, a family trust for the Phuthuma Nhleko family, is the sole shareholder of K2022644716 (South Africa) Proprietary Limited, which holds a 45% stake in SATH. Mr. Phuthuma Nhleko, one of our directors, serves as a trustee of the Capgro Trust and has agreed that he is prohibited from receiving, directly or indirectly, in his personal capacity, any proceeds of dividends or other distributions originating from IHS South Africa or as a result of the notional vendor funding arrangements.
During the year ended December 31, 2024, DAR Telecom Consulting LLC (“DAR Telecom”) was paid $nil (2023: $nil, 2022: $175,000) for services provided by Mr. Sam Darwish, the Chairman & Group Chief Executive Officer. DAR Telecom is controlled by Mr. Darwish. These amounts are included in Key Management Compensation.
During the year ended December 31, 2024, the Group incurred costs on behalf of Mr. Darwish of $nil (2023: $nil, 2022: $26,910) which were fully repaid by DAR Telecom.
During the year ended December 31, 2022, the Group entered into an arm’s length agreement to sub-lease office space from a subsidiary company of Wendel Group, a significant shareholder of the Company. Under the sub-lease agreement, the Group paid rent and utilities for the year ended December 31, 2024, amounting to $134,631 and was refunded the deposit previously paid of $195,298 (2023: $366,896, 2022: rent and utilities of $343,600 and a deposit of $195,298). The sub-lease agreement was terminated on May 31, 2024.
During the year ended December 31, 2023, the Group entered into an arm’s length agreement for the provision of consulting services from Teneo. Ms. Ursula Burns, one of our directors, is the Chairwoman of the Board of Teneo Worldwide, LLC. The total fees paid to Teneo for the year ended December 31, 2024, were $2,309,009 (2023: $750,000, 2022: $nil).
There were no other material transactions or balances between the Group and its key management personnel or members of their close family.
F-75
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
31.Business combinations and disposals
31.1Acquisitions
For acquisitions that meet the definition of a business combination, with the exception of the additional stages of the Kuwait Acquisition which are accounted for as asset acquisition, the Group applies the acquisition accounting method where assets acquired and liabilities assumed are recorded at fair value at the date of each acquisition, and the results of operations are included with those of the Group from the dates of the respective acquisitions. The Group completed one additional stage of the Kuwait Acquisition in 2023 (the subsidiary was disposed of in the current year as described in note 31.2). There were no acquisitions during the year ended December 31, 2024.
IHS Kuwait Limited
In the 2020 financial year IHS GCC KW Holding Limited (“IHS GCC KW”), a subsidiary of IHS Holding Limited completed the first two stages of the acquisition of 1,620 towers from Mobile Telecommunications Company K.S.C.P. (“Zain Kuwait”) comprising 1,162 towers. During April 2021, October 2021, September 2022 and August 2023 IHS GCC KW completed the third, fourth, fifth and sixth stages of the acquisition of 1,620 towers from Zain Kuwait comprising 67, 126, 43 and 101 towers respectively.
As part of the transaction, some towers that were not purchased were managed and operated under a Managed Services agreement. IHS GCC KW transferred the purchase right to IHS Kuwait Limited for the Construction, Erection and Maintenance of Wired and Wireless Communication and Radar Towers and Stations with Limited Liability (“IHS Kuwait”) who operates the towers as a standalone business. As part of the agreement, IHS Kuwait also assumed existing supplier contracts and land leases, allowing it to apply the Group business processes and deliver services immediately after the assignment of the towers.
As part of the agreement, Zain Kuwait subscribed for shares in IHS GCC KW representing 30% of the share capital of IHS GCC KW by issuing a loan note to IHS GCC KW. The acquisition is consistent with the Group’s strategy to expand in selected geographic areas.
The table as follows summarizes the consideration paid and the fair value of assets and liabilities acquired at the acquisition date of the 101 towers acquired in 2023.
|
|
2023 |
|
|
$’000 |
|
|
|
Gross consideration |
|
6,408 |
Less: consideration received in exchange for a retained 30% interest (by Zain Kuwait) in IHS GCC KW |
|
(1,922) |
Net consideration for 70% controlling interest in the acquired towers |
|
4,486 |
|
|
|
Identifiable assets acquired and liabilities assumed: |
|
|
Towers and tower equipment |
|
5,576 |
Customer-related assets |
|
2,224 |
Network-related assets |
|
766 |
Trade and other payables |
|
(2,158) |
Total identifiable net assets acquired (at 100%) |
|
6,408 |
|
|
|
Goodwill |
|
— |
|
|
|
Non-controlling interests |
|
1,922 |
F-76
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
31.2Disposals
On December 19, 2024, the Group completed the sale of its 70% interest in IHS Kuwait Limited (“IHS Kuwait”) to Zain Group. The net assets disposed of and the resulting net gain on disposal are as follows:
|
|
2024 |
|
|
$’000 |
|
|
|
Net assets disposed |
|
(77,044) |
Non-controlling interests derecognized |
|
23,181 |
Exchange differences on translation of foreign operations recycled |
|
(98) |
|
|
(53,961) |
|
|
|
Proceeds |
|
139,806 |
Costs of disposal |
|
(1,943) |
Net gain on disposal |
|
83,902 |
The net gain on disposal is included in Other income in the consolidated statement of loss and other comprehensive income. The disposal proceeds were entirely in cash, and net assets disposed of included cash of $23.5 million.
On April 30, 2024, the Group completed the sale of its wholly owned subsidiary IHS Peru S.A.C.
There were no business disposals in the preceding year.
32Capital commitments and contingent liabilities
32.1Capital commitments
The Group was committed to the purchase of property, plant and equipment of $98.9 million as of December 31, 2024 (2023: $162.9 million).
32.2Contingent liabilities
The Group has contingent liabilities in respect of legal claims arising in the ordinary course of business. The Group reviews these matters in consultation with internal and external legal counsel to determine on a case-by-case basis whether a loss from each of these matters is probable, possible or remote.
The Group’s possible contingent liabilities in respect of litigations and claims amounted to $7.7 million at the end of the reporting period (2023: $11.9 million).
Based on legal advice received, the Group’s liability is not considered probable, thus no provisions have been made in these consolidated financial statements.
In the ordinary course of business the Group is subject to regular tax reviews in the jurisdictions in which it operates, and out of which a number of tax disputes have been raised. Whilst the Group vigorously defends its positions in this regard, it does recognize a provision for uncertain tax positions and believes that the probable quantum of potential future cash outflows in relation to these tax disputes is unlikely to exceed the amount provided in this regard.
F-77
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
33.Events after the reporting period
On March 13, 2025, the Group acquired 100% of SPE Imóveis e Torres Selecionados as part of the Oi S.A. Judicial Recovery Plan. The acquisition effectively converts the 1,567 towers and 187 related land assets, already held by the Group as right-of use assets, to property, plant and equipment. The transaction was non-cash and was settled through discounts already given to Oi under the Judicial Recovery Plan agreed in April 2024.
F-78
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
SCHEDULE 1 - COMPANY STATEMENT OF (LOSS)/INCOME AND OTHER COMPREHENSIVE (LOSS)/INCOME
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
Administrative expenses |
|
(1,326,042) |
|
(267,382) |
|
(264,011) |
Other income |
|
64,111 |
|
429,698 |
|
2,329 |
Operating (loss)/income |
|
(1,261,931) |
|
162,316 |
|
(261,682) |
Finance income |
|
91,201 |
|
76,753 |
|
67,927 |
Finance costs |
|
(137,833) |
|
(127,044) |
|
(135,783) |
(Loss)/income before income tax |
|
(1,308,563) |
|
112,025 |
|
(329,538) |
Income tax expense |
|
— |
|
— |
|
— |
(Loss)/Income for the year |
|
(1,308,563) |
|
112,025 |
|
(329,538) |
Administrative expenses for the year ended December 31, 2024, include an impairment charge of $1,141.7 million on investments in subsidiaries, primarily driven by the devaluation of the Naira.
F-79
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
COMPANY STATEMENT OF FINANCIAL POSITION
|
|
|
|
2024 |
|
2023 |
|
|
Note |
|
$’000 |
|
$’000 |
Non-current assets |
|
|
|
|
|
|
Property, plant and equipment |
|
|
|
49 |
|
26 |
Other intangible assets |
|
|
|
1,092 |
|
1,357 |
Investments in subsidiaries |
|
|
|
3,928,288 |
|
5,508,489 |
Amounts due from related parties |
|
|
|
1,232,182 |
|
774,066 |
Derivative financial instrument assets |
|
|
|
21,820 |
|
230 |
|
|
|
|
5,183,431 |
|
6,284,168 |
Current assets |
|
|
|
|
|
|
Amounts due from related parties |
|
|
|
1,046,332 |
|
322,830 |
Derivative financial instrument assets |
|
|
|
— |
|
565 |
Trade and other receivables |
|
|
|
8,994 |
|
16,964 |
Cash and cash equivalents |
|
|
|
306,039 |
|
67,335 |
|
|
|
|
1,361,365 |
|
407,694 |
|
|
|
|
|
|
|
TOTAL ASSETS |
|
|
|
6,544,796 |
|
6,691,862 |
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
Borrowings |
|
2 |
|
2,299,460 |
|
1,358,290 |
Financial guarantees |
|
2 |
|
18,157 |
|
2,357 |
|
|
|
|
2,317,617 |
|
1,360,647 |
Current liabilities |
|
|
|
|
|
|
Trade and other payables |
|
|
|
19,823 |
|
14,035 |
Borrowings |
|
2 |
|
22,229 |
|
10,200 |
Amounts due to related parties |
|
|
|
503,049 |
|
336,510 |
|
|
|
|
545,101 |
|
360,745 |
|
|
|
|
|
|
|
TOTAL LIABILITIES |
|
|
|
2,862,718 |
|
1,721,392 |
|
|
|
|
|
|
|
Stated capital |
|
|
|
5,403,139 |
|
5,394,812 |
Accumulated losses |
|
|
|
(1,926,067) |
|
(617,504) |
Other reserves |
|
|
|
205,006 |
|
193,162 |
TOTAL EQUITY |
|
|
|
3,682,078 |
|
4,970,470 |
|
|
|
|
|
|
|
TOTAL EQUITY AND LIABILITIES |
|
|
|
6,544,796 |
|
6,691,862 |
F-80
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
COMPANY STATEMENT OF CHANGES IN EQUITY
|
|
|
|
|
|
|
|
|
|
|
Stated |
|
Accumulated |
|
Other |
|
Total |
|
|
capital |
|
losses |
|
reserves |
|
equity |
|
|
$’000 |
|
$’000 |
|
$’000 |
|
$’000 |
|
|
|
|
|
|
|
|
|
At January 1, 2022 |
|
5,223,484 |
|
(402,418) |
|
352,197 |
|
5,173,263 |
Exercise of share options |
|
88,469 |
|
— |
|
(88,469) |
|
— |
Share-based payment expense |
|
— |
|
— |
|
13,423 |
|
13,423 |
Other reclassifications related to share-based payment |
|
— |
|
1,560 |
|
(2,835) |
|
(1,275) |
Total transactions with owners |
|
88,469 |
|
1,560 |
|
(77,881) |
|
12,148 |
Loss for the year |
|
— |
|
(329,538) |
|
— |
|
(329,538) |
At December 31, 2022 |
|
5,311,953 |
|
(730,396) |
|
274,316 |
|
4,855,873 |
|
|
|
|
|
|
|
|
|
At January 1, 2023 |
|
5,311,953 |
|
(730,396) |
|
274,316 |
|
4,855,873 |
Shares repurchased and canceled through buyback program |
|
(10,037) |
|
— |
|
— |
|
(10,037) |
Exercise of share options |
|
92,896 |
|
— |
|
(92,896) |
|
— |
Share-based payment expense |
|
— |
|
— |
|
13,168 |
|
13,168 |
Other reclassifications related to share-based payment |
|
— |
|
867 |
|
(1,426) |
|
(559) |
Total transactions with owners |
|
82,859 |
|
867 |
|
(81,154) |
|
2,572 |
Income for the year |
|
— |
|
112,025 |
|
— |
|
112,025 |
At December 31, 2023 |
|
5,394,812 |
|
(617,504) |
|
193,162 |
|
4,970,470 |
|
|
|
|
|
|
|
|
|
At January 1, 2024 |
|
5,394,812 |
|
(617,504) |
|
193,162 |
|
4,970,470 |
Exercise of share options |
|
8,327 |
|
— |
|
(8,327) |
|
— |
Share-based payment expense |
|
— |
|
— |
|
20,171 |
|
20,171 |
Total transactions with owners |
|
8,327 |
|
— |
|
11,844 |
|
20,171 |
Loss for the year |
|
— |
|
(1,308,563) |
|
— |
|
(1,308,563) |
At December 31, 2024 |
|
5,403,139 |
|
(1,926,067) |
|
205,006 |
|
3,682,078 |
F-81
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
COMPANY STATEMENT OF CASH FLOWS
|
|
2024 |
|
2023 |
|
2022 |
|
|
$’000 |
|
$’000 |
|
$’000 |
Cash flows from operating activities |
|
|
|
|
|
|
Cash from/(used in) operations |
|
267 |
|
(105,822) |
|
(86,202) |
Net cash from/(used in) operating activities |
|
267 |
|
(105,822) |
|
(86,202) |
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
Purchase of property, plant and equipment |
|
(34) |
|
(35) |
|
— |
Purchase of software and licenses |
|
(248) |
|
(1,351) |
|
(54) |
Investment in subsidiaries |
|
(72,542) |
|
(33,588) |
|
(439,141) |
Dividends received from subsidiaries |
|
52,220 |
|
— |
|
— |
Loan disbursed to subsidiaries |
|
(880,278) |
|
(600) |
|
(254,615) |
Loan principal repayment received from subsidiaries |
|
263,574 |
|
43,007 |
|
47,601 |
Loan interest repayment received from subsidiaries |
|
61,202 |
|
23,632 |
|
39,401 |
Interest received |
|
6,772 |
|
8,490 |
|
3,270 |
Net cash (used in)/from investing activities |
|
(569,334) |
|
39,555 |
|
(603,538) |
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
Shares repurchased and canceled through buyback program |
|
— |
|
(10,038) |
|
— |
Interest paid |
|
(110,686) |
|
(92,549) |
|
(69,075) |
Bank loans and bond proceeds received (net of transaction costs) |
|
1,922,253 |
|
— |
|
643,785 |
Loan receipts from subsidiaries |
|
— |
|
— |
|
100,000 |
Fees on borrowings and derivative instruments |
|
(4,061) |
|
(10,185) |
|
(11,574) |
Bank loans and bonds repaid |
|
(1,000,000) |
|
— |
|
(280,000) |
Premium paid on derivative instruments |
|
— |
|
— |
|
(910) |
Net gain settled on derivative instruments |
|
796 |
|
419 |
|
— |
Net cash from/(used in) financing activities |
|
808,302 |
|
(112,353) |
|
382,226 |
|
|
|
|
|
|
|
Net increase/(decrease) in cash and cash equivalents |
|
239,235 |
|
(178,620) |
|
(307,514) |
Cash and cash equivalents at beginning of year |
|
67,335 |
|
245,373 |
|
554,100 |
Exchange differences |
|
(531) |
|
582 |
|
(1,213) |
Cash and cash equivalents at end of year |
|
306,039 |
|
67,335 |
|
245,373 |
F-82
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
NOTES TO THE COMPANY FINANCIAL STATEMENTS
1. Basis of preparation
The accompanying condensed financial statements of IHS Holding Limited (the “Parent”) should be read in conjunction with the consolidated financial statements and notes thereto of IHS Holding Limited and subsidiaries (collectively, the “Registrant”) included in Part I, Item 8 of the Annual Report. The accompanying condensed financial statements of the Parent have been prepared in accordance with Rule 12-04, Schedule 1 of Regulation S-X.
The Parent’s accounting policies are consistent with those of the Registrant. In the Parent only financial statements, investments in subsidiaries are accounted for at cost less accumulated impairment losses, unless the investment is acquired with a view to its subsequent disposal and the criteria for classification as held-for-sale are met. Transaction fees are included in the acquisition cost. An impairment loss is recognized for the amount by which the investment carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and its value in use.
2. Long term debt
IHS Holding 2021 Notes Issuance
In November 2024, the 2026 Notes were partially redeemed, in an aggregate principal amount outstanding of $300.0 million following the issuance of the IHS Holding 2030/31 Notes and as of December 31, 2024, the aggregate principal amount outstanding on the IHS Holding 2026/28 Notes is $700.0 million.
IHS Holding (2022) Bullet Term Loan
In March 2024, the available commitments under the Company’s October 2022 loan facility were voluntarily reduced by $70.0 million and the remaining available commitments of $60.0 million were drawn down in April 2024, with the proceeds applied towards general corporate purposes, resulting in the facility being fully drawn at $430.0 million.
This drawn amount of $430.0 million was fully prepaid in October 2024 using the proceeds received from the IHS Holding 2024 Dual-Tranche Term Loan.
IHS Holding (2024) Term Loan
In March 2024, the Company entered into a $270.0 million loan agreement with Standard Chartered Bank (Singapore) Limited as the original lender. This facility is scheduled to terminate in March 2026 and is repayable in installments.
The applicable interest rate per annum is Term SOFR, plus a margin ranging from 4.50% to 7.00% per annum over the duration of facility, based on the relevant margin step-up date.
This facility was fully drawn in March 2024 and the majority of the proceeds were applied toward the repayment of the Letter of Credit Facilities in Nigeria. In November 2024, this facility was fully prepaid using the proceeds received from the IHS Holding 2030/31 Notes.
IHS Holding (2024) Dual-Tranche Term Loan
In October 2024, IHS Holding Limited entered into and drew down on a dual-tranche $255.0 million and ZAR 3,246.0 million loan agreement (together totaling approximately $427.6 million). This syndicated facility is scheduled to terminate in October 2029. The majority of the proceeds were applied toward the repayment of the IHS Holding (2022) Bullet Term Loan and general corporate purposes.
F-83
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
IHS Holding 2024 Notes Issuance
In November 2024, IHS Holding Limited issued $550.0 million 7.875% Senior Notes due 2030 (the “2030 Notes”) and $650.0 million 8.250% Senior Notes due 2031 (the “2031 Notes”, and together with the 2030 Notes, the “IHS Holding 2030/31 Notes”), guaranteed by IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., IHS Nigeria Limited, IHS Towers NG Limited, INT Towers Limited and INT Towers NG Finco 1 Plc.
The proceeds of the issuance of the IHS Holding 2030/31 Notes were used to partially redeem the principal amount of the 2026 Notes and 2027 Notes and fully prepay the IHS Holding (2024) Term Loan (including accrued and unpaid interest), fees and expenses related to the offering of the notes, and for general corporate purposes. The IHS Holding 2030/31 Notes pay interest semi-annually in arrear and the principal is repayable in full on maturity.
A schedule of debt maturities is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carrying |
|
Within |
|
1 - 3 |
|
3 - 5 |
|
Over 5 |
|
|
|
|
|
|
|
|
|
value |
|
1 year |
|
years |
|
years |
|
years |
|
|
Currency |
|
Maturity date |
|
Interest rate |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
$'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dual-tranche Bullet Term Loan Facility |
|
USD |
|
Oct'29 |
|
4.50 |
% + 3M SOFR |
|
256,640 |
|
23,737 |
|
47,344 |
|
302,408 |
|
— |
Dual-tranche Bullet Term Loan Facility |
|
ZAR |
|
Oct'29 |
|
4.50 |
% + 3M JIBAR |
|
175,230 |
|
21,702 |
|
43,286 |
|
215,907 |
|
— |
2024 Notes |
|
USD |
|
May'30 |
|
7.875 |
% |
|
545,440 |
|
43,313 |
|
86,625 |
|
658,281 |
|
— |
2024 Notes |
|
USD |
|
Nov'31 |
|
8.250 |
% |
|
644,180 |
|
53,625 |
|
107,250 |
|
107,250 |
|
757,250 |
Senior Note |
|
USD |
|
Nov'26 |
|
5.625 |
% |
|
200,777 |
|
11,250 |
|
211,250 |
|
— |
|
— |
Senior Note |
|
USD |
|
Nov'28 |
|
6.250 |
% |
|
499,422 |
|
31,250 |
|
62,500 |
|
531,250 |
|
— |
|
|
|
|
|
|
|
|
|
2,321,689 |
|
184,877 |
|
558,255 |
|
1,815,096 |
|
757,250 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Term loan |
|
USD |
|
Oct'25 |
|
3.75 |
% + CAS + 3M SOFR |
|
370,935 |
|
34,768 |
|
405,055 |
|
— |
|
— |
Senior Note |
|
USD |
|
Nov'26 |
|
5.625 |
% |
|
498,920 |
|
28,125 |
|
556,250 |
|
— |
|
— |
Senior Note |
|
USD |
|
Nov'28 |
|
6.250 |
% |
|
498,635 |
|
31,250 |
|
62,500 |
|
562,500 |
|
— |
|
|
|
|
|
|
|
|
|
1,368,490 |
|
94,143 |
|
1,023,805 |
|
562,500 |
|
— |
In addition to the guarantees set out in note 22, Borrowings, IHS Holding Limited is a guarantor for the following:
IHS Zambia Limited Facility
IHS Zambia Limited entered into two facilities with a common terms agreement originally in December 2020 (as amended and/or restated from time to time, including in February 2021 and January 2023) with a total commitment of $95.0 million with certain financial institutions (the “Zambia Facility”), split into a facility for an aggregate commitment representing $75.0 million and a second facility for an aggregate commitment representing $20.0 million. The Zambia Facility is guaranteed by IHS Holding Limited, and was fully utilized as of March 2021. The Zambia Facility has an interest rate of 5.0% plus 3 Month Term SOFR and a credit adjustment spread ranging between 0.11% to 0.43% and contains customary information and negative covenants and requires IHS Zambia Limited to observe certain customary affirmative covenants, subject to certain agreed exceptions and materiality carve-outs. The covenants include that IHS Zambia Limited maintain specified net debt to EBITDA ratios and interest coverage ratios, each as defined in the agreement. The respective facilities will terminate in December 2027.
IHS Netherlands Holdco B.V. Notes
On each of September 18, 2019 and July 31, 2020, our wholly owned subsidiary, IHS Netherlands Holdco B.V. (“Holdco BV”), issued a total of $940.0 million 8.0% Senior Notes due 2027 (the “2027 Notes”) guaranteed by IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., Nigeria Tower Interco B.V., IHS Nigeria, IHS Towers NG Limited and INT Towers Limited, and (since June 22, 2021) IHS Holding Limited. On June 22, 2021, pursuant to a successful consent solicitation, Holdco B.V. also effected certain amendments to the indenture governing the notes to, among other things, expand the “restricted group” to encompass IHS Holding Limited and all of IHS Holding Limited’s subsidiaries (which would then be subject to the covenants and events of default under the indenture), and to make certain other consequential changes to the negative covenants and restrictions resulting from the larger group structure.
F-84
|
IHS HOLDING LIMITED CONSOLIDATED ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2024 |
|
The 2027 Notes mature on September 18, 2027, and pay interest semi-annually, with the principal repayable in full on maturity. On or after September 18, 2023, or 2024, the 2027 Notes may be redeemed (in whole or in part) at a price of 102.000% and 100.000%, respectively.
The indenture contains customary negative covenants and restrictions, including, but not limited to, our ability to: incur or guarantee additional indebtedness and issue certain preferred stock; make certain restricted payments and investments, including dividends or other distributions; create or incur certain liens; enter into agreements that restrict the ability of restricted subsidiaries to pay dividends; transfer or sell certain assets; merge or consolidate with other entities and enter into certain transactions with affiliates.
In November 2024 and December 2024, the 2027 Notes were partially redeemed, in an aggregate principal amount outstanding of $654.0 million following the issuance of the IHS Holding 2030/31 Notes and as of December 31, 2024, the aggregate principal amount outstanding on the 2027 Notes was $286.0 million.
Valuation of guarantees
The fair value of all guarantees was $18.2 million as of December 31, 2024 (2023: $2.4 million).
F-85
Exhibit 2.7
|
CLIFFORD CHANCE LLP |
EXECUTION VERSION
DATED AS OF NOVEMBER 29, 2024
IHS HOLDING LIMITED,
AS THE ISSUER
KROLL TRUSTEE SERVICES LIMITED,
AS TRUSTEE
AND
CITIBANK N.A., LONDON BRANCH,
AS PRINCIPAL PAYING AGENT, TRANSFER AGENT AND REGISTRAR
SENIOR NOTES INDENTURE
7.875% SENIOR NOTES DUE 2030
8.250% SENIOR NOTES DUE 2031
TABLE OF CONTENTS
|
Page |
|
Article 1 DEFINITIONS AND INCORPORATION BY REFERENCE |
1 |
|
Section 1.01. |
Definitions |
1 |
Section 1.02. |
Other Definitions |
37 |
Section 1.03. |
Rules of Construction |
38 |
Article 2 THE SENIOR NOTES |
39 |
|
Section 2.01. |
Form and Dating |
39 |
Section 2.02. |
Execution and Authentication |
40 |
Section 2.03. |
Paying Agent, Registrars and Transfer Agent |
41 |
Section 2.04. |
Paying Agent to Hold Money |
41 |
Section 2.05. |
Holder Lists |
42 |
Section 2.06. |
Transfer and Exchange |
42 |
Section 2.07. |
Replacement Senior Notes |
50 |
Section 2.08. |
Outstanding Senior Notes |
50 |
Section 2.09. |
Treasury Notes |
51 |
Section 2.10. |
Temporary Notes |
51 |
Section 2.11. |
Cancellation |
51 |
Section 2.12. |
Defaulted Interest |
52 |
Section 2.13. |
Computation of Interest |
52 |
Section 2.14. |
Further Issues. |
52 |
Section 2.15. |
CUSIP, ISIN or Common Code Number |
53 |
Section 2.16. |
Deposit of Moneys |
53 |
Section 2.17. |
Agents |
53 |
Article 3 REDEMPTION AND PREPAYMENT |
55 |
|
Section 3.01. |
Notices to Trustee |
55 |
Section 3.02. |
Selection of Senior Notes to Be Redeemed or Purchased |
55 |
Section 3.03. |
Notice of Redemption |
56 |
Section 3.04. |
Effect of Notice of Redemption |
57 |
Section 3.05. |
Deposit of Redemption or Purchase Price |
57 |
Section 3.06. |
Notes Redeemed or Purchased in Part |
58 |
Section 3.07. |
Optional Redemption |
58 |
Section 3.08. |
Redemption for Changes in Taxes |
60 |
Section 3.09. |
Mandatory Redemption; Open Market Purchases |
61 |
Section 3.10. |
Offer to Purchase by Application of Excess Proceeds |
61 |
Section 3.11. |
Optional Redemption upon Completion of Certain Tender Offers |
63 |
Article 4 COVENANTS |
64 |
|
Section 4.01. |
Payment of Senior Notes |
64 |
Section 4.02. |
Maintenance of Office or Agency |
64 |
Section 4.03. |
Reports |
65 |
Section 4.04. |
Compliance Certificate |
67 |
Section 4.05. |
Taxes |
67 |
Section 4.06. |
Stay, Extension and Usury Laws |
67 |
Section 4.07. |
Restricted Payments |
68 |
Section 4.08. |
Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries |
74 |
Section 4.09. |
Incurrence of Indebtedness and Issuance of Preferred Stock |
76 |
Section 4.10. |
Asset Sales |
83 |
Section 4.11. |
Transactions with Affiliates |
86 |
Section 4.12. |
Liens |
88 |
Section 4.13. |
Offer to Repurchase upon Change of Control |
89 |
Section 4.14. |
Additional Guarantees |
91 |
Section 4.15. |
[Reserved] |
92 |
Section 4.16. |
Designation of Restricted and Unrestricted Subsidiaries |
92 |
Section 4.17. |
Maintenance of Listing |
93 |
Section 4.18. |
Additional Amounts |
93 |
Section 4.19. |
Suspension of Certain Covenants when Senior Notes Rated Investment Grade |
96 |
Section 4.20. |
[Reserved] |
97 |
Section 4.21. |
Anti-Layering |
97 |
Section 4.22. |
Financial Calculations |
97 |
Article 5 SUCCESSORS |
98 |
|
Section 5.01. |
Merger, Consolidation or Sale of Assets |
98 |
Section 5.02. |
Successor Corporation Substituted |
100 |
Section 5.03. |
Issuer Substitution |
100 |
Article 6 DEFAULTS AND REMEDIES |
101 |
|
Section 6.01. |
Events of Default |
101 |
Section 6.02. |
Acceleration |
103 |
Section 6.03. |
Other Remedies |
104 |
Section 6.04. |
Waiver of Past Defaults |
104 |
Section 6.05. |
Control by Majority |
104 |
Section 6.06. |
Limitation on Suits |
105 |
Section 6.07. |
Rights of Holders of Senior Notes to Receive Payment |
105 |
Section 6.08. |
Collection Suit by Trustee |
106 |
Section 6.09. |
Trustee May File Proofs of Claim |
106 |
Section 6.10. |
Priorities |
106 |
Section 6.11. |
Undertaking for Costs |
107 |
Section 6.12. |
Restoration of Rights and Remedies |
107 |
Section 6.13. |
Rights and Remedies Cumulative |
107 |
Section 6.14. |
Delay or Omission Not Waiver |
107 |
Article 7 TRUSTEE |
108 |
|
Section 7.01. |
Duties of Trustee |
108 |
Section 7.02. |
Rights of Trustee |
109 |
Section 7.03. |
Individual Rights of Trustee |
112 |
Section 7.04. |
Trustee's Disclaimer |
112 |
Section 7.05. |
Notice of Defaults |
112 |
Section 7.06. |
Compensation and Indemnity |
112 |
Section 7.07. |
Replacement of Trustee |
114 |
Section 7.08. |
Successor Trustee by Merger, etc |
115 |
Section 7.09. |
Eligibility; Disqualification |
115 |
Section 7.10. |
Agents |
115 |
Section 7.11. |
FATCA |
115 |
Article 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE |
117 |
|
Section 8.01. |
Option to Effect Legal Defeasance or Covenant Defeasance |
117 |
Section 8.02. |
Legal Defeasance and Discharge |
117 |
Section 8.03. |
Covenant Defeasance |
118 |
Section 8.04. |
Conditions to Legal or Covenant Defeasance |
118 |
Section 8.05. |
Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions |
119 |
Section 8.06. |
Repayment to Issuer |
120 |
Section 8.07. |
Reinstatement |
120 |
Article 9 AMENDMENT, SUPPLEMENT AND WAIVER |
121 |
|
Section 9.01. |
Without Consent of Holders of Senior Notes |
121 |
Section 9.02. |
With Consent of Holders of Senior Notes |
122 |
Section 9.03. |
Revocation and Effect of Consents |
124 |
Section 9.04. |
Notation on or Exchange of Senior Notes |
125 |
Section 9.05. |
Trustee to Sign Amendments, etc |
125 |
Article 10 NOTE GUARANTEES |
125 |
|
Section 10.01. |
Guarantee |
125 |
Section 10.02. |
Limitation on Guarantor Liability |
127 |
Section 10.03. |
[Reserved] |
127 |
Section 10.04. |
[Reserved] |
127 |
Section 10.05. |
Releases |
127 |
Article 11 SATISFACTION AND DISCHARGE |
128 |
|
Section 11.01. |
Satisfaction and Discharge |
128 |
Section 11.02. |
Application of Trust Money |
130 |
Article 12 MISCELLANEOUS |
130 |
|
Section 12.01. |
Notices |
130 |
Section 12.02. |
Certificate and Opinion as to Conditions Precedent |
132 |
Section 12.03. |
Statements Required in Certificate or Opinion |
132 |
Section 12.04. |
Rules by Trustee and Agents |
133 |
Section 12.05. |
No Personal Liability of Directors, Officers, Employees and Stockholders |
133 |
Section 12.06. |
Agent for Service; Submission to Jurisdiction; Waiver of Immunities |
133 |
Section 12.07. |
Governing Law |
133 |
Section 12.08. |
No Adverse Interpretation of Other Agreements |
133 |
Section 12.09. |
Successors |
134 |
Section 12.10. |
Severability |
134 |
Section 12.11. |
Counterpart Originals |
134 |
Section 12.12. |
Table of Contents, Headings, etc |
134 |
Section 12.13. |
Judgment Currency |
134 |
Section 12.14. |
Prescription |
134 |
Section 12.15. |
Electronic Signature |
134 |
Section 12.16. |
Additional Information |
135 |
EXHIBITS
Exhibit A |
FORM OF SENIOR NOTE |
Exhibit B |
FORM OF CERTIFICATE OF TRANSFER |
Exhibit C |
FORM OF CERTIFICATE OF EXCHANGE |
Exhibit DFORMOF SUPPLEMENTAL SENIOR NOTES INDENTURE TO BE DELIVERED BY SUBSEQUENT GUARANTORS SENIOR NOTES INDENTURE dated as of November 29, 2024, among IHS HOLDING LIMITED, an exempted company with limited liability incorporated under the laws of the Cayman Islands, having its registered office at 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008, Cayman Islands (the “Issuer”), KROLL TRUSTEE SERVICES LIMITED, as trustee, and CITIBANK, N.A., LONDON BRANCH, as paying agent, transfer agent and registrar.
The Issuer and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders (as defined) of the 7.875% Senior Notes due 2030 (the “2030 Senior Notes”) and the 8.250% Senior Notes due 2031 (the “2031 Senior Notes” and, together with the 2030 Notes, the “Senior Notes”) and the Holders of any Additional Senior Notes (as defined below):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01.Definitions.
“144A Definitive Registered Note” means a Definitive Registered Note resold in reliance on Rule 144A.
“144A Global Note” means a 2030 144A Global Note or a 2031 144A Global Note.
“2030 144A Global Note” means a Global Note bearing the Global Note Legend and the Private Placement Legend and deposited with Citibank, N.A., London Branch as Custodian for DTC and registered in the name of Cede & Co. as nominee that will be issued in an initial amount equal to the principal amount of the 2030 Senior Notes sold in reliance on Rule 144A.
“2021 Indenture” means the indenture dated November 29, 2021, pursuant to which the Existing 2026 Notes and the Existing 2028 Notes were issued.
“2021 Indenture Date” means November 29, 2021.
“2027 Notes Issuer” means IHS Netherlands Holdco B.V.
“2027 Notes Issuer Restricted Subsidiaries” means Restricted Subsidiaries that are also Subsidiaries of the 2027 Notes Issuer on the Issue Date, or as may be so designated by the Issuer after the Issue Date from time to time.
“2031 144A Global Note” means a Global Note bearing the Global Note Legend and the Private Placement Legend and deposited with Citibank, N.A., London Branch as Custodian for DTC and registered in the name of Cede & Co. as nominee that will be issued in an initial amount equal to the principal amount of the 2031 Senior Notes sold in reliance on Rule 144A.
“2030 Global Note” means a 2030 144A Global Note and a 2030 Regulation S Global Note.
- 1 -
“2031 Global Note” means a 2031 144A Global Note and a 2031 Regulation S Global Note.
“2030 Regulation S Global Note” means a Global Note bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of and registered in the name of Citivic Nominees Limited as nominee for Euroclear and Clearstream that will be issued in an initial amount equal to the principal amount of the 2030 Senior Notes initially resold in reliance on Regulation S.
“2031 Regulation S Global Note” means a Global Note bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of and registered in the name of Citivic Nominees Limited as nominee for Euroclear and Clearstream that will be issued in an initial amount equal to the principal amount of the 2031 Senior Notes initially resold in reliance on Regulation S.
“2030 Senior Notes” means the 7.875% Senior Notes due 2030 issued under this Senior Notes Indenture.
“2031 Senior Notes” means the 8.250% Senior Notes due 2031 issued under this Senior Notes Indenture.
“Acquired Debt” means, with respect to any specified Person:
(1)Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Restricted Subsidiary; and
(2)Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.
“Additional 2030 Senior Notes” means additional 2030 Senior Notes (other than the Initial 2030 Senior Notes) issued under this Senior Notes Indenture in accordance with Section 2.02 hereof, as part of the same series as the Initial Senior Notes.
“Additional 2031 Senior Notes” means additional 2031 Senior Notes (other than the Initial 2031 Senior Notes) issued under this Senior Notes Indenture in accordance with Section 2.02 hereof, as part of the same series as the Initial Senior Notes.
“Additional Senior Notes” means any Additional 2030 Senior Notes and Additional 2031 Senior Notes.
“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control,” as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.
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For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” have correlative meanings.
“Agent” means any Registrar, co-registrar, Transfer Agent, Authenticating Agent, Paying Agent or additional paying agent.
“Applicable Premium” means, with respect to any Senior Note of any series on any redemption date, the greater of:
(1)1.0% of the principal amount of the Senior Note of such series; or
(2)the excess of:
(a)the present value at such redemption date of (x) the redemption price of such Senior Note at November 29, 2026 in the case of the 2030 Notes and November 29, 2027 in the case of the 2031 Notes (such redemption price for each series being set forth in the table appearing in Section 3.07(d) hereof), plus (y) all required interest payments due on such Senior Note through November 29, 2026 in the case of the 2030 Notes and November 29, 2027 in the case of the 2031 Notes (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points; over
(b)the principal amount of such Senior Note,
as calculated by the Issuer or on behalf of the Issuer by such Person as the Issuer may engage.
For the avoidance of doubt, calculation of the Applicable Premium shall not be a duty or obligation of the Trustee, the Registrar, the Transfer Agent or any Paying Agent.
“Applicable Procedures” means, with respect to any transfer or exchange of or for Book-Entry Interests in any Global Note, the rules and procedures of the DTC, Euroclear and/or Clearstream that apply to such transfer or exchange.
“Approved Issuer Substitution Jurisdiction” means an Approved Jurisdiction (other than the Federal Republic of Nigeria), provided that such jurisdiction will not cause the New Issuer to have the right to redeem any Senior Notes pursuant to Section 3.08 hereof immediately following the Substitution.
“Approved Jurisdiction” means any state which is a member of the European Union (including the United Kingdom), the Federal Republic of Nigeria, the Cayman Islands, Mauritius, Switzerland, Canada, the United States, any state thereof or the District of Columbia.
“Asset Sale” means:
(1)the sale, lease, conveyance or other disposition of any assets by the Issuer or any of its Restricted Subsidiaries; provided that the sale, lease, conveyance or other disposition of all or substantially all of the assets of the Issuer and its Restricted Subsidiaries taken as a whole will be governed by Section 4.13 hereof and/or Section 5.01 hereof and not by Section 4.10 hereof; and (2)the issuance of Equity Interests by any Restricted Subsidiary or the sale by the Issuer or any of its Restricted Subsidiaries of Equity Interests in any Subsidiary of the Issuer (in each case, other than directors' qualifying shares).
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Notwithstanding the preceding, none of the following items will be deemed to be an Asset Sale:
(1)any single transaction or series of related transactions that involves assets having a fair market value of less than the greater of $25.0 million and 0.8% of the Total Assets of the Issuer;
(2)a transfer of assets or Equity Interests between or among the Issuer and any Restricted Subsidiary;
(3)an issuance of Equity Interests by a Restricted Subsidiary to the Issuer or to another Restricted Subsidiary;
(4)the sale, lease or other transfer of accounts receivable, inventory or other assets in the ordinary course of business and any sale or other disposition of damaged, worn-out or obsolete assets or assets disposed of in connection with any decommissioned sites or assets that are no longer useful in the conduct of the business of the Issuer and its Restricted Subsidiaries;
(5)licenses and sublicenses by the Issuer or any of its Restricted Subsidiaries in the ordinary course of business;
(6)any surrender or waiver of contract rights or settlement, release, recovery on or surrender of contract, tort or other claims in the ordinary course of business;
(7)the granting of Liens not prohibited by Section 4.12 hereof;
(8)the sale or other disposition of cash or Cash Equivalents;
(9)a Restricted Payment that does not violate Section 4.07 hereof, a Permitted Investment or any transaction specifically excluded from the definition of Restricted Payment or, solely for purposes of Section 4.10(b) hereof, asset sales, the proceeds of which are used to make such Restricted Payments (in accordance with Section 4.07 hereof) or Permitted Investments; (12)the disposition of assets to a Person who is providing services (the provision of which have been or are to be outsourced by the Issuer or any Restricted Subsidiary to such Person) related to such assets; and
(10)the disposition of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of business or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements;
(11)the foreclosure, condemnation or any similar action (including as a result of a seizure, expropriation, nationalization, intervention, restriction or other action by or on behalf of any governmental, regulatory or other authority) with respect to any property or other assets or a surrender or waiver of contract rights or the settlement, release or surrender of contract, tort or other claims of any kind;
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(13)sales or dispositions of receivables in connection with any Qualified Receivables Financing or any factoring transaction or in the ordinary course of business.
“Bankruptcy Law” means (1) Title 11 of the U.S. Code or (2) any other law of the United States (or any political subdivision thereof), the Federal Republic of Nigeria (or any political subdivision thereof), the Netherlands (or any political subdivision thereof), or the laws of any other jurisdiction or any political subdivision thereof relating to bankruptcy, insolvency, receivership, winding up, liquidation, reorganization or relief of debtors as may be amended from time to time.
“Beneficial Owner” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the U.S. Exchange Act, except that in calculating the beneficial ownership of any particular “person” (as that term is used in Section 13(d)(3) of the U.S. Exchange Act), (i) such “person” will be deemed to have beneficial ownership of all securities that such “person” has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only after the passage of time; and (ii) such “person” will not be deemed to have beneficial ownership of the securities of any other person solely because each such person is party to the shareholders agreement relating to the Capital Stock of the Issuer or any Parent Holdco to the extent the terms of such agreement as it exists on the Issue Date convey beneficial ownership. The terms “Beneficially Owns,” “Beneficially Owned” and “Beneficial Ownership” have corresponding meanings.
“Board of Directors” means:
(1)with respect to a corporation, the board of directors of the corporation or any committee thereof duly authorized to act on behalf of such board;
(2)with respect to an exempted company, the board of directors of the exempted company or any committee thereof duly authorized to act on behalf of such board;
(3)with respect to a partnership, the board of directors of the general partner of the partnership or any committee thereof duly authorized to act on behalf of such board;
(4)with respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof; and
(5)with respect to any other Person, the board or committee of such Person serving a similar function.
“Book-Entry Interest” means a beneficial interest in a Global Note held by or through a Participant.
“Business Day” means a day (other than a Saturday, Sunday or other day) on which banking institutions in London, New York, Lagos, the jurisdiction of incorporation of the Issuer or a place of payment under this Senior Notes Indenture are authorized or required by law to open.
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“Capital Lease Obligation” means an obligation that is required to be classified and accounted for as a capitalized lease for financial reporting purposes on the basis of IFRS. The amount of Indebtedness will be, at the time any determination is to be made, the amount of such obligation required to be capitalized on a balance sheet (excluding any notes thereto) prepared in accordance with IFRS, and the stated maturity thereof will be the date of the last payment of rent or any other amount due under such lease prior to the first date such lease may be terminated without penalty.
“Capital Stock” means:
(1)in the case of a corporation, corporate stock;
(2)in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;
(3)in the case of a partnership or limited liability company, partnership interests (whether general or limited), shares or membership interests; and
(4)any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person, but excluding from all of the foregoing any debt securities convertible into Capital Stock, whether or not such debt securities include any right of participation with Capital Stock.
“Cash Equivalents” means:
(1)direct obligations (or certificates representing an interest in such obligations) issued by, or unconditionally guaranteed by, the government of a member state of the European Union (including the United Kingdom), the Federal Republic of Nigeria, the United States of America or any state thereof, Switzerland or the government of the jurisdiction of organization of any Restricted Subsidiary (including, in each case, any agency or instrumentality thereof), as the case may be, the payment of which is backed by the full faith and credit of the relevant member state of the European Union (including the United Kingdom), the Federal Republic of Nigeria, the United States of America or Switzerland or the government of the jurisdiction of organization of any Restricted Subsidiary, as the case may be, and which are not callable or redeemable at the issuer’s option;
(2)overnight bank deposits, time deposit accounts, certificates of deposit, banker's acceptances and money market deposits with maturities (and similar instruments) of 12 months or less from the date of acquisition issued by a bank or trust company, or a local branch or Subsidiary of a bank or trust company, which is organized under, or authorized to operate as a bank or trust company under, the laws of a member state of the European Union (including the United Kingdom), the Federal Republic of Nigeria, or of the United States of America or any state thereof, Switzerland or the government of the jurisdiction of organization of any Restricted Subsidiary or any commercial banking institution that is a member of the U.S. Federal Reserve System, in each case, either (a) having combined capital and surplus and undivided profits of not less than $250.0 million (or the foreign currency equivalent thereof as of the date of such investment), whose long term, unsecured, unsubordinated and unguaranteed debt has a rating, at the time any investment is made therein, of at least “BBB” or the equivalent thereof from S&P and at least “Ba3” or the equivalent thereof from Moody's or the equivalent rating category of another internationally recognized rating agency; (b) which has its primary registration in a jurisdiction in which the Issuer or a Restricted Subsidiary conducts its business or is organized and which would rank, in terms of combined capital and surplus and undivided profits or the ratings on its long term debt, among the top ten such banks registered in such jurisdiction or (c) which is a lender under any Credit Facility to which the Issuer or any Guarantor is a party;
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(3)repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clauses (1) and (2) above entered into with any financial institution meeting the qualifications specified in clause (2) above;
(4)commercial paper having one of the two highest ratings obtainable from Moody's or S&P and, in each case, maturing within one year after the date of acquisition;
(5)money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (1) through (4) of this definition; and
(6) other instruments customarily utilized for high quality investments that can be readily monetized without material risk of loss in the good faith judgment of a responsible financial or accounting officer of the Issuer or any of its Restricted Subsidiaries.
“Change of Control” means the occurrence of any of the following:
(1)the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Issuer and its Subsidiaries, taken as a whole, to any Person (including any “person” (as that term is used in Section 13(d)(3) of the U.S. Exchange Act)) other than one or more Permitted Holders (other than any such sale, lease, transfer, conveyance or other disposition of all or substantially all of the assets of the Issuer to an Affiliate of the Issuer for the purpose of reincorporating the Issuer in another jurisdiction; provided that such transaction complies with Article 5 hereof);
(2)the adoption of a plan relating to the liquidation or dissolution of the Issuer; or
(3)the consummation of any transaction (including, without limitation, any merger or consolidation), the result of which is that any Person (including any “person” (as defined above)), other than one or more Permitted Holders, becomes the Beneficial Owner, directly or indirectly, of more than 50% of the Voting Stock of the Issuer, measured by voting power rather than number of shares; provided that any Voting Stock of which any Permitted Holder is the “beneficial owner” (other than deemed beneficial ownership derived from membership in a “group”) shall not be included in any Voting Stock of which any such person or group is the “beneficial owner” (as so defined), unless that person or group is not an affiliate of a Permitted Holder and has greater voting power with respect to that Voting Stock,
provided that, in the case of the preceding clauses (1) and (3), a Change of Control shall not be deemed to have occurred if such Change of Control is also a Specified Change of Control Event.
“Clearstream” means Clearstream Banking, SA.
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“Code” means the U.S. Internal Revenue Code of 1986, as amended.
“Common Depositary” means a depositary common to Euroclear and Clearstream, being initially Citibank Europe plc, until a successor replaces it and thereafter means the successor serving hereunder.
“Consolidated EBITDA” means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for such period plus the following to the extent deducted in calculating such Consolidated Net Income, without duplication:
(1)provision for current and deferred taxes based on income or profits of such Person and its Subsidiaries which are Restricted Subsidiaries for such period; plus
(2)without double counting, the Consolidated Interest Expense of such Person and its Subsidiaries which are Restricted Subsidiaries for such period and Receivables Fees; plus
(3)depreciation, amortization (including, without limitation, amortization of intangibles and deferred financing fees) and other non-cash charges and expenses (including without limitation write downs and impairment of property, plant, equipment and intangibles and other long-lived assets and the impact of purchase accounting on the Issuer and its Restricted Subsidiaries for such period) of the Issuer and its Restricted Subsidiaries (excluding any such non-cash charge or expense to the extent that it represents an accrual of or reserve for cash charges or expenses in any future period or amortization of a prepaid cash charge or expense that was paid in a prior period) for such period; plus
(4)any expenses, charges or other costs related to the issuance of any Capital Stock, any Permitted Investment, acquisition, disposition, recapitalization, listing or the incurrence of Indebtedness permitted to be incurred under Section 4.09 hereof (including refinancing thereof) whether or not successful, including (a) such fees, expenses or charges related to any incurrence of Indebtedness issuance and (b) any amendment or other modification of any incurrence; plus
(5)any foreign currency translation losses (including losses related to currency remeasurements of Indebtedness) of the Issuer and its Restricted Subsidiaries; plus
(6)the amount of management, monitoring, consulting and advisory fees and related expenses paid in such period to any Parent Holdco of the Issuer to the extent permitted by Section 4.11 hereof; plus (11)any foreign currency translation gains (including gains related to currency re-measurements of Indebtedness) of the Issuer and its Restricted Subsidiaries; minus
(7)the amount of any minority interest expense consisting of subsidiary income attributable to minority equity interests of third parties in any non-Wholly-Owned Subsidiary in such period or any prior period; plus
(8)any impairment of property, plant and equipment and prepaid land rent, or withholding tax receivable; plus
(9)the unwinding of discount on decommissioning liability; plus
(10)loss on revaluation of derivative financial instruments; plus
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(12)any extraordinary, exceptional or unusual gain; minus
(13)non-cash items increasing such Consolidated Net Income for such period (other than any non-cash items increasing such Consolidated Net Income pursuant to clauses (1) through (11) of the definition of Consolidated Net Income), other than the reversal of a reserve for cash charges in a future period in the ordinary course of business,
in each case, on a consolidated basis and determined in accordance with IFRS.
“Consolidated Interest Expense” means, for any period (in each case, determined on the basis of IFRS), the consolidated net interest income/expense of the Issuer and its Restricted Subsidiaries, whether paid or accrued, including any pension liability interest cost, plus or including (without duplication) any interest, costs and charges consisting of:
(1)interest expense attributable to Capital Lease Obligations;
(2)amortization of debt discount, debt issuance cost and premium;
(3)non-cash interest expense;
(4)commissions, discounts and other fees and charges owed with respect to financings not included in clause (2) above;
(5)costs associated with Hedging Obligations;
(6)dividends on other distributions in respect of all Disqualified Stock of the Issuer and all preferred stock of any Restricted Subsidiary, to the extent held by Persons other than the Issuer or a Subsidiary of the Issuer;
(7)any consolidated interest expense that was capitalized during such period; and
(8)interest actually paid by the Issuer or any Restricted Subsidiary under any Guarantee of Indebtedness or other obligation of any other Person.
Notwithstanding any of the foregoing, Consolidated Interest Expense shall not include (i) any interest accrued, capitalized or paid in respect of Subordinated Shareholder Debt and (ii) any commissions, discounts, yield and other fees and charges related to a Qualified Receivables Financing.
“Consolidated Net Income” means, with respect to any specified Person for any period, the aggregate of the net income (loss) of such Person and its Subsidiaries which are Restricted Subsidiaries for such period, on a consolidated basis (excluding the net income (loss) of any Unrestricted Subsidiary), determined in accordance with IFRS and without any reduction in respect of preferred stock dividends; provided that:
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(1)the net income (loss) of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method of accounting will be included only to the extent of the amount of dividends or similar distributions paid in cash to the specified Person or a Restricted Subsidiary which is a Subsidiary of the Person;
(2)solely for the purpose of determining the amount available for Restricted Payments under Section 4.07(a)(v)(C)(1) hereof, any net income of any Restricted Subsidiary (other than any Guarantor) will be excluded if such Subsidiary is subject to restrictions, directly or indirectly, on the payment of dividends or the making of distributions by such Restricted Subsidiary, directly or indirectly, to the Issuer (or any Guarantor that holds the Equity Interests of such Restricted Subsidiary, as applicable) by operation of the terms of such Restricted Subsidiary's charter or any agreement, instrument, judgment, decree, order, statute or governmental rule or regulation applicable to such Restricted Subsidiary or its shareholders (other than (a) restrictions that have been waived or otherwise released, (b) restrictions pursuant to the Senior Notes or this Senior Notes Indenture or that are not prohibited under Section 4.08 hereof, (c) contractual restrictions in effect on the Issue Date with respect to the Restricted Subsidiary and other restrictions with respect to such Restricted Subsidiary that taken as a whole, are not materially less favorable to the holders of the Senior Notes than such restrictions in effect on the Issue Date or (d) restrictions pursuant to applicable law, rule, regulation or order or the terms of any license, authorization, concession or permit), except that the Issuer’s equity in the net income of any such Restricted Subsidiary for such period will be included in such Consolidated Net Income up to the aggregate amount of cash or Cash Equivalents actually distributed or that could have been distributed by such Restricted Subsidiary during such period to the Issuer or another Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend to another Restricted Subsidiary (other than any Guarantor or the Issuer), to the limitation contained in this clause);
(3)any net gain (or loss) realized upon the sale or other disposition of any asset or disposed operations of the Issuer or any Restricted Subsidiaries (including pursuant to any sale leaseback transaction) which is not sold or otherwise disposed of in the ordinary course of business (as determined in good faith by the Issuer) will be excluded;
(4)any one-time non-cash charges or any amortization or depreciation resulting from purchase accounting, in each case, in relation to any acquisition of, or merger or consolidation with, another Person or business or resulting from any reorganization, restructuring, liquidation (including provisional liquidation), winding up or like proceeding involving the Issuer or its Subsidiaries will be excluded;
(5)the cumulative effect of a change in accounting principles will be excluded;
(6)any extraordinary, exceptional or nonrecurring gains or losses or any charges in respect of any restructuring, redundancy or severance (in each case, as determined in good faith by the Issuer) will be excluded;
(7)any unrealized gains or losses in respect of Hedging Obligations or any ineffectiveness recognized in earnings related to qualifying hedge transactions or the fair value or changes therein recognized in earnings for derivatives that do not qualify as hedge transactions, in each case, in respect of Hedging Obligations will be excluded; (10)all deferred financing costs written off and premium paid in connection with any early extinguishment of Indebtedness and any net gain or loss from any write-off or forgiveness of Indebtedness will be excluded;
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(8)any non-cash compensation charge or expenses arising from any grant of stock, stock options or other equity-based awards will be excluded;
(9)any goodwill or other intangible asset impairment charges will be excluded;
(11)the impact of any accrued interest (including accreting or pay-in-kind interest) on any Subordinated Shareholder Debt will be excluded; and
(12)the net gain or loss from the receipt of any insurance proceeds shall be excluded.
“Consolidated Net Leverage” means, as of any date of determination, the sum, expressed in US dollars, of the aggregate outstanding Indebtedness of the Issuer and its Restricted Subsidiaries on a consolidated basis (excluding Hedging Obligations except to the extent provided in Sections 4.09(e) and 4.09(f) hereof), less cash and Cash Equivalents of such specified person on that date of determination. The US dollar equivalent of the principal amount of Indebtedness denominated in a different currency shall be calculated based on the applicable provisions of Section 4.09 hereof.
“Consolidated Net Leverage Ratio” means, as of any date of determination, with respect to any specified Person, the ratio of (a) Consolidated Net Leverage on such date to (b) the product of (i) the Consolidated EBITDA of the Issuer for the most recently ended four consecutive fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or other transaction for which the Consolidated Net Leverage Ratio is being calculated is completed; provided, however, that, solely for the purpose of calculating the Consolidated Net Leverage Ratio for the incurrence of Indebtedness pursuant to Section 4.09 hereof, the pro forma calculation of the Consolidated Net Leverage Ratio shall not give effect to (i) any Indebtedness incurred on the date on which the event for which the calculation of the Consolidated Net Leverage Ratio is made (the “Calculation Date”) pursuant to the provisions described in Section 4.09(b) hereof, (other than Section 4.09(b)(xiv) hereof, the incurrence of which is itself subject to the Consolidated Net Leverage Ratio) or (ii) the discharge on the Calculation Date of any Indebtedness to the extent that such discharge results from the proceeds incurred pursuant to the provisions described in Section 4.09(b) hereof (other than Section 4.09(b)(xiv) hereof).
In addition, for purposes of calculating the Consolidated EBITDA for such period:
(1)acquisitions that have been made by the specified Person or any of its Subsidiaries which are Restricted Subsidiaries, including through mergers or consolidations, or by any Person or any of its Subsidiaries which are Restricted Subsidiaries acquired by the specified Person or any of its Subsidiaries which are Restricted Subsidiaries, and including all related financing transactions and including increases in ownership of Subsidiaries which are Restricted Subsidiaries, during the four consecutive fiscal quarter reference period or subsequent to such reference period and on or prior to the relevant Calculation Date, or that are to be made on the relevant Calculation Date, will be given pro forma effect (as determined in good faith by a responsible accounting or financial officer of the Issuer and may include anticipated cost synergies and expense and cost reductions) as if they had occurred on the first day of the four consecutive fiscal quarter reference period;
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(2)if since the beginning of such four consecutive fiscal quarter reference period the Issuer or any Restricted Subsidiary has disposed of any company, any business, or any group of assets constituting an operating unit of a business (any such disposition, a “Sale”) or if the transaction giving rise to the need to calculate the Consolidated Net Leverage Ratio is such a Sale, Consolidated EBITDA for such period will be reduced by an amount equal to the Consolidated EBITDA (if positive) attributable to the assets which are the subject of such Sale for such period or increased by an amount equal to the Consolidated EBITDA (if negative) attributable thereto for such period; provided that if any such sale constitutes “discontinued operations” in accordance with IFRS, Consolidated Net Income shall be reduced by an amount equal to the Consolidated Net Income (if positive) attributable to such operations for such period or increased by an amount equal to the Consolidated Net Income (if negative) attributable thereto for such period;
(3)any Person that is a Restricted Subsidiary on the relevant Calculation Date will be deemed to have been a Restricted Subsidiary at all times during such four consecutive fiscal quarter period; and
(4)any Person that is not a Restricted Subsidiary on the relevant Calculation Date will be deemed not to have been a Restricted Subsidiary at any time during such four consecutive fiscal quarter period.
“Contingent Obligations” means, with respect to any Person, any obligation of such Person guaranteeing in any manner, whether directly or indirectly, any operating lease, dividend or other obligation that, in each case, does not constitute Indebtedness (“primary obligations”) of any other Person (the “primary obligor”), including any obligation of such Person, whether or not contingent:
(1)to purchase any such primary obligation or any property constituting direct or indirect security therefor;
(2)to advance or supply funds:
(a)for the purchase or payment of any such primary obligation; or
(b)to maintain the working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; or
(3)to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation against loss in respect thereof.
“continuing” means, with respect to any Default or Event of Default, that such Default or Event of Default has not been cured or waived.
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“Credit Facility” means one or more debt facilities, instruments or arrangements incurred (including the Nigeria 2023 Revolving Credit Facility, the Nigeria 2023 Term Loan, the IHS Holding 2020 Revolving Credit Facility and the IHS Holding 2024 Dual-Tranche Term Loan) or commercial paper facilities and overdraft facilities or indentures or trust deeds or note purchase agreements, in each case, with banks, other institutions, funds or investors, providing for revolving credit loans, term loans, performance guarantees, receivables financing (including through the sale of receivables to such institutions or to special purpose entities formed to borrow from such institutions against such receivables), letters of credit, bonds, notes debentures or other corporate debt instruments or other Indebtedness, in each case, as amended, restated, modified, renewed, refunded, replaced, restructured, refinanced, repaid, increased or extended in whole or in part from time to time (and whether or not with the original administrative agent and lenders or another administrative agent or agents or trustees or other banks or institutions and whether provided under the Nigeria 2023 Revolving Credit Facility, the Nigeria 2023 Term Loan, the IHS Holding 2020 Revolving Credit Facility and the IHS Holding 2024 Dual-Tranche Term Loan or one or more other credit or other agreements, indentures, financing agreements or otherwise) and in each case including all agreements, instruments and documents executed and delivered pursuant to or in connection with the foregoing (including any notes and letters of credit issued pursuant thereto and any guarantee and collateral agreement, patent and trademark security agreement, mortgages or letter of credit applications and other guarantees, pledges, agreements, security agreements and collateral documents). Without limiting the generality of the foregoing, the term “Credit Facilities” shall include any agreement or instrument (1) changing the maturity of any Indebtedness incurred thereunder or contemplated thereby, (2) adding Subsidiaries of the Issuer as additional borrowers, issuers or guarantors thereunder, (3) increasing the amount of Indebtedness incurred thereunder or available to be borrowed thereunder or (4) otherwise altering the terms and conditions thereof.
“Currency Exchange Protection Agreement” means, in respect of any Person, any foreign exchange contract, currency swap agreement, currency option, cap, floor, ceiling or collar or agreement or other similar agreement or arrangement designed to protect such Person against fluctuations in currency exchange rates as to which such Person is a party.
“Custodian” means Citibank, N.A., London Branch and any and all successors thereto appointed as Custodian hereunder and having become such pursuant to the applicable provisions of this Senior Notes Indenture.
“Default” means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.
“Definitive Registered 2030 Note” means a certificated 2030 Senior Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 hereof, substantially in the form of Exhibit A hereto and bearing the Private Placement Legend, except that such Senior Note shall not bear the Global Note Legend and shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto.
“Definitive Registered 2031 Note” means a certificated 2031 Senior Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 hereof, substantially in the form of Exhibit A hereto and bearing the Private Placement Legend, except that such Senior Note shall not bear the Global Note Legend and shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto.
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“Definitive Registered Note” means the Definitive Registered 2030 Note or the Definitive Registered 2031 Note.
“Depositary” means, with respect to the Senior Notes issuable or issued in whole or in part in global form, DTC or Euroclear and Clearstream, in each case, including any and all successors thereto appointed as Depositary hereunder and having become such pursuant to the applicable provision(s) of this Senior Notes Indenture.
“Designated Non-Cash Consideration” means the fair market value of non-cash consideration received by the Issuer or one of its Restricted Subsidiaries in connection with an Asset Sale that is so designated as “Designated Non-Cash Consideration” pursuant to an Officer's Certificate, setting forth the basis of such valuation, less the amount of cash or Cash Equivalents received in connection with a subsequent sale of such Designated Non-Cash Consideration.
“Designated Preference Shares” means, with respect to the Issuer or any Parent Holdco of the Issuer, preferred stock (other than Disqualified Stock) (1) that is issued for cash (other than to the Issuer or a Subsidiary of the Issuer or an employee stock ownership plan or trust established by the Issuer or any such Subsidiary for the benefit of their employees to the extent funded by the Issuer or such Subsidiary) and (2) that is designated as “Designated Preference Shares” pursuant to an Officer's Certificate of the Issuer at or prior to the issuance thereof, the net proceeds of which are excluded from the calculation set forth in Section 4.07(a)(v)(C)(2) hereof.
“Disqualified Stock” means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, in each case, at the option of the holder of the Capital Stock), or upon the happening of any event, (1) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder of the Capital Stock, in whole or in part, on or prior to the six-month anniversary of the date that the Senior Notes mature or (2) provides for, either mandatorily or at the option of the holder of the Capital Stock, the payment of dividends or distributions (other than in the form of Equity Interests that are not Disqualified Stock). Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Stock solely because the holders of the Capital Stock have the right to require the issuer thereof to repurchase such Capital Stock upon the occurrence of a Change of Control or an Asset Sale will not constitute Disqualified Stock if the terms of such Capital Stock provide that the issuer thereof may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with Section 4.07 hereof. For purposes hereof, the amount of Disqualified Stock which does not have a fixed repurchase price shall be calculated in accordance with the terms of such Disqualified Stock as if such Disqualified Stock were purchased on any date on which Indebtedness shall be required to be determined pursuant to this Senior Notes Indenture, and if such price is based upon, or measured by, the fair market value of such Disqualified Stock, such fair market value to be determined as set forth herein.
“DTC” means The Depository Trust Company, a New York corporation, or any successor.
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“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).
“Equity Offering” means a public offering or a private placement of Capital Stock (other than Disqualified Stock or Designated Preference Shares) of the Issuer or a Parent Holdco of the Issuer pursuant to which the net cash proceeds are contributed to the Issuer in the form of a subscription for, or a capital contribution in respect of, Capital Stock (other than Disqualified Stock) of the Issuer or as Subordinated Shareholder Debt of the Issuer.
“Euroclear” means Euroclear Bank, SA/NV, or any successor securities clearing agency.
“European Union” means the European Union as of January 1, 2004, including the countries of Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom, but not including any country which became or becomes a member of the European Union after January 1, 2004.
“Exchange” means The International Stock Exchange.
“Excluded Contributions” means the net cash proceeds, property or assets received by the Issuer after the Issue Date (other than any such cash proceeds, property or assets that are Excluded Amounts or Parent Debt Contributions) from:
(1)contributions to its Equity Interests; and
(2)the sale (other than to a Subsidiary of the Issuer) of Capital Stock (other than Disqualified Stock or Designated Preference Shares) of the Issuer,
in each case designated as “Excluded Contributions” pursuant to an Officer's Certificate (which shall be designated no later than the date on which such Excluded Contribution has been received by the Issuer), the net cash proceeds of which are excluded from the calculation set forth in Section 4.07(a)(v)(C)(2) hereof.
“Existing 2026 Notes” means the $500 million aggregate principal amount of 5.625% Senior Notes due 2026 issued by the Issuer.
“Existing 2026 Note Guarantees” means the note guarantees executed in connection with the Existing 2026 Notes.
“Existing 2027 Notes” means the $940 million aggregate principal amount of 8.000% Senior Notes due 2027 issued by the 2027 Notes Issuer.
“Existing 2027 Note Guarantees” means the note guarantees executed in connection with the Existing 2027 Notes.
“Existing 2027 Notes Indenture” means the indenture dated September 18, 2019, pursuant to which the Existing 2027 Notes were issued.
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“Existing 2028 Notes” means the $500 million aggregate principal amount of 6.250% Senior Notes due 2028 issued by the Issuer.
“Existing 2028 Note Guarantees” means the note guarantees executed in connection with the Existing 2028 Notes.
''Existing Notes'' means, collectively, the Existing 2026 Notes, the Existing 2027 Notes and the Existing 2028 Notes.
''Existing Note Guarantees'' means, collectively, the Existing 2026 Note Guarantees, the Existing 2027 Note Guarantees and the Existing 2028 Note Guarantees.
''Existing Notes Indentures'' means, collectively, the 2021 Indenture and the Existing 2027 Notes Indenture.
“fair market value” wherever such term is used in this Senior Notes Indenture (except as otherwise specifically provided in this Senior Notes Indenture), is as determined in good faith by the Issuer's Chief Executive Officer, Chief Financial Officer or a responsible accounting or financial officer of the Issuer.
“Fitch” means Fitch Ratings Inc.
“Global Note Legend” means the legend set forth in Section 2.06(f)(ii) hereof, which is required to be placed on all Global Notes issued under this Senior Notes Indenture.
“Global Notes” means, individually and collectively, each of the 2030 144A Global Note, 2031 144A Global Note, 2030 Regulation S Global Note and the 2031 Regulation S Global Note, substantially in the form of Exhibit A hereto, bearing the Private Placement Legend and the Global Note Legend, issued in accordance with Sections 2.01, 2.06(b), 2.06(d) and 2.06(e).
“Government Securities” means direct non-callable and non-redeemable obligations of, or obligations guaranteed by the United States government, and the payment for which the United States government pledges its full faith and credit.
“guarantee” means a guarantee other than by endorsement of negotiable instruments for collection or deposit in the ordinary course of business, of all or any part of any Indebtedness (whether arising by agreements to keep-well, to take or pay or to maintain financial statement conditions, pledges of assets or otherwise).
“Guarantee Agreement” means any guarantee agreement by which any Person agrees to guarantee the Notes and all obligations under this Senior Notes Indenture, and as such guarantee agreement may be amended, modified and/or supplemented from time to time and any supplemental guarantee agreement entered into in accordance with the provisions of this Senior Notes Indenture and/or the Guarantee Agreement as it may be amended, modified and/or supplemented from time to time.
“Guarantor” means any Person that executes any Guarantee Agreement or supplemental indenture or supplemental guarantee agreement in accordance with the provisions of this Senior Notes Indenture and/or Guarantee Agreement, and their respective successors and assigns, in each case, until the Note Guarantee of such Person has been released in accordance with the provisions of this Senior Notes Indenture and/or Guarantee Agreement.
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''Guarantor Redomiciliation'' means any redomiciliation of any Guarantor or Guarantors from where they are currently domiciled to be domiciled in any Approved Jurisdiction (in one or more steps), and each of the filings, registrations and other steps in relation thereto.
“Hedging Obligations” means, with respect to any specified Person, the obligations of such Person under:
(1)interest rate swap agreements, (whether from fixed to floating or from floating to fixed), interest rate cap agreements and interest rate collar agreements;
(2)other agreements or arrangements designed to manage interest rates or interest rate risk; and
(3)other agreements or arrangements designed to protect such Person against fluctuations in currency exchange rates, including Currency Exchange Protection Agreements, or commodity prices.
“Holder” means a Person in whose name a Senior Note is registered.
“IFRS” means International Financial Reporting Standards (formerly International Accounting Standards) endorsed from time to time by the European Union or any variation thereof with which the Issuer or its Restricted Subsidiaries comply as in effect on the Issue Date or, with respect to the covenant described under the heading “Reports,” as in effect from time to time. Except as otherwise set forth in this Senior Notes Indenture, all ratios, calculations and determinations based on IFRS contained in this Senior Notes Indenture shall be computed in accordance with IFRS as in effect on the Issue Date. At any time after the Issue Date, the Issuer may elect to establish that IFRS shall mean the IFRS as in effect on or prior to the date of such election (the “Elected IFRS Date”); provided that any such election, once made, shall be irrevocable.
“IHS Holding 2020 Revolving Credit Facility” means that certain senior revolving credit facility agreement originally dated March 30, 2020 and as amended and restated on June 2, 2021 and November 6, 2023 by and among the Issuer, the guarantors thereto as obligors thereunder, the senior lenders named therein, and the agent, including any related notes, guarantees, collateral documents, instruments, and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“IHS Holding 2024 Dual-Tranche Term Loan” means that certain term loan facility agreement originally dated October 7, 2024 by and among the Issuer, the guarantors thereto as obligors thereunder, the original lenders named therein, and the agent, including any related notes, guarantees, collateral documents, instruments, and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
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“Indebtedness” means, with respect to any specified Person, any indebtedness of such Person (excluding accrued expenses and trade payables):
(1)in respect of borrowed money;
(2)evidenced by bonds, debentures, notes, loan stock, commercial paper, acceptance credits, letters of credit, bills or promissory notes drawn, accepted, endorsed or issued by such Person (but not Trade Instruments);
(3)representing the deferred purchase price of assets or services (except trade accounts incurred and payable in the ordinary course of business within 365 days of the date they are incurred);
(4)representing non-contingent obligations of such Person to reimburse any other Person for amounts paid by that Person under a letter of credit or similar instrument (excluding any letters of credit or similar instrument incurred and payable in the ordinary course of business within 365 days of the date they were incurred);
(5)representing Capital Lease Obligations;
(6)representing the balance deferred and unpaid of the purchase price of any property or services due more than one year after such property is acquired or such services are completed;
(7)representing any Hedging Obligations in respect of interest rate or currency hedging; and
(8)the principal component of all obligations, or liquidation preferences, with respect to any Disqualified Stock or, with respect to any Restricted Subsidiary, any preferred stock (but excluding, in each case, any accrued dividends),
if and to the extent any of the preceding items (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet (excluding the footnotes thereto) of the specified Person prepared in accordance with IFRS. In addition, the term “Indebtedness” includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent not otherwise included, the guarantee by the specified Person of any Indebtedness of any other Person.
The term “Indebtedness” shall not include:
(1)Subordinated Shareholder Debt;
(2)Contingent Obligations in the ordinary course of business;
(3)in connection with the purchase by the Issuer or any Restricted Subsidiary of any business, any post-closing payment adjustments to which the seller may become entitled to the extent such payment is determined by a final closing balance sheet or such payment depends on the performance of such business after the closing;
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(4)purchase price hold-backs in respect of a portion of the purchase price of an asset to satisfy warranty claims or other unperforming obligations of the seller;
(5)obligations under or in respect of a Qualified Receivables Financing to the extent such obligations are non-recourse to the Issuer or any Restricted Subsidiary to the extent provided in the definitions relating thereto; or
(6)for the avoidance of doubt, any contingent obligations in respect of workers' compensation claims, early retirement or termination obligations, pension fund obligations or contributions or similar claims, obligations or contributions or social security or wage Taxes.
“Indirect Participant” means a Person who holds a Book-Entry Interest in a Global Note through a Participant.
“Initial 2030 Senior Notes” means the first $550 million aggregate principal amount of 2030 Senior Notes issued under this Senior Notes Indenture on the date hereof.
“Initial 2031 Senior Notes” means the first $650 million aggregate principal amount of 2031 Senior Notes issued under this Senior Notes Indenture on the date hereof.
“Initial Senior Notes” means Initial 2030 Senior Notes and the Initial 2031 Senior Notes.
“Investment Grade Status” shall occur when the Senior Notes are rated “Baa3” or better by Moody's and “BBB-” or better by S&P and “BBB-” or better by Fitch (or, if either such entity ceases to rate the Senior Notes, the equivalent investment grade credit rating from any other “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the U.S. Exchange Act selected by the Issuer as a replacement agency).
“Investments” means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates) in the forms of loans (including guarantees or other obligations, but excluding advances or extensions of credit to customers or suppliers made in the ordinary course of business), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as Investments on a balance sheet (excluding the footnotes) prepared in accordance with IFRS. If the Issuer or any Restricted Subsidiary sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary, the Issuer will be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Issuer’s Investments in such Restricted Subsidiary that were not sold or disposed of in an amount determined as provided in Section 4.07(c) hereof. The acquisition by the Issuer or any Restricted Subsidiary of a Person that holds an Investment in a third Person will be deemed to be an Investment by the Issuer or such Restricted Subsidiary in such third Person in an amount equal to the fair market value of the Investments held by the acquired Person in such third Person in an amount determined as provided in Section 4.07(c)
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hereof. Except as otherwise provided in this Senior Notes Indenture, the amount of an Investment will be determined at the time the Investment is made and without giving effect to subsequent changes in value and, to the extent applicable, shall be determined based on the equity value of such Investment.
“Issue Date” means November 29, 2024.
“Issuer” means IHS Holding Limited until a successor or substitute replaces it in accordance with the provisions of this Senior Notes Indenture, after which “Issuer” shall mean such successor.
“Land Lease” means any lease which would be treated as a “lease liability” in accordance with IFRS relating to the lease of land.
“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest, assignment by way of security, or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement or any lease in the nature thereof.
“Management Advances” means loans or advances not exceeding the greater of $20.0 million and 0.5% of Total Assets in aggregate outstanding amount, and in each case made to, or guarantees with respect to loans or advances made to, directors, officers or employees of the Issuer or any Restricted Subsidiary: (1) in respect of travel, entertainment or moving related expenses incurred in the ordinary course of business; (2) in respect of moving related expenses incurred in connection with any closing or consolidation of any facility or office; or (3) in the ordinary course of business.
“Management Fees” means customary fees and related expenses for the performance of transaction, management, consulting, financial or other advisory services or underwriting, placement or other investment banking activities, including in connection with mergers, acquisitions, dispositions or joint ventures, by any Permitted Holder or any of its Affiliates for the Issuer or any Restricted Subsidiary, which payments in respect of this clause have been approved by a majority of the disinterested members of the Board of Directors of the Issuer, or, if there are not sufficient disinterested members of the Board of Directors of the Issuer to form a majority, by a majority of the Board of Directors.
“Market Capitalization” means an amount equal to (1) the total number of issued and outstanding shares of common stock or common equity interests of the Issuer on the date of the declaration of the relevant dividend multiplied by (2) the arithmetic mean of the closing prices per share of such common stock or common equity interests for the 30 consecutive trading days immediately preceding the date of declaration of such dividend.
“Moody's” means Moody's Investors Service, Inc.
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“Net Proceeds” means the aggregate cash proceeds received by the Issuer or any of its Restricted Subsidiaries in respect of any Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration or Cash Equivalents substantially concurrently received in any Asset Sale), net of (1) the direct costs relating to such Asset Sale, including, without limitation, legal, accounting and investment banking fees, and sales commissions, and any relocation expenses incurred as a result of the Asset Sale, (2) taxes paid or payable as a result of the Asset Sale, (3) all distributions and other payments required to be made to minority interest holders (other than the Issuer or any of its Subsidiaries) in Subsidiaries or joint ventures as a result of such Asset Sale, (4) any reserve for adjustment or indemnification obligations in respect of the sale price of such asset or assets established in accordance with IFRS, and (5) all payments made on any Indebtedness incurred pursuant to clause (iv) of the definition of Permitted Debt secured by any assets subject to such Asset Sale, as required in accordance with the terms of any Lien upon such assets, or which by applicable law is required be repaid out of the proceeds from such Asset Sale.
“Nigeria 2023 Revolving Credit Facility” means that certain senior revolving credit facility agreement, originally dated on or around, January 3, 2023, by and among the Issuer and the guarantors thereto as obligors thereunder, the senior lenders named therein, and the agent, including any related notes, guarantees, instruments and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“Nigeria 2023 Term Loan” means that certain term facility agreement, originally dated on or around, January 3, 2023, by and among the Issuer and the guarantors thereto as obligors thereunder, the senior lenders named therein, and the agent, including any related notes, guarantees, instruments and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“Nigerian Guarantor” means any Guarantor incorporated in Nigeria.
“Non-2027 Notes Issuer Group Lease Obligations” means any leases of the Issuer or any Restricted Subsidiary that is not a 2027 Notes Issuer Group Restricted Subsidiary that would not have constituted a Capital Lease Obligation prior to the adoption of IFRS 16 (Leases).
“Non-Recourse Debt” means Indebtedness as to which neither the Issuer nor any of its Restricted Subsidiaries (1) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness) or (2) is directly or indirectly liable as a guarantor or otherwise.
“Note Guarantee” means the guarantee by each Guarantor of the Issuer's obligations under this Senior Notes Indenture and the Senior Notes, executed pursuant to the provisions of this Senior Notes Indenture or a Guarantee Agreement or any supplemental indenture and/or supplemental guarantee agreement.
“Obligations” means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness.
“Offering Memorandum” means the offering memorandum dated November 14, 2024, relating to the offering of the Initial Senior Notes.
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“Officer” means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, the Treasurer, director, manager or a responsible accounting or financial officer of such Person, or any other individual designated as an “Officer” for the purposes of the Senior Notes Indenture by the Board of Directors of such Person.
“Officer's Certificate” means a certificate signed by an Officer.
“Opinion of Counsel” means a written opinion from legal counsel who is reasonably acceptable to the Trustee, that meets the requirements of Section 12.03 hereof. The counsel may be an employee of or counsel to the Issuer or any Subsidiary of the Issuer.
“Parent Debt Contribution” means a contribution to the Issuer or any of its Restricted Subsidiaries in the form of equity, funding the issuance or sale of Capital Stock of the Issuer or as Subordinated Shareholder Debt or otherwise on lent as a proceeds loan, bonds or other debt financing instrument to the Issuer or any of its Restricted Subsidiaries and which meets the conditions of Section 4.07(b)(xvii) under which dividends or other distributions may be paid.
“Parent Holdco” means any Person (other than a natural person) which legally and beneficially owns more than 50% of the Voting Stock and/or Capital Stock of another Person, either directly or through one or more Subsidiaries.
“Pari Passu Indebtedness” means (1) with respect to the Issuer, any Indebtedness that ranks pari passu in right of payment to the Senior Notes and (2) with respect to a Guarantor, any Indebtedness that ranks pari passu in right of payment to the Note Guarantee of such Guarantor (including without limitation, the Existing Note Guarantees and the guarantees executed in connection with the Nigeria 2023 Revolving Credit Facility, the Nigeria 2023 Term Loan, the IHS Holding 2020 Revolving Credit Facility and the IHS Holding 2024 Dual-Tranche Term Loan).
“Participant” means, with respect to DTC, Euroclear or Clearstream, a Person who has an account with DTC, Euroclear or Clearstream, respectively.
“Permitted Business” means (1) any businesses activities engaged in by the Issuer or any of its Subsidiaries on the Issue Date and (2) any businesses, services and activities engaged in by the Issuer or any of the Restricted Subsidiaries that are related, complementary, incidental, ancillary or similar to any of the foregoing or are extensions or developments of any thereof.
“Permitted Holders” means (1) any Successor Parent of the Issuer and (2) any Person who is acting as an underwriter in connection with a public or private offering of Capital Stock of the Issuer or any Parent Holdco, acting in such capacity. Any person or group whose acquisition of beneficial ownership constitutes (1) a Change of Control in respect of which a Change of Control Offer is made in accordance with the requirements of this Senior Notes Indenture or (2) a Change of Control which is also a Specified Change of Control Event, will thereafter, together with its Affiliates, constitute an additional Permitted Holder.
“Permitted Investments” means:
(1)any Investment in the Issuer or in a Restricted Subsidiary; (3)any Investment by the Issuer or any Restricted Subsidiary in a Person, if as a result of such Investment:
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(2)any Investment in cash and Cash Equivalents;
(a)such Person becomes a Restricted Subsidiary; or
(b)such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Issuer or a Restricted Subsidiary;
(4)any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with Section 4.10 hereof;
(5)any acquisition of assets or Capital Stock solely in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Issuer or Subordinated Shareholder Debt;
(6)any Investments received in compromise or resolution of (a) obligations of trade creditors or customers that were incurred in the ordinary course of business of the Issuer or any of its Restricted Subsidiaries, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer; or (b) litigation, arbitration or other disputes or foreclosure of Liens;
(7)Investments in receivables owing to the Issuer or any Restricted Subsidiary created or acquired in the ordinary course of business;
(8)Investments represented by Hedging Obligations, which obligations are permitted by Section 4.09(b)(ix) hereof;
(9)Investments in the Senior Notes and any other Indebtedness of the Issuer or any Restricted Subsidiary (other than Indebtedness constituting Subordinated Obligations);
(10)any guarantee of Indebtedness permitted to be incurred by Section 4.09 hereof;
(11)guarantees of performance or other obligations (other than Indebtedness) arising in the ordinary course of the business of the Issuer and its Restricted Subsidiaries, including obligations under licenses, concessions or operating leases related to the ordinary course of the business of the Issuer and its Restricted Subsidiaries;
(12)any Investment existing on, or made pursuant to binding commitments existing on, the Issue Date by the Issuer or any Restricted Subsidiary of the Issuer and any Investment consisting of an extension, modification or renewal of any such Investment existing on, or made pursuant to a binding commitment existing on, the Issue Date; provided that the amount of any such Investment may be increased (a) as required by the terms of such Investment as in existence on the Issue Date or (b) as otherwise permitted under this Senior Notes Indenture;
(13)Investments acquired after the Issue Date as a result of the acquisition by the Issuer or any Restricted Subsidiary of another Person, including by way of a merger, amalgamation or consolidation with or into the Issuer or any of its Restricted Subsidiaries in a transaction that is not prohibited by Section 5.01 hereof after the Issue Date to the extent that such Investments were not made in contemplation of such acquisition, merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger, amalgamation or consolidation;
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(14)Management Advances;
(15)any Investment to the extent made using as consideration Capital Stock of the Issuer (other than Disqualified Stock), Subordinated Shareholder Debt or Capital Stock of any Parent Holdco; and
(16)other Investments in any Person having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (16) that are at the time outstanding not to exceed the greater of (a) $250.0 million and (b) 5.0% of the Total Assets of the Issuer at any time outstanding; provided that if an Investment is made pursuant to this clause in a Person that is not a Restricted Subsidiary and such Person subsequently becomes a Restricted Subsidiary or is subsequently designated a Restricted Subsidiary pursuant to Section 4.07 hereof, such Investment shall thereafter be deemed to have been made pursuant to clause (1) or (3) of the definition of “Permitted Investments” and not this clause.
“Permitted Liens” means:
(1)Liens in favor of the Issuer or any Restricted Subsidiary;
(2)Liens on property (including Capital Stock) of a Person existing at the time such Person becomes a Restricted Subsidiary or is merged with or into or consolidated with the Issuer or any Restricted Subsidiary; provided that such Liens do not extend to any assets other than those of the Person that becomes a Restricted Subsidiary or is merged with or into or consolidated with the Issuer or any Restricted Subsidiary;
(3)Liens to secure the performance of statutory obligations, trade contracts, insurance, surety or appeal bonds, workers compensation obligations, leases (including, without limitation, statutory and common law landlord's liens), performance bonds, surety and appeal bonds or other obligations of a like nature incurred (including Liens to secure letters of credit issued to assure payment of such obligations) or Liens in connection with bids, tenders, contracts or leases to secure licenses, public or statutory obligations, in each case, incurred in the ordinary course of business; (8)any Liens imposed by the operation of law in the ordinary course of business (including any netting or set-off as a result of a fiscal unity (fiscale eenheid) for Dutch corporate tax or value added tax purposes or of any other jurisdiction having similar effect);
(4)Liens to secure Indebtedness permitted by Section 4.09(b)(iv) hereof covering only the assets acquired with or financed by such Indebtedness;
(5)Liens securing Indebtedness under Hedging Obligations, which obligations are permitted by Section 4.09(b)(ix) hereof;
(6)Liens existing on the Issue Date after giving effect to the offering of the Senior Notes and the application of proceeds therefrom as described in this Offering Memorandum under the heading “Use of Proceeds”;
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(7)Liens for taxes, assessments or governmental charges or claims that (a) are not yet due and payable or (b) are being contested in good faith;
(9)survey exceptions, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real property that were not incurred in connection with Indebtedness and that do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person;
(10)Liens created for the benefit of (or to secure) the Senior Notes (or the Note Guarantees);
(11)Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of customs duties in connection with the importation of goods;
(12)Liens to secure any Permitted Refinancing Indebtedness (excluding Liens to secure Permitted Refinancing Indebtedness initially secured pursuant to clause (32) of this definition) permitted to be incurred under this Senior Notes Indenture; provided, however, that:
(a)the new Lien is limited to all or part of the same property and assets that secured or, under the written agreements pursuant to which the original Lien arose, could secure the original Lien (plus improvements and accessions to such property or proceeds or distributions thereof); and
(b)the Indebtedness secured by the new Lien is not increased to any amount greater than the sum of (i) the outstanding principal amount, or, if greater, committed amount, of the Indebtedness renewed, refunded, refinanced, replaced, defeased or discharged with such Permitted Refinancing Indebtedness and (ii) an amount necessary to pay any fees and expenses, including premiums, related to such renewal, refunding, refinancing, replacement, defeasance or discharge;
(13)Liens on insurance policies and proceeds thereof, or other deposits, to secure insurance premium financings;
(14)Liens arising in favor of the Trustee for its own benefit and similar Liens in favor of other trustees, agents and representatives arising under instruments governing Indebtedness permitted to be incurred; provided, however, that such Liens are solely for the benefit of the trustees, agents or representatives in their capacities as such and not for the benefit of the holders of the Indebtedness;
(15)filing of Uniform Commercial Code financing statements under U.S. state law (or similar filings under other applicable laws) in connection with operating leases in the ordinary course of business;
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(16)bankers' Liens, rights of setoff or similar rights and remedies as to deposit accounts, Liens arising out of judgments or awards not constituting an Event of Default and notices of lis pendens and associated rights related to litigation being contested in good faith by appropriate proceedings and for which adequate reserves have been made;
(17)Liens on cash, Cash Equivalents or other property arising in connection with the defeasance, discharge or redemption of Indebtedness;
(18)Liens on specific items of inventory or other goods (and the proceeds thereof) of any Person securing such Person's obligations in respect of bankers' acceptances issued or created in the ordinary course of business for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(19)leases (including operating leases), licenses, subleases and sublicenses of assets in the ordinary course of business;
(20)Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of assets entered into in the ordinary course of business;
(21)(a) mortgages, liens, security by way of assignment, security interests, pledges, restrictions, encumbrances or any other matters of record that have been placed by any developer, landlord or other third party on property over which the Issuer or any Restricted Subsidiary has easement rights or on any real property leased by the Issuer or any Restricted Subsidiary (including any rental deposits) and subordination or similar agreements relating thereto and (b) any condemnation or eminent domain proceedings or compulsory purchase order affecting real property;
(22)Liens on property or assets under construction (and related rights) in favor of a contractor or developer or arising from progress or partial payments by a third party relating to such property or assets;
(23)(a) Liens securing or arising by reason of any netting or set-off arrangement entered into in the ordinary course of banking or other trading activities; or (b) Liens in connection with specified bank accounts (and cash therein) in connection with the incurrence and repayment of Indebtedness under any daylight facilities permitted to be incurred under Section 4.09 hereof;
(24)Liens (including put and call arrangements) on Capital Stock or other securities of any Unrestricted Subsidiary that secure Indebtedness of such Unrestricted Subsidiary;
(25)pledges of goods, the related documents of title and/or other related documents arising or created in the ordinary course of the Issuer or any Restricted Subsidiary's business or operations as Liens only for Indebtedness to a bank or financial institution directly relating to the goods or documents on or over which the pledge exists;
(26)Liens over cash paid into an escrow account pursuant to any purchase price retention arrangement as part of any permitted disposal by the Issuer or a Restricted Subsidiary on condition that the cash paid into such escrow account in relation to a disposal does not represent more than 15% of the net proceeds of such disposal; (28)Liens created on any asset of the Issuer or a Restricted Subsidiary established to hold assets of any stock option plan or any other management or employee benefit or incentive plan or unit trust of the Issuer or a Restricted Subsidiary securing any loan to finance the acquisition of such assets;
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(27)limited recourse Liens in respect of the ownership interests in, or assets owned by, any joint ventures which are not Restricted Subsidiaries securing obligations of such joint ventures;
(29)Liens (a) on escrowed proceeds for the benefit of the related holders of debt securities or other Indebtedness (or the underwriters or arrangers thereof) or (b) on cash set aside at the time of the incurrence of any Indebtedness or government securities purchased with such cash, in the case of each of clause (a) and (b), to the extent such cash or government securities prefund the payment of interest on such Indebtedness and are held in an escrow account or similar arrangement to be applied for such purpose;
(30)Liens on Receivables Assets incurred in connection with a Qualified Receivables Financing or Liens securing Indebtedness or other obligations of a Receivables Subsidiary;
(31)(a) Liens on property or assets of a Restricted Subsidiary that is not a Guarantor to secure Indebtedness of such Restricted Subsidiary or any other Restricted Subsidiary that is not a Guarantor or (b) any Liens, to the extent such Liens are securing Priority Debt and are not on property, assets or Capital Stock of a 2027 Notes Issuer Group Restricted Subsidiary;
(32)any cash collateral provided in respect of letters of credit or bank guarantees to the issuer of such letters of credit or bank guarantees to the extent that the Indebtedness to which such letters of credit or bank guarantees relate is permitted or not prohibited to be incurred under this Senior Notes Indenture; and
(33)Liens incurred in the ordinary course of business of the Issuer or any Restricted Subsidiary securing Indebtedness of the Issuer and its Restricted Subsidiaries that does not exceed the greater of $100.0 million and 2.0% of the Total Assets of the Issuer at any one time outstanding.
“Permitted Parent Payments” means, without duplication as to amounts, payments to any Parent Holdco of the Issuer to permit such entity to pay:
(1)customary indemnification obligations of any Parent Holdco owing to directors, officers, employees or other Persons under its charter or by-laws or pursuant to written agreements with any such Person to the extent relating to the Issuer and its Subsidiaries;
(2)obligations of any Parent Holdco in respect of directors' fees, remuneration and expenses (including director and officer insurance (including premiums therefore)) to the extent relating to the Issuer and its Subsidiaries;
(3)professional fees and expenses of any Parent Holdco related to the ownership of the Capital Stock of the Issuer and, indirectly through the Issuer, its Subsidiaries (including, without limitation, accounting, legal, audit corporate reporting, and administrative expenses and other reasonable and normal course expenses required to maintain such Parent Holdco's corporate existence or its holding of the Capital Stock of the Issuer); and (4)expenses incurred by any Parent Holdco in connection with any public offering or other sale of Capital Stock or Indebtedness, whether consummated or not, (a) where the net proceeds of such offering or sale are intended to be received by or contributed to the Issuer or a Subsidiary of the Issuer; or (b) in a pro-rated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed; and
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(5)any Related Taxes.
“Permitted Refinancing Indebtedness” means any Indebtedness of the Issuer or any of its Restricted Subsidiaries issued in exchange for, or the net proceeds of which are used to renew, refund, refinance, replace, exchange, defease or discharge other Indebtedness of the Issuer or any of its Restricted Subsidiaries (other than intercompany Indebtedness); provided that:
(1)the aggregate principal amount (or accreted value, if applicable), or if issued with original issue discount, aggregate issue price) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable, or if issued with original issue discount, aggregate issue price) of the Indebtedness renewed, refunded, refinanced, replaced, exchanged, defeased or discharged (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith);
(2)such Permitted Refinancing Indebtedness has (a) a final maturity date that is either (i) no earlier than the final maturity date of the Indebtedness being renewed, refunded, refinanced, replaced, exchanged, defeased or discharged or (ii) after the final maturity date of the Senior Notes and (b) has a Weighted Average Life to Maturity that is equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged;
(3)if the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged is expressly, contractually subordinated in right of payment to the Senior Notes or a Note Guarantee, such Permitted Refinancing Indebtedness is subordinated in right of payment to the Senior Notes or such Note Guarantee, as the case may be, on terms at least as favorable to the holders of Senior Notes as those contained in the documentation governing the Indebtedness being renewed, refunded, refinanced, replaced, exchanged, defeased or discharged; and
(4)if the Issuer or any Guarantor was the obligor on the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged, such Indebtedness is incurred either by the Issuer or a Guarantor.
Permitted Refinancing Indebtedness in respect of any Indebtedness may be incurred from time to time after the termination, discharge or repayment of any such Indebtedness.
“Permitted Reorganization” means any amalgamation, demerger, merger, voluntary liquidation, consolidation, reorganization, restructuring, redomiciliation, winding up or corporate reconstruction involving the Issuer or any Restricted Subsidiary that is made on a solvent basis; provided that (1) any payments, business, property or assets distributed in connection with such Reorganization remain within the Issuer and the Restricted Subsidiaries; and (2) if any Note Guarantees are released in connection with such Reorganization in accordance with the Note Guarantee release provisions of this Senior Notes Indenture, Note Guarantees must be provided promptly following the completion of such Reorganization such that the Note Guarantees in place following the Reorganization are not materially worse for the holders of the Senior Notes than the pre-existing Note Guarantees (in the good faith judgment of the Issuer).
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Promptly upon consummation of a Permitted Reorganization, the Issuer will file with the Trustee a copy of the resolution of the Board of Directors of the Issuer or the applicable Restricted Subsidiary authorizing such Permitted Reorganization and deliver an Officer's Certificate certifying that such Permitted Reorganization complied or will comply with the terms of this Senior Notes Indenture and did not result or will not result in a Default or Event of Default. The Trustee at the direction and request of the Issuer shall take any action necessary to effect any releases of Note Guarantees (as well as any subsequent giving of Note Guarantees) requested by the Issuer in connection with a Permitted Reorganization.
“Person” means any individual, corporation, partnership, joint venture, association, joint stock company, exempted company, trust, unincorporated organization, limited liability company or government or other entity.
“Priority Debt” means Indebtedness permitted to be incurred pursuant to the provisions of sub-paragraph (y) of the last paragraph of Section 4.09(b) or would not otherwise cause the Priority Debt Cap to be exceeded, assuming that such Indebtedness were so incurred.
“Priority Debt Cap” means the greater of $1,890 million and 200% of Consolidated EBITDA.
“Private Placement Legend” means the legend set forth in Section 2.06(f)(i) hereof to be placed on all Senior Notes issued under this Senior Notes Indenture except where otherwise permitted by the provisions of this Senior Notes Indenture.
“Public Debt” means any Indebtedness consisting of bonds, debentures, notes or other similar debt securities issued in (1) a public offering registered under the U.S. Securities Act or (2) a private placement to institutional investors that is underwritten for resale in accordance with Rule 144A under the U.S. Securities Act or Regulation S under the U.S. Securities Act, whether or not it includes registration rights entitling the holders of such securities to registration thereof with the SEC for public resale.
“QIB” means a “qualified institutional buyer” as defined in Rule 144A.
“Qualified Receivables Financing” means any Receivables Financing of a Receivables Subsidiary that meets the following conditions: (1) an Officer or the Board of Directors of the Issuer shall have determined in good faith that such Qualified Receivables Financing (including financing terms, covenants, termination events and other provisions) is in the aggregate economically fair and reasonable to the Issuer and the Receivables Subsidiary, (2) all sales of accounts receivable and related assets to the Receivables Subsidiary are made at fair market value (as determined in good faith by an Officer or the Board of Directors of the Issuer), and (3) the financing terms, covenants, termination events and other provisions thereof shall be on market terms (as determined in good faith by the Issuer) and may include Standard Securitization Undertakings.
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The grant of a security interest in any accounts receivable of the Issuer or any of its Restricted Subsidiaries (other than a Receivables Subsidiary) to secure Indebtedness under Credit Facilities or Indebtedness in respect of the Senior Notes shall not be deemed a Qualified Receivables Financing.
“Receivable” means a right to receive payment arising from a sale or lease of goods or services by a Person pursuant to an arrangement with another Person pursuant to which such other Person is obligated to pay for goods or services under terms that permit the purchase of such goods and services on credit, as determined on the basis of IFRS.
“Receivables Assets” means any assets that are or will be the subject of a Qualified Receivables Financing.
“Receivables Fees” means distributions or payments made directly or by means of discounts with respect to any participation interest issued or sold in connection with, and other fees paid to a Person that is not a Restricted Subsidiary in connection with, any Receivables Financing.
“Receivables Financing” means any transaction or series of transactions that may be entered into by the Issuer or any of its Subsidiaries pursuant to which the Issuer or any of its Subsidiaries may sell, convey or otherwise transfer to (1) a Receivables Subsidiary (in the case of a transfer by the Issuer or any of its Subsidiaries), or (2) any other Person (in the case of a transfer by a Receivables Subsidiary), or may grant a security interest in, any accounts receivable (whether now existing or arising in the future) of the Issuer or any of its Subsidiaries, and any assets related thereto, including all collateral securing such accounts receivable, all contracts and all guarantees or other obligations in respect of such accounts receivable, proceeds of such accounts receivable and other assets which are customarily transferred or in respect of which security interest are customarily granted in connection with asset securitization transactions involving accounts receivable and any Hedging Obligations entered into by the Issuer or any such Subsidiary in connection with such accounts receivable.
“Receivables Repurchase Obligation” means any obligation of a seller of receivables in a Qualified Receivables Financing to repurchase receivables arising as a result of a breach of a representation, warranty or covenant or otherwise, including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, off-set or counterclaim of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller.
“Receivables Subsidiary” means a Wholly-Owned Subsidiary of the Issuer (or another Person formed for the purposes of engaging in a Qualified Receivables Financing with the Issuer in which the Issuer or any Subsidiary of the Issuer makes an Investment and to which the Issuer or any Subsidiary of the Issuer transfers accounts receivable and related assets) which engages in no activities other than in connection with the financing of accounts receivable of the Issuer and its Subsidiaries, all proceeds thereof and all rights (contractual or other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and which is designated by the Board of Directors of the Issuer (as provided below) as a Receivables Subsidiary and:
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(1)no portion of the Indebtedness or any other obligations (contingent or otherwise) of which (A) is guaranteed by the Issuer or any other Restricted Subsidiary of the Issuer (excluding guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings), (B) is subject to terms that are substantially equivalent in effect to a guarantee of any losses on securitized or sold receivables by the Issuer or any other Restricted Subsidiary of the Issuer, (C) is recourse to or obligates the Issuer or any other Restricted Subsidiary of the Issuer in any way other than pursuant to Standard Securitization Undertakings, or (D) subjects any property or asset of the Issuer or any other Restricted Subsidiary of the Issuer, directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings,
(2)with which neither the Issuer nor any other Restricted Subsidiary of the Issuer has any contract, agreement, arrangement or understanding other than on terms which the Issuer reasonably believes to be no less favorable to the Issuer or such Restricted Subsidiary than those that might be obtained at the time from Persons that are not Affiliates of the Issuer, and
(3)to which neither the Issuer nor any other Restricted Subsidiary of the Issuer has any obligation to maintain or preserve such entity's financial condition or cause such entity to achieve certain levels of operating results.
Any such designation by the Board of Directors of the Issuer shall be evidenced to the Trustee by filing with the Trustee a copy of the resolution of the Board of Directors of the Issuer giving effect to such designation and an Officer's Certificate certifying that such designation complied with the foregoing conditions.
“Regulation S” means Regulation S promulgated under the U.S. Securities Act.
“Regulation S Definitive Registered Note” means a Definitive Registered Note resold in reliance on Regulation S.
“Regulation S Global Note” means a 2030 Regulation S Global Note or a 2031 Regulation S Global Note.
“Related Taxes” means:
(1)any Taxes required to be paid (provided that such Taxes are in fact paid) by any Parent Holdco by virtue of its:
(a)having Capital Stock outstanding (but not by virtue of owning stock or other equity interests of any corporation or other entity other than, directly or indirectly, the Issuer or any of the Issuer’s Subsidiaries);
(b)issuing or holding Subordinated Shareholder Debt; or
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(c)being a holding company, directly or indirectly, of the Issuer or any of the Issuer’s Subsidiaries; and (2)if and for so long as the Issuer is a member of a group filing a consolidated or combined tax return with any Parent Holdco, any consolidated or combined Taxes measured by income for which such Parent Holdco is liable up to an amount not to exceed the lesser of the amount of any such Taxes that the Issuer and its Subsidiaries would have been required to pay on (i) a separate company basis or (ii) on a consolidated basis if the Issuer and its Subsidiaries had paid tax on a consolidated, combined, group, affiliated or unitary basis on behalf of an affiliated group consisting only of the Issuer and its Subsidiaries; provided that distributions shall be permitted in respect of the income of an Unrestricted Subsidiary only to the extent such Unrestricted Subsidiary distributed cash for such purpose to the Issuer or its Restricted Subsidiaries.
“Responsible Officer” when used with respect to the Trustee, means any officer or assistant officer of the Trustee (or any successor of the Trustee) including any director, associate director, assistant secretary or any other officer or assistant officer of the Trustee customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject.
“Replacement Assets” means (1) properties and assets that replace the properties and assets that were the subject of an Asset Sale or (2) properties and assets received in exchange (directly or indirectly through equity interests or similar participations) for the properties and assets that are the subject of the Asset Sale and that, in each case, will be used in a Permitted Business.
“Restricted Investment” means an Investment other than a Permitted Investment.
“Restricted Period” means the 40-day distribution compliance period as defined in Regulation S.
“Restricted Subsidiary” means any Subsidiary of the Issuer that is not an Unrestricted Subsidiary.
“Rule 144” means Rule 144 promulgated under the U.S. Securities Act.
“Rule 144A” means Rule 144A promulgated under the U.S. Securities Act.
“Rule 903” means Rule 903 promulgated under the U.S. Securities Act.
“Rule 904” means Rule 904 promulgated under the U.S. Securities Act.
“S&P” means Standard & Poor’s Ratings Group.
“SEC” means the U.S. Securities and Exchange Commission.
“Senior Notes” has the meaning assigned to it in the preamble to this Senior Notes Indenture. Unless the context otherwise requires, all references to the Senior Notes shall include the Initial Senior Notes and any Additional Senior Notes.
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“Senior Notes Indenture” means this indenture for the Senior Notes, as amended or supplemented from time to time.
“Senior Notes Initial Purchasers” has the meaning ascribed to such term in the Offering Memorandum.
“Significant Subsidiary” means, at the date of determination, any Restricted Subsidiary that together with its Subsidiaries that are Restricted Subsidiaries (1) for the most recent fiscal year, accounted for more than 10% of the consolidated revenues of the Issuer or (2) as of the end of the most recent fiscal year, was the owner of more than 10% of the consolidated Total Assets of the Issuer.
“Specified Change of Control Event” means the occurrence of any event that would constitute a Change of Control pursuant to the definition thereof; provided that giving pro forma effect thereto, the Consolidated Net Leverage Ratio would not exceed 4.0 to 1.0. Notwithstanding the foregoing, only one Specified Change of Control Event shall be permitted under this Senior Notes Indenture after the Issue Date.
“Standard Securitization Undertakings” means representations, warranties, covenants, indemnities and guarantees of performance entered into by the Issuer or any Subsidiary of the Issuer which the Issuer has determined in good faith to be customary in a Receivables Financing, including those relating to the servicing of the assets of a Receivables Subsidiary, it being understood that any Receivables Repurchase Obligation shall be deemed to be a Standard Securitization Undertaking.
“Stated Maturity” means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which the payment of interest or principal was scheduled to be paid in the documentation governing such Indebtedness as of the Issue Date, and will not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.
“Subordinated Obligation” means, with respect to any Person, any Indebtedness of the Issuer which is expressly subordinated in right of payment to the Senior Notes pursuant to a written agreement.
“Subordinated Shareholder Debt” means, collectively, any debt provided to the Issuer or a Guarantor by any direct or indirect Parent Holdco of the Issuer or any Permitted Holder, including any Subsidiary or Affiliate of any Parent Holdco that is not a Subsidiary of the Issuer, in exchange for or pursuant to any security, instrument or agreement other than Capital Stock, together with any such security, instrument or agreement and any other security or instrument other than Capital Stock issued in payment of any obligation under any Subordinated Shareholder Debt; provided that such Subordinated Shareholder Debt:
(1)does not (including upon the occurrence of any event) mature or require any amortization or other payment of principal prior to the maturity of the Senior Notes (other than through conversion or exchange of any such security or instrument for Equity Interests of the Issuer (other than Disqualified Stock) or for any other security or instrument meeting the requirements of the definition); (4)is not secured by a Lien on any assets of the Issuer or a Restricted Subsidiary and is not guaranteed by the Issuer (in respect of Subordinated Shareholder Debt incurred by a Guarantor) or any Subsidiary of the Issuer (in respect of Subordinated Shareholder Debt incurred by the Issuer); and
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(2)does not (including upon the occurrence of any event) require the payment of cash interest prior to the maturity of the Senior Notes;
(3)does not (including upon the occurrence of any event) provide for the acceleration of its maturity nor confers on its holders any right (including upon the happening of any event) to declare a default or event of default or take any enforcement action, in each case, prior to the maturity of the Senior Notes;
(5)is contractually subordinated in right of payment to the prior payment in full in cash of all obligations of the Issuer or Guarantor (as applicable) under the Senior Notes and the Note Guarantees pursuant to subordination on insolvency, enforcement limitation, payment blockage, turnover, filing of claims and release of claims provisions,
provided, however, that after any event or circumstance that results in such Indebtedness ceasing to qualify as Subordinated Shareholder Debt, such Indebtedness shall constitute an incurrence of such Indebtedness by the Issuer or Guarantor, as applicable, and any and all Restricted Payments made through the use of the net proceeds from the incurrence of such Indebtedness since the date of the original issuance of such Subordinated Shareholder Debt shall constitute new Restricted Payments that are deemed to have been made after the date of the original issuance of such Subordinated Shareholder Debt.
“Subsidiary” means, with respect to any specified Person:
(1)any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency and after giving effect to any voting agreement or stockholders' agreement that effectively transfers voting power) to vote in the election of directors, managers or trustees of the corporation, association or other business entity is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person (or a combination thereof); “Tax Sharing Agreement” means any tax sharing or profit and loss pooling or similar agreement with customary or arm's length terms entered into with any Parent Holdco of the Issuer or Unrestricted Subsidiary, as the same may be amended, supplemented, waived or otherwise modified from time to time in accordance with the terms thereof and of this Senior Notes Indenture.
(2)any partnership or limited liability company of which (a) more than 50% of the capital accounts, distribution rights, total equity and voting interests or general and limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof, whether in the form of membership, general, special or limited partnership interests or otherwise, and (b) such Person or any Subsidiary of such Person is a controlling general partner or otherwise controls such entity; and
(3)any corporation, company, association, partnership, limited liability company or other business entity which is or is eligible to be consolidated in the financial statements of such Person in accordance with IFRS.
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“Successor Parent” means, with respect to any Person, any other Person more than 50% of the total voting power of the Voting Stock of which is, at the time the first Person becomes a Subsidiary of such other Person, “beneficially owned” (as defined below) by one or more Persons that “beneficially owned” (as defined below) more than 50% of the total voting power of the Voting Stock of the first Person immediately prior to the first Person becoming a Subsidiary of such other Person. For purposes hereof, “beneficially own” has the meaning correlative to the term “beneficial owner,” as such term is defined in Rules 13d-3 and 13d-5 under the U.S. Exchange Act (as in effect on the Issue Date).
“Tax” means any tax, duty, levy, impost, assessment or other governmental charge (including penalties, interest and any other additions thereto, and, for the avoidance of doubt, including any withholding or deduction for or on account of Tax). “Taxes” and “Taxation” shall be construed to have corresponding meanings.
“Total Assets” means, with respect to any specified Person as of any date, the total assets of such Person, calculated on a consolidated basis in accordance with IFRS, excluding all intra-group items and investments in any Subsidiaries of such Person of or by such Person or any of its Restricted Subsidiaries.
“Trade Instruments” means any performance bonds, advance payment bonds or documentary letters of credit issued in respect of the obligations of any of the Issuer or its Restricted Subsidiaries arising in the ordinary course of business which, in each case, is not (or will not be) outstanding for a period longer than 9 months from the date such instrument is issued.
“Transactions” means the offering of the Senior Notes and the use of proceeds thereof as described in the Offering Memorandum.
“Treasury Rate” means, as of any redemption date, the yield to maturity at the time of computation of U.S. Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) which has become publicly available on a day no earlier than two Business Days prior to the redemption date (or, if such statistical release is not so published or available, any publicly available source of similar market date selected by the Issuer in good faith)) most nearly equal to the period from the redemption date to November 29, 2026 in the case of the 2030 Notes and November 29, 2027 in the case of the 2031 Notes; provided, however, that if the period from the redemption date to November 29, 2026 in the case of the 2030 Notes and November 29, 2027 in the case of the 2031 Notes is not equal to the constant maturity of a U.S. Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by a linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields to U.S. Treasury securities for which such yields are given, except that if the period from the redemption date to November 29, 2026 in the case of the 2030 Notes and November 29, 2027 in the case of the 2031 Notes is less than one year, the weekly average yield on actually traded U.S. Treasury securities adjusted to a constant maturity of one year shall be used.
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“Trustee” means Kroll Trustee Services Limited, until a successor replaces it in accordance with the applicable provisions of this Senior Notes Indenture and thereafter means the successor serving hereunder.
“Unrestricted Subsidiary” means any Subsidiary of the Issuer that is designated by the Board of Directors of the Issuer as an Unrestricted Subsidiary pursuant to a resolution of the Board of Directors but only to the extent that such Subsidiary at the time of such designation:
(1)has no Indebtedness other than Non-Recourse Debt;
(2)except as permitted by Section 4.11 hereof, is not party to any agreement, contract, arrangement or understanding with the Issuer or any Restricted Subsidiary unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Issuer or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Issuer; and
(3)is a Person with respect to which neither the Issuer nor any Restricted Subsidiary has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve such Person's financial condition or to cause such Person to achieve any specified levels of operating results.
“U.S. Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended and the rules and regulations promulgated pursuant thereto.
“U.S. Securities Act” means the U.S. Securities Act of 1933, as amended and the rules and regulations promulgated pursuant thereto.
“U.S. Person” means a U.S. Person as defined in Rule 902(k) promulgated under the U.S. Securities Act.
“Voting Stock” of any specified Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.
“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing:
(1)the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect of the Indebtedness, by
(b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by
(2)the then outstanding principal amounts of such Indebtedness.
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“Wholly-Owned Subsidiary” means a Restricted Subsidiary of the Issuer, all of the Capital Stock of which (other than directors' qualifying shares or shares required by any applicable law or regulation to be held by a Person other than the Issuer or another Wholly-Owned Subsidiary) is owned by the Issuer or another Wholly-Owned Subsidiary.
Section 1.02.Other Definitions.
Term |
|
Defined in |
“Additional Amounts” |
|
4.18 |
“Affiliate Transaction” |
|
4.11 |
“Applicable Law” |
|
7.11 |
“Asset Sale Offer” |
|
4.10 |
“Authenticating Agent” |
|
2.02 |
“Authentication Order” |
|
2.02 |
“Authority” |
|
7.11 |
“Authorized Agent” |
|
12.06 |
“Calculation Date” |
|
1.01 |
“Change in Tax Law” |
|
3.08 |
“Change of Control Offer” |
|
4.13 |
“Change of Control Payment” |
|
4.13 |
“Change of Control Payment Date” |
|
4.13 |
“Covenant Defeasance” |
|
8.03 |
“Event of Default” |
|
6.01 |
“Excess Proceeds” |
|
4.10 |
“Excluded Amounts” |
|
4.07 |
“FATCA Withholding” |
|
7.11 |
“incur” |
|
4.09 |
“Increased Amount” |
|
4.12 |
“Initial Lien” |
|
4.12 |
“Judgment Currency” |
|
12.13 |
“Legal Defeasance” |
|
8.02 |
“Non-Pro Rata Election” |
|
4.10 |
“Notes Offer” |
|
4.10 |
“Offer Amount” |
|
3.10 |
“Offer Period” |
|
3.10 |
“Party” |
|
7.11 |
“Paying Agent” |
|
2.03 |
“Payment Default” |
|
6.01 |
“Permitted Debt” |
|
4.09 |
“Permitted Payments” |
|
4.07 |
“Principal Paying Agent” |
|
2.03 |
“Public Debt Offer” |
|
4.10 |
“Purchase Date” |
|
3.10 |
“Register” |
|
2.03 |
“Registrar” |
|
2.03 |
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Term |
|
Defined in |
“Restricted Payments” |
|
4.07 |
“Substitution” |
|
5.03 |
“Suspension Period” |
|
4.19 |
“Tax Jurisdiction” |
|
4.18 |
“Tax Redemption Date” |
|
3.08 |
“Transaction Commitment Date Election” |
|
4.22 |
“Transfer Agent” |
|
2.03 |
Section 1.03.Rules of Construction. Unless the context otherwise requires:
(a)a term has the meaning assigned to it;
(b)an accounting term not otherwise defined has the meaning assigned to it in accordance with IFRS;
(c)“or” is not exclusive;
(d)words in the singular include the plural, and in the plural include the singular;
(e)“will” shall be interpreted to express a command;
(f)provisions apply to successive events and transactions;
(g)a reference to any person includes their respective successors and assigns;
(h)references to sections of or rules under the U.S. Securities Act will be deemed to include substitute, replacement of successor sections or rules adopted by the SEC from time to time;
(i)all references to the principal, premium, interest or any other amount payable pursuant to this Senior Notes Indenture shall be deemed also to refer to any Additional Amounts which may be payable hereunder in respect of payments of principal, premium, interest and any other amounts payable pursuant to this Senior Notes Indenture or any undertakings given in addition thereto or in substitution therefor pursuant to this Senior Notes Indenture and express reference to the payment of Additional Amounts in any provisions hereof shall not be construed as excluding Additional Amounts in those provisions hereof where such express reference is not made; and
(j)unsecured or unguaranteed Indebtedness shall not be deemed to be subordinate or junior to secured Indebtedness or guaranteed Indebtedness merely by virtue of its nature as unsecured or unguaranteed Indebtedness.
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ARTICLE 2
THE SENIOR NOTES
Section 2.01.Form and Dating. (a) General. The Senior Notes and the Trustee's or Authenticating Agent's certificate of authentication will be substantially in the form of Exhibit A hereto. The Senior Notes may have notations, legends or endorsements required by law, stock exchange rule or usage and as provided herein. The Issuer shall approve the form of the Senior Notes and any notation, legend or endorsement thereon. Each Note will be dated the date of its authentication. The terms and provisions contained in the Senior Notes will constitute, and are hereby expressly made, a part of this Senior Notes Indenture and the Issuer, the Guarantors and the Trustee, by their execution and delivery of this Senior Notes Indenture, expressly agree to such terms and provisions and to be bound thereby. However, to the extent any provision of any Senior Note conflicts with the express provisions of this Senior Notes Indenture, the provisions of this Senior Notes Indenture shall govern and be controlling.
(b)Global Notes. Senior Notes issued in global form will be substantially in the form of Exhibit A hereto (including the Global Note Legend thereon and the “Schedule of Exchanges of Interests in the Global Note” attached thereto). Each Global Note will represent such of the outstanding Senior Notes as will be specified therein and each shall provide that it represents the aggregate principal amount of outstanding Senior Notes from time to time endorsed thereon and that the aggregate principal amount of outstanding Senior Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions and purchases and cancellations. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Senior Notes represented thereby will be made by the Trustee or the Depositary or the Principal Paying Agent at the direction of the Trustee, in accordance with instructions given by the Holder thereof as required by Section 2.06 hereof.
(c)144A Global Notes and Regulation S Global Notes. The 2030 Senior Notes sold within the United States to QIBs pursuant to Rule 144A under the U.S. Securities Act shall be issued initially in the form of a 2030 144A Global Note, which shall be deposited with the Custodian, and registered in the name of Cede & Co., as nominee for DTC, duly executed by the Issuer and authenticated by the Trustee or the Authenticating Agent as hereinafter provided. The aggregate principal amount of a 2030 144A Global Note may from time to time be increased or decreased by adjustments made on Schedule A to each such Global Note, as hereinafter provided.
The 2031 Senior Notes sold within the United States to QIBs pursuant to Rule 144A under the U.S. Securities Act shall be issued initially in the form of a 2031 144A Global Note, which shall be deposited with the Custodian, and registered in the name of Cede & Co., as nominee for DTC, duly executed by the Issuer and authenticated by the Trustee or the Authenticating Agent as hereinafter provided. The aggregate principal amount of a 2031 144A Global Note may from time to time be increased or decreased by adjustments made on Schedule A to each such Global Note, as hereinafter provided.
The 2030 Senior Notes offered and sold in reliance on Regulation S shall be issued initially in the form of a 2030 Regulation S Global Note, which shall be deposited with the Common Depositary for Euroclear and Clearstream, duly executed by the Issuer and authenticated by the Trustee or the Authenticating Agent as hereinafter provided.
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The aggregate principal amount of a 2030 Regulation S Global Note may from time to time be increased or decreased by adjustments made on Schedule A to each such Global Note, as hereinafter provided.
The 2031 Senior Notes offered and sold in reliance on Regulation S shall be issued initially in the form of a 2031 Regulation S Global Note, which shall be deposited with the Common Depositary for Euroclear and Clearstream, duly executed by the Issuer and authenticated by the Trustee or the Authenticating Agent as hereinafter provided. The aggregate principal amount of a 2031 Regulation S Global Note may from time to time be increased or decreased by adjustments made on Schedule A to each such Global Note, as hereinafter provided.
(d)Definitive Registered Notes. Definitive Registered Notes issued upon transfer of a Book-Entry Interest or a Definitive Registered Note, or in exchange for a Book-Entry Interest or a Definitive Registered Note, shall be issued in accordance with this Senior Notes Indenture.
Notes issued in definitive registered form will be substantially in the form of Exhibit A hereto (excluding the Global Note Legend thereon and without the “Schedule of Exchanges of Interests in the Global Note” in the form of Schedule A attached thereto).
(e)Book-Entry Provisions. The Applicable Procedures shall be applicable to Book-Entry Interests in the Global Notes that are held by Participants through DTC, Euroclear or Clearstream.
(f)Denomination. The Senior Notes shall be in denominations of $200,000 and integral multiples of $1,000 in excess thereof.
Section 2.02.Execution and Authentication. At least one Officer must sign the Senior Notes for the Issuer by manual or facsimile signature.
If an Officer whose signature is on a Senior Note no longer holds that office at the time a Senior Note is authenticated, the Senior Note will nevertheless be valid.
A Senior Note will not be valid until authenticated by the manual or facsimile signature of the authorized signatory of the Trustee or the Authenticating Agent. The signature will be conclusive evidence that the Senior Note has been authenticated under this Senior Notes Indenture. Notwithstanding the foregoing, if any Senior Note shall have been authenticated and delivered hereunder but never issued and sold by the Issuer, the Issuer shall deliver such Senior Note to the Trustee for cancellation pursuant to Section 2.11 hereof.
The Trustee will, upon receipt of a written order of the Issuer signed by an authorized representative (an “Authentication Order”), authenticate or cause the Authenticating Agent to authenticate the Senior Notes for original issue that may be validly issued under this Senior Notes Indenture, including any Additional Senior Notes. The aggregate principal amount of Senior Notes outstanding at any time may not exceed the aggregate principal amount of Senior Notes authorized for issuance by the Issuer pursuant to one or more Authentication Orders, except as provided in Section 2.07 hereof.
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The Trustee may appoint one or more authentication agents (each, an “Authenticating Agent”) acceptable to the Issuer to authenticate Notes. Such an agent may authenticate Notes whenever the Trustee may do so. Each reference in this Senior Notes Indenture to authentication by the Trustee includes authentication by such agent. An Authenticating Agent has the same rights as an Agent to deal with the Issuer or an Affiliate of the Issuer.
Section 2.03.Paying Agent, Registrars and Transfer Agent Issuer will maintain one or more paying agents (each, a “Paying Agent”) for the Senior Notes. The initial Paying Agent will be Citibank, N.A., London Branch (the “Paying Agent” or “Principal Paying Agent”) and Citibank, N.A., London Branch hereby accepts such appointment.
The Issuer will also maintain a transfer agent (the “Transfer Agent”). The Issuer hereby appoints Citibank, N.A., London Branch in London as the initial Transfer Agent and Citibank, N.A., London Branch hereby accepts such appointment. The Issuer will also maintain a registrar (the “Registrar”). The Issuer hereby appoints Citibank, N.A., London Branch as the initial Registrar and Citibank, N.A., London Branch hereby accepts such appointment. The Registrar will maintain a register (the “Register”) for the Senior Notes reflecting ownership of the Definitive Registered Notes (as defined herein) outstanding from time to time and will make payments on and facilitate transfers of Definitive Registered Notes on behalf of the Issuer. Each Transfer Agent shall perform the functions of a transfer agent.
The Registrar will send, on request, a copy of the Register to the Issuer on the Issue Date and after any change to the Register made by the Registrar, with such copy to be held by the Issuer at its registered office.
Upon notice to the Trustee, the Issuer may change the Paying Agent, the Registrar or the Transfer Agent without prior notice to the Holders (subject, in the case of a Paying Agent, to the condition described in the first paragraph of this Section 2.03). For so long as the Senior Notes are listed on the Official List of the Exchange and if and to the extent the rules of the International Stock Exchange Authority Limited so require, the Issuer will notify The International Stock Exchange Authority Limited of any change of the Paying Agent, Registrar or Transfer Agent.
Section 2.04.Paying Agent to Hold Money. The Issuer will require each Paying Agent (other than the Trustee in circumstances in which it is required to act as Paying Agent) not a party to this Senior Notes Indenture to agree in writing that each Paying Agent will hold for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal of, premium or Additional Amounts, if any, or interest on, the Senior Notes, and will notify the Trustee of any default by the Issuer in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Issuer at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Issuer or a Subsidiary of the Issuer) will have no further liability for the money. Money held by the Paying Agent will not need to be segregated except as required by law. If the Issuer or a Subsidiary of the Issuer acts as Paying Agent, it will segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent and in no event shall any Paying Agent be liable for interest on any money received by it hereunder. Upon any insolvency, bankruptcy or reorganization proceedings relating to the Issuer (including, without limitation, its bankruptcy, voluntary or judicial liquidation, composition with creditors, reprieve from payment, controlled management, fraudulent conveyance, general settlement with creditors, reorganization or similar laws affecting the rights of creditors generally), the Trustee may serve as Paying Agent for the Senior Notes.
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The Issuer shall no later than 10:00 a.m. (London time) on the second Business Day prior to the day on which the Paying Agent is to receive payment, procure that the bank effecting payment for it confirms via fax or tested SWIFT MT100 message to the Paying Agent the payment instructions relating to such payment. A Paying Agent shall not be obliged to pay the Holders of the Senior Notes (or make any other payment) unless and until such time as it has confirmed receipt of funds sufficient to make the relevant payment.
Money held by the initial Paying Agent (as described in Section 2.03 above) will not be held in trust but will be held by such Paying Agent as banker and such money shall not be held subject to the United Kingdom's Financial Conduct Authority's Client Money Rules.
For the avoidance of doubt, the Paying Agent, the Trustee and any other Agent shall be held harmless and have no liability with respect to the payment or disbursements to be made by the Paying Agent and the Trustee (i) for which payment instructions are not made or received or that are not otherwise deposited by the respective times set forth in this Section 2.04 and (ii) until they have confirmed receipt of funds sufficient to make the relevant payment.
Section 2.05.Holder Lists. The Registrar will preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of all Holders. Following the exchange of beneficial interests in Global Notes for Definitive Registered Notes, if the Trustee or the Principal Paying Agent is not the Registrar, the Issuer will furnish or cause the Registrar to furnish, to the Trustee and each Paying Agent at least seven Business Days before each interest payment date and at such other times as the Trustee or the Principal Paying Agent may request in writing, a list of the names and addresses of the Holders of such Definitive Registered Notes in such form and as of such date as the Trustee or the Principal Paying Agent may reasonably require. Neither the Trustee, the Agents nor any of their agents will have any responsibility or be liable for any aspect of the records in relation to, or payments made on account of, beneficial ownership interests in the Global Notes or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.
Section 2.06.Transfer and Exchange. (a) Transfer and Exchange of Global Notes. The Global Notes may not be transferred except as a whole to any Person other than to another Depositary or Common Depositary, another Custodian or nominee of the Depositary or Common Depositary or to a successor clearing agency or its depositary or common depositary or custodian or nominee approved by the Issuer, the Guarantors and the Trustee. All Global Notes will be exchanged by the Issuer for Definitive Registered Notes:
(i)if DTC (in the case of the 144A Global Note) or Euroclear or Clearstream (in the case of the Regulation S Global Note) notifies the Issuer that it is unwilling or unable to continue to act as a clearing system for such Global Note, or if at any time DTC ceases (in the case of the 144A Global Note) to be a “clearing agency” registered under the U.S. Exchange Act and a successor depositary is not appointed by the Issuer within 120 days of such notice;
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(ii)if the Custodian or the Common Depositary, as the case may be, so requests following an Event of Default under this Senior Notes Indenture; or
(iii)if the owner of a Book-Entry Interest requests such exchange in writing delivered through the Custodian or the Common Depositary following a Default or Event of Default under this Senior Notes Indenture.
Upon the occurrence of any of the preceding events in clauses (i) through (ii) above, the Issuer shall issue or cause to be issued Definitive Registered Notes in such names as the Custodian or Common Depositary shall instruct the Trustee. Global Notes also may be exchanged or replaced, in whole or in part, as provided in Section 2.07 and 2.10 hereof. Every Senior Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form of, and shall be, a Global Note. A Global Note may not be exchanged for another Senior Note other than as provided in this (a). Book-Entry Interests in a Global Note may be transferred and exchanged as provided in (b) or (c) hereof.
None of the Issuer, the Trustee, the Paying Agent, the Registrar, the Transfer Agent or any of their respective agents will have any responsibility for the performance by Euroclear, Clearstream or DTC or their respective participants or indirect participants of their respective obligations under the rules and procedures governing their operations.
(b)General Provisions Applicable to Transfer and Exchange of Book-Entry Interests in the Global Notes.
The transfer and exchange of Book-Entry Interests shall be effected through the relevant Depositary, in accordance with the provisions of this Senior Notes Indenture and the Applicable Procedures. Transfers of Book-Entry Interests shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the U.S. Securities Act. Transfers and exchanges of Book-Entry Interests for Book-Entry Interests also shall require compliance with either subparagraph (b)(i) or (b)(ii) below, as applicable, as well as subparagraph (b)(iii) below, if applicable:
(i)Transfer of Book-Entry Interests in the Same Global Note. Book-Entry Interests in a Global Note may be transferred to Persons who take delivery thereof in the form of a Book-Entry Interest in the same Global Note in accordance with the transfer restrictions set forth in the Private Placement Legend; provided, however, that prior to the expiration of the Restricted Period, Book-Entry Interests in the Regulation S Global Notes will be limited to Persons that have accounts with Euroclear or Clearstream or Persons who hold interests through Euroclear or Clearstream, and any sale or transfer of such interest to U.S. Persons shall not be permitted during the Restricted Period unless such resale or transfer is made pursuant to Rule 144A. No written orders or instructions shall be required to be delivered to the Trustee, Registrar or Transfer Agent to effect the transfers described in this Section 2.06(b)(i).
(ii)All Other Transfers and Exchanges of Book-Entry Interests in Global Notes. A holder may transfer or exchange a Book-Entry Interest in Global Notes in a transaction not subject to Section 2.06(b)(i) above only if the Trustee and the Registrar or the relevant Transfer Agent (copied to the Trustee) receives either:
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(A)both:
(1)a written order from a Participant or an Indirect Participant given to the Custodian or the Common Depositary, as applicable, in accordance with the Applicable Procedures directing the Custodian or the Common Depositary, as applicable, to credit or cause to be credited a Book-Entry Interest in another Global Note in an amount equal to the Book-Entry Interest to be transferred or exchanged; and
(2)instructions given by the Custodian or the Common Depositary, as applicable, in accordance with the Applicable Procedures containing information regarding the Participant's account to be credited with such increase; or
(B)both:
(1)a written order from a Participant or an Indirect Participant given to Custodian or the Common Depositary, as applicable, in accordance with the Applicable Procedures directing the Custodian or the Common Depositary, as applicable, to cause to be issued a Definitive Registered Note in an amount equal to the Book-Entry Interest to be transferred or exchanged; and
(2)instructions given by Custodian or the Common Depositary, as applicable, to the Registrar containing information specifying the identity of the Person in whose name such Definitive Registered Note shall be registered to effect the transfer or exchange referred to in Section 2.06(b)(i) above, the principal amount of such securities and the CUSIP, ISIN, Common Code or other similar number identifying the Senior Notes, provided that any such transfer or exchange is made in accordance with the transfer restrictions set forth in the Private Placement Legend.
(iii)Transfer of Book-Entry Interests to Another Global Note. A Book-Entry Interest in any Global Note may be transferred to a Person who takes delivery thereof in the form of a Book-Entry Interest in another Global Note if the transfer complies with the requirements of Section 2.06(b)(ii) above and the Trustee and the Registrar receives the following:
(A)if the transferee will take delivery in the form of a Book-Entry Interest in a 144A Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof; and
(B)if the transferee will take delivery in the form of a Book-Entry Interest in a Regulation S Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) and/or item (3) thereof.
(c)Transfer or Exchange of Book-Entry Interests in Global Notes for Definitive Registered Notes. If any holder of a Book-Entry Interest in a Global Note proposes to exchange such Book-Entry Interest for a Definitive Registered Note or to transfer such Book-Entry Interest to a Person who takes delivery thereof in the form of a Definitive Registered Note, then, upon receipt by the Trustee and the Registrar of the following documentation:
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(i)in the case of a transfer on or before the expiration of the Restricted Period by a holder of a Book-Entry Interest in a Regulation S Global Note, the Trustee shall have received a certificate to the effect set forth in Exhibit B hereto, including the certifications in either item (1) or item (2) thereof;
(ii)in the case of an exchange by a holder of a Book-Entry Interest in a Global Note of such Book-Entry Interest for a Definitive Registered Note, the Trustee shall have received a certificate from such holder in the form of Exhibit C hereto, including the certifications in items (1) thereof;
(iii)in the case of a transfer after the expiration of the Restricted Period by a holder of a Book-Entry Interest in a Regulation S Global Note, the transfer complies with Section 2.06(b) hereof;
(iv)in the case of a transfer by a holder of a Book-Entry Interest in a 144A Global Note to a QIB in reliance on Rule 144A, the Trustee shall have received a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof;
(v)in the case of a transfer by a holder of a Book-Entry Interest in a 144A Global Note in reliance on Regulation S, the Trustee shall have received a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof; or
(vi)in the case of a transfer by a holder of a Book-Entry Interest in a 144A Global Note in reliance on Rule 144, the Trustee shall have received a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to (g) hereof, and the Issuer shall execute and the Trustee or the Authenticating Agent shall authenticate and deliver to the Person designated in the instructions a Definitive Registered Note in the appropriate principal amount. Any Definitive Registered Note issued in exchange for a Book-Entry Interest in a Global Note pursuant to this (c) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such Book-Entry Interest shall instruct the applicable Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Registrar shall deliver such Definitive Registered Notes to the Persons in whose names such Senior Notes are so registered. Any Definitive Registered Note issued in exchange for a Book-Entry Interest in a Global Note pursuant to this (c) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein.
(d)Transfer and Exchange of Definitive Registered Notes for Book-Entry Interests in the Global Notes. If any Holder of a Definitive Registered Note proposes to exchange such Definitive Registered Note for a Book-Entry Interest in a Global Note or to transfer such Definitive Registered Note to a Person who takes delivery thereof in the form of a Book-Entry Interest in a Global Note, then, upon receipt by the Trustee, the relevant Transfer Agent and the Registrar of the following documentation:
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(i)if the Holder of such Definitive Registered Note proposes to exchange such Senior Note for a Book-Entry Interest in a Global Note, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in item (2) thereof;
(ii)if such Definitive Registered Note is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof;
(iii)if such Definitive Registered Note is being transferred in reliance on Regulation S or Rule 144, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) or (3) thereof, as applicable; and
(iv)if such Definitive Registered Note is being transferred to the Issuer or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3) thereof, the Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent (other than the Issuer or a Subsidiary of the Issuer) and no one else will cancel the Definitive Registered Note, and the Trustee will increase or cause to be increased the aggregate principal amount of the appropriate Global Note.
(e)Transfer and Exchange of Definitive Registered Notes for Definitive Registered Notes. Upon request by a Holder of Definitive Registered Notes and such Holder's compliance with the provisions of this (e), the Transfer Agent or the Registrar will register the transfer or exchange of Definitive Registered Notes of which registration the Issuer will be informed of by the Transfer Agent or the Registrar (as the case may be). Prior to such registration of transfer or exchange, the requesting Holder must present or surrender to the Transfer Agent or the Registrar the Definitive Registered Notes duly endorsed and accompanied by a written instruction of transfer in a form satisfactory to the Transfer Agent or the Registrar duly executed by such Holder or its attorney, duly authorized to execute the same in writing. In the event that the Holder of such Definitive Registered Notes does not transfer the entire principal amount of Senior Notes represented by any such Definitive Registered Note, the Transfer Agent or the Registrar will cancel or cause to be cancelled such Definitive Registered Note and the Issuer (who has been informed of such cancellation) shall execute and the Trustee or the Authenticating Agent shall authenticate and deliver to the requesting Holder and any transferee Definitive Registered Notes in the appropriate principal amounts. In addition, the requesting Holder shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this (e).
Any Definitive Registered Note may be transferred to and registered in the name of Persons who take delivery thereof in the form of a Definitive Registered Note if the Registrar receives the following:
(i)if the transfer will be made pursuant to Rule 144A, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof; and
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(ii)if the transfer will be made in reliance on Regulation S, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof.
(f)Legends. The following legends will appear on the face of all Senior Notes issued under this Senior Notes Indenture unless specifically stated otherwise in the applicable provisions of this Senior Notes Indenture.
(i)Private Placement Legend. Each Global Note and each Definitive Registered Note (and all Senior Notes issued in exchange therefor or in substitution thereof) shall bear the legend in substantially the following form:
“THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT (“RULE 144A”)) OR (B) IT IS ACQUIRING THIS SECURITY IN AN “OFFSHORE TRANSACTION” PURSUANT TO RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, (2) AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR FOR WHICH IT HAS PURCHASED SECURITIES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) WHICH IS [IN THE CASE OF REGULATION S NOTES: 40 DAYS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE DATE ON WHICH THIS SECURITY WAS FIRST OFFERED TO PERSONS OTHER THAN DISTRIBUTORS (AS DEFINED IN RULE 902 OF REGULATION S)] [IN THE CASE OF RULE 144A NOTES: ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY)] ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE U.S. SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL” BUYER AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT, OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE U.S.
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SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL AND TO COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS, AND ANY APPLICABLE LOCAL LAWS AND REGULATIONS AND FURTHER SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHTS PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE SENIOR NOTES INDENTURE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THE FAILURE TO PROVIDE THE ISSUER, THE TRUSTEE AND ANY PAYING AGENT WITH THE APPLICABLE U.S. FEDERAL INCOME TAX CERTIFICATIONS (GENERALLY, A U.S. INTERNAL REVENUE SERVICE FORM W-9 (OR SUCCESSOR APPLICABLE FORM) IN THE CASE OF A PERSON THAT IS A “UNITED STATES PERSON” WITHIN THE MEANING OF SECTION 7701(A)(30) OF THE CODE OR AN APPLICABLE U.S. INTERNAL REVENUE SERVICE FORM W-8 (OR SUCCESSOR APPLICABLE FORM) IN THE CASE OF A PERSON THAT IS NOT A “UNITED STATES PERSON” WITHIN THE MEANING OF SECTION 7701(A)(30) OF THE CODE) MAY RESULT IN U.S. FEDERAL WITHHOLDING FROM PAYMENTS TO THE HOLDER IN RESPECT OF THE NOTES REPRESENTED BY THIS CERTIFICATE”.
(ii)Global Note Legend. Each Global Note will bear a legend in substantially the following form:
“THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE SENIOR NOTES INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE SENIOR NOTES INDENTURE, (2) THIS GLOBAL NOTE MAY BE TRANSFERRED OR EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(A) OF THE SENIOR NOTES INDENTURE, AND (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE SENIOR NOTES INDENTURE.”
(g)Cancellation and/or Adjustment of Global Notes. At such time as all Book-Entry Interests in a particular Global Note have been exchanged for Definitive Registered Notes or a particular Global Note has been redeemed, repurchased or cancelled in whole and not in part, each such Global Note will be returned to or retained and cancelled by the Trustee in accordance with Section 2.11 hereof.
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At any time prior to such cancellation, if any Book-Entry Interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a Book-Entry Interest in another Global Note or for Definitive Registered Notes, the principal amount of Senior Notes represented by such Global Note will be reduced accordingly and an endorsement will be made on such Global Note by the Trustee or the Custodian or the Common Depositary, as applicable, at the direction of the Trustee, to reflect such reduction; and if the Book-Entry Interests is being exchanged for or transferred to a Person who will take delivery thereof in the form of a Book-Entry Interests in another Global Note, such other Global Note will be increased accordingly and an endorsement will be made on such Global Note by the Trustee or by the Custodian or the Common Depositary, as applicable, at the direction of the Trustee to reflect such increase.
(h)General Provisions Relating to Transfers and Exchanges.
(i)To permit registrations of transfers and exchanges, the Issuer will execute and the Trustee or the Authenticating Agent will authenticate Global Notes and Definitive Registered Notes upon receipt of an Authentication Order in accordance with Section 2.02 hereof or at the Registrar's request.
(ii)No service charge will be made by the Issuer or the Registrar to a Holder of a Book-Entry Interest in a Global Note, a Holder of a Global Note or a Holder of a Definitive Registered Note for any registration of transfer or exchange, but the Issuer may require payment of a sum sufficient to cover any stamp duty, stamp duty reserve, documentary or other similar tax or governmental charge that may be imposed in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 4.10 and 4.13 hereof).
(iii)No Transfer Agent or Registrar will be required to register the transfer of or exchange of any Senior Note selected for redemption in whole or in part, except the unredeemed portion of any Senior Note being redeemed in part.
(iv)All Global Notes and Definitive Registered Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Registered Notes will be the valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits under this Senior Notes Indenture, as the Global Notes or Definitive Registered Notes surrendered upon such registration of transfer or exchange.
(v)Neither the Registrar nor the Issuer shall be required to register the transfer into its register kept at its registered office of any Definitive Registered Notes: (A) for a period of 15 days prior to any date fixed for the redemption of such Definitive Registered Notes under Section 3.03 hereof; (B) for a period of 15 days immediately prior to the date fixed for selection of such Definitive Registered Notes to be redeemed in part; (C) for a period of 15 days prior to the record date with respect to any interest payment date applicable to such Definitive Registered Notes; or (D) which the Holder has tendered (and not withdrawn) for repurchase in connection with a Change of Control Offer or an Asset Sale Offer. Any such transfer will be made without charge to the Holder, other than any taxes, duties and governmental charges payable in connection with such transfer.
(vi)The Trustee, any Agent and the Issuer may deem and treat the Person in whose name any Senior Note is registered as the absolute owner of such Senior Note for the purpose of receiving payment of principal of, interest and Additional Amounts, if any, on such Senior Notes and for all other purposes, and none of the Trustee, any Agent or the Issuer shall be affected by notice to the contrary.
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(vii)All certifications, certificates and Opinions of Counsel required to be submitted to the Issuer, the Trustee or the applicable Registrar pursuant to this Section 2.06 to effect a registration of transfer or exchange may be submitted initially by facsimile with originals to be delivered promptly thereafter to the Trustee.
(viii)Neither the Trustee nor any Agent shall have any obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Senior Notes Indenture or under applicable law with respect to any transfer of any Book-Entry Interest in any Global Note or any Definitive Registered Note other than to require delivery of such certificates and other documentation or evidence as is expressly required by, and to do so if and when expressly required by the terms of, this Senior Notes Indenture, and to examine the same to determine substantial compliance as to conformity with the express requirements hereof.
(ix)Neither the Trustee nor any Agent shall have any responsibility for any actions taken or not taken by Euroclear or Clearstream or DTC.
(i)Limitation on Transfers and Exchanges between 2030 Global Notes and 2031 Global Notes. Notwithstanding any provision of this Senior Notes Indenture, (i) no Book-Entry Interest in any 2030 Global Note and no Definitive Registered 2030 Note issued in exchange for a Book-Entry Interest in any 2030 Global Note may be transferred or exchanged for any Book-Entry Interest in any 2031 Global Note or any Definitive Registered 2031 Note issued in exchange for a Book-Entry Interest in any 2031 Global Note, and (ii) no Book-Entry Interest in any 2031 Global Note and no Definitive Registered 2031 Note issued in exchange for a Book-Entry Interest in any 2030 Global Note may be transferred or exchanged for any Book-Entry Interest in any 2030 Global Note or any Definitive Registered 2030 Note issued in exchange for a Book-Entry Interest in any 2030 Global Note.
Section 2.07.Replacement Senior Notes. If any mutilated Note is surrendered to the Registrar, the Trustee or the Issuer and the Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Senior Note, the Issuer will issue and the Trustee, upon receipt of an Authentication Order, will authenticate or cause the Authenticating Agent to authenticate a replacement Note if the Trustee's requirements are met. If required by the Trustee, any Agent or the Issuer, an indemnity bond must be supplied by the Holder that is sufficient in the judgment of the Trustee, any Agent and the Issuer to protect the Issuer, the Trustee, any Agent from any loss that any of them may suffer if a Senior Note is replaced. The Issuer may charge the Holder for its expenses in replacing a Senior Note, including reasonable fees and expenses of counsel.
Every replacement Note is an additional obligation of the Issuer and will be entitled to all of the benefits of this Senior Notes Indenture equally and proportionately with all other Notes duly issued hereunder.
Section 2.08.Outstanding Senior Notes. The Senior Notes outstanding at any time are all the Senior Notes authenticated by the Trustee or the Authenticating Agent except for those cancelled by it, those delivered to the Paying Agent for cancellation, those reductions in the interest in a Global Note effected by the Trustee in accordance with the provisions hereof, and those described in this Section 2.08 as not outstanding.
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Except as set forth in Section 2.09 hereof, a Senior Note does not cease to be outstanding because the Issuer or an Affiliate of the Issuer holds the Senior Note; however, Senior Notes held by the Issuer or a Subsidiary of the Issuer shall not be deemed to be outstanding for purposes of Section 3.07(a) hereof.
If a Senior Note is replaced pursuant to Section 2.07 hereof, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a protected purchaser.
If the principal amount of any Senior Note is considered paid under Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If a Paying Agent (other than the Issuer, a Subsidiary of the Issuer or an Affiliate of any thereof) holds, on a redemption date or maturity date, money sufficient to pay Senior Notes payable on that date, and is not prohibited from paying such money to the Holders pursuant to the terms of this Senior Notes Indenture, then on and after that date such Senior Notes will be deemed to be no longer outstanding and will cease to accrue interest.
Section 2.09.Treasury Notes. In determining whether the Holders of the required principal amount of Senior Notes have concurred in any direction, waiver or consent, Senior Notes owned by the Issuer or any Guarantor, or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer or any Guarantor, will be considered as though not outstanding, except that for the purposes of determining whether the Trustee will be protected in relying on any such direction, waiver or consent, only Senior Notes that the Trustee knows are so owned will be so disregarded.
Section 2.10.Temporary Notes. Until certificates representing Senior Notes are ready for delivery, the Issuer may prepare and the Trustee, upon receipt of an Authentication Order, will authenticate or cause the Authenticating Agent to authenticate temporary Senior Notes. Temporary Notes will be substantially in the form of certificated Senior Notes but may have variations that the Issuer considers appropriate for temporary Senior Notes and as may be reasonably acceptable to the Trustee. Without unreasonable delay, the Issuer will prepare and the Trustee or the Authenticating Agent will authenticate definitive Senior Notes in exchange for temporary Notes.
Holders of temporary Senior Notes will be entitled to all of the benefits of this Senior Notes Indenture.
Section 2.11.Cancellation. The Issuer at any time may deliver Senior Notes to the Trustee for cancellation. The Registrar, each Paying Agent and any Transfer Agent will forward to the Trustee any Senior Notes surrendered to them for registration of transfer, exchange or payment. The Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent (other than the Issuer or a Subsidiary of the Issuer) and no one else will cancel all Senior Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and will destroy cancelled Senior Notes (subject to the record retention requirement of the U.S. Exchange Act). Certification of the destruction of all cancelled Notes will be delivered to the Issuer following a written request from the Issuer. The Issuer may not issue new Notes to replace Notes that it has paid or that have been delivered to the Trustee for cancellation.
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The Issuer undertakes to promptly inform the Exchange (as long as the Senior Notes are admitted to trading on the Exchange and listed on the Official List of the Exchange) on any such cancellation.
Section 2.12.Defaulted Interest. If the Issuer defaults in a payment of interest on the Senior Notes, it will pay the defaulted interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, in each case at the rate provided in the Senior Notes and in Section 4.01 hereof. The Issuer will notify the Trustee as soon as practicable in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment. The Issuer will fix or cause to be fixed each such special record date and payment date; provided that no such special record date may be less than 10 days prior to the related payment date for such defaulted interest. At least 15 days before the special record date, the Issuer (or, upon the written request of the Issuer, the Trustee in the name and at the expense of the Issuer) will mail or cause to be mailed to the Holders in accordance with Section 12.01 hereof a notice that states the special record date, the related payment date and the amount of such interest to be paid. The Issuer undertakes to promptly inform the Exchange (as long as the Senior Notes are admitted to trading on the Exchange and listed on the Official List of the Exchange) of any such special record date.
Section 2.13.Computation of Interest. Interest on the 2030 Senior Notes will accrue at the rate of 7.875% per annum and will be computed on the basis of a 360-day year comprised of twelve 30-day months. Interest on the 2031 Senior Notes will accrue at the rate of 8.250% per annum and will be computed on the basis of a 360-day year comprised of twelve 30-day months.
Section 2.14.Further Issues. (a) From time to time, subject to the Issuer's compliance with Section 4.09 and Section 4.12 hereof, the Issuer will be permitted to issue Additional Senior Notes under this Senior Notes Indenture, which shall have terms substantially identical to the Senior Notes of either series issued on the Issue Date, except in respect of any of the following terms which shall be set forth in an Officer's Certificate supplied to the Trustee:
(i)the title of such Additional Senior Notes;
(ii)the aggregate principal amount of such Additional Senior Notes;
(iii)the date or dates on which such Additional Senior Notes have been issued;
(iv)the rate or rates at which such Additional Senior Notes shall bear interest, the date or dates from which such interest shall accrue, the interest payment dates on which such interest shall be payable, the record dates for the determination of holders thereof to whom such interest is payable and the basis upon which such interest will be calculated;
(v)the currency or currencies in which such Additional Senior Notes shall be denominated and the currency in which cash or government obligations in connection with such series of Additional Senior Notes may be payable;
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(vi)the date or dates and price or prices at which, the period or periods within which, and the terms and conditions upon which, such Additional Senior Notes may be redeemed, in whole or in part; and
(vii)if other than denominations of $200,000 and in integral multiples of $1,000 in excess thereof, the denominations in which such Additional Senior Notes shall be issued and redeemed.
(b)The Additional Senior Notes will constitute a separate series of Senior Notes but will be treated as a single class of securities for all purposes of this Senior Notes Indenture, including, without limitation, with respect to waivers, amendments and all other matters which are not specially distinguished for such series, provided, however, that if any Additional Senior Notes are not fungible with Initial Senior Notes for U.S. federal income tax purposes, such Additional Senior Notes shall have a separate CUSIP number, ISIN or other identifying number from the Initial Senior Notes. Unless the context otherwise requires, for all purposes of this Senior Notes Indenture, references to “Senior Notes” shall be deemed to include references to the Initial Senior Notes as well as any Additional Senior Notes.
Section 2.15.CUSIP, ISIN or Common Code Number. The Issuer in issuing the Senior Notes may use “CUSIP,” “ISIN” or “Common Code” numbers and, if so, such CUSIP, ISIN or Common Code number shall be included in notices of redemption or exchange as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness or accuracy of the CUSIP, ISIN or Common Code number printed in the notice or on the Senior Notes, and that reliance may be placed only on the other identification numbers printed on the Senior Notes, and any such redemption or exchange shall not be affected by any defect in or omission of such numbers.
The Issuer will promptly notify the Trustee of any change in the CUSIP, ISIN or Common Code number.
Section 2.16.Deposit of Moneys. No later than 10:00 a.m. (London time), on the Business Day prior to each interest payment date and the maturity date of the Senior Notes and on the Business Day immediately following any acceleration of the Senior Notes pursuant to Section 6.02 hereof, the Issuer shall deposit with the Paying Agent, in immediately available funds, money in U.S. dollars sufficient to make cash payments, if any, due on such day or date, as the case may be. Subject to actual receipt of such funds as provided by this Section 2.16 by the designated Paying Agent, such Paying Agent shall remit such payment in a timely manner to the Holders on such day or date, as the case may be, to the Persons and in the manner set forth in paragraph 2 of the Senior Notes. The Issuer shall promptly notify the Trustee and the Paying Agent of its failure to so act.
Section 2.17.Agents.
(a)The rights, powers, duties and obligations and actions of each Agent under this Senior Notes Indenture are several and not joint or joint and several.
(b)The Issuer and the Agents acknowledge and agree that in the event of a Default or Event of Default, the Trustee may, by notice in writing to the Issuer and the Agents, require that the Agents act as agents of, and take instructions exclusively from, the Trustee.
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The Agents need have no concern for the interests of the Holders and except in the case of the Paying Agents as provided above and in Section 2.04 shall act solely as agents of the Issuer.
(c)The Issuer agrees to pay to each Agent such compensation, as the Issuer and such Agent shall from time to time agree in writing for all services rendered by such Agent hereunder.
(d)The Agents hold all funds as banker subject to the terms of this Senior Notes Indenture and, as a result, such money will not be held in accordance with the rules established by the UK Financial Conduct Authority in the UK Conduct Authority’s Handbook of rules and guidance from time to time in relation to client money.
(e)Any obligation the Agents may have to publish a notice to Holders on behalf of the Issuer will have been met upon delivery of the notice to DTC, Euroclear and/or Clearstream, as applicable.
(f)In the event that instructions given to any Agent are not reasonably clear, then such Agent shall be entitled to seek clarification from the Issuer or other party entitled to give the Agents instructions under this Senior Notes Indenture by written request promptly upon receipt by such Agent of such instructions. If an Agent has sought clarification in accordance with this Section 2.17(f), then such Agent shall be entitled to take no action until such clarification is provided, and shall not incur any liability for not taking any action pending receipt of such clarification.
(g)The roles, duties and functions of the Agents are of a mechanical nature and each Agent shall only perform those acts and duties as specifically set out in this Senior Notes Indenture and no other acts, covenants, obligations or duties shall (including without limitation duties or obligations of a fiduciary or equitable nature) be implied or read into this Senior Notes Indenture against any of the Agents.
(h)No Agent shall be required to make any payment under this Senior Notes Indenture unless and until it has received the full amount to be paid in accordance with the terms of this Senior Notes Indenture. To the extent that an Agent has made a payment for which it did not receive the full amount, the Issuer will reimburse the Agent the full amount of any shortfall.
(i)The Issuer agrees to pay any and all stamp, registration and other documentary taxes, duties, assessments or government charges (including any interest and penalties thereon or in connection therewith) payable in connection with the execution, delivery, performance and enforcement of this Agreement by the Agents.
(j)The Agent shall not be responsible to anyone with respect to the legality of this Agreement or the validity or legality of the Notes.
(k)Notwithstanding any other provision of this Senior Notes Indenture, the Agent shall be entitled to take any action or to refuse to take any action which the Agent regards as necessary for the Agent to comply with any Applicable Law, or the rules, operating procedures or market practice of any relevant stock exchange or other market or clearing system.
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(l)The Agents shall not be liable for any loss caused by events beyond their reasonable control including any malfunction, interruption or error in the transmission of information caused by any machine or systems or interception of communication facilities, abnormal operating conditions or events of force majeure.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01.Notices to Trustee. If the Issuer elects to redeem Senior Notes pursuant to the optional redemption provisions of Section 3.07 hereof, it must furnish to the Trustee in accordance with Section 12.01 hereof, at least 10 days but not more than 60 days before a redemption date (and, in any case, concurrently with any notice given to Holders pursuant to Section 3.03 hereof), an Officer's Certificate setting forth:
(a)the clause of this Senior Notes Indenture pursuant to which the redemption shall occur;
(b)the redemption date and the record date;
(c)the principal amount of Senior Notes to be redeemed;
(d)the redemption price; and
(e)the CUSIP, ISIN or Common Code numbers of the Senior Notes, as applicable.
Section 3.02.Selection of Senior Notes to Be Redeemed or Purchased. If less than all of the Senior Notes of any series are to be redeemed or purchased in an offer to purchase at any time, the Trustee (or the Registrar, as applicable) will select Senior Notes for redemption or purchase on a pro rata basis in accordance with the procedures of DTC, Clearstream or Euroclear (as applicable) (or, in the case of Senior Notes issued in global form pursuant to Article 2 hereof, based on a method that most nearly approximates a pro rata basis (for Senior Notes held in DTC, on a pro rata pass-through distribution of principal basis in accordance with their procedures)), unless otherwise required by law or applicable stock exchange or depositary requirements. Neither the Trustee nor the Registrar shall be liable for any selections made by it in accordance with this Section 3.02.
The Trustee will promptly notify the Issuer in writing of the Senior Notes selected for redemption or purchase and, in the case of any Senior Note selected for partial redemption or purchase, the principal amount thereof to be redeemed or purchased. Senior Notes and portions of Senior Notes selected will be in amounts of $200,000 or in integral multiples of $1,000 in excess thereof; except that if all of the Senior Notes of a Holder are to be redeemed or purchased, the entire outstanding amount of Senior Notes held by such Holder shall be redeemed or purchased. Except as provided in the preceding sentence, provisions of this Senior Notes Indenture that apply to Senior Notes called for redemption or purchase also apply to portions of Senior Notes called for redemption or purchase.
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Section 3.03.Notice of Redemption. (a) Subject to the provisions of Section 3.10 hereof, at least 10 days but not more than 60 days before a redemption date, the Issuer will mail or cause to be mailed, by first class mail, a notice of redemption to each Holder of the relevant series whose Senior Notes are to be redeemed at its registered address (with a copy to the Trustee, Paying Agent and Registrar), except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the relevant series of Senior Notes or the satisfaction and discharge of this Senior Notes Indenture pursuant to Articles 8 or 11 hereof. For Senior Notes which are represented by Global Notes, notices may be given by delivery of the relevant notices to DTC, Euroclear or Clearstream of any series, as applicable, for communication to entitled account holders in substitution for the aforesaid mailing. So long as any Senior Notes of such series are listed on the Official List of the Exchange and the rules of The International Stock Exchange Authority Limited so require, the Issuer will forthwith notify The International Stock Exchange Authority Limited of any such redemption and the principal amount of any Senior Notes of the relevant series outstanding following any partial redemption of such Senior Notes.
(b)The notice will identify the Senior Notes to be redeemed and corresponding CUSIP, ISIN or Common Code numbers, as applicable, and will state:
(i)the redemption date and the record date;
(ii)the redemption price and the amount of accrued interest, if any, and Additional Amounts, if any, to be paid;
(iii)if any Global Note is being redeemed in part, the portion of the principal amount of such Global Note to be redeemed and that, after the redemption date upon surrender of such Global Note, the principal amount thereof will be decreased by the portion thereof redeemed pursuant thereto;
(iv)if any Definitive Registered Note is being redeemed in part, the portion of the principal amount of such Senior Note to be redeemed, and that, after the redemption date, upon surrender of such Senior Note, a new Definitive Registered Note or Definitive Registered Notes in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Definitive Registered Note;
(v)the name and address of the Paying Agent(s) to which the Senior Notes are to be surrendered for redemption;
(vi)that Notes called for redemption must be surrendered to the relevant Paying Agent to collect the redemption price, plus accrued and unpaid interest, if any, and Additional Amounts, if any;
(vii)that, unless the Issuer defaults in making such redemption payment, interest, and Additional Amounts, if any, on Notes called for redemption cease to accrue on and after the redemption date;
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(viii)the paragraph of the Senior Notes and/or Section of this Senior Notes Indenture pursuant to which the Senior Notes called for redemption are being redeemed; and
(ix)that no representation is made as to the correctness or accuracy of the CUSIP, ISIN or Common Code numbers, if any, listed in such notice or printed on the Senior Notes.
(c)At the Issuer's written request, the Trustee will give the notice of redemption in the Issuer's name and at its expense; provided, however, that the Issuer will have delivered to the Trustee, at least five days (or such shorter period as agreed by the Trustee) prior to the date on which the notice of redemption is published or mailed to Holders, as the case may be, an Officer's Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in (b) hereof.
Section 3.04.Effect of Notice of Redemption. Any redemption or notice of redemption may, at the Issuer's discretion, be subject to one or more conditions precedent. In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such notice may state that, in the Issuer's discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied (provided, however, that, in no case shall the notice have been delivered less than 10 days or more than 60 days prior to the date on which such redemption (if any) occurs), or such redemption may not occur and such notice may be modified or rescinded in the event that any or all such conditions shall not have been satisfied by the redemption date, or by the redemption date so delayed. The Issuer shall send a supplemental notice to the clearing system confirming the satisfaction of the conditions precedent to any conditional redemption. In addition, such notice of redemption may be extended if such conditions precedent have not been satisfied or waived by the Issuer by notice to the Holders of the applicable series of Senior Notes and the Issuer may provide in such notice that payment of the redemption or purchase price and performance of the Issuer's obligations with respect to such redemption may be performed by another Person. Notice of any redemption in connection with a satisfaction and discharge under the Senior Notes Indenture may be subject to a notice period of more than 60 days, at the Issuer's discretion.
Section 3.05.Deposit of Redemption or Purchase Price. (a) No later than 10:00 a.m. (London time) one Business Day prior to the redemption or purchase date, the Issuer will deposit with the Trustee or with the Paying Agent money in U.S. dollars sufficient to pay the redemption or purchase price of, and accrued interest and Additional Amounts (if any) on, all Senior Notes to be redeemed on that date. The Trustee or the Paying Agent will promptly return to the Issuer any money deposited with the Trustee or the Paying Agent, as applicable, by the Issuer in excess of the amounts necessary to pay the redemption or purchase price of, and accrued interest and Additional Amounts, if any, on, all Senior Notes to be purchased or redeemed. The Issuer shall, no later than 10:00 a.m. (London time) on the second Business Day prior to the date on which the applicable Paying Agent receives payment, procure that the bank effecting payment for it confirms by fax or tested SWIFT MT100 message to the relevant Paying Agent that an irrevocable instruction has been given. The Paying Agent and the Trustee, as applicable, shall be held harmless and have no liability with respect to payments or disbursements to be made by the Paying Agent and/or Trustee (i) for which payment instructions are not made or that are not otherwise deposited by the respective times set forth in this Section 3.05, and (ii) shall not be obligated to make payment until they have confirmed receipt of funds sufficient to make the relevant payment.
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(b)If the Issuer complies with the provisions of Section 3.05(a) hereof, on and after the redemption or purchase date, interest will cease to accrue on the Senior Notes or the portions of Senior Notes called for redemption or purchase. If a Senior Note is redeemed or purchased on or after a record date for the payment of interest but on or prior to the related interest payment date, then any accrued and unpaid interest shall be paid to the Person in whose name such Senior Note was registered at the close of business on such record date. If any Senior Note called for redemption is not so paid upon surrender for redemption or purchase because of the failure of the Issuer to comply with Section 3.05(a) hereof, interest shall be paid on the unpaid principal, from the redemption or purchase date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Senior Notes and in Section 4.01 hereof.
Section 3.06.Notes Redeemed or Purchased in Part. Upon surrender of a Definitive Registered Note that is redeemed or purchased in part, the Issuer will issue and, upon receipt of an Authentication Order, the Trustee or the Authenticating Agent will authenticate for (and in the name of) the Holder at the expense of the Issuer a new Note equal in principal amount to the unredeemed or unpurchased portion of the Senior Note surrendered; provided that any Definitive Registered Note shall be in a principal amount of $200,000 and integral multiples of $1,000 in excess thereof.
Section 3.07.Optional Redemption. (a) At any time prior to November 29, 2026, in the case of the 2030 Senior Notes, and November 29, 2027, in the case of the 2031 Senior Notes, the Issuer may on any one or more occasions redeem up to 40% of the aggregate principal amount of Senior Notes of the applicable series issued under this Senior Notes Indenture, upon not less than 10 nor more than 60 days' prior written notice to the Holders, at a redemption price equal to 107.875%, in the case of the 2030 Senior Notes, and 108.250% in the case of the 2031 Senior Notes, of the principal amount thereof, plus accrued and unpaid interest and Additional Amounts, if any, to the date of redemption (subject to the rights of Holders of the Senior Notes of the applicable series on the relevant record date to receive interest on the relevant interest payment date), with the net cash proceeds of any Equity Offering of the Issuer or any Parent Holdco of the Issuer to the extent the proceeds from such Equity Offering are contributed to the Issuer's common equity capital or are paid to the Issuer as consideration for the issuance of ordinary shares of the Issuer or as Subordinated Shareholder Debt (in each case, excluding proceeds from any Parent Debt Contribution); provided that:
(i)at least 50% of the aggregate principal amount of the Senior Notes of the series being redeemed originally issued under this Senior Notes Indenture (excluding Senior Notes of such series held by the Issuer and its Subsidiaries and their respective Affiliates) remain outstanding immediately after the occurrence of such redemption; and
(ii)the redemption occurs within 180 days of the date of the closing of such Equity Offering.
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(b)At any time prior to November 29, 2026, in the case of the 2030 Senior Notes, and November 29, 2027, in the case of the 2031 Senior Notes, the Issuer may on any one or more occasions redeem all or a part of the Senior Notes of the applicable series upon not less than 10 nor more than 60 days' prior written notice to the Holders, at a redemption price equal to 100.000% of the principal amount of the Senior Notes of such series redeemed, plus the Applicable Premium as of, and accrued and unpaid interest and Additional Amounts, if any, to the date of redemption, subject to the rights of Holders of the Senior Notes of such series on the relevant record date to receive interest due on the relevant interest payment date.
(c)Except pursuant to Sections 3.07(a) and 3.07(b) hereof and except pursuant to Section 3.08 and Section 4.13(a) hereof, the 2030 Senior Notes will not be redeemable at the Issuer's option prior to November 29, 2026 and the 2031 Senior Notes will not be redeemable at the Issuer's option prior to November 29, 2027.
(d)On or after November 29, 2026, in the case of the 2030 Senior Notes, and November 29, 2027, in the case of the 2031 Senior Notes, the Issuer may on any one or more occasions redeem all or a part of the Senior Notes of the applicable series upon not less than 10 nor more than 60 days' prior written notice to the Holders, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest and Additional Amounts, if any, on the Senior Notes of such series redeemed, to the applicable date of redemption, if redeemed on or after the dates indicated below, subject to the rights of Holders of Senior Notes of such series on the relevant record date to receive interest on the relevant interest payment date:
2030 Senior Notes:
Date |
|
Redemption |
November 29, 2026 |
|
103.93750% |
November 29, 2027 |
|
101.96875% |
November 29, 2028 and thereafter |
|
100.00000% |
2031 Senior Notes:
Date |
|
Redemption |
November 29, 2026 |
|
104.12500% |
November 29, 2027 |
|
102.06250% |
November 29, 2028 and thereafter |
|
100.00000% |
(e)Unless the Issuer defaults in the payment of the redemption price, interest will cease to accrue on the applicable series of Senior Notes or portions thereof called for redemption on the applicable redemption date.
(f)Any redemption pursuant to this Section 3.07 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof.
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(g)If requested in writing by the Issuer, which request may be included in the applicable notice of redemption or pursuant to the applicable Officer's Certificate, the Trustee or the Paying Agent (or such other entity directed, designated or appointed (as agent) by the Trustee, for this purpose) shall distribute any amounts deposited to the Holders prior to the applicable redemption date, provided, however that the Holders and the Paying Agent shall have received at least five Business Days' notice (or such shorter period as the Paying Agent may agree) from the Issuer of such earlier repayment (which may be included in the notice of redemption). For the avoidance of doubt, the distribution and payment to Holders prior to the applicable redemption date as set forth above will not include any negative interest, present value adjustment, break costs or any other premium on such amounts. To the extent that either series of Senior Notes are represented by Global Notes deposited with a common depositary or custodian for a clearing system, any payment to the beneficial holders holding Book-Entry Interests as participants of such clearing system will be subject to the then applicable procedures of such clearing system.
Section 3.08.Redemption for Changes in Taxes. (a) The Issuer may redeem the Senior Notes, in whole but not in part, at its discretion at any time upon giving not less than 10 nor more than 60 days' prior written notice of the redemption (which date shall be no earlier than 60 days prior to the next date on which any amount would be payable in respect of the Notes) to the Holders (with a copy to the Trustee and the Paying Agent) (which notice will be irrevocable and given in accordance with the procedures described in Section 3.03 and Section 12.01 hereof), at a redemption price equal to 100% of the aggregate principal amount thereof, together with accrued and unpaid interest, if any, to (but excluding) the date fixed by the Issuer for redemption (a “Tax Redemption Date”) and all Additional Amounts (if any) due on the Tax Redemption Date as a result of the redemption or otherwise in accordance with Section 4.18 hereof, (and subject to the right of Holders on the Tax Redemption Date to receive accrued and unpaid interest due on the relevant interest payment date and Additional Amounts (if any) in respect thereof and (in respect of the payment of any Additional Amounts) insofar only as the obligation to pay Additional Amounts applies also at the time such notice is given), if on the next date on which any amount would be payable in respect of the Senior Notes, the Issuer or a Guarantor is or would be required to pay Additional Amounts, and the Issuer or Guarantor cannot avoid any such payment obligation by taking reasonable measures available, and the requirement arises as a result of:
(i)any amendment to, or change in, the laws (or any regulations or rulings promulgated thereunder) of a relevant Tax Jurisdiction which amendment or change becomes effective on or after the Issue Date (or, if the applicable Tax Jurisdiction became a Tax Jurisdiction with respect to the Issuer or such Guarantor, as applicable, on a date after the Issue Date, such later date); or
(ii)any amendment to, or change in, an official position, or the introduction of an official position, regarding the interpretation, administration or application of such laws, regulations or rulings (including by virtue of a holding, judgment, or order by a court of competent jurisdiction or a change in published tax authority practice or other administrative practice) which amendment, change or introduction becomes effective on or after the Issue Date (or, if the applicable Tax Jurisdiction became a Tax Jurisdiction with respect to the Issuer or such Guarantor, as applicable, after the Issue Date, such later date)
(each of the foregoing clauses (i) and (ii), a “Change in Tax Law”).
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(b)Prior to the publication or, where relevant, mailing of any notice of redemption of the Senior Notes pursuant to this Senior Notes Indenture, the Issuer will deliver to the Trustee (i) an Officer's Certificate stating that obligation to pay such Additional Amounts cannot be avoided by the Issuer (or the relevant Guarantor, as applicable) taking reasonable measures available to it; and (ii) a written opinion of independent tax counsel to the Issuer of recognized standing in the relevant Tax Jurisdiction and reasonably satisfactory to the Trustee (such approval not to be unreasonably withheld) to the effect that the Issuer (or the relevant Guarantor, as applicable) has or will become obligated to pay such Additional Amounts as a result of a Change in Tax Law.
(c)The Trustee will accept and shall be entitled to rely on such Officer's Certificate and Opinion of Counsel without further inquiry, investigation, independent verification or liability as sufficient evidence of the existence and satisfaction of the conditions precedent as described above, in which event it will be conclusive and binding on the Holders.
Section 3.09.Mandatory Redemption; Open Market Purchases. The Issuer is not required to make mandatory redemption payments or sinking fund payments with respect to the Senior Notes. The Issuer and its Affiliates may at any time and from time to time purchase Senior Notes in the open market or privately negotiated transactions with third parties or pursuant to one or more tender or exchange offers or otherwise, upon such terms and at such prices as well as with such consideration as the Issuer or any such Affiliates may determine.
Section 3.10.Offer to Purchase by Application of Excess Proceeds. (a) In the event that, pursuant to Section 4.10 hereof, the Issuer is required to commence an Asset Sale Offer or to commence a Notes Offer, it will follow the procedures specified in this Section 3.10.
(b)Each Asset Sale Offer will be made to all Holders and, to the extent the Issuer elects to do so, to holders of other Indebtedness that is Pari Passu Indebtedness to purchase, prepay or redeem with the proceeds of sales of assets. In addition, each Notes Offer will be made to all Holders. Each Asset Sale Offer and Notes Offer will remain open for such period as is required by applicable law (the “Offer Period”). No later than three Business Days after the termination of the Offer Period (the “Purchase Date”), the Issuer will apply all Excess Proceeds, in the case of an Asset Sale Offer, or Net Proceeds, in the case of a Notes Offer (the “Offer Amount”), to the purchase of the Senior Notes and, if applicable, such other Pari Passu Indebtedness (on a pro rata basis based on the principal amount of Senior Notes and such other Pari Passu Indebtedness surrendered, if applicable) or, if less than the Offer Amount has been tendered, all Senior Notes and, if applicable, such other Indebtedness tendered in response to the Asset Sale Offer or Notes Offer, as the case may be. Payment for any Senior Notes so purchased will be made in the same manner as interest payments are made.
(c)If the Purchase Date is on or after a record date for the payment of interest and on or before the related payment date, any accrued and unpaid interest, if any, will be paid to the Person in whose name a Senior Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Sale Offer or Notes Offer, as the case may be.
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(d)Upon the commencement of an Asset Sale Offer or Notes Offer, the Issuer will send, by first class mail, a notice to the Trustee and each of the Holders with a copy to the Trustee. The notice will contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Asset Sale Offer or Notes Offer, as the case may be. The notice, which will govern the terms of the Asset Sale Offer or Notes Offer (as applicable), will state:
(i)that the Asset Sale Offer or Notes Offer (as applicable) is being made pursuant to this Section 3.10 and Section 4.10 hereof and the length of time the Asset Sale Offer or Notes Offer (as applicable) will remain open;
(ii)the Offer Amount, the purchase price and the Purchase Date;
(iii)that any Senior Note not tendered or accepted for payment will continue to accrue interest;
(iv)that, unless the Issuer defaults in making such payment, any Senior Note accepted for payment pursuant to the Asset Sale Offer or Notes Offer (as applicable) will cease to accrue interest after the Purchase Date;
(v)that Holders electing to have a Senior Note purchased pursuant to an Asset Sale Offer or Notes Offer (as applicable) may elect to have Senior Notes purchased in denominations of $1,000, or integral multiples thereof; provided that Senior Notes of $200,000 or less may only be purchased in whole and not in part;
(vi)that Holders electing to have a Senior Note purchased pursuant to any Asset Sale Offer or Notes Offer (as applicable) will be required to surrender the Senior Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Senior Note completed, or transfer by book-entry transfer through the facilities of the Depositary, to the account of the Issuer, or a Paying Agent at the address specified in the notice at least three days before the Purchase Date;
(vii)that Holders will be entitled to withdraw their election if the Issuer, the Depositary or the Paying Agent, as the case may be, receives, not later than the expiration of the Offer Period, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Senior Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Senior Note purchased;
(viii)that, if the aggregate principal amount of Senior Notes and, if applicable, other Pari Passu Indebtedness surrendered by holders thereof exceeds the Offer Amount, the Issuer will select the Senior Notes and other Pari Passu Indebtedness to be purchased on a pro rata basis based on the principal amount of Senior Notes and such other Pari Passu Indebtedness surrendered (with such adjustments as may be deemed appropriate by the Issuer so that only Senior Notes in denominations of $1,000, or integral multiples thereof, will be purchased; provided that Senior Notes of $200,000 or less may only be purchased in whole and not in part; and
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(ix)that Holders whose Definitive Registered Notes were purchased only in part will be issued new Definitive Registered Notes equal in principal amount to the unpurchased portion of the Senior Notes surrendered (or transferred by book-entry transfer).
(e)On or before the Purchase Date, the Issuer will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Offer Amount of Senior Notes or portions thereof tendered pursuant to the Asset Sale Offer or Notes Offer (as applicable), or if less than the Offer Amount has been tendered, all Senior Notes tendered, and will deliver or cause to be delivered to the Trustee the Senior Notes properly accepted together with an Officer's Certificate stating that such Senior Notes or portions thereof were accepted for payment by the Issuer in accordance with the terms of this Section 3.10. The Issuer, the relevant Depositary or the Paying Agent, as the case may be, will promptly (but in any case not later than five days after the Purchase Date) mail or deliver to each tendering Holder in the manner specified in the Senior Notes an amount equal to the purchase price of the Senior Notes tendered by such Holder and accepted by the Issuer for purchase. In connection with any purchase of Global Notes pursuant hereto, the Trustee will endorse such Global Notes to reflect the decrease in principal amount of such Global Note resulting from such purchase. In connection with any partial purchase of Definitive Registered Notes, the Issuer will promptly issue a new Definitive Registered Note, and the Trustee, upon written request from the Issuer, will procure the authentication of and mail or deliver such new Definitive Registered Note to the tendering Holder, in a principal amount equal to any unpurchased portion of the Definitive Registered Note surrendered. Any Senior Note tendered but not accepted will be promptly mailed or delivered by the Issuer to the Holder thereof. The Issuer will publicly announce and inform The International Stock Exchange Authority Limited (for as long as the Senior Notes (if any) are admitted to trading on the Exchange and listed on the Official List of the Exchange) of the results of the Asset Sale Offer or Notes Offer (as applicable) on the Purchase Date.
(f)Other than as specifically provided in this Section 3.10, any purchase pursuant to this Section 3.10 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof (it being understood that any purchase pursuant to this Section 3.10 shall not be subject to conditions precedent).
Section 3.11.Optional Redemption upon Completion of Certain Tender Offers. In connection with any tender offer for any series of Senior Notes (including, without limitation, any Change of Control Offer and any Asset Sale Offer), if Holders of Senior Notes of not less than 90% in aggregate principal amount of the applicable outstanding Notes validly tender and do not withdraw such Senior Notes in such tender offer and the Issuer, or any third party making such a tender offer in lieu of the Issuer, purchases all of the Senior Notes validly tendered and not withdrawn by such Holders, all of the holders of the applicable series of Senior Notes will be deemed to have consented to such tender or other offer and, accordingly, the Issuer or such third party will have the right upon not less than 10 nor more than 60 days' prior notice, given not more than 30 days following such tender offer expiration date, to redeem the applicable series of Senior Notes that remain outstanding in whole, but not in part, following such purchase at a price equal to the price (excluding any early tender fee) offered to each other Holder of Senior Notes in such tender offer, plus, to the extent not included in the tender offer payment, accrued and unpaid interest, if any, thereon, to, but excluding, such redemption date. In determining whether the Holders of at least 90% of the aggregate principal amount of the then outstanding Notes of the relevant series have validly tendered and not validly withdrawn their Notes in a tender offer, Notes owned by the Issuer or its Affiliates or by funds controlled or managed by any Affiliate of the Issuer, or any successor thereof, shall be deemed to be outstanding for the purposes of such tender offer.
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ARTICLE 4
COVENANTS
Section 4.01.Payment of Senior Notes. The Issuer will pay or cause to be paid the principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes on the dates and in the manner provided in the Senior Notes and this Senior Notes Indenture. Principal, premium, if any, interest and Additional Amounts, if any, will be considered paid on the date due if the Paying Agent, if other than the Issuer or a Subsidiary of the Issuer, holds as of 10:00 a.m. London Time one Business Day prior to the due date money deposited by the Issuer in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest and Additional Amounts, if any, then due. If the Issuer or any of its Subsidiaries acts as Paying Agent, principal, premium, if any, interest and Additional Amounts, if any, shall be considered paid on the due date if the entity acting as Paying Agent complies with Section 2.16 hereof.
Principal of, interest, premium and Additional Amounts, if any, on the Senior Notes will be payable at the corporate trust office or agency of the Principal Paying Agent maintained in London, for such purposes. All payments on the Global Notes will be made by transfer of immediately available funds to an account of the Holder of the Global Notes in accordance with instructions given by that Holder.
Principal of, interest, premium and Additional Amounts, if any, on any Definitive Registered Notes will be payable at the corporate trust office or agency of any Paying Agent in any location required to be maintained for such purposes pursuant to Section 2.03 hereof. In addition, interest on Definitive Registered Notes may be paid by check mailed to the person entitled thereto as shown on the Register for such Definitive Registered Notes.
The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at a rate that is 1% per annum higher than the then applicable interest rate on the Senior Notes to the extent lawful. The Issuer will pay interest (including post- petition interest in any proceeding under any Bankruptcy Law) on overdue instalments of interest and Additional Amounts, if any (without regard to any applicable grace period), at the same rate to the extent lawful.
Section 4.02.Maintenance of Office or Agency. The Issuer will maintain the offices and agencies specified in Section 2.03 and Section 12.06 hereof. The Issuer shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Issuer fails to maintain any such required office or agency or fails to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the trust office of the Trustee (the address of which is specified in Section 12.01 hereof).
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The Issuer may also from time to time designate one or more other offices or agencies where the Senior Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission will in any manner relieve the Issuer of its obligation to maintain an office or agency in the City of London. The Issuer will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.
The Issuer hereby designates the trust office of the Trustee (the address of which is specified in Section 12.01 hereof) as one such office or agency of the Issuer in accordance with Section 2.03 hereof.
Section 4.03.Reports. (a) For so long as any Senior Notes are outstanding, the Issuer will furnish to the Trustee the following reports:
(i)within 120 days after the end of the Issuer’s fiscal year beginning with the fiscal year ending December 31, 2024, annual reports containing the following information: (a) audited consolidated balance sheet of the Issuer as of the end of the two most recent fiscal years and audited consolidated income statements and statements of cash flow of the Issuer for the two most recent fiscal years, including complete footnotes to such financial statements and the report of the independent auditors on the financial statements; (b) pro forma income statement and balance sheet information of the Issuer (which need not comply with Article 11 of Regulation S-X under the U.S. Exchange Act), together with explanatory footnotes, for any material acquisitions, dispositions or recapitalizations that have occurred since the beginning of the most recently completed fiscal year to which such annual report relates (unless such pro forma information has been provided in a previous report pursuant to clause (ii) or (iii) below (provided that such pro forma financial information will be provided only to the extent available without unreasonable expense, in which case, the Issuer will provide, in the case of a material acquisition, acquired company financial statements)); (c) an operating and financial review of the audited financial statements, including a discussion of the results of operations, a discussion of financial condition and liquidity and capital resources, and a discussion of material commitments and contingencies and critical accounting policies; (d) a description of the business, management and shareholders of the Issuer, material affiliate transactions and material debt instruments; and (e) material risk factors and material recent developments;
(ii)within 60 days following the end of each of the first three fiscal quarters in each fiscal year of the Issuer beginning with the quarter ending March 31, 2025, quarterly reports containing the following information: (a) an unaudited condensed consolidated balance sheet as of the end of such quarter and unaudited condensed statements of income and cash flow for the quarterly and year to date periods ending on the unaudited condensed balance sheet date, and the comparable prior year periods for the Issuer, together with condensed footnote disclosure; (b) pro forma income statement and balance sheet information of the Issuer (which need not comply with Article 11 of Regulation S-X under the U.S. Exchange Act), together with explanatory footnotes, for any material acquisitions, dispositions or recapitalizations that have occurred since the beginning of the most recently completed fiscal quarter to which such quarterly report relates (provided that such pro forma financial information will be provided only to the extent available without unreasonable expense, in which case, the Issuer will provide, in the case of a material acquisition, acquired company financial statements); (c) an operating and financial review of the unaudited financial statements, including a discussion of the consolidated financial condition and results of operations of the Issuer, and any material change between the current quarterly period and the corresponding period of the prior year; (d) material recent developments; and
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(iii)promptly after the occurrence of any material acquisition, disposition or restructuring of the Issuer and the Restricted Subsidiaries, taken as a whole, or any changes of the Chief Executive Officer or Chief Financial Officer at the Issuer or change in auditors of the Issuer or any other material event that the Issuer or any of its Restricted Subsidiaries announces publicly, information describing such event.
(b)In addition, if the Issuer has designated any of its Subsidiaries as Unrestricted Subsidiaries and such Subsidiaries are Significant Subsidiaries, then the quarterly and annual financial information required by Sections 4.03(a)(i) and 4.03(a)(ii) hereof will include a reasonably detailed presentation, either on the face of the financial statements or in the footnotes thereto, of the financial condition and results of operations of the Issuer and its Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the Issuer.
(c)All financial statements will be prepared in accordance with IFRS. Except as provided for above, no report need include separate financial statements for the Issuer or Subsidiaries of the Issuer or any disclosure with respect to the results of operations or any other financial or statistical disclosure not of a type included in the Offering Memorandum.
(d)In addition, for so long as Senior Notes of a series remain outstanding, the Issuer has agreed that it will furnish to the Holders and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the U.S. Securities Act.
(e)Substantially concurrently with the issuance to the Trustee of the reports specified in Sections 4.03(a)(i), 4.03(a)(ii) and 4.03(a)(iii) hereof, the Issuer shall also (a) use its commercially reasonable efforts (i) to post copies of such reports on such website as may be then maintained by the Issuer and its Subsidiaries or (ii) otherwise to provide substantially comparable availability of such reports to holders (as determined by the Issuer in good faith) or (b) to the extent the Issuer determines in good faith that it cannot make such reports available in the manner described in the preceding clause (a) owing to applicable law or after the use of its commercially reasonable efforts, furnish such reports to the holders and, upon their request, prospective purchasers of the Senior Notes. For the avoidance of doubt, there shall be no requirement to issue the information specified in Section 4.03(a)(iii) hereof to the Trustee if it shall already have been made publicly available under Section 4.03(e)(a)(i) hereof, unless the Trustee so requests.
(f)For so long as either: (i) the Issuer is subject to the reporting requirements of Section 13(a) or 15(d) of the US Exchange Act and continues to file the reports required by Section 13(a) or 15(d) of the US Exchange Act with the SEC; or (ii) the Issuer chooses to provide reports which, if filed with the SEC, would satisfy (in the good faith judgment of the Issuer) the reporting requirements of Section 13(a) or 15(d) of the US Exchange Act (other than the provision of certifications, exhibits or information as to internal controls and procedures) and, in the case of this Section 4.03(f)(ii), makes such reports available to Holders on its website or otherwise provides substantially comparable availability of such reports to Holders (as determined by the Issuer in good faith), the Issuer will be deemed to have complied with the provisions contained in this Section 4.03.
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(g)The Issuer may satisfy its obligations in this covenant with respect to financial information relating to the Issuer by furnishing financial information relating to any Parent Holdco; provided the same is accompanied by consolidating information that explains in reasonable detail the material differences between the information relating to such Parent Holdco and its Subsidiaries, on the one hand, and the information relating to the Issuer and its Restricted Subsidiaries, on the other hand.
(h)Delivery of information, documents and reports to the Trustee pursuant to this Section 4.03 is for informational purposes only. The Trustee’s receipt of such shall not constitute actual or constructive knowledge or notice of any information contained therein, including the Issuer’s compliance with any of its covenants under the Senior Notes Indenture or related documents herein.
Section 4.04.Compliance Certificate. (a) The Issuer shall deliver to the Trustee, within 120 days after the end of each fiscal year, an Officer's Certificate stating that a review of the activities of the Issuer and its Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether the Issuer has kept, observed, performed and fulfilled its obligations under this Senior Notes Indenture, and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge, the Issuer is not in default in the performance or observance of any of the terms, provisions and conditions of this Senior Notes Indenture (or, if a Default or Event of Default has occurred, describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Issuer is taking or proposes to take with respect thereto).
(b)So long as any of the Senior Notes are outstanding, the Issuer will deliver to the Trustee, as soon as reasonably practicable after (but not later than thirty days) upon any Officer becoming aware of any Default or Event of Default, an Officer's Certificate specifying such Default or Event of Default and what action the Issuer is taking or proposes to take with respect thereto.
Section 4.05.Taxes. The Issuer will pay, and the Issuer will cause each of its Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and governmental levies except such as are contested in good faith and by appropriate proceedings or where the failure to effect such payment is not adverse in any material respect to the Holders of the Senior Notes.
Section 4.06.Stay, Extension and Usury Laws. The Issuer and each of the Guarantors covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Senior Notes Indenture; and the Issuer and each of the Guarantors (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law has been enacted.
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Section 4.07.Restricted Payments. (a) The Issuer will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly:
(i)declare or pay any dividend or make any other payment or distribution on account of the Issuer’s Equity Interests or any of its Restricted Subsidiaries' Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving the Issuer or any of its Restricted Subsidiaries) or to the direct or indirect holders of the Issuer’s or any of its Restricted Subsidiaries' Equity Interests in their capacity as holders (other than dividends or distributions payable in Equity Interests (other than Disqualified Stock or Designated Preference Shares of the Issuer)) other than dividends or distributions payable to the Issuer or a Restricted Subsidiary;
(ii)purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving the Issuer) any Equity Interests of the Issuer or any Parent Holdco of the Issuer;
(iii)make any principal payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Subordinated Obligations (excluding any intercompany Indebtedness between or among the Issuer and any of its Restricted Subsidiaries), except (i) at the Stated Maturity thereof or (ii) the purchase, repurchase or other acquisition of Indebtedness purchased in anticipation of satisfying a sinking fund obligation, principal installment or scheduled maturity, in each case due within one year of the date of such purchase, repurchase or other acquisition;
(iv)make any payment (except through capitalization) on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Subordinated Shareholder Debt; or
(v)make any Restricted Investment,
(all such payments and other actions set forth in the Sections 4.07(a)(i) through (v) above being collectively referred to as “Restricted Payments”), unless, at the time of any such Restricted Payment:
(A)no Default or Event of Default has occurred and is continuing or would occur as a consequence of such Restricted Payment;
(B)the Issuer would, at the time of such Restricted Payment and after giving pro forma effect thereto, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Consolidated Net Leverage Ratio test set forth in Section 4.09(a) hereof; and
(C)such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Issuer and its Restricted Subsidiaries since the Issue Date (excluding Restricted Payments permitted by Section 4.07(b) hereof other than Sections 4.07(b)(i), (xvi), (xviii) and (xx) hereof), is less than the sum, without duplication, of:
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(1)50% of the Consolidated Net Income of the Issuer for the period (taken as one accounting period) from the beginning of the fiscal quarter commencing immediately prior to the Issue Date to the end of the Issuer’s most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, if such Consolidated Net Income for such period is a deficit, less 100% of such deficit); plus
(2)100% of the aggregate net cash proceeds and the fair market value of marketable securities or other property received by the Issuer since the Issue Date as a contribution to its common equity capital or from the issue or sale of Equity Interests of the Issuer (other than Disqualified Stock, Excluded Contributions and Designated Preference Shares) or from the issue or sale of convertible or exchangeable Disqualified Stock of the Issuer or convertible or exchangeable debt securities of the Issuer, in each case that have been converted into or exchanged for Equity Interests of the Issuer (other than Equity Interests (or Disqualified Stock, Designated Preference Shares or debt securities) sold to a Subsidiary of the Issuer) or from the issuance or sale of Subordinated Shareholder Debt (other than an issuance or sale to a Subsidiary of the Issuer), other than any Parent Debt Contributions; plus
(3)to the extent that any Restricted Investment that was made after the Issue Date is (a) sold, disposed of or otherwise cancelled, liquidated or repaid, 100% of the aggregate amount received in cash and the fair market value of the property and marketable securities or other property received by the Issuer or any Restricted Subsidiary, or (b) made in an entity that subsequently becomes a Restricted Subsidiary, 100% of the fair market value of the Restricted Investment of the Issuer and its Restricted Subsidiaries as of the date such entity becomes a Restricted Subsidiary; plus
(4)to the extent that any Unrestricted Subsidiary of the Issuer designated as such after the Issue Date is redesignated as a Restricted Subsidiary or is merged or consolidated into the Issuer or a Restricted Subsidiary, or all of the assets of such Unrestricted Subsidiary are transferred to the Issuer or a Restricted Subsidiary, the fair market value of the property received by the Issuer or Restricted Subsidiary or the Issuer’s Restricted Investment in such Subsidiary as of the date of such redesignation, merger, consolidation or transfer of assets, to the extent such investments reduced the Restricted Payments capacity under this clause (C) and were not previously repaid or otherwise reduced; plus
(5)100% of any dividends or distributions received by the Issuer or a Restricted Subsidiary after the Issue Date from an Unrestricted Subsidiary, to the extent that such dividends or distributions were not otherwise included in the Consolidated Net Income of the Issuer for such period; plus
(6)upon the full and unconditional release of a Restricted Investment that is a guarantee made by the Issuer or one of its Restricted Subsidiaries to any Person, an amount equal to the amount of such guarantee, (b)The preceding provisions will not prohibit any of the following (collectively, “Permitted Payments”):
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provided, however, that notwithstanding the foregoing, any amounts (such amounts, the “Excluded Amounts”) that would otherwise be included in the calculation of the amount available for Restricted Payments pursuant to Section 4.07(a)(v)(C) hereof will be excluded to the extent (1) such amounts result from the receipt of net cash proceeds or property or marketable securities received in contemplation of, or in connection with, an event that would otherwise constitute a Change of Control pursuant to the definition thereof, (2) the purpose of, or the effect of, the receipt of such net cash proceeds or property or assets or marketable securities was to reduce the Consolidated Net Leverage Ratio so that there would be an occurrence of a Specified Change of Control Event that would not have been achieved without the receipt of such net cash proceeds or property or assets or marketable securities and (3) no Change of Control Offer is made in connection with such Change of Control in accordance with the requirements of this Senior Notes Indenture.
(i)the payment of any dividend or the consummation of any redemption within 60 days after the date of declaration of the dividend or giving of the redemption notice, as the case may be, if at the date of declaration or notice, the dividend or redemption payment would have complied with the provisions of this Senior Notes Indenture;
(ii)the making of any Restricted Payment in exchange for, or out of or with the net cash proceeds of the substantially concurrent sale or issuance (other than to a Subsidiary of the Issuer) of, Equity Interests of the Issuer (other than Disqualified Stock, Parent Debt Contributions, Excluded Amounts or Designated Preference Shares), Subordinated Shareholder Debt or from the substantially concurrent contribution of common equity capital to the Issuer; provided that the amount of any such net cash proceeds that are utilized for any such Restricted Payment will be excluded from Section 4.07(a)(v)(C)(2) hereof and will not be considered to be net cash proceeds from an Equity Offering for the purposes of Section 3.07 hereof;
(iii)the repurchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Obligations made in exchange for, or out of the proceeds of a substantially concurrent sale or issuance of, Permitted Refinancing Indebtedness;
(iv)any purchase, repurchase, redemption, defeasance or other acquisition or retirement of Subordinated Obligations:
(A)(i) from Net Proceeds to the extent permitted under Section 4.10 hereof, but only if the Issuer shall have first complied with the terms of such covenant described under Section 4.10 and purchased all Senior Notes tendered pursuant to any offer to repurchase all the Senior Notes required thereby, prior to purchasing, repurchasing, redeeming, defeasing or otherwise acquiring or retiring such Subordinated Obligations and (ii) at a purchase price not greater than 100% of the principal amount of such Subordinated Obligations plus accrued and unpaid interest and any premium payable thereon;
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(B)to the extent required by the agreement governing such Subordinated Obligations, following the occurrence of a Change of Control (or other similar event described therein as a “change of control”), but only (i) if the Issuer shall have first complied with the terms described under Section 4.13 hereof and purchased all Senior Notes tendered pursuant to the offer to repurchase all the Senior Notes required thereby, prior to purchasing, repurchasing, redeeming, defeasing or otherwise acquiring or retiring such Subordinated Obligations and (ii) at a purchase price not greater than 101% of the principal amount of such Subordinated Indebtedness plus accrued and unpaid interest and any premium payable thereon; or
(C)(i) consisting of Acquired Debt (other than Indebtedness incurred (a) to provide all or any portion of the funds utilized to consummate the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary or was otherwise acquired by the Issuer or a Restricted Subsidiary or (b) otherwise in connection with or contemplation of such acquisition) and (ii) at a purchase price not greater than 100% of the principal amount of such Subordinated Obligations plus accrued and unpaid interest and any premium required by the terms of any Acquired Debt;
(v)the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Issuer or any Restricted Subsidiary held by any current or former officer, director, employee or consultant of the Issuer or any of its Restricted Subsidiaries pursuant to any equity subscription agreement, stock option agreement, restricted stock grant, shareholders' agreement or similar agreement; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests may not exceed $20.0 million per calendar year from the 2021 Indenture Date (with unused amounts in any calendar year being carried over to the next two succeeding calendar years); and provided further, that such amount in any calendar year may be increased by an amount not to exceed the cash proceeds (excluding proceeds from any Parent Debt Contributions) from the sale of Equity Interests of the Issuer or a Restricted Subsidiary received by the Issuer or a Restricted Subsidiary during such calendar year, in each case to members of management, directors or consultants of the Issuer, any of its Restricted Subsidiaries or any Parent Holdco of the Issuer to the extent the cash proceeds from the sale of Equity Interests have not otherwise been applied to the making of Restricted Payments pursuant to Section 4.07(a)(v)(C)(2) hereof or this Section 4.07(b)(v) and are not Excluded Contributions or Excluded Amounts;
(vi)the repurchase of Equity Interests deemed to occur upon the exercise of stock options to the extent such Equity Interests represent a portion of the exercise price of those stock options;
(vii)the declaration and payment of regularly scheduled or accrued dividends to holders of any class or series of Disqualified Stock of the Issuer or any preferred stock of any Restricted Subsidiary issued on or after the 2021 Indenture Date in accordance with Section 4.09 hereof;
(viii)(a) payments of cash, dividends, distributions, advances or other Restricted Payments by the Issuer or any of its Restricted Subsidiaries to allow the payment of cash in lieu of the issuance of fractional shares upon (x) the exercise of options or warrants or (y) the conversion or exchange of Capital Stock of any such Person and (b) payments made or expected to be made by the Issuer or any Restricted Subsidiary pursuant to the exercise, in each case on a “cashless” or “net exercise” basis, of any option to purchase Capital Stock granted to any future, present or former employee, director, officer, contractor or consultant of the Issuer or any Restricted Subsidiary pursuant to any employee benefit plans or arrangements, including for the purpose of satisfying any Taxes (including estimated Taxes) due as a result of the exercise of any such option;
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(ix)advances or loans to (a) any future, present or former officer, director, employee or consultant of the Issuer or a Restricted Subsidiary to pay for the purchase or other acquisition for value of Equity Interests of the Issuer (other than Disqualified Stock or Designated Preference Shares), or any obligation under a forward sale agreement, deferred purchase agreement or deferred payment arrangement pursuant to any management equity plan or stock option plan or any other management or employee benefit or incentive plan or other agreement or arrangement or (b) any management equity plan, employee benefit trust or stock option plan or any other management or employee benefit or incentive plan or unit trust or the trustees of any such plan or trust to pay for the purchase or other acquisition for value of Equity Interests of the Issuer (other than Disqualified Stock or Designated Preference Shares); provided that the total aggregate amount of Restricted Payments made under this Section 4.07(b)(ix) does not exceed $20.0 million at any time outstanding;
(x)payments or distributions to dissenting shareholders pursuant to applicable law in connection with or contemplation of a merger, amalgamation, consolidation or transfer of assets that complies with the provisions of the Senior Notes relating to mergers, amalgamations, consolidations or transfers of substantially all of a Guarantor's assets;
(xi)the payment of any dividend (or, in the case of any partnership or limited liability company, any similar distribution) by a Restricted Subsidiary to the holders of its Equity Interests (other than the Issuer or any Restricted Subsidiary) then entitled to participate in such dividends on a pro rata basis or otherwise in compliance with the terms of the instruments governing such Equity Interests;
(xii)dividends, loans, advances or distributions (including any repayment of any Subordinated Shareholder Debt) to any Parent Holdco or other payments by the Issuer or any Restricted Subsidiary in an amount equal to (without duplication) (A) the amounts required to make Permitted Parent Payments; or (B) amounts constituting or to be used for purposes of making payments (i) as disclosed in the Offering Memorandum under the heading “Use of Proceeds” on or after the Issue Date; or (ii) to the extent specified in Sections 4.11(b)(i), (iv), (v) and (x) hereof;
(xiii)Restricted Payments that are made with Excluded Contributions;
(xiv)so long as no Default or Event of Default has occurred and is continuing, the payment of Management Fees;
(xv)the declaration and payment of dividends to holders of any class or series of Designated Preference Shares of the Issuer issued after the 2021 Indenture Date; provided, however, that, the amount of all dividends declared or paid pursuant to this Section 4.07(b)(xv) shall not exceed the net proceeds received by the Issuer or the aggregate amount contributed in cash to the equity (other than through the issuance of Disqualified Stock, a Parent Debt Contribution, Excluded Amounts or an Excluded Contribution) of the Issuer or contributed as Subordinated Shareholder Debt to the Issuer, as applicable, from the issuance or sale of such Designated Preference Shares;
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(xvi)so long as no Default or Event of Default has occurred and is continuing (or would result therefrom), any Restricted Payment; provided that the Consolidated Net Leverage Ratio on a pro forma basis after giving effect to any such dividend, distribution, advance, loan or other payment and any Indebtedness incurred in connection therewith does not exceed 3.5 to 1.0;
(xvii)dividends or other distributions in amounts required and used by a Parent Holdco of the Issuer to make a substantially concurrent payment of interest on Indebtedness, the proceeds of which have been contributed as a Parent Debt Contribution to the Issuer or any of its Restricted Subsidiaries, and that has been guaranteed by, or is otherwise considered Indebtedness of, the Issuer or any of its Restricted Subsidiaries incurred in accordance with Section 4.09 hereof; provided that any amounts payable (A) as interest on any proceeds loan or other Indebtedness of the Issuer or any Restricted Subsidiary pursuant to which the Parent Debt Contribution was made, or (B) on any guarantee or other obligation of the Issuer or any Restricted Subsidiary on such Indebtedness will, in each case, reduce the amount available for making restricted payments under this Section 4.07(b)(xvii);
(xviii)so long as no Default or Event of Default has occurred and is continuing (or would result therefrom), the declaration and payment by the Issuer of, or loans, advances, dividends or distributions to any Parent Holdco to pay, dividends on the common stock or common equity interests of the Issuer or any Parent Holdco following any Equity Offering of such common stock or common equity interests following September 18, 2019, in an amount not to exceed in any fiscal year the greater of (a) 6% of the Net Cash Proceeds received by the Issuer from such Equity Offering or contributed to the equity (other than through the issuance of Disqualified Stock or Designated Preference Shares or through an Excluded Contribution or Excluded Amounts or a Parent Debt Contribution) of the Issuer and (b) following the Equity Offering, an amount equal to 6% of the Market Capitalization; provided that in the case of this clause (b) after giving pro forma effect to such loans, advances, dividends or distributions, the Consolidated Net Leverage Ratio shall be equal to or less than 4.0 to 1.0;
(xix)payment of Receivables Fees and purchases of Receivables Assets pursuant to a Receivables Repurchase Obligation in connection with a Qualified Receivables Financing; and
(xx)so long as no Default or Event of Default has occurred and is continuing, other Restricted Payments in an aggregate amount not to exceed the greater of $350.0 million and 6.0% of the Total Assets of the Issuer.
(c)The amount of all Restricted Payments (other than cash) will be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Issuer or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any cash Restricted Payment shall be its face amount, and the fair market value of any non-cash Restricted Payment shall be determined conclusively by the Issuer acting in good faith.
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(d)For purposes of determining compliance with this Section 4.07, in the event that a Restricted Payment (or portion thereof) meets the criteria of more than one of the categories of Permitted Payments described in the foregoing Sections 4.07(b)(i) through (xx), or is permitted pursuant to Section 4.07(a) hereof and/or one or more of the clauses contained in the definition of “Permitted Investment,” the Issuer will be entitled to classify such Restricted Payment or Investment (or portion thereof) on the date of its payment or later reclassify (based on circumstances existing on the date of such reclassification) such Restricted Payment or Investment (or portion thereof) in any manner that complies with this covenant, including as an Investment pursuant to one of more clauses contained in the definition of Permitted Investment.
Section 4.08.Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries. (a) The Issuer will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:
(i)pay dividends or make any other distributions on its Capital Stock to the Issuer or any Restricted Subsidiary, or with respect to any other interest or participation in, or measured by, its profits, or pay any Indebtedness owed to the Issuer or any Restricted Subsidiary;
(ii)make loans or advances to the Issuer or any Restricted Subsidiary; or
(iii)sell, lease or transfer any of its properties or assets to the Issuer or any Restricted Subsidiary,
provided that (x) the priority of any preferred stock in receiving dividends or liquidating distributions prior to dividends or liquidating distributions being paid on common stock and (y) the subordination of (including the application of any standstill period to) loans or advances made to the Issuer or any Restricted Subsidiary to other Indebtedness incurred by the Issuer or any Restricted Subsidiary, in each case, shall not be deemed to constitute such an encumbrance or restriction.
(b)However, Section 4.08(a) hereof will not apply to encumbrances or restrictions existing under or by reason of:
(i)any encumbrance or restriction pursuant to (A) any Credit Facility (including the Nigeria 2023 Revolving Credit Facility, the Nigeria 2023 Term Loan, the IHS Holding 2020 Revolving Credit Facility and the IHS Holding 2024 Dual-Tranche Term Loan), (B) this Senior Notes Indenture, any Guarantee Agreement, the Senior Notes, the Note Guarantees, the Existing Notes, the Existing Note Indentures and the Existing Note Guarantees or (C) any other agreement or instrument, in each case in effect at or entered into on or as of the Issue Date;
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(ii)agreements governing other Indebtedness permitted to be incurred under Section 4.09 hereof and any amendments, restatements, modifications, renewals, supplements, refundings, replacements or refinancings of those agreements; provided that the restrictions therein (A) are not materially less favorable to the holders of the Senior Notes than is customary in comparable financings (as determined in good faith by the Issuer); (B) are customary in comparable financings; or (C) would not, in the good faith determination of the Issuer, materially impair the ability of the Issuer to make payments on the Senior Notes;
(iii)applicable law, rule, regulation or order or the terms of any license, authorization, concession or permit;
(iv)any instrument governing Indebtedness or Capital Stock of a Person acquired by the Issuer or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness or Capital Stock was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired; provided that, in the case of Indebtedness, such Indebtedness was permitted by the terms of this Senior Notes Indenture to be incurred;
(v)purchase money obligations for property acquired in the ordinary course of business and Capital Lease Obligations that impose restrictions on the property purchased or leased of the nature described in Section 4.08(a)(iii) hereof;
(vi)any encumbrance or restriction: (A) entered into in the ordinary course of business that restricts in a customary manner the subletting, assignment or transfer of any property or asset that is subject to a lease, license or similar contract, or the assignment or transfer of any lease, license or other contract; (B) contained in mortgages, pledges or other security agreements permitted under this Senior Notes Indenture or securing Indebtedness of the Issuer or a Restricted Subsidiary permitted under this Senior Notes Indenture to the extent such encumbrances or restrictions restrict the transfer of the property or assets subject to such mortgages, pledges or other security agreements; or (C) pursuant to customary provisions restricting dispositions of real property interests set forth in any reciprocal easement agreements of the Issuer or any Restricted Subsidiary;
(vii)any agreement for the sale or other disposition of the Capital Stock or all or substantially all of the property and assets of a Restricted Subsidiary that restricts distributions by that Restricted Subsidiary pending its sale or other disposition;
(viii)Permitted Refinancing Indebtedness; provided that the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced as determined in good faith by the Issuer would not in the good faith determination of the Issuer, materially impair the ability of the Issuer to make payments on the Senior Notes;
(ix)Liens permitted to be incurred under the provisions of Section 4.12 hereof that limit the right of the debtor to dispose of the assets subject to such Liens;
(x)customary provisions limiting the disposition or distribution of assets or property in joint venture agreements, asset sale agreements, sale-leaseback agreements, stock sale agreements and other similar agreements in the ordinary course of business (including agreements entered into in connection with an Investment), which limitation is applicable only to the assets that are the subject of such agreements;
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(xi)restrictions on cash or other deposits or net worth imposed by customers or suppliers or required by insurance, surety or bonding companies, in each case, under contracts entered into in the ordinary course of business;
(xii)restrictions effected in connection with a Qualified Receivables Financing that, in the good faith determination of an Officer or the Board of Directors of the Issuer, are necessary or advisable to effect such Qualified Receivables Financing;
(xiii)any encumbrance or restriction pursuant to or ancillary to Hedging Obligations; or
(xiv)any encumbrance or restriction existing under any agreement that extends, renews, refinances or replaces the agreements containing the encumbrances or restrictions in the foregoing Sections 4.08(b)(i) through 4.08(b)(xiii), or in this Section 4.08(b)(xiv); provided that the terms and conditions of any such encumbrances or restrictions are no more restrictive in any material respect than those under or pursuant to the agreement so extended, renewed, refinanced or replaced or would not in the good faith determination of the Issuer, materially impair the ability of the Issuer to make payments on the Senior Notes.
Section 4.09.Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Issuer will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, “incur”) any Indebtedness (including Acquired Debt), and the Issuer will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Issuer may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock and any Restricted Subsidiary may incur Indebtedness or issue preferred stock, if on the date on which such Indebtedness is incurred or such Disqualified Stock or preferred stock is issued, as the case may be, the Issuer’s Consolidated Net Leverage Ratio would not exceed 4.5 to 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the Indebtedness had been incurred or the Disqualified Stock or preferred stock had been issued on such date.
(b)Section 4.09(a) hereof will not prohibit the incurrence of any of the following items of Indebtedness (collectively, “Permitted Debt”):
(i)the incurrence of Indebtedness under the Credit Facilities in an aggregate principal amount at any one time outstanding not to exceed $1,000.0 million, plus in the case of any refinancing of any Indebtedness permitted under this Section 4.09(b)(i) or any portion thereof, the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing;
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(ii)Indebtedness outstanding on the Issue Date after giving pro forma effect to the Transactions and the use of the net proceeds thereof (other than Indebtedness described in Sections 4.09(b)(i) and (iii) hereof);
(iii)the incurrence by the Issuer and the Guarantors of Indebtedness represented by the Senior Notes (other than Additional Senior Notes) and the related Note Guarantees (including any future Note Guarantees) and the Existing Notes and the Existing Note Guarantees and, without limitation, any intercompany Indebtedness entered into (between or among the Issuer and its Restricted Subsidiaries) using the proceeds thereof;
(iv)the incurrence by the Issuer or any Restricted Subsidiary of Indebtedness representing (x) Capital Lease Obligations, mortgage financings, purchase money obligations or other Indebtedness incurred for the purpose of financing all or any part of the purchase price, lease expense, rental payments or cost of design, construction, installation or improvement of property, plant or equipment or other assets (including Capital Stock) used in the business of the Issuer or any of its Restricted Subsidiaries, not to exceed the greater of $150.0 million or 3.0% of the Total Assets of the Issuer at any time outstanding, (y) any Non-2027 Notes Issuer Group Lease Obligations, or (z) without prejudice to any other permission set forth in this Senior Notes Indenture, (A) Capital Lease Obligations incurred in the ordinary course of business and consistent with past practice and (B) consisting of any obligations in respect of a lease, concession or license of property (or guarantee thereof) which would be considered an operating lease under IFRS (or would have previously been categorized as operating leases prior to the adoption of IFRS 16 (Leases));
(v)the incurrence by the Issuer or any Restricted Subsidiary of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge any Indebtedness (other than intercompany Indebtedness) incurred under Sections 4.09(a), 4.09(b)(ii), 4.09(b)(iii), 4.09(b)(v) or 4.09(b)(xiv) hereof;
(vi)the incurrence by the Issuer or any Restricted Subsidiary of intercompany Indebtedness between or among the Issuer or any Restricted Subsidiary; provided that:
(A)if the Issuer or any Guarantor is the obligor on such Indebtedness and the obligee is not the Issuer or a Guarantor, such Indebtedness must be unsecured and ((i) except in respect of the intercompany current liabilities incurred in the ordinary course of business in connection with the cash management operations of the Issuer and its Restricted Subsidiaries and (ii) only to the extent legally permitted (the Issuer and its Restricted Subsidiaries having completed all procedures required in the reasonable judgment of directors of officers of the obligee or obligor to protect such Persons from any penalty or civil or criminal liability in connection with the subordination of such Indebtedness)) expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Senior Notes, in the case of the Issuer, or its Note Guarantee, in the case of a Guarantor; and
(B)(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Issuer or a Restricted Subsidiary and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Issuer or a Restricted Subsidiary, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Issuer or such Restricted Subsidiary, as the case may be, that was not permitted by this Section 4.09(b)(vi);
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(vii)the incurrence by the Issuer or any Restricted Subsidiary of intercompany Indebtedness between or among the Issuer or any Restricted Subsidiary; provided that the Indebtedness arises under guarantees entered into pursuant to section 2:403 of the Dutch Civil Code in respect of a Restricted Subsidiary incorporated in the Netherlands and any residual liability with respect to such guarantees arising under Section 2:404 of the Dutch Civil Code;
(viii)the issuance by any Restricted Subsidiary to the Issuer or to any of its Restricted Subsidiaries of preferred stock; provided that:
(A)any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Issuer or a Restricted Subsidiary; and
(B)any sale or other transfer of any such preferred stock to a Person that is not either the Issuer or a Restricted Subsidiary,
will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this Section 4.09(b)(vii)(viii) ;
(ix)the incurrence by the Issuer or any Restricted Subsidiary of Hedging Obligations not for speculative purposes (as determined in good faith by the Issuer or such Restricted Subsidiary, as the case may be);
(x)the guarantee by the Issuer or any Restricted Subsidiary of Indebtedness of the Issuer or any Restricted Subsidiary to the extent that the guaranteed Indebtedness was permitted to be incurred by another provision of this covenant; provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Senior Notes or a Note Guarantee, then the guarantee must be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(xi)the incurrence by the Issuer or any of its Restricted Subsidiaries of Indebtedness in respect of workers' compensation claims, self-insurance obligations, captive insurance companies, bankers' acceptances, performance and surety bonds in the ordinary course of business;
(xii)the incurrence by the Issuer or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within 30 Business Days;
(xiii)Indebtedness represented by guarantees of any Management Advances;
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(xiv)Indebtedness of (A) any Person outstanding on the date on which such Person becomes a Restricted Subsidiary or is merged, consolidated, amalgamated or otherwise combined with (including pursuant to any acquisition of assets and assumption of related liabilities) the Issuer or any Restricted Subsidiary (other than Indebtedness incurred to provide all or any portion of the funds used to consummate the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary or was otherwise acquired by the Issuer or a Restricted Subsidiary or otherwise in connection with, or in contemplation of, such acquisition) or (B) the Issuer or any Restricted Subsidiary incurred in relation to any such acquisition, merger, consolidation, amalgamation or combination; provided, however, with respect to this Section 4.09(b)(xiv), that at the time of the acquisition or other transaction pursuant to which such Indebtedness was incurred or deemed to be incurred (x) the Issuer would have been able to incur $1.00 of additional Indebtedness pursuant to Section 4.09(a) hereof after giving effect to the incurrence of such Indebtedness pursuant to this Section 4.09(b)(xiv) calculated on a pro forma basis or (y) the Consolidated Net Leverage Ratio would be equal or less than the Consolidated Net Leverage Ratio immediately prior to giving effect to such acquisition or other transaction on a pro forma basis; or, in the case of any Indebtedness incurred in reliance on Section 4.09(b)(xiv) (A) hereof, the principal amount of such Indebtedness is discharged, or otherwise reclassified in any manner that complies with Section 4.09, within one year of incurrence.
(xv)Indebtedness arising from agreements of the Issuer or a Restricted Subsidiary providing for customary indemnification, obligations in respect of earnouts or other adjustments of purchase price or, in each case, similar obligations, in each case, incurred or assumed in connection with the acquisition or disposition of any business or assets or Person or any Equity Interests of a Subsidiary; provided that the maximum liability of the Issuer and its Restricted Subsidiaries in respect of all such Indebtedness shall at no time exceed the gross proceeds, including the fair market value of non-cash proceeds (measured at the time received and without giving effect to any subsequent changes in value), actually received by (or held in escrow as collateral for such Indebtedness for later release to) the Issuer and its Restricted Subsidiaries in connection with such disposition;
(xvi)Indebtedness of the Issuer and its Restricted Subsidiaries in respect of (A) letters of credit, surety, performance or appeal bonds, completion guarantees, judgment, advance payment, customs, VAT or other tax guarantees or similar instruments issued in the ordinary course of business of such Person or in respect of any governmental requirement and not in connection with the borrowing of money, including letters of credit or similar instruments in respect of self-insurance and workers compensation obligations, and (B) any customary cash management, cash pooling or netting or setting off arrangements, including customary credit card facilities, entered into in the ordinary course of business; provided, however, that upon the drawing of such letters of credit or other instrument, such obligations are reimbursed within 30 days following such drawing;
(xvii)(A) customer deposits and advance payments received in the ordinary course of business from customers for goods or services purchased in the ordinary course of business; (B) Indebtedness owed on a short-term basis of no longer than 30 days to banks and other financial institutions incurred in the ordinary course of business of the Issuer and its Restricted Subsidiaries with such banks or financial institutions that arises in connection with ordinary banking arrangements to manage cash balances of the Issuer and its Restricted Subsidiaries; and (C) Indebtedness incurred by a Restricted Subsidiary in connection with bankers acceptances, discounted bills of exchange or the discounting or factoring of receivables for credit management of bad debt purposes, in each case incurred or undertaken in the ordinary course of business;
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(xviii)Indebtedness of the Issuer and the Guarantors in an aggregate outstanding principal amount which, when taken together with any Permitted Refinancing Indebtedness in respect thereof and the principal amount of all other Indebtedness incurred pursuant to this Section 4.09(b)(xviii) and then outstanding, will not exceed 100% of the net proceeds (other than proceeds from any Parent Debt Contribution) received by the Issuer from the issuance or sale (other than to a Restricted Subsidiary) of its Subordinated Shareholder Debt or Capital Stock (other than Disqualified Stock, Designated Preference Shares, Excluded Amounts or an Excluded Contribution) or otherwise contributed to the equity (other than through the issuance of Disqualified Stock, Designated Preference Shares, Excluded Amounts, an Excluded Contribution or a Parent Debt Contribution) of the Issuer, in each case, subsequent to the Issue Date; provided, however, that (i) any such net proceeds that are so received or contributed shall be excluded for purposes of making Restricted Payments under Section 4.07(a) hereof and Sections 4.07(b)(ii) and 4.07(b)(v) hereof to the extent the Issuer and its Restricted Subsidiaries incur Indebtedness in reliance thereon and (ii) any net proceeds that are so received or contributed shall be excluded for purposes of incurring Indebtedness pursuant to this Section 4.09(b)(xviii) to the extent the Issuer or any of its Restricted Subsidiaries makes a Restricted Payment under Section 4.07(a) hereof and Sections 4.07(b)(ii) and 4.07(b)(v) hereof in reliance thereon;
(xix)guarantees by the Issuer or any Restricted Subsidiary granted to any trustee of any management equity plan or stock option plan or any other management or employee benefit or incentive plan or unit trust scheme approved by the Board of Directors of the Issuer, so long as the proceeds of the Indebtedness so guaranteed are used to purchase Equity Interests of the Issuer (other than Disqualified Stock); provided that the amount of any net cash proceeds from the sale of such Equity Interests of the Issuer will be excluded from Section 4.07(a)(v)(C)(2) hereof and will not be considered to be net cash proceeds from an Equity Offering for purposes of Section 3.07 hereof;
(xx)Indebtedness under daylight borrowing facilities incurred in connection with any refinancing of Indebtedness (including by way of set-off or exchange); provided that such Indebtedness does not exceed the principal amount of the Indebtedness being refinanced and the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing, so long as any such Indebtedness is repaid within three days of the date on which such Indebtedness is incurred;
(xxi)Indebtedness incurred by a Receivables Subsidiary in a Qualified Receivables Financing;
(xxii)Indebtedness incurred by the Issuer and any Restricted Subsidiary under local Credit Facilities in an aggregate principal amount at any one time outstanding under this clause this Section 4.09(b)(xxii), not to exceed $50.0 million, plus in the case of any refinancing of any Indebtedness permitted under this Section 4.09(b)(xxii) or any portion thereof, the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing;
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(xxiii)any joint and several liability in respect of any Tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same) as a result of a fiscal unity (fiscale eenheid) for Dutch corporate tax or value added tax purposes (or any similar structure of any other jurisdiction having similar effect) in respect of the Issuer or any Restricted Subsidiary;
(xxiv)the incurrence of Indebtedness under Land Leases entered into by the Issuer or any Restricted Subsidiary in the ordinary course of business; or
(xxv)the incurrence of Indebtedness by the Issuer or any of its Restricted Subsidiaries in an aggregate principal amount at any time outstanding, including all Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this Section 4.09(b)(xxv), not to exceed the greater of $150.0 million and 3.0% of the Total Assets of the Issuer at any time outstanding,
provided that the amount of Indebtedness incurred by any Restricted Subsidiary that is not a Guarantor in reliance on Sections 4.09(a), (b)(ii) or (b)(xxv) hereof (x) with respect to any 2027 Notes Issuer Group Restricted Subsidiary, shall be limited to the greater of $150.0 million and 3.0% of the Total Assets of the Issuer and (y) with respect to any other Restricted Subsidiary that is not a 2027 Notes Issuer Group Restricted Subsidiary, shall be limited to the Priority Debt Cap at any time outstanding.
(c)For purposes of determining compliance with this Section 4.09, (i) in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in Section 4.09(b)(i) through 4.09(b)(xxiii)(b)(xxv) hereof, or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Issuer, in its sole discretion, will be permitted to classify such item of Indebtedness on the date of its incurrence and only be required to include the amount and type of such Indebtedness in one of such clauses and will be permitted on the date of such incurrence to divide and classify an item of Indebtedness in more than one of the types of Indebtedness described in the Sections 4.09(a) and 4.09(b) hereof, from time to time to reclassify all or a portion of such item of Indebtedness, in any manner that complies with this covenant. All Indebtedness under the IHS Holding 2020 Revolving Credit Facility, the Nigeria 2023 Revolving Credit Facility and the Nigeria 2023 Term Loan shall be incurred under Section 4.09(b)(i) hereof, and may not be reclassified; (ii) guarantees of, or obligations in respect of letters of credit, bankers' acceptances or other similar instruments relating to, or Liens securing, Indebtedness that is otherwise included in the determination of a particular amount of Indebtedness shall not be included; (iii) if obligations in respect of letters of credit, bankers' acceptances or other similar instruments are incurred pursuant to any Credit Facility and are being treated as incurred pursuant to Sections 4.09(a) and 4.09(b) hereof and the letters of credit, bankers' acceptances or other similar instruments relate to other Indebtedness, then such other Indebtedness shall not be included; and (iv) Indebtedness permitted by this covenant need not be permitted solely by reference to one provision permitting such Indebtedness but may be permitted in part by one such provision and in part by one or more other provisions of this covenant permitting such Indebtedness.
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(d)The accrual of interest or preferred stock dividends, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on preferred stock or Disqualified Stock in the form of additional shares of the same class of preferred stock or Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of preferred stock or Disqualified Stock for purposes of this Section 4.09.
(e)For purposes of determining compliance with the Consolidated Net Leverage Ratio on the date of any proposed incurrence of Indebtedness, the US dollar equivalent principal amount of Indebtedness denominated in a different currency shall be utilized, calculated based on the relevant currency exchange rate in effect on the last balance sheet date, or at the option of the Issuer, the date first committed, in the case of Indebtedness incurred under Credit Facilities; provided, that if such Indebtedness denominated in currency other than US dollars is subject to a Currency Exchange Protection Agreement with respect to US dollars the amount of such Indebtedness expressed in US dollars will be calculated so as to take account of the effects of such Currency Exchange Protection Agreement.
(f)The principal amount of any refinancing Indebtedness incurred in the same currency as the Indebtedness being refinanced will be the US dollar equivalent of the Indebtedness refinanced determined by reference to the currency exchange rate in effect on the last balance sheet date to the date on which such refinancing Indebtedness is being incurred, except that to the extent that such US dollar equivalent was determined based on a Currency Exchange Protection Agreement, in which case the refinancing Indebtedness will be determined in accordance with Section 4.09(e) hereof.
(g)Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Issuer or any Restricted Subsidiary may incur pursuant to this covenant shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values.
(h)The amount of any Indebtedness outstanding as of any date will be:
(i)in the case of any Indebtedness issued with original issue discount, the amount of the liability in respect thereof determined in accordance with IFRS;
(ii)the principal amount of the Indebtedness, in the case of any other Indebtedness;
(iii)in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(A)the fair market value of such assets at the date of determination; and
(B)the amount of the Indebtedness of the other Person
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(iv)any “parallel debt” obligation relating to Indebtedness that is otherwise included in the determination of a particular amount of Indebtedness shall not be included; and
(v)the principal amount of any Disqualified Stock of the Issuer, or preferred stock of a Restricted Subsidiary, which will be equal to the greater of the maximum mandatory redemption or repurchase price (not including, in either case, any redemption or repurchase premium) or the liquidation preference thereof.
Section 4.10.Asset Sales. (a) The Issuer will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, consummate an Asset Sale unless:
(i)the Issuer (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at least equal to the fair market value (determined at the time of contracting such Asset Sale) of the assets or Equity Interests issued or sold or otherwise disposed of; and
(ii)at least 75% of the consideration received in the Asset Sale by the Issuer or such Restricted Subsidiary is in the form of cash or Cash Equivalents. For purposes of this provision, each of the following will be deemed to be cash:
(A)any liabilities, as recorded on the balance sheet of the Issuer or any Restricted Subsidiary (other than contingent liabilities), that are assumed by the transferee of any such assets and as a result of which the Issuer and its Restricted Subsidiaries are no longer obligated with respect to such liabilities or are indemnified against further liabilities;
(B)any securities, notes or other obligations received by the Issuer or any such Restricted Subsidiary from such transferee that are converted by the Issuer or such Restricted Subsidiary into cash or Cash Equivalents within 180 days following the closing of the Asset Sale, to the extent of the cash or Cash Equivalents received in that conversion;
(C)any Capital Stock or assets of the kind referred to in Sections 4.10(b)(iii), 4.10(b)(v) or 4.10(b)(vi) hereof;
(D)Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Sale, to the extent that the Issuer and each Restricted Subsidiary are released from any guarantee of such Indebtedness in connection with such Asset Sale;
(E)consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Issuer or any Restricted Subsidiary that is cancelled;
(F)accounts receivable of a business retained by the Issuer or any Restricted Subsidiary, as the case may be, following the sale of such business; and
(G)any Designated Non-Cash Consideration received by the Issuer or any of its Restricted Subsidiaries in such Asset Sales having an aggregate fair market
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value, when taken together with all other Designated Non-Cash Consideration received pursuant to this Section 4.10(a)(ii)(G) that is at that time outstanding, not to exceed the greater of $100.0 million and 2.0% of the Total Assets of the Issuer, measured at the time of the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value).
(b)Within 365 days after the receipt of any Net Proceeds from an Asset Sale, the Issuer (or the applicable Restricted Subsidiary, as the case may be) may apply such Net Proceeds (at the option of the Issuer or such Restricted Subsidiary) to:
(i)(A) prepay, repay, redeem or purchase (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) Pari Passu Indebtedness; provided that the Issuer shall redeem, repay or repurchase Pari Passu Indebtedness that is Public Debt pursuant to this Section 4.10(b)(i)(A) only if the Issuer makes (at such time or subsequently in compliance with this covenant) an offer to all holders of the Senior Notes to purchase their Senior Notes in accordance with the provisions set forth below for an Asset Sale Offer for an aggregate principal amount of Senior Notes at least equal to the proportion that (x) the total aggregate principal amount of Senior Notes outstanding bears to (y) the sum of the total aggregate principal amount of Senior Notes outstanding plus the total aggregate principal amount outstanding of such Pari Passu Indebtedness (a ''Public Debt Offer''), provided further that such Public Debt Offer shall not be required if the Issuer was eligible to, and has, made a Non-Pro Rata Election (as defined herein) in respect of such Net Proceeds; (B) with respect to assets of a Restricted Subsidiary that is not a Guarantor, prepay, repay, repurchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any of its Indebtedness; or (C) prepay, repay, repurchase or redeem any Indebtedness that is secured on any asset which security does not also secure the Senior Notes on a pari passu or senior basis (and in each of Sections 4.10(b)(i)(A) and (B) hereof and this Section 4.10(b)(i)(C), other than Indebtedness that is owed to the Issuer or a Restricted Subsidiary);
(ii)purchase Senior Notes (a) pursuant to an offer to all holders of the Senior Notes at a purchase price in cash equal to at least 100% of the principal amount thereof, plus accrued and unpaid interest to, but not including, the date of purchase (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date) (a “Notes Offer”) or (b) pursuant to Section 3.07 hereof;
(iii)acquire all or substantially all of the assets of, or any Capital Stock of, another Permitted Business, if, after giving effect to any such acquisition of Capital Stock, the Permitted Business is or becomes a Restricted Subsidiary;
(iv)make a capital expenditure;
(v)acquire other assets (other than Capital Stock) that are used or useful in a Permitted Business;
(vi)invest in any Replacement Assets;
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(vii)enter into a commitment approved by the Board of Directors or otherwise binding on the Issuer to apply the Net Proceeds pursuant to Sections 4.10(b)(iii), (iv), (v) or (vi) hereof; provided that such commitment shall be treated as a permitted application of the Net Proceeds from the date of such commitment until the earlier of (x) the date on which such acquisition or expenditure is consummated, and (y) the 180th day following the expiration of the aforementioned 365 day period; or
(viii)any combination of the foregoing;
provided however, that the Issuer shall be permitted, at any time and from time to time following the Issue Date through the date that is three years from the Issue Date, to make one or more elections to apply up to a maximum of $1.0 billion in aggregate (or its equivalent in other currencies) of the Net Proceeds from Asset Sales pursuant to Section 4.10(b)(i) to the redemption, repayment or repurchase of any Pari Passu Indebtedness that is Public Debt without being required to make a Public Debt Offer (any such election, a ''Non-Pro Rata Election''). Following any such Non-Pro Rata Election, any proceeds so applied shall be considered a permitted application of Net Proceeds pursuant to this Senior Notes Indenture.
(c)Pending the final application of any Net Proceeds, the Issuer (or the applicable Restricted Subsidiary) may temporarily reduce revolving credit borrowings or otherwise invest the Net Proceeds in any manner that is not prohibited by this Senior Notes Indenture.
(d)Any Net Proceeds from Asset Sales that are not applied or invested as provided in Section 4.10(b) hereof will constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $100.0 million, within ten Business Days thereof, or at any earlier time at the Issuer's election, the Issuer will make an offer (an “Asset Sale Offer”) to all Holders and may, to the extent the Issuer so elects, make an offer to holders of Pari Passu Indebtedness to purchase, prepay or redeem with the proceeds of sales of assets in accordance with Section 3.10 hereof the maximum principal amount of Senior Notes and such other Pari Passu Indebtedness (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith) that may be purchased, prepaid or redeemed out of the Excess Proceeds. The offer price for the Senior Notes in any Asset Sale Offer will be equal to (i) solely in the case of the Senior Notes, 100% of the principal amount of the applicable series, which shall be repurchased in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part; and (ii) solely in the case of any other Pari Passu Indebtedness, no greater than 100% of the principal amount, plus, in the case of (i) and (ii), accrued and unpaid interest and Additional Amounts, if any, to the date of purchase, prepayment or redemption, subject to the rights of Holders on the relevant record date to receive interest due on the relevant interest payment date, and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Issuer and its Restricted Subsidiaries may use those Excess Proceeds for any purpose not otherwise prohibited by this Senior Notes Indenture. If the aggregate principal amount of Senior Notes and other Pari Passu Indebtedness tendered into (or to be prepaid or redeemed in connection with) such Asset Sale Offer exceeds the amount of Excess Proceeds, or if the aggregate principal amount of Senior Notes tendered pursuant to an Asset Sale Offer that is an application of Net Proceeds pursuant to Section 4.10(b)(i) hereof exceeds the amount of the Net Proceeds so applied, the Trustee or the Registrar, as applicable, will select the Senior Notes and such other Pari Passu Indebtedness, if applicable, to be purchased on a pro rata basis (or in the manner described under Section 3.02 hereof), based on the amounts tendered or required to be prepaid or redeemed in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part.
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Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. Neither the Trustee nor the Registrar shall be liable for any selections made by it in accordance with this Section 4.10.
(e)The Issuer will comply with the requirements of Rule 14e-1 under the U.S. Exchange Act and any other applicable securities laws and regulations to the extent those laws and regulations are applicable in connection with each repurchase of Senior Notes pursuant to a Change of Control Offer, an Asset Sale Offer or a Notes Offer. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control or Asset Sale provisions of this Senior Notes Indenture, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control or Asset Sale provisions of this Senior Notes Indenture by virtue of such compliance.
(f)The Issuer or a Restricted Subsidiary, as the case may be, may make an Asset Sale Offer prior to the expiration of the 365-day period mentioned in this Section 4.10. The provisions of this Senior Notes Indenture relating to the Issuer’s obligation to make an Asset Sale Offer may be waived or modified with the consent of Holders of a majority in outstanding aggregate principal amount of the Senior Notes.
Section 4.11.Transactions with Affiliates. (a) The Issuer will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, enter into or conduct any transaction or series of related transactions (including the purchase, sale, lease or exchange of any property or the rendering of any services) with any Affiliate of the Issuer (any such transaction or series of related transactions being, an “Affiliate Transaction”) involving aggregate value in excess of $40.0 million, unless:
(i)the Affiliate Transaction is on terms that are not materially less favorable to the Issuer or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Issuer or such Restricted Subsidiary with an unrelated Person; and
(ii)with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate value in excess of $50.0 million, a resolution of the Board of Directors of the Issuer set forth in an Officer's Certificate certifying that such Affiliate Transaction complies with this covenant and that such Affiliate Transaction has been approved by a majority of the disinterested members of the Board of Directors of the Issuer, or, if there are not sufficient disinterested members of the Board of Directors of the Issuer to form a majority, by a majority of the Board of Directors.
(b)The following items will not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions of Section 4.11(a) hereof:
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(i)any issuance or sale of Capital Stock, Subordinated Shareholder Debt, options, other equity-related interests or other securities, or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, or entering into, or maintenance of, any employment, consulting, collective bargaining or benefit plan, program, agreement or arrangement, related trust or other similar agreement and other compensation arrangements, options, warrants or other rights to purchase Capital Stock of the Issuer, any Restricted Subsidiary or any Parent Holdco, restricted stock plans, long-term incentive plans, stock appreciation rights plans, participation plans or similar employee benefits or consultants' plans or indemnities provided on behalf of officers, employees, directors or consultants approved or ratified by the Board of Directors of the Issuer;
(ii)transactions between or among the Issuer and/or its Restricted Subsidiaries, or between and among Restricted Subsidiaries and any Receivables Subsidiary;
(iii)any transaction in the ordinary course of business between or among the Issuer or any Restricted Subsidiary and any Affiliate of the Issuer that would constitute an Affiliate Transaction solely because the Issuer or a Restricted Subsidiary owns an equity interest in or otherwise controls such Affiliate;
(iv)payment of reasonable and customary fees and reimbursements of expenses (pursuant to indemnity arrangements or otherwise) of officers, directors, employees or consultants of the Issuer or any of its Restricted Subsidiaries;
(v)the execution, delivery and performance (without duplication of any Permitted Parent Payments) of any Tax Sharing Agreement or any arrangement pursuant to which the Issuer or any of its Restricted Subsidiaries is required or permitted to file a consolidated Tax return, or the formation and maintenance of any consolidated group for Tax, accounting or cash pooling or management purposes in the ordinary course of business;
(vi)any Restricted Payment that is permitted pursuant to Section 4.07 hereof (other than pursuant to Section 4.07(b)(xii)(B)(ii) hereof);
(vii)any Permitted Investment (other than Permitted Investments described in clauses (3), (10) and (16) of the definition thereof);
(viii)(A) issuances or sales of Capital Stock (other than Disqualified Stock or Designated Preference Shares) of the Issuer or options, warrants or other rights to acquire such Capital Stock or Subordinated Shareholder Debt; provided that the interest rate and other financial terms of such Subordinated Shareholder Debt are approved by a majority of the members of the Board of Directors of the Issuer in their reasonable determination and (B) any amendment, waiver or other transaction with respect to any Subordinated Shareholder Debt made in compliance with the other provisions of this Senior Notes Indenture;
(ix)transactions pursuant to, or contemplated by any agreement in effect on the Issue Date and transactions pursuant to any amendment, modification or extension to such agreement, so long as such amendment, modification or extension, taken as a whole, is not materially more disadvantageous to the holders of the Senior Notes than the original agreement as in effect on the Issue Date;
(x)Management Advances and the payment of Management Fees;
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(xi)transactions with customers, clients, suppliers, or purchasers or sellers of goods or services or providers of employees or other labor, in each case in the ordinary course of business and otherwise in compliance with the terms of this Senior Notes Indenture that are fair to the Issuer or the Restricted Subsidiaries, in the reasonable determination of the members of the Board of Directors of the Issuer or the senior management thereof, or are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated Person;
(xii)transactions, agreements or other arrangements with customers, suppliers, contractors, lessors or sellers of goods or services that are negotiated with an Affiliate or any Parent Holdco, in each case, which are otherwise in compliance with the terms of this Senior Notes Indenture; provided that the terms and conditions of any such transaction, agreement or other arrangement as applicable to the Issuer and its Restricted Subsidiaries are fair to the Issuer and its Restricted Subsidiaries and are on terms no less favorable to the Issuer and its Restricted Subsidiaries than those that could have reasonably been obtained in respect of an analogous transaction or agreement that would not constitute an Affiliate Transaction (in each case, as determined in good faith by the Board of Directors of the Issuer);
(xiii)any agreements or other arrangements entered into from time to time with any Parent Holdco that is entered into for the provision of group services, provided that such agreements or arrangements are on terms which are fair to the Issuer or the relevant Restricted Subsidiary in the reasonable determination of the Board of Directors or an Officer of the Issuer or the relevant Restricted Subsidiary;
(xiv)any participation in a rights offer or public tender or exchange offer for publicly-held securities or debt instruments issued by the Issuer or any of its Restricted Subsidiaries that are conducted on arm's-length terms and provide for the same price or exchange ratio, as the case may be, to all holders accepting such rights, tender or exchange offer;
(xv)transactions between the Issuer or any Restricted Subsidiary and any other Person that would constitute an Affiliate Transaction solely because a director of such other Person is also a director of the Issuer or any Parent Holdco of the Issuer; provided, however, that such director abstains from voting as a director of the Issuer or such Parent Holdco, as the case may be, on any matter including such other Person; and
(xvi)any transaction effected as part of a Qualified Receivables Financing.
Section 4.12.Liens. The Issuer will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or otherwise cause or suffer to exist or become effective any Lien (an “Initial Lien”) of any kind securing Indebtedness upon any of their property or assets, now owned or hereafter acquired, except (a) Permitted Liens; or (b) if such Lien is not a Permitted Lien, to the extent that all Obligations due under this Senior Notes Indenture, the Senior Notes and the Note Guarantees are, in each case, secured on an equal and ratable basis or on a priority basis with the Obligations secured by the Initial Lien (and on a priority basis if such Obligations secured by the Initial Lien are subordinated in right of payment to either the Senior Notes or any Note Guarantee). With respect to any Lien securing Indebtedness that was permitted to secure such Indebtedness at the time of the incurrence of such Indebtedness, such Lien shall also be permitted to secure any Increased Amount of such Indebtedness.
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The “Increased Amount” of any Indebtedness shall mean any increase in the amount of such Indebtedness in connection with any accrual of interest, the accretion of accreted value, the amortization of original issue discount, the payment of interest in the form of additional Indebtedness with the same terms, accretion of original issue discount or liquidation preference and increases in the amount of Indebtedness outstanding solely as a result of fluctuations in the exchange rate of currencies or increases in the value of property securing such Indebtedness.
Section 4.13.Offer to Repurchase upon Change of Control. (a) Upon the occurrence of a Change of Control, the Issuer will make an offer (a “Change of Control Offer”) to each Holder to repurchase all or any part (in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part) of that Holder's Senior Notes pursuant to a Change of Control Offer on the terms set forth in this Senior Notes Indenture. In the Change of Control Offer, the Issuer will offer a payment in cash equal to 101% of the aggregate principal amount of Senior Notes repurchased, plus accrued and unpaid interest and Additional Amounts, if any, on the Senior Notes repurchased to the date of purchase (the “Change of Control Payment”), subject to the rights of Holders on the relevant record date to receive interest due on the relevant interest payment date. Within 30 days following any Change of Control, the Issuer will mail a notice to each Holder, with a copy to the Trustee, at such Holder's registered address or otherwise deliver a notice in accordance with the procedures of Section 3.03 and Section 12.01 hereof, stating that a Change of Control Offer is being made and offering to repurchase Senior Notes of the applicable series on the date (the “Change of Control Payment Date”) specified in the notice:
(i)that the Change of Control Offer is being made pursuant to this Section 4.13 and that all Senior Notes tendered will be accepted for payment;
(ii)the purchase price and the Change of Control Payment Date, which shall be no earlier than 30 days and no later than 60 days from the date such notice is mailed or delivered;
(iii)that any Senior Note not tendered will continue to accrue interest;
(iv)that, unless the Issuer defaults in the payment of the Change of Control Payment, all Senior Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest after the Change of Control Payment Date;
(v)that Holders electing to have any Senior Notes purchased pursuant to a Change of Control Offer will be required to surrender the Senior Notes, with the form entitled “Option of Holder to Elect Purchase” attached to the Senior Notes completed, or transfer by book-entry transfer, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date;
(vi)that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the second Business Day preceding the Change of Control Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of Senior Notes delivered for purchase, and a statement that such Holder is withdrawing his election to have the Senior Notes purchased; and
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(vii)that Holders whose Senior Notes are being purchased only in part will be issued new Senior Notes equal in principal amount to the unpurchased portion of the Senior Notes surrendered, which unpurchased portion must be equal to $200,000 in principal amount or an integral multiple of $1,000 in excess thereof.
(b)The Issuer will comply with the requirements of Rule 14e-1 under the U.S. Exchange Act and any other applicable securities laws and regulations to the extent those laws and regulations are applicable in connection with the repurchase of the Senior Notes as a result of a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control provisions of this Senior Notes Indenture, the Issuer will comply with any applicable securities laws and regulations and will not be deemed to have breached its obligations under this Senior Notes Indenture by virtue of such compliance.
(c)On the Change of Control Payment Date, the Issuer will, to the extent lawful:
(i)accept for payment all Senior Notes or portions of Senior Notes properly tendered pursuant to the Change of Control Offer;
(ii)deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Senior Notes or portions of Senior Notes properly tendered and not withdrawn; and
(iii)deliver or cause to be delivered to the Trustee the Senior Notes properly accepted together with an Officer's Certificate stating the aggregate principal amount of Senior Notes or portions of Senior Notes being purchased by the Issuer.
The Paying Agent will promptly mail (or cause to be delivered) to each Holder properly tendered and not withdrawn the Change of Control Payment for such Senior Notes, and the Trustee (or an authentication agent approved by it, upon receipt of an authentication order from the Issuer) will promptly authenticate and mail (or cause to be transferred by book-entry) to each Holder a new Senior Note equal in principal amount to any unpurchased portion of the Senior Notes surrendered, if any. The Issuer will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.
The provisions of this Section 4.13 that require the Issuer to make a Change of Control Offer following a Change of Control will be applicable whether or not any other provisions of this Senior Notes Indenture are applicable.
(d)Notwithstanding anything to the contrary in this Section 4.13, the Issuer will not be required to make a Change of Control Offer upon a Change of Control if (1) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Senior Notes Indenture applicable to a Change of Control Offer made by the Issuer and purchases all Senior Notes properly tendered and not withdrawn under the Change of Control Offer, or (2) an unconditional notice of redemption has been given pursuant to Section 3.07 hereof or all conditions to redemption under Section 3.07 hereof have been satisfied or waived, unless and until there is a default in payment of the applicable redemption price.
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Notwithstanding anything to the contrary contained in this Section 4.13, a Change of Control Offer may be made in advance of a Change of Control, conditioned upon the consummation of such Change of Control, provided a definitive agreement is in place for the Change of Control at the time the Change of Control Offer is made.
(e)The provisions of this Senior Notes Indenture relating to the Issuer's obligation to make an offer to repurchase the Senior Notes as a result of a Change of Control may be waived or modified with the written consent of Holders of a majority in outstanding aggregate principal amount of the Senior Notes of such series.
(f)If and for so long as the Senior Notes of the relevant series are listed on the Official List of the Exchange and the rules of the Exchange so require, the Issuer will publish notices relating to the Change of Control Offer to the extent and in the manner permitted by such rules.
Section 4.14.Additional Guarantees. (a) The Issuer will not cause or permit any of its Restricted Subsidiaries that is not a Guarantor, directly or indirectly, to guarantee the payment of, assume or in any manner become liable with respect to any other Indebtedness of the Issuer or a Guarantor incurred under Credit Facilities in excess of the greater of $40.0 million and 0.8% of the Total Assets of the Issuer or that constitutes Public Debt unless such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture or supplemental guarantee agreement providing for the guarantee of the payment of the Senior Notes by such Restricted Subsidiary, which Note Guarantee will be senior to or pari passu with such Restricted Subsidiary's guarantee of such other Indebtedness.
(b)Notwithstanding Section 4.14(a) hereof:
(i)the Note Guarantee by such Restricted Subsidiary may be limited in amount to the extent such Note Guarantee may reasonably be expected to give rise to or result in (a) any breach or violation of statutory limitations, corporate benefit, financial assistance, fraudulent preference, thin capitalization rules, capital maintenance rules, guidance and coordination rules or the laws rules or regulations (or analogous restriction) of any applicable jurisdiction; (b) any risk or liability for the officers, directors or (except in the case of a Restricted Subsidiary that is a partnership) shareholders of such Restricted Subsidiary (or, in the case of a Restricted Subsidiary that is a partnership, directors or shareholders of the partners of such partnership); or (c) any material cost, expense, liability or obligation (including with respect to any Taxes but excluding any obligation under the Note Guarantee itself) that cannot be avoided by reasonable measures available to the Issuer other than reasonable out of pocket expenses (but, in such a case each of the Issuer and the Restricted Subsidiaries will use their reasonable best efforts to overcome the relevant legal limit and will procure that the relevant Restricted Subsidiary undertakes all whitewash or similar procedures which are legally available to eliminate the relevant limit);
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(ii)for so long as it is not permissible under applicable law or regulation for a Restricted Subsidiary to become a Guarantor, such Restricted Subsidiary need not become a Guarantor (but, in such a case, each of the Issuer and the Restricted Subsidiaries will use their reasonable best efforts to overcome the relevant legal prohibition precluding the giving of the guarantee and will procure that the relevant Restricted Subsidiary undertakes all whitewash or similar procedures which are legally available to eliminate the relevant legal prohibition, and shall give such guarantee at such time (and to the extent) that it thereafter becomes permissible); and
(iii)This Section 4.14 shall not be applicable to any guarantees by any Restricted Subsidiary:
(A)that existed at the time such Person became a Restricted Subsidiary if the guarantee was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary (or any Permitted Refinancing thereof);
(B)given to a bank or trust company having, at the time such guarantee was given, combined capital and surplus and undivided profits of not less than $500.0 million and whose debt has a rating of at least “A” or the equivalent thereof by S&P and at least “A2” or the equivalent thereof by Moody's in connection with the operation of cash management programs established for the Issuer’s benefit or that of any Restricted Subsidiary; or
(C)in respect of any Priority Debt.
(c)Any guarantee of the payment of the Senior Notes to be provided pursuant to this Section 4.14 (or otherwise provided following the Issue Date at the Issuer's option or as may be required under this Senior Notes Indenture) may, in the Issuer's sole discretion, be provided by way of a supplemental guarantee agreement or supplemental indenture without effect on its enforceability or status.
Section 4.15.[Reserved].
Section 4.16.Designation of Restricted and Unrestricted Subsidiaries. The Board of Directors of the Issuer may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause a Default. If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Issuer and its Restricted Subsidiaries in the Subsidiary designated as an Unrestricted Subsidiary will be deemed to be an Investment made as of the time of the designation and will reduce the amount available for Restricted Payments under Section 4.07 hereof or under one or more clauses of the definition of Permitted Investments, as determined by the Issuer. That designation will only be permitted if the Investment would be permitted at that time and if the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
Any designation of a Subsidiary of the Issuer as an Unrestricted Subsidiary will be evidenced to the Trustee by filing with the Trustee a copy of a resolution of the Issuer’s Board of Directors giving effect to such designation and an Officer's Certificate certifying that such designation complies with the preceding conditions and was permitted by Section 4.07 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Senior Notes Indenture and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary as of such date and, if such Indebtedness is not permitted to be incurred as of such date under Section 4.09 hereof, the Issuer will be in default of such covenant.
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The Board of Directors of the Issuer may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such designation will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of any outstanding Indebtedness of such Unrestricted Subsidiary, and such designation will only be permitted if (a) such Indebtedness is permitted under Section 4.09 hereof, calculated on a pro forma basis as if such designation had occurred at the beginning of the applicable reference period; and (b) no Default or Event of Default would be in existence following such designation.
Section 4.17.Maintenance of Listing. The Issuer will use its commercially reasonable efforts to list and to maintain the “listing” (as defined under section 1005 of the UK Income Tax Act 2007 (the ''ITA 07'')) of the Senior Notes of each series on the Exchange for so long as such Notes of the relevant series are outstanding; provided that if the Issuer is unable to obtain the listing of the relevant series of Notes on the Exchange or if at any time the Issuer determines that it will not so list or maintain such listing, it will use its commercially reasonable efforts to obtain and maintain a listing of such Senior Notes on another “recognised stock exchange” (also as defined under section 1005 of the ITA 07), in which case, references in this Section 4.17 to the Exchange will be deemed to refer to such other “recognised stock exchange.”
Section 4.18.Additional Amounts. (a) All payments made by or on behalf of the Issuer under or with respect to the Senior Notes (whether or not in the form of Definitive Registered Notes) or any of the Guarantors with respect to any Note Guarantee will be made free and clear of and without withholding or deduction for, or on account of, any Taxes except to the extent the withholding or deduction of such Taxes is then required by law (in which case the Issuer or the relevant Guarantor will make all withholdings and deductions then required by law). If any deduction or withholding for, or on account of, any Taxes imposed or levied by or on behalf of (1) any jurisdiction in which the Issuer or any Guarantor is then incorporated, organized, engaged in business for tax purposes or otherwise resident for tax purposes or any political subdivision thereof or therein (including, for the avoidance of doubt, the United Kingdom as at Issue Date) or (2) any jurisdiction from or through which payment is made by or on behalf of the Issuer or any Guarantor (including the jurisdiction of any Paying Agent) or any political subdivision thereof or therein (each, a “Tax Jurisdiction”) will at any time be required to be made (other than United States “backup” withholding) from any payments made by or on behalf of the Issuer under or with respect to the Senior Notes or any Guarantor under or with respect to any Note Guarantee, including repayments of principal, and any payment of interest or premium, the Issuer or the relevant Guarantor, as applicable, will pay such additional amounts (the “Additional Amounts”) as may be necessary in order that the net amounts received by each Holder in respect of such payments after such withholding or deduction (including any such withholding or deduction from such Additional Amounts) will equal the respective amounts that would have been received in respect of such payments in the absence of such withholding or deduction; provided, however, that no Additional Amounts will be payable with respect to:
(i)any Taxes, to the extent such Taxes would not have been imposed but for the existence of any actual or deemed (pursuant to applicable Tax law of the relevant Tax Jurisdiction, such as, if applicable, but not limited to, a connection of an estate, nominee, trust, partnership, limited liability company or corporation that is attributed to the fiduciary, settlor, beneficiary, member or shareholder, as applicable) present or former connection between the Holder or the beneficial owner of the Senior Notes and the relevant Tax Jurisdiction (including being a resident of such jurisdiction for Tax purposes or being or having been engaged in a trade or business therein), other than connections arising from the holding of such Senior Note, the enforcement of rights under such Senior Note or under a Note Guarantee or the receipt of any payments in respect of such Senior Note or a Note Guarantee;
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(ii)any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Senior Note for payment (where Senior Notes are in the form of Definitive Registered Notes and presentation is required) more than 30 days after the relevant payment is first made available for payment to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had the Senior Note been presented on the last day of such 30 day period);
(iii)any estate, inheritance, gift, sales, personal property, transfer or similar Taxes;
(iv)any Taxes payable other than by deduction or withholding from payments under, or with respect to, the Senior Notes or with respect to any Note Guarantee;
(v)any Taxes imposed in connection with a Senior Note presented for payment (where presentation is required for payment) by or on behalf of the Holder or beneficial owner who would have been able to avoid such Tax by presenting the relevant Senior Note to, or otherwise accepting payment from, another Paying Agent in the United Kingdom or any member state of the European Union;
(vi)any Taxes, to the extent such Taxes were imposed or withheld by reason of the failure of the Holder or beneficial owner of Senior Notes to comply with any reasonable written request of the Issuer or any Guarantor addressed to the Holder or beneficial owner, as applicable, (and made at a time that would enable the Holder or beneficial owner acting reasonably to comply with that request and, in any event, providing at least 30 calendar days' notice) to satisfy any certification, identification, information or other reporting requirements, whether required by statute, treaty, regulation or administrative practice of a Tax Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, Taxes imposed by the Tax Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Tax Jurisdiction), but in each case, only to the extent the Holder or beneficial owner is legally entitled to provide such certification or documentation;
(vii)any Taxes imposed on or with respect to any payment by the Issuer or the relevant Guarantor to the Holder if such Holder is a fiduciary or partnership or person other than the sole beneficial owner of such payment to the extent that Taxes would not have been imposed on such payment had such Holder been the sole beneficial owner of such Senior Note;
(viii)any Taxes, to the extent such Taxes were imposed or withheld pursuant to Section 1471(b) of the Code, or otherwise imposed or withheld pursuant to Sections 1471 through 1474 of the Code, any regulations or agreements thereunder, official interpretations thereof, or any law implementing an intergovernmental agreement between a non-U.S. jurisdiction and the United States with respect to the foregoing;
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(ix)any Taxes imposed pursuant to the Dutch Withholding Tax Act 2021 (Wet bronbelasting 2021) as published in the Official Gazette (Staatsblad) Stb. 2019, 513 of 27 December 2019 (for the avoidance of doubt, any changes to the yearly updated Dutch Regulation on low-taxing states and non-cooperative jurisdictions for tax purposes (Regeling laagbelastende staten en niet-coöperatieve rechtsgebieden voor belastingdoeleinden) are considered to be part of the Dutch Withholding Tax Act 2021 as published in the Official Gazette Stb. 2019, 513 of 27 December 2019); or
(x)any combination of items from Sections 4.18(a)(i) through (ix) above.
(b)In addition to the foregoing, the Issuer and the Guarantors will also pay and indemnify the Holder for any stamp, issue, registration or documentary Taxes (including penalties and interest related thereto other than those arising due to the delay or default of the Holder) which are levied by any Tax Jurisdiction on the execution, delivery, issuance, or registration of any of the Senior Notes, this Senior Notes Indenture or any Guarantee Agreement or Note Guarantee on the enforcement of any of the Senior Notes or any Note Guarantee (for the avoidance of doubt, other than any such Taxes, penalties or interest arising on or in connection with a transfer of the Senior Notes or any further dealings in the Notes following issuance).
(c)If the Issuer or any Guarantor, as the case may be, becomes aware that it will be obligated to pay Additional Amounts with respect to any payment under or with respect to the Senior Notes or any Note Guarantee, each of the Issuer or the relevant Guarantor, as the case may be, will deliver to the Trustee on a date that is at least 30 days prior to the date of that payment (unless the obligation to pay Additional Amounts arises less than 45 days prior to that payment date, in which case the Issuer or the relevant Guarantor shall notify the Trustee promptly thereafter) an Officer's Certificate stating the fact that Additional Amounts will be payable and the amount estimated to be so payable. The Officer's Certificate(s) must also set forth any other information necessary to enable the Paying Agent to pay such Additional Amounts to Holders on the relevant payment date. The Issuer and the relevant Guarantor will provide the Trustee with documentation satisfactory to the Trustee evidencing the payment of Additional Amounts. The Trustee shall be entitled to rely solely on such Officer's Certificate as conclusive proof that such payments are necessary without further inquiry, investigation, independent verification or liability of any kind.
(d)The Issuer or the relevant Guarantor will remit the full amount deducted or withheld to the relevant Tax authority in accordance with applicable law. The Issuer or the relevant Guarantor will use its reasonable efforts to obtain Tax receipts from each Tax authority evidencing the payment of any Taxes so deducted or withheld. In discharging any deduction and remittance obligation, any Nigerian Guarantors will be required to issue Tax receipts for the Tax so deducted prescribed in the applicable regulations. The Issuer or the relevant Guarantor (not being a Nigerian Guarantor) will furnish to the Trustee, within a reasonable time after the date the payment of any Taxes so deducted or withheld is made, certified copies of Tax receipts evidencing payment by the Issuer or a Guarantor, as the case may be, or if, notwithstanding such entity's efforts to obtain receipts, receipts are not obtained, other evidence of payments (reasonably satisfactory to the Trustee) by such entity. In the case of a Nigerian Guarantor, it will be sufficient if the Trustee is furnished with evidence of the Tax receipts issued by the Nigerian Guarantor in respect of the Tax deducted. Upon reasonable request, copies of Tax receipts or other evidence of payments, as the case may be, will be made available by the Trustee to the Holders and beneficial owners of the Senior Notes.
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(e)Whenever in this Senior Notes Indenture there is mentioned, in any context, the payment of amounts based upon the principal amount of the Senior Notes or of principal, interest or of any other amount payable under, or with respect to, any of the Senior Notes or any Note Guarantee, such mention shall be deemed to include mention of the payment of Additional Amounts to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof in accordance with this Section 4.18.
(f)The obligations in this Section 4.18 will survive any termination, defeasance or discharge of this Senior Notes Indenture, any transfer by a Holder or beneficial owner of its Senior Notes, and will apply, mutatis mutandis, to any jurisdiction in which any successor Person to the Issuer or any Guarantor is incorporated, organized, engaged in business for tax purposes, or otherwise resident for tax purposes or any jurisdiction from or through which such Person makes any payment on the Senior Notes (or any Note Guarantee) and any department or political subdivision thereof or therein.
Section 4.19.Suspension of Certain Covenants when Senior Notes Rated Investment Grade.
(a)If on any date following the Issue Date:
(i)the Senior Notes have achieved Investment Grade Status; and
(ii)no Default or Event of Default shall have occurred and be continuing on such date,
then, beginning on that day and continuing until such time, if any, at which the Senior Notes cease to have Investment Grade Status (such period, the “Suspension Period”), Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.14 and 4.16 and Section 5.01(a)(iv) hereof will no longer be applicable to the Senior Notes and any related default provisions of this Senior Notes Indenture will cease to be effective and will not be applicable to the Issuer and its Restricted Subsidiaries.
(b)The foregoing sections and any related default provisions will again apply according to their terms from the first day on which the Senior Notes cease to have Investment Grade Status. The foregoing sections will not, however, be of any effect with regard to the actions of the Issuer and the Restricted Subsidiaries properly taken during the continuance of the Suspension Period; provided that (1) with respect to the Restricted Payments made after any such reinstatement, the amount of Restricted Payments will be calculated as though Section 4.07 hereof had been in effect prior to, but not during, the Suspension Period and (2) all Indebtedness incurred, or Disqualified Stock or preferred stock issued, during the Suspension Period will be classified to have been incurred or issued pursuant to Section 4.09(b)(ii) hereof. Upon the occurrence of a Suspension Period, the amount of Excess Proceeds shall be reset at zero.
(c)The Issuer shall notify the Trustee in writing that Sections 4.19(a)(i) and 4.19(a)(ii) hereof have been satisfied, provided that such notification shall not be a condition for the suspension of the covenants set forth above to be effective. The Trustee shall not be obliged to notify Holders of such event.
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The Trustee shall have no duty to monitor the ratings of the Senior Notes and shall not be deemed to have any knowledge of the ratings of the Notes and shall have no duty to notify Holders if the Senior Notes achieve Investment Grade Status.
Section 4.20.[Reserved].
Section 4.21.Anti-Layering. Neither the Issuer nor any Guarantor will incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Issuer or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Senior Notes and the applicable Note Guarantee on substantially identical (or more favorable) terms; provided, however, that no Indebtedness will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Issuer or any Guarantor solely (a) by virtue of being unsecured, (b) by virtue of being secured with different collateral, (c) by virtue of being secured on a junior priority basis, (d) by virtue of not being guaranteed or (e) by virtue of the application of waterfall or other payment ordering provisions affecting different tranches of Indebtedness under Credit Facilities.
Section 4.22.Financial Calculations. (a) When determining the availability under any basket or ratio under this Senior Notes Indenture in connection with any transaction or whether such transaction is permitted under this Senior Notes Indenture (including, for the avoidance of doubt and without limitation, testing any incurrence or assumption of Indebtedness or Liens, the making of any Restricted Payment, Permitted Payment or Investment, any Asset Sale, any acquisition, merger, consolidation, amalgamation or other business combination and any other transaction requiring the testing of any basket based on the Consolidated EBITDA of the Issuer), the date of determination of such basket or ratio or the testing of any such transaction and of any Default or Event of Default shall, at the option of the Issuer, be the date the definitive agreements for such transaction are entered into (the “Transaction Commitment Date Election”).
(b)If the Issuer makes a Transaction Commitment Date Election, such baskets or ratios shall be calculated with such pro forma adjustments as are appropriate and consistent with the pro forma provisions set forth in the definition of Consolidated Net Leverage Ratio after giving effect to such transaction and other transactions to be entered into in connection therewith (including any incurrence of Indebtedness and the use of proceeds thereof) as if they had occurred at the beginning of the applicable period for purposes of determining the ability to consummate any such transaction, and, for the avoidance of doubt (x) if any of such baskets or ratios are exceeded as a result of fluctuations in such basket or ratio (including due to fluctuations in the Consolidated Net Income or Consolidated EBITDA of the Issuer or that arises from an asset or a target company subject to such transaction) subsequent to such date of determination and at or prior to the consummation of the relevant transaction, such baskets or ratios will not be deemed to have been exceeded as a result of such fluctuations solely for purposes of determining whether the transaction is permitted hereunder and (y) such baskets or ratios shall not be tested at the time of consummation of such transaction or related transactions.
(c)If the Issuer makes a Transaction Commitment Date Election, any such transactions (including any incurrence of Indebtedness and the use of proceeds therefrom) shall be deemed to have occurred on the date the definitive agreements are entered into for purposes of calculating any baskets or ratios under this Senior Notes Indenture after the date of such agreement and before the consummation of such transaction.
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To the extent the date of determination of a basket or ratio is tested prior to the date of consummation of a transaction, such basket or ratio shall be deemed utilized to the same extent until the earlier of the date of consummation of such transaction or the date such transaction is terminated or expires without consummation, except that, in the case of an acquisition, merger or consolidation, any calculation of Consolidated EBITDA for purposes other than incurrences of Indebtedness or Liens or the making of Restricted Payments (not related to such acquisition, merger or consolidation) shall not reflect such transaction until it has been consummated.
ARTICLE 5
SUCCESSORS
Section 5.01.Merger, Consolidation or Sale of Assets. (a) The Issuer will not (1) consolidate or merge with or into another Person (whether or not it is the surviving corporation) or (2) sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties and assets as an entirety or substantially as an entirety in one or more related transactions, to another Person, unless:
(i)either: (a) the Issuer is the surviving Person; or (b) the Person formed by or surviving any such consolidation or merger (if other than the Issuer) or to which such sale, assignment, transfer, conveyance, lease or other disposition has been made is an entity organized or existing under the laws of an Approved Jurisdiction (other than the Federal Republic of Nigeria);
(ii)the Person formed by or surviving any such consolidation or merger with the Issuer (if other than the Issuer) or the Person to which such sale, assignment, transfer, conveyance, lease or other disposition has been made assumes all the obligations of the Issuer under the Senior Notes and this Senior Notes Indenture pursuant to a supplemental indenture;
(iii)immediately after such transaction, no Default or Event of Default exists;
(iv)the Issuer or the Person formed by or surviving any such consolidation or merger (if other than the Issuer), or to which such sale, assignment, transfer, conveyance, lease or other disposition has been made would, on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable period (A) be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Consolidated Net Leverage Ratio test set forth in Section 4.09(a) hereof or (B) have a Consolidated Net Leverage Ratio not greater than it was immediately prior to giving effect to such transaction; and
(v)the Issuer delivers to the Trustee, in form and substance reasonably satisfactory to the Trustee, an Officer's Certificate and Opinion of Counsel, in each case, stating that such consolidation, merger or transfer and such supplemental indenture comply with this covenant and that all conditions precedent in this Senior Notes Indenture relating to such transaction have been satisfied and that this Senior Notes Indenture and the Senior Notes constitute
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legal, valid and binding obligations of the Issuer, or the Person formed by or surviving any such consolidation or merger (as applicable) enforceable in accordance with their terms.
(b)A Guarantor (other than a Guarantor whose Note Guarantee is to be released in accordance with the terms of the Note Guarantee and Section 10.05 hereof) will not, directly or indirectly: (1) consolidate or merge with or into another Person (whether or not such Guarantor is the surviving corporation) or (2) sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of the properties or assets of such Guarantor and its Subsidiaries that are Restricted Subsidiaries taken as a whole, in one or more related transactions, to another Person, unless:
(i)either:
(A)such Guarantor is the surviving Person; or
(B)the Person formed by or surviving any such consolidation or merger (if other than such Guarantor) or the Person to which such sale, assignment, transfer, conveyance, lease or other disposition has been made assumes all the obligations of such Guarantor under its Note Guarantee, any Guarantee Agreement and this Senior Notes Indenture pursuant to a supplemental indenture or supplemental guarantee agreement;
(ii)immediately after giving pro forma effect to such transaction or transactions (and treating any Indebtedness which becomes an obligation of the surviving corporation as a result of such transaction as having been incurred by the surviving corporation at the time of such transaction or transactions), no Default or Event of Default exists; and
(iii)the Issuer delivers to the Trustee an Officer's Certificate and Opinion of Counsel, in each case, stating that such consolidation, merger or transfer and such supplemental indenture (or supplemental guarantee agreement, as applicable) comply with this covenant and that all conditions precedent in this Senior Notes Indenture relating to such transaction have been satisfied and that this Senior Notes Indenture, any Guarantee Agreement and the Note Guarantee constitute legal, valid and binding obligations of the Guarantor or the Person formed by or surviving any such consolidation and merger (as applicable) enforceable in accordance with their terms. The Trustee shall be entitled to rely conclusively on such Officer's Certificate and Opinion of Counsel without further inquiry, investigation, independent verification or liability of any kind.
(c)[Reserved].
(d)This Section 5.01 will not apply to (i) any consolidation or merger of any Restricted Subsidiary that is not a Guarantor with and into the Issuer or a Guarantor; (ii) any consolidation or merger of any Guarantor with or into the Issuer or any other Guarantor; (iii) any Permitted Reorganization effected in compliance with the definition thereof; or (iv) any Guarantor Redomiciliation; provided that, in the case of Sections 5.01(d)(i) and (ii) hereof, Sections 5.01(a)(ii) and 5.01(a)(v) hereof will be complied with. Sections 5.01(a)(iii), 5.01(a)(iv) and 5.01(b)(ii) hereof will not apply to any merger or consolidation of the Issuer or any Guarantor with or into an Affiliate solely for the purpose of reincorporating the Issuer or such Guarantor in another jurisdiction. This Section 5.01 will not apply to any transaction undertaken in accordance with Section 5.03 hereof.
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Section 5.02.Successor Corporation Substituted. Upon any consolidation or merger, or any sale, assignment, transfer, lease, conveyance or other disposition of all or substantially all of the properties or assets of the Issuer, any Guarantor or their respective Subsidiaries in a transaction that is subject to, and that complies with the provisions of, Section 5.01 hereof, the successor Person formed by such consolidation or into or with which the Issuer or such Guarantor is merged or to which such sale, assignment, transfer, lease, conveyance or other disposition is made shall succeed to, and be substituted for (so that from and after the date of such consolidation, merger, sale, assignment, transfer, lease, conveyance or other disposition, the provisions of this Senior Notes Indenture referring to the “Issuer” or the “Guarantor,” as applicable, shall refer instead to the successor Person and not to the Issuer or such Guarantor), and may exercise every right and power of the Issuer under this Senior Notes Indenture with the same effect as if such successor Person had been named as the Issuer or such Guarantor, as applicable, herein; provided, however, that the predecessor Issuer shall not be relieved from the obligation to pay the principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes except in the case of a sale of all of the Issuer's assets in a transaction that is subject to, and that complies with the provisions of, Section 5.01 hereof.
Section 5.03.Issuer Substitution. (a) The Issuer may be substituted by any entity (the “New Issuer” and any such substitution, the “Substitution”) at any time provided that the following conditions are met:
(i)the New Issuer is organized and existing under the laws of an Approved Issuer Substitution Jurisdiction and pro forma for such substitution, the Issuer (if the New Issuer is a Restricted Subsidiary of the Issuer) or the New Issuer is or will continue to be listed on a ''recognized stock exchange'' (as defined in section 1005 of the ITA 07);
(ii) the New Issuer assumes all the obligations of the Issuer under the Senior Notes and this Senior Notes Indenture pursuant to a supplemental indenture;
(iii)immediately after such transaction, no Default or Event of Default exists;
(iv)the New Issuer would, on the date of such Substitution after giving pro forma effect thereto (including giving pro forma effect to any Subsidiaries of the New Issuer (as defined in Section 5.03(b) hereof) that will become Restricted Subsidiaries from the date of the Substitution) and any related financing transactions as if the same had occurred at the beginning of the applicable period be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Consolidated Net Leverage Ratio test set forth in Section 4.09(a);
(v)effective at same time as the Substitution, the Issuer shall provide a guarantee of the Senior Notes pursuant to a supplemental indenture or supplemental guarantee agreement on a pari passu basis with the existing Note Guarantees;
(vi)on or immediately prior to the date of the Substitution, the corporate family rating of the New Issuer (or the Issuer, if the New Issuer is a Restricted Subsidiary of the Issuer) being equal to, or greater than, the then-prevailing rating for the Senior Notes, according to any two of Moody's, S&P and Fitch; and
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(vii)the Issuer delivers to the Trustee, in form and substance reasonably satisfactory to the Trustee, an Officer's Certificate and Opinion of Counsel, in each case, stating that such Substitution and such supplemental indenture (and/or supplemental guarantee agreement, as applicable) comply with this covenant and that all conditions precedent in this Senior Notes Indenture or a Guarantee Agreement (if applicable) relating to such transaction have been satisfied and that this Senior Notes Indenture, the Senior Notes and the Note Guarantees (including the Note Guarantee provided by the Issuer) constitute legal, valid and binding obligations of the New Issuer and the Guarantors enforceable in accordance with their terms. The Trustee shall be entitled to rely conclusively on such Officer's Certificate and Opinion of Counsel without further inquiry, investigation, independent verification or liability of any kind.
(b)Notwithstanding any other provision or covenant in this Senior Notes Indenture, the Substitution shall be permitted by this Senior Notes Indenture, provided such Substitution complies with the terms of this covenant and following such Substitution, the Trustee will join the Issuer in a supplemental indenture to effect the Substitution in accordance with Section 9.01(a)(iii) hereof and in doing all such things that are required to be done to effect such Substitution in the clearing systems or pursuant to this Senior Notes Indenture without the consent of holders of the Senior Notes. Following such Substitution references to the “Issuer” shall be to the New Issuer in this Senior Notes Indenture and the Senior Notes in all respects (except that the Issuer, if the New Issuer is the Restricted Subsidiary of the Issuer, may continue to act as the top of the “restricted group” for the Senior Notes and consequential changes to effect such change may be made throughout in the supplemental indenture effecting such Substitution), and the New Issuer will succeed to, and be substituted for, and may exercise every right and power of, the Issuer as issuer under this Senior Notes Indenture and the Senior Notes, and upon such Substitution, the Issuer will be released from its obligations as issuer under this Senior Notes Indenture and the Senior Notes. The Subsidiaries of the New Issuer that are not Restricted Subsidiaries of the Issuer will be treated as having become Restricted Subsidiaries from the date of the Substitution for the purposes of this Senior Notes Indenture. A Substitution pursuant to this covenant may only occur once.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01.Events of Default. (a) Each of the following is an “Event of Default”:
(i)default for 30 days in the payment when due of interest or Additional Amounts, if any, with respect to the relevant series of Senior Notes;
(ii)default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the relevant series of Senior Notes;
(iii)failure by the Issuer or relevant Guarantor to comply with the provisions of Section 5.01 and 5.03 hereof;
(iv)failure by the Issuer or relevant Guarantor for 60 days after written notice (i) to the Issuer by the Trustee or (ii) to the Issuer and the Trustee by the Holders of at least 25% in aggregate principal amount of the Senior Notes then outstanding voting as a single class to comply with any of the agreements in this Senior Notes Indenture (other than a default in performance, or breach, or a covenant or agreement which is specifically dealt with in Sections 6.01(a)(i), 6.01(a)(ii) or 6.01(a)(iii) hereof);
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(v)default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Issuer or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Issuer or any of its Restricted Subsidiaries), whether such Indebtedness or guarantee now exists, or is created after the Issue Date, if that default:
(A)is caused by a failure to pay the principal of such Indebtedness following the expiration of the grace period provided in such Indebtedness and such failure to make any payment has not been waived or the maturity of such indebtedness has not been extended (a “Payment Default”); or
(B)results in the acceleration of such Indebtedness prior to its express maturity,
and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $75.0 million or more;
(vi)failure by the Issuer or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary, to pay final judgments entered by a court or courts of competent jurisdiction aggregating in excess of $75.0 million (exclusive of any amounts that a solvent insurance company has acknowledged liability for), which judgments shall not have been discharged or waived and there shall have been a period of 60 consecutive days during which a stay of enforcement of such judgment or order, by reason of an appeal, waiver or otherwise, shall not have been in effect;
(vii)except as permitted by this Senior Notes Indenture (including with respect to any limitations) or a Guarantee Agreement, any Note Guarantee of a Guarantor that is a Significant Subsidiary or any group of Guarantors that, taken together, would constitute a Significant Subsidiary is held in any judicial proceeding to be unenforceable or invalid or ceases for any reason to be in full force and effect, or any Guarantor that is a Significant Subsidiary or any group of Guarantors that, taken together, would constitute a Significant Subsidiary, or any Person acting on behalf of any such Guarantor or Guarantors, denies or disaffirms its obligations under its Note Guarantee;
(viii)the Issuer or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary pursuant to or within the meaning of Bankruptcy Law:
(A)commences a voluntary case under any applicable Bankruptcy Law or any other case to be adjudicated bankrupt or insolvency, or files for or has been granted a moratorium on payment of its debts, or files for bankruptcy or is declared bankrupt;
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(B)consents to the entry of an order for relief against it in an involuntary case or to the commencement of any bankruptcy or insolvency proceedings against it;
(C)consents to the appointment of, or taking possession by, an administrator, custodian, receiver, liquidator, trustee, sequestrator or similar official of it or for all or substantially all of its property;
(D)makes a general assignment for the benefit of its creditors;
(E)admits in writing its inability to pay its debts generally as they become due;
(F)files a petition or answer or consent seeking reorganization for relief (other than a solvent reorganization for purposes of transferring assets among the Issuer and its Restricted Subsidiaries); and
(ix)a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(A)is for relief against the Issuer or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary in an involuntary case;
(B)adjudging the Issuer or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries bankrupt or insolvency, or seeking moratorium, reorganization, arrangement, adjustment or composition of or in respect of the Issuer or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries;
(C)appoints a custodian or administrator of the Issuer or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary or for all or substantially all of the property of the Issuer or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary; or
(D)orders the liquidation of the Issuer or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive days.
Section 6.02.Acceleration. In the case of an Event of Default specified in Sections 6.01(a)(viii) and 6.01(a)(ix) hereof, with respect to the Issuer or any Guarantor that is a Significant Subsidiary or any group of Guarantors that, taken together, would constitute a Significant Subsidiary, all outstanding Senior Notes will become due and payable immediately without further action or notice or other act on the part of the Trustee or any Holders. If any other Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the then outstanding Senior Notes by written notice to the Issuer (and to the Trustee if such notice is given by the Holders) may and the Trustee, upon the written request of such Holders, shall declare all amounts in respect of the Senior Notes to be due and payable immediately.
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In the event of a declaration of acceleration of the Senior Notes because an Event of Default described in Section 6.01(a)(v) hereof has occurred and is continuing, the declaration of acceleration of the Senior Notes shall be automatically annulled if the event of default or payment default triggering such Event of Default pursuant to Section 6.01(a)(v) hereof shall be remedied or cured, or waived by the holders of the Indebtedness, or the Indebtedness that gave rise to such Event of Default shall have been discharged in full, within 30 days after the declaration of acceleration with respect thereto and if (a) the annulment of the acceleration of the Senior Notes would not conflict with any judgment or decree of a court of competent jurisdiction and (b) all existing Events of Default, except non-payment of principal, premium or interest on the Senior Notes that became due solely because of the acceleration of the Senior Notes, have been cured or waived.
Section 6.03.Other Remedies. (a) If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal of, premium on, if any, interest or Additional Amounts, if any, on, the Senior Notes or to enforce the performance of any provision of the Senior Notes or this Senior Notes Indenture.
(b)The Trustee may maintain a proceeding even if it does not possess any of the Senior Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder of a Senior Note in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law.
Section 6.04.Waiver of Past Defaults. The Holders of not less than a majority in aggregate principal amount of the then outstanding Senior Notes by written notice to the Trustee may, on behalf of the Holders of all of the Senior Notes waive any past Default and its consequences hereunder, except a continuing Default in the payment of principal of, premium on, if any, interest or Additional Amounts, if any, on, any Senior Note held by a non-consenting Holder (which may only be waived pursuant to Section 9.02 hereof); provided that the Holders of a majority in aggregate principal amount of the then outstanding Senior Notes may rescind an acceleration and its consequences, including any related payment default that resulted from such acceleration with respect to such Senior Notes and its consequences if rescission would not conflict with any judgment or decree of a court of competent jurisdiction. In connection with any such waiver or rescission, the Issuer shall pay all of the fees and expenses of the Trustee, including those of its agents and counsel. Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Senior Notes Indenture; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.
Section 6.05.Control by Majority. Holders of a majority in aggregate principal amount of the then outstanding Senior Notes may direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee or exercising any trust or power conferred on the Trustee. The Trustee may withhold from Holders notice of any continuing Default or Event of Default if it determines that withholding notice is in their interest, except a Default or Event of Default relating to the payment of principal, interest or Additional Amounts or premium, if any.
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Section 6.06.Limitation on Suits. (a) Subject to the provisions of this Senior Notes Indenture relating to the duties of the Trustee, in case an Event of Default occurs and is continuing of which the Trustee has written notice, the Trustee will be under no obligation to exercise any of the rights or powers under this Senior Notes Indenture at the request or direction of any Holders of Senior Notes unless such Holders have made a written request and offered to the Trustee and the Trustee has received, indemnity and/or security satisfactory to the Trustee against any loss, cost, liability, tax or expense (which includes the expense of the Trustee's legal counsel). Subject to Article 9, except to enforce the right to receive payment of principal, premium, if any, or interest or Additional Amounts when due, no Holder may pursue any remedy with respect to this Senior Notes Indenture or the Senior Notes unless:
(i)such Holder has previously given the Trustee written notice that an Event of Default is continuing;
(ii)Holders of at least 25% in aggregate principal amount of the then outstanding Senior Notes have requested, in writing, that the Trustee pursue the remedy;
(iii)such Holders have offered the Trustee and the Trustee has received security and/or indemnity satisfactory to the Trustee against any loss, cost, liability, tax or expense (which includes the expense of the Trustee's legal counsel);
(iv)the Trustee has not complied with such written request within 60 days after the receipt of the written request and the offer of security and/or indemnity; and
(v)Holders of a majority in aggregate principal amount of the then outstanding Senior Notes have not given the Trustee a direction inconsistent with such request within such 60-day period.
(b)A Holder of a Senior Note may not use this Senior Notes Indenture to prejudice the rights of another Holder of a Senior Note or to obtain a preference or priority over another Holder of a Senior Note. The Trustee shall have no obligation to ascertain whether the actions of a Holder of a Senior Note is unduly prejudicial to the interests of other Holders of the Senior Notes.
Section 6.07.Rights of Holders of Senior Notes to Receive Payment. Notwithstanding any other provision of this Senior Notes Indenture, the right of any Holder of a Senior Note to receive payment of principal of, premium on, if any, interest or Additional Amounts, if any, on, the Senior Note, on or after the respective due dates expressed in the Senior Note (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder other than as provided in Section 9.02 hereof; provided that a Holder shall not have the right to institute any such suit for the enforcement of payment if and to the extent that the institution or prosecution thereof or the entry of judgment therein would, under applicable law, result in the surrender, impairment, waiver or loss of the Lien of this Senior Notes Indenture upon any property subject to such Lien.
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For the avoidance of doubt, no amendment to, or deletion of any of the covenants under Article 4 or Article 5, or action taken in compliance with the covenants in effect at the time of such action, shall be deemed to impair or affect any rights of any Holders to receive payment of principal of or premium, if any, or interests on the Senior Notes or to institute suit for the enforcement of any payment on or with respect to such Holder's Notes.
Section 6.08.Collection Suit by Trustee. If an Event of Default specified in Sections 6.01(a)(i) or 6.01(a)(ii) hereof occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Issuer for the whole amount of principal of, premium on, if any, interest and Additional Amounts, if any, remaining unpaid on, the Senior Notes and interest on overdue principal and, to the extent lawful, Additional Amounts, interest and such further amount as shall be sufficient to cover the costs and expenses of collection, including the compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
Section 6.09.Trustee May File Proofs of Claim. The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders of the Senior Notes allowed in any judicial proceedings relative to the Issuer, a Guarantor or any other obligor upon the Senior Notes, their creditors or property and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.06 hereof. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.06 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Senior Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 6.10.Priorities. If the Trustee collects any money pursuant to this Article 6, it shall pay out the money in the following order:
First: to the Trustee, the Agents and its and their agents and attorneys for amounts due under Section 7.06 hereof, including payment of all compensation, expenses and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection;
Second: to Holders of Senior Notes for amounts due and unpaid on the Senior Notes for principal, premium, if any, interest and Additional Amounts, if any, ratably, without preference or priority of any kind, according to the amounts due and payable on the Senior Notes for principal, premium, if any, interest and Additional Amounts, if any, respectively; and
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Third: to the Issuer, any Guarantor or to such party as a court of competent jurisdiction shall direct.
The Issuer shall provide the Trustee with any additional information in its possession necessary for the Trustee to make the payments mentioned above, upon a reasonable request.
The Trustee may fix a record date and payment date for any payment to Holders of Senior Notes pursuant to this Section 6.10.
Section 6.11.Undertaking for Costs. In any suit for the enforcement of any right or remedy under this Senior Notes Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defences made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder of a Senior Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in aggregate principal amount of the then outstanding Senior Notes.
Section 6.12.Restoration of Rights and Remedies. If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Senior Notes Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined in a final judgment adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Issuer, any Guarantor, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.
Section 6.13.Rights and Remedies Cumulative. Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes in Section 2.07 hereof, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.
Section 6.14.Delay or Omission Not Waiver. No delay or omission of the Trustee or any Holder of any Senior Note to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article 6 or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.
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ARTICLE 7
TRUSTEE
Section 7.01.Duties of Trustee. (a) If an Event of Default has occurred and is continuing, of which the Trustee has actual knowledge, the Trustee will exercise such of the rights and powers vested in it by this Senior Notes Indenture, and use the same degree of care and skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs. The Trustee may refuse to follow any direction that conflicts with law or this Senior Notes Indenture or the Senior Notes or would involve the Trustee in personal liability or could be unduly prejudicial to the rights of the other holders; provided, however, that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction. Prior to taking any action under this Senior Notes Indenture, the Trustee will be entitled to the indemnification and/or security as provided in this Article 7 against all fees, losses, liabilities and expenses caused by taking or not taking such action (other than those arising as a result of gross negligence or willful misconduct by the Trustee) satisfactory to the Trustee in its sole discretion.
(b)Except during the continuance of an Event of Default:
(i)the duties of the Trustee and the Agents will be determined solely by the express provisions of this Senior Notes Indenture and the Trustee and the Agents need perform only those duties that are specifically set forth in this Senior Notes Indenture and no others, and no implied covenants or obligations shall be read into this Senior Notes Indenture against the Trustee or the Agents; and
(ii)in the absence of wilful misconduct, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or Opinions of Counsel furnished to the Trustee and conforming to the requirements of this Senior Notes Indenture. However, the Trustee will examine the certificates or Opinions of Counsel which by any provision hereof are specifically required to be furnished to the Trustee to determine whether or not such certificates or Opinions of Counsel conform to the requirements of this Senior Notes Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).
(c)The Trustee may not be relieved from liabilities for its own grossly negligent action, its own grossly negligent failure to act, or its own wilful misconduct, except that:
(i)this Section 7.01(c) does not limit the effect of Section 7.01(b) hereof;
(ii)the Trustee will not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was grossly negligent in ascertaining the pertinent facts; and
(iii)the Trustee will not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Sections 6.02, 6.04 or 6.05 hereof.
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(d)Whether or not therein expressly so provided, every provision of this Senior Notes Indenture that in any way relates to the Trustee is subject to Section 7.01(a), (b) and (c) hereof.
(e)No provision of this Senior Notes Indenture will require the Trustee to expend or risk its own funds or incur any liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, including in taking any action at the request of Holders. The Trustee will be under no obligation to exercise any of its rights and powers under this Senior Notes Indenture at the request of any Holders, unless such Holder has offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense (which includes the expense of the Trustee’s legal counsel).
(f)The Trustee will not be liable for interest on any money received by it except as the Trustee may agree in writing with the Issuer. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law and funds held by the Trustee will not be subject to the United Kingdom FCA Client Money Rules.
(g)The Trustee shall not be deemed to have notice or any knowledge of any matter (including without limitation Defaults or Events of Default) unless a Responsible Officer assigned to and working in the Trustee's corporate trust and agency department has actual knowledge thereof or unless written notice thereof is received by the Trustee (attention: Agency & Trust) and such notice clearly references the Senior Notes, the Issuer or this Senior Notes Indenture.
Notwithstanding anything else herein contained, the Trustee and each Agent may refrain from doing anything that would or might in its opinion based upon legal advice in the relevant jurisdiction be contrary to any law of any state or jurisdiction (including but not limited to the United States of America or any jurisdiction forming a part of it and England & Wales) or any directive or regulation of any agency of any such state or jurisdiction and may do anything which is, in its opinion, necessary to comply with any such law, directive or regulation.
Section 7.02.Rights of Trustee. (a) The Trustee may conclusively rely, and shall be protected in acting or refraining from acting, upon any document (whether in its original, electronic or facsimile form) believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in such document. The Trustee may, if it sees fit, make such inquiry. The Trustee may refrain, without liability, from acting in accordance with any instruction if, in its sole discretion, the Trustee determines that such instruction is equivocal or unclear or if it is to so refrain in order to comply with applicable law.
(b)Before the Trustee acts or refrains from acting, it may require an Officer's Certificate or an Opinion of Counsel or both. The Trustee will not be liable for any action it takes or omits to take in good faith in reliance on such Officer's Certificate or Opinion of Counsel, as the case may be. The Trustee may consult with counsel or other professional advisors and the written advice of such counsel, professional advisor or any Opinion of Counsel will be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.
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(c)The Trustee may act through its attorneys and agents and will not be responsible for the misconduct or negligence of any agent appointed with due care.
(d)The Trustee will not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this Senior Notes Indenture.
(e)Unless otherwise specifically provided in this Senior Notes Indenture, any demand, request, direction or notice from the Issuer, will be sufficient if signed by an Officer of the Issuer.
(f)The Trustee will be under no obligation to exercise any of the rights or powers vested in it by this Senior Notes Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee indemnity and/or security satisfactory to it against the losses, costs, liabilities, taxes and expenses (which include the expenses of the Trustee's legal counsel) that might be incurred by it in compliance with such request or direction.
(g)The Trustee shall have no duty to inquire as to the performance of the covenants of the Issuer and/or its Restricted Subsidiaries. In addition, the Trustee shall not be deemed to have knowledge of any Default or Event of Default except: (i) any Event of Default occurring pursuant to Section 6.01(a)(i) or Section 6.01(a)(ii) hereof (provided it is acting as Paying Agent); and (ii) any Default or Event of Default of which a Responsible Officer shall have received written notification. Delivery of reports, information and documents to the Trustee under Section 4.03 hereof is for informational purposes only and the Trustee's receipt of the foregoing shall not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Issuer's compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer's Certificates).
(h)The Trustee shall not have any obligation or duty to monitor, determine or inquire as to compliance, and shall not be responsible or liable for compliance with restrictions on transfer, exchange, redemption, purchase or repurchase, as applicable, of minimum denominations imposed under this Senior Notes Indenture or under applicable law or regulation with respect to any transfer, exchange, redemption, purchase or repurchase, as applicable, of any interest in any Senior Notes.
(i)The rights, privileges, indemnities, protections, immunities and benefits given to the Trustee, including its right to be indemnified and/or secured, are extended to, and shall be enforceable by the Trustee in each of its capacities hereunder and by each agent (including the Agents), custodian and other person employed to act hereunder. Absent wilful misconduct or gross negligence, each Paying Agent, Registrar and Transfer Agent shall not be liable for acting in good faith on instructions believed by it to be genuine and from the proper party.
(j)In the event the Trustee receives inconsistent or conflicting requests and indemnity from two or more groups of Holders, each representing less than a majority in aggregate principal amount of the Senior Notes then outstanding, pursuant to the provisions of this Senior Notes Indenture, the Trustee, in its sole discretion, may determine what action, if any, will be taken and shall not incur any liability for its failure to act until such inconsistency or conflict is, in its reasonable opinion, resolved.
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(k)In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by acts of war or terrorism involving the United States, the United Kingdom or any member state of the European Monetary Union or any other national or international calamity or emergency (including natural disasters or acts of God), it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.
(l)The Trustee is not required to give any bond or surety with respect to the performance or its duties or the exercise of its powers under this Senior Notes Indenture or the Senior Notes.
(m)The permissive right of the Trustee to take the actions permitted by this Senior Notes Indenture shall not be construed as an obligation or duty to do so.
(n)The Trustee will not be liable to any person if prevented or delayed in performing any of its obligations or discretionary functions under this Senior Notes Indenture by reason of any present or future law applicable to it, by any governmental or regulatory authority or by any circumstances beyond its control.
(o)The Trustee shall not under any circumstances be liable for any special, punitive, indirect, incidental or consequential loss or damage whatsoever (being loss of business, goodwill, opportunity or profit of any kind) of the Issuer, any Restricted Subsidiary of the Issuer or any other Person (or, in each case, any successor thereto), even if advised of it in advance and even if foreseeable.
(p)The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Issuer personally or by agent or attorney at the sole cost of the Issuer and the Trustee shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.
(q)The Trustee may request that the Issuer delivers an Officer's Certificate setting forth the names of the individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Senior Notes Indenture, which Officer's Certificate may be signed by any person authorized to sign an Officer's Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.
(r)No provision of this Senior Notes Indenture shall require the Trustee to do anything which, in its opinion, may be illegal or contrary to applicable law or regulation.
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(s)The Trustee may refrain from taking any action in any jurisdiction if the taking of such action in that jurisdiction would, in its opinion, based upon legal advice in the relevant jurisdiction, be contrary to any law of that jurisdiction or, to the extent applicable, the State of New York.
(t)The Trustee may retain professional advisors to assist it in performing its duties under this Senior Notes Indenture. The Trustee may consult with such professional advisors or with counsel, and the advice or opinion of such professional advisors or counsel with respect to legal or other matters relating to this Senior Notes Indenture and the Senior Notes shall be full and complete authorization and protection from liability in respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.
(u)The Trustee may assume without inquiry in the absence of actual knowledge that the Issuer is duly complying with its obligations contained in this Senior Notes Indenture required to be performed and observed by it, and that no Default or Event of Default or other event which would require repayment of the Senior Notes has occurred.
Section 7.03.Individual Rights of Trustee. The Trustee in its individual or any other capacity may become the owner or pledgee of Senior Notes and may otherwise deal with the Issuer or any Affiliate of the Issuer with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days or resign. Any Agent may do the same with like rights and duties. The Trustee is also subject to Sections 7.09 and 7.10 hereof.
Section 7.04.Trustee's Disclaimer. The Trustee will not be responsible for and makes no representation as to the validity or adequacy of this Senior Notes Indenture, the Senior Notes, or any Note Guarantee, it shall not be accountable for the Issuer's use of the proceeds from the Senior Notes or any money paid to the Issuer or upon the Issuer's direction under any provision of this Senior Notes Indenture, it will not be responsible for the use or application of any money received by any Paying Agent, and it will not be responsible for any statement or recital herein or any statement in the Senior Notes or any other document in connection with the sale of the Senior Notes or pursuant to this Senior Notes Indenture other than its certificate of authentication.
Section 7.05.Notice of Defaults. If a Default or Event of Default occurs and is continuing and if it is known to the Trustee, the Trustee will mail to Holders of Senior Notes a notice of the Default or Event of Default within 90 days after it occurs. The Trustee may withhold from the Holders notice of any continuing Default or Event of Default, if it determines that withholding notice is in their interest, except a Default or Event of Default relating to the payment of principal, interest or Additional Amounts or premium, if any.
Section 7.06.Compensation and Indemnity. (a) The Issuer or, upon the failure of the Issuer to pay, each Guarantor, jointly and severally, will pay to the Trustee and Agents from time to time compensation for its acceptance of this Senior Notes Indenture and services hereunder as shall be agreed from time to time between them. The Trustee's compensation will not be limited by any law on compensation of a trustee of an express trust. The Issuer, and each Guarantor, jointly and severally, will reimburse the Trustee promptly upon request for all disbursements, advances and expenses properly incurred or made by it in addition to the compensation for its services. Such expenses will include the properly incurred compensation, disbursements and expenses of the Trustee's agents and counsel.
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In the event of the occurrence of an Event of Default or potential Event of Default or the Trustee considering it expedient or necessary or being requested by the Issuer to undertake duties which the Trustee reasonably determines to be of an exceptional nature or otherwise outside the scope of the normal duties of the Trustee under this Senior Notes Indenture, the Issuer or, failing whom, the Guarantors shall pay to the Trustee such additional remuneration as shall be agreed between them.
(b)The Issuer and the Guarantors, jointly and severally, will indemnify the Trustee and its officers, directors, employees and the Agents against any and all losses, liabilities, damages, claims, taxes, costs or expenses (including attorneys' fees and expenses) incurred by it arising out of or in connection with the acceptance or administration of its duties under this Senior Notes Indenture, including the costs and expenses of enforcing this Senior Notes Indenture or any Guarantee Agreement against the Issuer and the Guarantors (including this Section 7.06) and defending itself against any claim (whether asserted by the Issuer, the Guarantors, any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder, except to the extent any such loss, liability or expense may be attributable to the Trustee's gross negligence, willful misconduct or fraud. These expenses shall include any costs or charges incurred by the relevant Agent in carrying out instructions to clear and/or settle transfers of securities under this Senior Notes Indenture (including cash penalty charges that may be incurred under Article 7 of the Central Securities Depositaries Regulation (EU) No 909/2014 if a settlement fail occurs due to the Issuer’s failure to deliver any required securities or cash or other action or omission). The Trustee shall notify the Issuer promptly of any third-party claim for which it may seek indemnity of which it has received written notice. Failure by the Trustee to so notify the Issuer shall not relieve the Issuer of its obligations hereunder. The Issuer shall defend the claim, with counsel satisfactory to the Trustee, and the Trustee shall provide reasonable cooperation at the Issuer's expense in the defense; provided that if the defendants in any such claim include both the Issuer and the Trustee and the Trustee shall have concluded that there may be legal defenses available to it which are different from or additional to those available to the Issuer, or the Trustee has concluded that there may be any other actual or potential conflicting interests between the Issuer and the Trustee, the Trustee shall have the right to select separate counsel and the Issuer shall be required to pay the fees and expenses of such separate counsel. Any settlement which affects the Trustee may not be entered into without the written consent of the Trustee, unless the Trustee is given a full and unconditional release from liability with respect to the claims covered thereby and such settlement does not include a statement or admission of fault, culpability or failure to act by or on behalf of the Trustee. Neither the Issuer nor any Guarantor need pay for any settlement made without its consent, which consent will not be unreasonably withheld.
(c)The obligations of the Issuer and the Guarantors under this Section 7.06 will survive the resignation or removal of any Trustee, the satisfaction and discharge of this Senior Notes Indenture and the termination of this Senior Notes Indenture.
(d)To secure the Issuer's and the Guarantors' payment obligations in this Section 7.06, the Trustee will have a Lien prior to the Senior Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal of, premium on, if any, interest or Additional Amounts, if any, on, particular Notes. Such Lien will survive the satisfaction and discharge of this Senior Notes Indenture.
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(e)When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(a)(viii) hereof occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law.
(f)The indemnity contained in this Section 7.06 shall survive the discharge or termination of this Senior Notes Indenture and shall continue for the benefit of the Trustee or an Agent notwithstanding its resignation or retirement.
Section 7.07.Replacement of Trustee. (a) A resignation or removal of the Trustee and appointment of a successor Trustee will become effective only upon the successor Trustee's acceptance of appointment as provided in this Section 7.07.
(b)The Trustee may resign in writing at any time and be discharged from the trust hereby created by so notifying the Issuer. The Holders of a majority in aggregate principal amount of the then outstanding Senior Notes may remove the Trustee by so notifying the Trustee and the Issuer in writing not less than 60 days prior to the effective date of such removal. The Issuer may remove the Trustee if:
(i)the Trustee fails to comply with Section 7.09 hereof;
(ii)the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;
(iii)a custodian or public officer takes charge of the Trustee or its property; or
(iv)the Trustee becomes incapable of acting.
(c)If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Issuer will promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in aggregate principal amount of the then outstanding Senior Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Issuer.
(d)If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, (i) the retiring Trustee (at the expense of the Issuer), the Issuer, or the Holders of at least 10% in aggregate principal amount of the then outstanding Senior Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee or (ii) the retiring Trustee may appoint a successor Trustee at any time prior to the date on which a successor Trustee takes office, provided that such appointment shall be reasonably satisfactory to the Issuer.
(e)If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.09 hereof, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
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(f)A successor Trustee will deliver a written acceptance of its appointment to the retiring Trustee and to the Issuer. Thereupon, the resignation or removal of the retiring Trustee will become effective, and the successor Trustee will have all the rights, powers and duties of the Trustee under this Senior Notes Indenture. The successor Trustee will mail a notice of its succession to Holders. The retiring Trustee will promptly transfer all property held by it as Trustee to the successor Trustee; provided all sums owing to the Trustee hereunder have been paid and subject to the Lien provided for in Section 7.06 hereof. The retiring Trustee shall have no responsibility or liability for the action or inaction of the successor Trustee. Notwithstanding replacement of the Trustee pursuant to this Section 7.07, the Issuer's obligations under Section 7.06 hereof will continue for the benefit of the retiring Trustee.
Section 7.08.Successor Trustee by Merger, etc. If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act will be the successor Trustee.
Section 7.09.Eligibility; Disqualification. There will at all times be a Trustee hereunder that is a corporation organized and doing business under the laws of England and Wales, a member state of the European Union or the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power and that is subject to supervision or examination by federal or state authorities.
Section 7.10.Agents. (a) Resignation of Agents. Any Agent may resign and be discharged from its duties under this Senior Notes Indenture at any time by giving thirty (30) days' prior written notice of such resignation to the Trustee and Issuer. The Trustee or Issuer may remove any Agent at any time by giving thirty (30) days' prior written notice to any Agent. Upon such notice, a successor Agent shall be appointed by the Issuer, who shall provide written notice of such to the Trustee. Such successor Agent shall become the Agent hereunder upon the resignation or removal date specified in such notice. If the Issuer is unable to replace the resigning Agent within thirty (30) days after such notice, the Agent may, in its sole discretion, deliver any funds then held hereunder in its possession to the Trustee, may appoint a successor agent on the Issuer's behalf or may apply to a court of competent jurisdiction for the appointment of a successor Agent or for other appropriate relief. The costs and expenses (including its counsels' fees and expenses) incurred by the Agent in connection with such proceeding shall be paid by the Issuer. Upon receipt of the identity of the successor Agent, the Agent shall deliver any funds then held hereunder to the successor Agent, less the Agent's fees, costs and expenses or other obligations owed to the Agent. Upon its resignation and delivery any funds, the Agent shall be discharged of and from any and all further obligations arising in connection with this Senior Notes Indenture, but shall continue to enjoy the benefit of Section 7.06 hereof.
(b)The Agents shall act solely as agents of the Issuer and need have not concern for the interests of, or be under any fiduciary duty or other obligation towards, or have any relationship of agency or trust to, the Holders or any person other than the Issuer, except as expressly stated elsewhere in this Senior Notes Indenture.
Section 7.11.FATCA. (a) Mutual Undertaking Regarding Information Reporting and Collection Obligations.
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Each Party shall, within ten business days of a written request by another Party, supply to that other Party such forms, documentation and other information relating to it, its operations, or the Senior Notes as that other Party reasonably requests for the purposes of that other Party's compliance with Applicable Law and shall notify the relevant other Party reasonably promptly in the event that it becomes aware that any of the forms, documentation or other information provided by such Party is (or becomes) inaccurate in any material respect; provided, however, that no Party shall be required to provide any forms, documentation or other information pursuant to this (a) to the extent that: (i) any such form, documentation or other information (or the information required to be provided on such form or documentation) is not reasonably available to such Party and cannot be obtained by such Party using reasonable efforts; or (ii) doing so would or might in the reasonable opinion of such Party constitute a breach of any: (a) Applicable Law; (b) fiduciary duty; or (c) duty of confidentiality. For purposes of this (a), “Applicable Law” shall be deemed to include (i) any rule or practice of any Authority by which any Party is bound or with which it is accustomed to comply; (ii) any agreement between any Authorities; and (iii) any agreement between any Authority and any Party that is customarily entered into by institutions of a similar nature.
(b)Notice of Possible Withholding Under FATCA. The Issuer shall notify each Agent in the event that it determines that any payment to be made by an Agent under the Senior Notes is a payment which could be subject to FATCA Withholding if such payment were made to a recipient that is generally unable to receive payments free from FATCA Withholding, and the extent to which the relevant payment is so treated, provided, however, that the Issuer's obligation under this (b) shall apply only to the extent that such payments are so treated by virtue of characteristics of the Issuer, the Senior Notes, or both.
(c)Agent Right to Withhold. Notwithstanding any other provision of this Senior Notes Indenture, each Agent shall be entitled to make a deduction or withholding from any payment which it makes under the Senior Notes for or on account of any Tax, if and only to the extent so required by Applicable Law, in which event the Agent shall make such payment after such deduction or withholding has been made and shall account to the relevant Authority within the time allowed for the amount so deducted or withheld or, at its option, shall reasonably promptly after making such payment return to the Issuer the amount so deducted or withheld, in which case, the Issuer shall so account to the relevant Authority for such amount. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this (c). If such a withholding or deduction is so required, the Agent will not pay an additional amount in respect of that withholding or deduction.
(d)Issuer Right to Redirect. In the event that the Issuer determines in its sole discretion that any deduction or withholding for or on account of any Tax will be required by Applicable Law in connection with any payment due to any of the Agents on any Senior Notes, then the Issuer will be entitled to redirect or reorganize any such payment in any way that it sees fit in order that the payment may be made without such deduction or withholding provided that, any such redirected or reorganized payment is made through a recognized institution of international standing and otherwise made in accordance with this Senior Notes Indenture. The Issuer will promptly notify the Agents and the Trustee of any such redirection or reorganization. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Section 7.11(d).
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(e)Instruction. The Trustee and each Agent is entitled to do nothing, without liability, if conflicting, unclear or equivocal instructions are received or in order to comply with any Applicable Law.
(f)For the purposes of Sections 7.11(a) through (e) above, the following definitions apply:
“Applicable Law” means any law or regulation including, but not limited to: (i) any statute or regulation; (ii) any rule or practice of any Authority by which any Party is bound or with which it is accustomed to comply; (iii) any agreement between any Authorities; and (iv) any customary agreement between any Authority and any Party.
“Authority” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“FATCA Withholding” means any withholding or deduction required pursuant to an agreement described in Section 1471(b) of the Code, or any Taxes otherwise imposed pursuant to sections 1471 through 1474 of the Code, any regulations or agreements thereunder, any official interpretations thereof, any intergovernmental agreements implementing the foregoing or any treaty, regulation or law implementing such intergovernmental agreement.
“Party” means each party to this Senior Notes Indenture.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01.Option to Effect Legal Defeasance or Covenant Defeasance. The Issuer may at any time, at the option of its Board of Directors evidenced by a resolution set forth in an Officer's Certificate, elect to have either Section 8.02 or 8.03 hereof be applied to all outstanding Senior Notes and all obligations of the Guarantors discharged with respect to their Note Guarantees upon compliance with the conditions set forth below in this Article 8.
Section 8.02.Legal Defeasance and Discharge. (a) Upon the Issuer's exercise under Section 8.01 hereof of the option applicable to this Section 8.02, the Issuer and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to have been discharged from their obligations with respect to all outstanding Senior Notes (including the Note Guarantees) on the date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means that the Issuer and the Guarantors will be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Senior Notes (including the Note Guarantees), which will thereafter be deemed to be “outstanding” only for the purposes of Section 8.05 hereof and the other Sections of this Senior Notes Indenture referred to in Sections 8.05(a)(i) and (ii) below, and to have satisfied all their other obligations under such Senior Notes, the Note Guarantees and this Senior Notes Indenture (and the Trustee, on demand of and at the expense of the Issuer, shall execute proper instruments acknowledging the same), except for the following provisions which will survive until otherwise terminated or discharged hereunder:
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(i)the rights of Holders of outstanding Senior Notes to receive payments in respect of the principal of, or interest (including Additional Amounts) or premium, if any, on, such Senior Notes when such payments are due from the trust referred to in Section 8.04 hereof;
(ii)the Issuer's obligations with respect to the Senior Notes under Article 2 and Section 4.02 hereof;
(iii)the rights, powers, trusts, duties and immunities of the Trustee and the Issuer's and the Guarantors' obligations in connection therewith; and
(iv)this Article 8.
(b)Subject to compliance with this Article 8, the Issuer may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03 hereof.
Section 8.03.Covenant Defeasance. Upon the Issuer's exercise under Section 8.01 hereof of the option applicable to this Section 8.03, the Issuer and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be released from each of their obligations under the covenants contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.16, 4.20 and 4.21 hereof and Section 5.01(a)(iv) hereof with respect to the outstanding Senior Notes on and after the date the conditions set forth in Section 8.04 hereof are satisfied (hereinafter, “Covenant Defeasance”), and the Senior Notes will thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but will continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Senior Notes will not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Senior Notes and Note Guarantees, the Issuer and the Guarantors may omit to comply with and will have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply will not constitute a Default or an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Senior Notes Indenture and such Senior Notes and Note Guarantees will be unaffected thereby. In addition, upon the Issuer's exercise under Section 8.01 hereof of the option applicable to this Section 8.03, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, Sections 6.01(a)(iii), 6.01(a)(iv), 6.01(a)(v), 6.01(a)(vi), 6.01(a)(vii) and 6.01(a)(viii) and (other than with respect to the Issuer) 6.01(a)(ix) hereof will not constitute Events of Default.
Section 8.04.Conditions to Legal or Covenant Defeasance. (a) In order to exercise either Legal Defeasance or Covenant Defeasance under either Section 8.02 or 8.03 hereof:
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(i)the Issuer must irrevocably deposit with the Trustee (or such entity designated by the Trustee for this purpose), in trust for the benefit of the Holders, cash in US dollars, non-callable US dollar-denominated Government Securities or a combination of cash in US dollars and non-callable US dollar-denominated Government Securities in amounts as will be sufficient, to pay the principal of, or interest (including Additional Amounts and premium, if any) on the outstanding Senior Notes on the stated date for payment thereof or on the applicable redemption date, as the case may be, and the Issuer must specify whether the Senior Notes are being defeased to such stated date for payment or to a particular redemption date;
(ii)in the case of an election under Section 8.02 hereof, the Issuer must deliver to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee of United States counsel confirming that (a) the Issuer has received from, or there has been published by, the U.S. Internal Revenue Service a ruling that the Issuer can rely upon or (b) since the Issue Date, there has been a change in the applicable U.S. federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel will confirm that, the beneficial owners of the outstanding Senior Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Legal Defeasance and will be subject to tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
(iii)in the case of an election under Section 8.03 hereof, the Issuer must deliver to the Trustee an opinion reasonably acceptable to the Trustee of United States counsel confirming that the beneficial owners of the outstanding Senior Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
(iv)the Issuer must deliver to the Trustee an Officer's Certificate stating that the deposit was not made by the Issuer with the intent of preferring the Holders over the other creditors of the Issuer or the Guarantors with the intent of defeating, hindering, delaying or defrauding any creditors of the Issuer, the Guarantors or others; and
(v)the Issuer must deliver to the Trustee an Officer's Certificate and an Opinion of Counsel, subject to customary assumptions and qualifications, each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.
(b)In connection with either a Legal Defeasance or a Covenant Defeasance, Section 7.06 hereof shall survive.
Section 8.05.Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions. (a) Subject to Section 8.06 hereof, all money and non-callable U.S. dollar-denominated Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.05, the “Trustee”) pursuant to Section 8.04 hereof in respect of the outstanding Senior Notes will be held in trust and applied by the Trustee, in accordance with the provisions of such Senior Notes and this Senior Notes Indenture, to the payment, either directly or through any Paying Agent (including the Issuer acting as Paying Agent) as the Trustee may determine, to the Holders of such Senior Notes of all sums due and to become due thereon in respect of principal, premium, if any, interest and Additional Amounts, if any, but such money need not be segregated from other funds except to the extent required by law and funds held by the Trustee will not be subject to the United Kingdom FCA Client Money Rules.
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(b)The Issuer will pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash, the non-callable U.S. dollar-denominated Government Securities deposited pursuant to Section 8.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Senior Notes.
(c)Notwithstanding anything in this Article 8 to the contrary, the Trustee will deliver or pay to the Issuer from time to time upon the request of the Issuer any money, non-callable U.S. dollar-denominated Government Securities held by it as provided in Section 8.04 hereof which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (which may be the opinion delivered under Section 8.04(i) hereof), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06.Repayment to Issuer. Any money deposited with the Trustee or any Paying Agent, or then held by the Issuer, in trust for the payment of the principal of, premium on, if any, interest or Additional Amounts, if any, on, any Senior Note and remaining unclaimed for two years after such principal, premium, if any, interest or Additional Amounts, if any, has become due and payable shall be paid to the Issuer on its request or (if then held by the Issuer) will be discharged from such trust; and the Holder of such Senior Note will thereafter be permitted to look only to the Issuer for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Issuer as trustee thereof, will thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Issuer give notice to the Holders in accordance with Section 12.01 hereof that such money remains unclaimed and that, after a date specified therein, which will not be less than 30 days from the date of such notification or publication, any unclaimed balance of such money then remaining will be repaid to the Issuer.
Section 8.07.Reinstatement. If the Trustee or Paying Agent is unable to apply any U.S. dollars or non-callable U.S. dollar-denominated Government Securities in accordance with Section 8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Issuer's and the Guarantors' obligations under this Senior Notes Indenture and the Senior Notes and the Note Guarantees will be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.02 or 8.03 hereof, as the case may be; provided, however, that, if the Issuer makes any payment of principal of, premium on, if any, interest or Additional Amounts, if any, on, any Senior Note following the reinstatement of its obligations, the Issuer will be subrogated to the rights of the Holders of such Senior Notes to receive such payment from the money held by the Trustee or Paying Agent.
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ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01.Without Consent of Holders of Senior Notes. (a) Notwithstanding Section 9.02 hereof, without the consent of any Holder of Senior Notes, the Issuer, the Guarantors and the Trustee may amend or supplement this Senior Notes Indenture, the Senior Notes, any Guarantee Agreement and the Note Guarantees:
(i)to cure any ambiguity, defect or inconsistency;
(ii)to provide for uncertificated Senior Notes in addition to or in place of certificated Senior Notes;
(iii)to provide for the assumption of the Issuer's or a Guarantor's obligations to Holders and Note Guarantees in the case of a merger or consolidation or sale of all or substantially all of the Issuer's or such Guarantor's assets, as applicable, or in the case of any Substitution;
(iv)to make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect the legal rights under this Senior Notes Indenture or any Guarantee Agreement of any such Holder in any material respect;
(v)to conform the text of this Senior Notes Indenture, the Note Guarantees, any Guarantee Agreement or the Senior Notes to any provision of the “Description of the Notes” section of the Offering Memorandum to the extent that such provision in such “Description of the Notes” section of the Offering Memorandum was intended to be a verbatim recitation of a provision of this Senior Notes Indenture, any Guarantee Agreement, the Note Guarantees and the Senior Notes;
(vi)to release any Note Guarantee in accordance with the terms of this Senior Notes Indenture or any Guarantee Agreement;
(vii)to provide for the issuance of Additional Senior Notes in accordance with the limitations set forth in this Senior Notes Indenture as of the Issue Date;
(viii)to allow any Guarantor to execute a supplemental indenture, supplemental guarantee agreement and/or a Note Guarantee, or to document any Guarantee under this Senior Notes Indenture and/or any Guarantee Agreement, or vice versa with respect to the Senior Notes;
(ix)to provide for uncertificated Senior Notes in addition to or in place of certificated Senior Notes (provided that the uncertificated Senior Notes are issued in registered form for purposes of Section 163(f) of the Code); or
(x)to evidence and provide the acceptance of the appointment of a successor Trustee under this Senior Notes Indenture.
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(b)In formulating its opinion on such matters, the Trustee shall be entitled to rely absolutely on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer's Certificate.
(c)For the avoidance of doubt, (i) no amendment to or deletion of, or actions taken in compliance with, the covenants contained in this Senior Notes Indenture shall be deemed to impair or affect any rights of Holders to receive payment of principal of, or premium, if any, or interest, on the Senior Notes; and (ii) it is understood and agreed that any amendment or waiver with respect to any matter described in Sections 9.02(e)(i) through (vi) and 9.02(e)(viii) that by its terms applies to only the 2030 Senior Notes or the 2031 Senior Notes shall require the consent of Holders holding not less than 90% of the then-outstanding principal amount of the 2030 Senior Notes or the 2031 Senior Notes, as applicable, in order for it to be binding on all Holders of the 2030 Senior Notes or the 2031 Senior Notes, as applicable.
(d)It is not necessary for the consent of the Holders of Senior Notes under Section 9.02 hereof to approve the particular form of any proposed amendment, supplement or waiver, but it is sufficient if such consent approves the substance thereof. For the avoidance of doubt, (i) any supplemental indenture shall be effective if executed by the Issuer without the need for the countersignature of any Guarantors (unless such supplemental indenture relates to the accession of any guarantors to this Senior Notes Indenture pursuant to Section 9.02(a)(viii), in which case such acceding guarantor shall execute such supplemental indenture) and (ii) any supplemental guarantee agreement shall be effective if executed by the Issuer and such acceding guarantor only.
(e)Upon the written request of the Issuer accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental indenture, and upon receipt by the Trustee of the documents described in Section 7.02 hereof, the Trustee will join with the Issuer in the execution of any amended or supplemental indenture authorized or permitted by the terms of this Senior Notes Indenture and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee will not be obligated to enter into such amended or supplemental indenture that affects its own rights, duties or immunities under this Senior Notes Indenture or otherwise.
Section 9.02.With Consent of Holders of Senior Notes. (a) Except as provided below in this Section 9.02, this Senior Notes Indenture (including, without limitation, Section 3.10, Section 4.10 and Section 4.13 hereof), any Guarantee Agreement, the Senior Notes and the Note Guarantees may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the Senior Notes then outstanding (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes), and, subject to Section 6.04 and Section 6.07 hereof, any existing Default or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium on, if any, interest or Additional Amounts, if any, on, the Senior Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of this Senior Notes Indenture, any Guarantee Agreement, the Senior Notes and the Note Guarantees may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding Senior Notes (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes); provided that, if any amendment, supplement, waiver or other modification will only affect one series of the Senior Notes, only the consent of a majority in principal amount of the then outstanding Senior Notes of such series shall be required.
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Section 2.08 hereof shall determine which Senior Notes are considered to be “outstanding” for purposes of this Section 9.02.
(b)Upon the written request of the Issuer accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental indenture, and upon the filing with the Trustee of evidence satisfactory to the Trustee of the consent of the Holders of Senior Notes as aforesaid, and upon receipt by the Trustee of the documents described in Section 7.02 hereof, the Trustee will join with the Issuer in the execution of such amended or supplemental indenture unless such amended or supplemental indenture directly affects the Trustee's own rights, duties, liabilities or immunities under this Senior Notes Indenture or otherwise, in which case the Trustee may in its discretion, but will not be obligated to, enter into such amended or supplemental Senior Notes Indenture. Any amended or supplemental indenture which amends Article 10 (Note Guarantees) or otherwise affects or alters any Guarantee given by such Guarantor in any manner shall be joined by such Guarantor.
(c)It is not necessary for the consent of the Holders of Senior Notes under this Section 9.02 to approve the particular form of any proposed amendment, supplement or waiver, but it is sufficient if such consent approves the substance thereof.
(d)After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Issuer will mail to the Holders of Senior Notes affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Issuer to mail such notice, or any defect therein, will not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver. Subject to Section 6.04 and Section 6.07 hereof, the Holders of a majority in aggregate principal amount of the Senior Notes then outstanding voting as a single class may waive compliance in a particular instance by the Issuer with any provision of this Senior Notes Indenture, the Senior Notes and the Note Guarantees.
(e)Unless consented to by the Holders of at least 90% of the aggregate principal amount of then outstanding Senior Notes (or if any amendment, supplement, waiver or other modification will only amend, supplement, waive or modify one series of the Senior Notes, only with the consent of Holders holding not less than 90% of the then outstanding aggregate principal amount of Senior Notes of such series) (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes), without the consent of each Holder affected, an amendment, supplement or waiver or other modification under this Section 9.02 may not (with respect to any Senior Notes held by a non-consenting Holder):
(i)reduce the percentage of the principal amount of Senior Notes whose Holders must consent to an amendment, supplement or waiver;
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(ii)reduce the principal of or change the fixed maturity of any Senior Note or alter the provisions with respect to the redemption of the Senior Notes (except as provided above with respect to Section 4.10 or Section 4.13 hereof);
(iii)reduce the rate of or change the time for payment of interest, including default interest, on any Senior Note;
(iv)impair the right of any Holder to institute suit for the enforcement of any payment of principal of and interest or Additional Amounts (if any) on such Holder's Notes or the associated Note Guarantee on or after the due dates therefore;
(v)waive a Default or Event of Default in the payment of principal of, or interest, Additional Amounts or premium, if any, on, the Senior Notes (except pursuant to a rescission of acceleration of the Senior Notes by the Holders of at least a majority in aggregate principal amount of the then outstanding Senior Notes and a waiver of the Payment Default that resulted from such acceleration);
(vi)make any Senior Note payable in money other than that stated in Senior Notes;
(vii)make any change in the provisions of this Senior Notes Indenture relating to waivers of past Defaults or the rights of Holders to receive payments of principal of, or interest, Additional Amounts or premium, if any, on, the Senior Notes;
(viii)waive a redemption payment with respect to any Senior Note (other than a payment required by Section 4.10 or Section 4.13 hereof);
(ix)release any Guarantor from any of its obligations under its Note Guarantee, any Guarantee Agreement or this Senior Notes Indenture, except in accordance with the terms of this Senior Notes Indenture or the relevant Guarantee Agreement; or
(x)make any change in the preceding amendment and waiver provisions.
(f)Any amendment, supplement, waiver or other modification consented to by at least 90% of the aggregate principal amount of the then outstanding Senior Notes (or if any amendment, supplement, waiver or other modification will only amend, supplement, waive or modify one series of the Senior Notes, only with the consent of Holders holding not less than 90% of the then outstanding aggregate principal amount of Senior Notes of such series) will be binding against any non-consenting Holders.
Section 9.03.Revocation and Effect of Consents. Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a Senior Note is a continuing consent by the Holder of a Senior Note and every subsequent Holder of a Senior Note or portion of a Senior Note that evidences the same debt as the consenting Holder's Note, even if notation of the consent is not made on any Senior Note. However, any such Holder of a Senior Note or subsequent Holder of a Senior Note may revoke the consent as to its Note if the Trustee receives written notice of revocation before the date the amendment, supplement or waiver becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder.
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Section 9.04.Notation on or Exchange of Senior Notes. (a) The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Senior Note thereafter authenticated. The Issuer in exchange for all Senior Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate or cause the Authenticating Agent to authenticate the new Notes that reflect the amendment, supplement or waiver.
(b)Failure to make the appropriate notation or issue a new Note will not affect the validity and effect of such amendment, supplement or waiver.
Section 9.05.Trustee to Sign Amendments, etc. The Trustee will sign any amended or supplemental indenture authorized pursuant to this Article 9 if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. The Issuer may not sign an amended or supplemental indenture until the Board of Directors of the Issuer approves it. In executing any amended or supplemental indenture, the Trustee will be entitled to receive and (subject to Section 7.01 hereof) will be fully protected in relying upon, an Officer's Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Senior Notes Indenture and that such supplemental indenture constitutes the legal, valid and binding obligation of the Issuer and the Guarantors (as applicable), subject to customary exceptions.
ARTICLE 10
NOTE GUARANTEES
Section 10.01.Guarantee. (a) Subject to this Article 10, each of the Issuer and the Guarantors hereby, jointly and severally, unconditionally guarantees to each Holder of a Senior Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of this Senior Notes Indenture, the Senior Notes or the obligations of the Issuer hereunder or thereunder, that:
(i)the principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes will be promptly paid in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes, if lawful, and all other obligations of the Issuer to the Holders or the Trustee hereunder or thereunder will be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and
(ii)in case of any extension of time of payment or renewal of any Senior Notes or any of such other obligations, that same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise.
Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Guarantors will be jointly and severally obligated to pay the same immediately.
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Each Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.
(b)The Guarantors hereby agree that their obligations hereunder are unconditional, irrespective of the validity, regularity or enforceability of the Senior Notes or this Senior Notes Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Senior Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Issuer, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defence of a guarantor. Each Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Issuer, any right to require a proceeding first against the Issuer, protest, notice and all demands whatsoever and covenant that this Note Guarantee will not be discharged except by complete performance of the obligations contained in the Senior Notes and this Senior Notes Indenture.
(c)If any Holder or the Trustee is required by any court or otherwise to return to the Issuer, the Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to either the Issuer or the Guarantors, any amount paid by either to the Trustee or such Holder, this Note Guarantee, to the extent theretofore discharged, will be reinstated in full force and effect.
(d)Each Guarantor agrees that it will not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby. Each Guarantor further agrees that, as between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand,
(i)the maturity of the obligations guaranteed hereby may be accelerated as provided in Article 6 hereof for the purposes of this Note Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby; and
(ii)in the event of any declaration of acceleration of such obligations as provided in Article 6 hereof, such obligations (whether or not due and payable) will forthwith become due and payable by the Guarantors for the purpose of this Note Guarantee. The Guarantors will have the right to seek contribution from any non-paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Note Guarantee.
(e)The Guarantors hereby agree that their obligations hereunder are unconditional, irrespective of the validity, regularity or enforceability of the Senior Notes or this Senior Notes Indenture, and agree to be bound by any and all amendments or supplemental indenture to the Senior Notes Indenture or any Guarantee Agreement without the need to execute such amendment or supplemental indenture and/or supplemental guarantee agreement unless such amendment or supplemental indenture and/or supplemental guarantee agreement amends Article 10 (Note Guarantees) or otherwise affects or alters the Guarantee given by the additional Guarantors in any manner. The Issuer shall deliver copies of all amendments or supplemental indentures and/or supplemental guarantee agreements to all Guarantors not signatory thereto.
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Section 10.02.Limitation on Guarantor Liability. Each Guarantor, and by its acceptance of Senior Notes, each Holder, hereby confirms that it is the intention of all such parties that the Note Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance, for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar national, federal, local or state law or voidable preference, financial assistance or improper corporate benefit, or violate the corporate purpose of the relevant Guarantor or any applicable capital maintenance or similar laws or regulations affecting the rights of creditors generally under any applicable law or regulation to the extent applicable to any Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree that the obligations of such Guarantor will be limited to the maximum amount that will, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Guarantor that are relevant under such laws, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under this Article 10, result in the obligations of such Guarantor under its Note Guarantee not constituting either a fraudulent transfer or conveyance or voidable preference, financial assistance or improper corporate benefit, or violating the corporate purpose of the relevant Guarantor or any applicable capital maintenance or similar laws or regulations affecting the rights of creditors generally under any applicable law or regulation.
Section 10.03.[Reserved]
Section 10.04.[Reserved]
Section 10.05.Releases. (a) The Note Guarantee of a Guarantor will be automatically released and discharged without any further action by the Issuer, the relevant Guarantor or the Trustee and such Guarantor's obligations under the Note Guarantee, any Guarantee Agreement and this Senior Notes Indenture will automatically terminate and be of no further force and effect:
(i)with respect to a Guarantor, in connection with any sale or other disposition of all or substantially all of the assets of that Guarantor (including by way of merger, consolidation, amalgamation or combination) to a Person that is not (either before or after giving effect to such transaction) the Issuer or a Restricted Subsidiary, provided, that the sale or other disposition does not violate Section 4.10 hereof;
(ii)with respect to a Guarantor, in connection with any sale or other disposition of Capital Stock of that Guarantor (or Capital Stock of any Parent Holdco of such Guarantor (other than the Issuer or any Parent Holdco of the Issuer)) to a Person that is not (either before or after giving effect to such transaction) the Issuer or a Restricted Subsidiary, provided, that the sale or other disposition does not violate Section 4.10 hereof and the Guarantor ceases to be a Restricted Subsidiary as a result of the sale or other disposition;
(iii)if the Issuer designates any Restricted Subsidiary that is a Guarantor to be an Unrestricted Subsidiary in accordance with Section 4.16 hereof;
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(iv)upon a Legal Defeasance or Covenant Defeasance as provided for in Article 8 hereof or satisfaction and discharge of this Senior Notes Indenture as provided for in Article 11 hereof ;
(v)upon the full and final payment of the Senior Notes and performance of all Obligations of the Issuer and the Guarantors under this Senior Notes Indenture, any Guarantee Agreement and the Senior Notes;
(vi)as described under Section 9.02 hereof;
(vii)with respect to an additional Note Guarantee given under Section 4.14 hereof, upon release of the guarantee that gave rise to the requirement to issue such additional guarantee so long as no Default or Event of Default would arise as a result thereof and no other Indebtedness that would give rise to an obligation to give an additional Note Guarantee is at that time guaranteed by the relevant Guarantor;
(viii)as a result of a transaction permitted or not prohibited by Section 5.01 hereof; or
(ix)as part of a Permitted Reorganization.
(b)Upon any occurrence giving rise to a release of a Note Guarantee, as specified above, the Trustee, subject to receipt of an Officer's Certificate and an Opinion of Counsel from the Issuer and/or Guarantor will, upon the request of the Issuer, execute any documents reasonably required in order to evidence or effect such release, discharge and termination in respect of such Note Guarantee, subject to customary protections and indemnifications. Neither the Issuer, the Trustee nor any Guarantor will be required to make a notation on the Senior Notes to reflect any such release, discharge or termination. Each of the releases set forth above shall be effected by the Trustee without the consent of the Holders or any other action or consent on the part of the Trustee.
(c)Any Guarantor not released from its obligations under its Note Guarantee as provided in this Section 10.05 will remain liable for the full amount of principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes and for the other obligations of any Guarantor under this Senior Notes Indenture as provided in this Article 10.
ARTICLE 11
SATISFACTION AND DISCHARGE
Section 11.01.Satisfaction and Discharge. (a) This Senior Notes Indenture will be discharged and will cease to be of further effect as to all Senior Notes of the applicable series issued hereunder, when:
(i)either:
(A)all Senior Notes of the applicable series that have been authenticated and delivered, except lost, stolen or destroyed Senior Notes that have been replaced or paid and Senior Notes for whose payment money has been deposited in trust and thereafter repaid to the Issuer or discharged from such trust as provided for in this Senior Notes Indenture, have been delivered to the Trustee for cancellation; or
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(B)all Senior Notes of the applicable series that have not been delivered to the Principal Paying Agent for cancellation have become due and payable by reason of the publication of a notice of redemption by the Principal Paying Agent in the name, and at the expense, of the Issuer or otherwise or will become due and payable within one year and the Issuer or any Guarantor has irrevocably deposited or caused to be deposited with the Trustee (or such other entity designated by the Trustee for this purpose) as trust funds in trust solely for the benefit of the holders, cash in U.S. dollars, non-callable U.S. dollar-denominated Government Securities or a combination of cash in U.S. dollars and non-callable U.S. dollar-denominated Government Securities, in amounts as will be sufficient, without consideration of any reinvestment of interest, to pay and discharge the entire Indebtedness on the Senior Notes of the applicable series not delivered to the Principal Paying Agent for cancellation for principal, premium and Additional Amounts, if any, and accrued interest to the date of maturity or redemption;
(ii)the Issuer or any Guarantor has paid or caused to be paid all sums payable by the Issuer and the Guarantors under this Senior Notes Indenture in relation to the Notes of the applicable series; and
(iii)the Issuer has delivered irrevocable instructions to the Trustee under this Senior Notes Indenture to apply the deposited money toward the payment of the Senior Notes of the applicable series at maturity or on the redemption date, as the case may be.
In addition, the Issuer must deliver an Officer's Certificate and an opinion of independent counsel to the Trustee stating that all conditions precedent in this Senior Notes Indenture relating to satisfaction and discharge of this Senior Notes Indenture have been satisfied and such satisfaction and discharge will not result in a breach or violation of, or constitute a default under, this Senior Notes Indenture; provided that any such counsel may rely on any Officer's Certificate as to matters of fact (including as to compliance with the Sections 11.01(a)(i) through 11.01(a)(iii) hereof).
(b)Notwithstanding the satisfaction and discharge of this Senior Notes Indenture, if money has been deposited with the Trustee pursuant to Section 11.01(a)(i)(B) hereof, the provisions of Sections 11.02 and 8.06 hereof will survive. In addition, nothing in this Section 11.01 will be deemed to discharge those provisions of Section 7.06 hereof, that, by their terms, survive the satisfaction and discharge of this Senior Notes Indenture.
(c)If requested in writing by the Issuer to the Trustee and Paying Agent (which request may be included in the applicable notice of redemption or pursuant to the above referenced Officer’s Certificate) no later than five Business Days prior to such distribution (or such shorter period as the Trustee and the Paying Agent may agree), the Trustee or Paying Agent (or such other entity directed, designated or appointed (as agent) by the Trustee, for this purpose) shall distribute any amounts deposited in trust to Holders of the Senior Notes prior to maturity or the redemption date, as the case may be, provided that the Trustee or Paying Agent shall not be required to incur any losses, fees, costs or penalties in relation to such early distribution. For the avoidance of doubt, the distribution and payment to the Holders prior to the maturity or redemption date as set forth above shall not include any negative interest, present value adjustment, break cost or any additional premium on such amounts.
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To the extent the Senior Notes are represented by a Global Note deposited with a depositary or custodian for the clearing system, any payment to the beneficial holders holding interests as a participant of such clearing system shall be subject to the then applicable procedures of the clearing system. The Trustee and the Paying Agent shall not be liable to any Holder by virtue of the Issuer instructing the Trustee or the Paying Agent to make an early distribution of funds as described in this Section 11.01(c).
Section 11.02.Application of Trust Money. Subject to the provisions of Section 8.06 hereof, all money deposited with the Trustee pursuant to Section 11.01 hereof shall be held in trust and applied by it, in accordance with the provisions of the Senior Notes and this Senior Notes Indenture, to the payment, either directly or through any Paying Agent (including the Issuer acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal of, premium on, if any, interest and Additional Amounts, if any, for whose payment such money has been deposited with the Trustee; but such money need not be segregated from other funds except to the extent required by law and funds held by the Trustee will not be subject to the United Kingdom FCA Client Money Rules.
If the Trustee or Paying Agent is unable to apply any money or Government Securities in accordance with Section 11.01 hereof by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Issuer's and any Guarantor's obligations under this Senior Notes Indenture and the Senior Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 11.01 hereof; provided that if the Issuer has made any payment of principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes because of the reinstatement of its obligations, the Issuer shall be subrogated to the rights of the Holders of such Senior Notes to receive such payment from the money or Government Securities held by the Trustee or Paying Agent.
ARTICLE 12
MISCELLANEOUS
Section 12.01.Notices. (a) Any notice or communication by the Issuer, any Guarantor, the Trustee or any Agent to the others is duly given if in writing and delivered in Person or mailed by first class mail (registered or certified, return receipt requested), facsimile transmission or overnight air courier guaranteeing next day delivery, to the others' address:
If to the Issuer and/or any Guarantor:
IHS Holding Limited
1 Cathedral Piazza
123 Victoria Street
London SW1E 5BP
United Kingdom
Attention: Group Legal
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If to the Trustee:
Kroll Trustee Services Limited
6th Floor, The News Building
3 London Bridge Street
London SE1 9SG
United Kingdom
Attention: The Trustee Directors, Agency & Trust
Email: deals@ats.kroll.com
If to the Paying Agent, Registrar or Transfer Agent:
Citigroup Centre,
Canada Square,
Canary Wharf,
London E14 5LB,
United Kingdom
Attention: Citi Agency & Trust
In the case of the Paying Agent:
E-mail: ppapayments@citi.com; issueroperationscsu@citi.com
In the case of the Registrar:
E-mail: register@citi.com
In the case of the Transfer Agent:
E-mail: dtc.transfers@citi.com
(b)The Issuer, any Guarantor or the Trustee, by notice to the others, may designate additional or different addresses for subsequent notices or communications.
(c)All notices and communications (other than those sent to Holders) will be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if transmitted by facsimile; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery.
(d)All notices to the Holders (while any Senior Notes are represented by one or more Global Notes) shall be delivered to DTC, Euroclear and Clearstream, as applicable for communication to entitled account Holders. If publication as provided above is not practicable, notice will be given in such other manner, and shall be deemed to have been given on such date, as the Trustee may approve. In the case of Definitive Registered Notes, notices will be mailed to Holders by first-class mail at their respective addresses as they appear on the records of the Registrar, unless stated otherwise in the register kept by, and at the registered office of the Issuer.
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(e)Notices given by publication will be deemed given on the first date on which publication is made. Notices delivered to DTC, Euroclear and Clearstream will be deemed given on the date when delivered. Notices given by first class mail, postage paid, will be deemed given five calendar days after mailing whether or not the addressee receives it.
(f)If a notice or communication is mailed or published in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it.
(g)If the Issuer or any Guarantor mails a notice or communication to Holders or delivers a notice or communication to holders of Book-Entry Interests, it will mail a copy to the Trustee and each Agent at the same time.
All notices will be given in the English language.
Section 12.02.Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Issuer to the Trustee to take any action under this Senior Notes Indenture, the Issuer shall furnish to the Trustee:
(i)an Officer's Certificate in form and substance reasonably satisfactory to the Trustee (which must include the statements set forth in Section 12.03 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Senior Notes Indenture relating to the proposed action have been satisfied; and
(ii)an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee (which must include the statements set forth in Section 12.03 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been satisfied.
Section 12.03.Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Senior Notes Indenture shall include:
(i)a statement that the Person making such certificate or opinion has read such covenant or condition;
(ii)a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
(iii)a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been satisfied; and
(iv)a statement as to whether or not, in the opinion of such Person, such condition or covenant has been satisfied.
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Section 12.04.Rules by Trustee and Agents. The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions.
Section 12.05.No Personal Liability of Directors, Officers, Employees and Stockholders. No director, officer, employee, incorporator or stockholder of the Issuer or any Guarantor, as such, will have any liability for any obligations of the Issuer or the Guarantors under the Senior Notes, this Senior Notes Indenture, any Guarantee Agreement and the Note Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Senior Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Senior Notes. The waiver may not be effective to waive liabilities under applicable securities laws.
Section 12.06.Agent for Service; Submission to Jurisdiction; Waiver of Immunities. Each of the parties hereto irrevocably agrees that any suit, action or proceeding arising out of, related to, or in connection with this Senior Notes Indenture, the Senior Notes and the Note Guarantees or the transactions contemplated hereby, and any action arising under U.S. federal or state securities laws, may be instituted in any U.S. federal or state court located in the State and City of New York, Borough of Manhattan; irrevocably waives, to the fullest extent it may effectively do so, any objection which it may now or hereafter have to the laying of venue of any such proceeding; and irrevocably submits to the jurisdiction of such courts in any such suit, action or proceeding. The Issuer and each of the Guarantors hereby appoints Corporation Service Company, 19 West 44th Street, Suite 200, New York, New York 10036, United States of America as its authorized agent upon whom process may be served in any such suit, action or proceeding which may be instituted in any federal or state court located in the State of New York, Borough of Manhattan arising out of or based upon this Senior Notes Indenture, the Senior Notes or the transactions contemplated hereby or thereby, and any action brought under U.S. federal or state securities laws (the “Authorized Agent”). The Issuer and each of the Guarantors expressly consents to the exclusive jurisdiction of any such court in respect of any such action and waives any other requirements of or objections to personal jurisdiction with respect thereto and waives any right to trial by jury. Such appointment shall be irrevocable unless and until replaced by an agent reasonably acceptable to the Trustee. The Issuer and each of the Guarantors represents and warrants that the Authorized Agent has agreed to act as said agent for service of process, and the Issuer agrees to take any and all action, including the filing of any and all documents and instruments, that may be necessary to continue such appointment in full force and effect as aforesaid. Service of process upon the Authorized Agent and written notice of such service to the Issuer shall be deemed, in every respect, effective service of process upon the Issuer and any Guarantor.
Section 12.07.Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THIS SENIOR NOTES INDENTURE, THE SENIOR NOTES AND THE NOTE GUARANTEES.
Section 12.08.No Adverse Interpretation of Other Agreements. This Senior Notes Indenture may not be used to interpret any other indenture, loan or debt agreement of the Issuer, any Guarantor or any of their respective Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Senior Notes Indenture.
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Section 12.09.Successors. All agreements of the Issuer in this Senior Notes Indenture and the Senior Notes will bind its successors. All agreements of the Trustee in this Senior Notes Indenture will bind its successors. All agreements of each Guarantor in this Senior Notes Indenture will bind its successors, except as otherwise provided in Section 10.05 hereof.
Section 12.10.Severability. In case any provision in this Senior Notes Indenture or in the Senior Notes is invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby.
Section 12.11.Counterpart Originals. The parties may sign any number of copies of this Senior Notes Indenture. Each signed copy will be an original, but all of them together represent the same agreement.
Section 12.12.Table of Contents, Headings, etc. The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Senior Notes Indenture have been inserted for convenience of reference only, are not to be considered a part of this Senior Notes Indenture and will in no way modify or restrict any of the terms or provisions hereof.
Section 12.13.Judgment Currency. Any payment on account of an amount that is payable in US dollars which is made to or for the account of any Holder or the Trustee in lawful currency of any other jurisdiction (the “Judgment Currency”), whether as a result of any judgment or order or the enforcement thereof or the liquidation of the Issuer or any Guarantor, shall constitute a discharge of the Issuer or the Guarantor's obligation under this Senior Notes Indenture, any Guarantee Agreement and the Senior Notes or Note Guarantee, as the case may be, only to the extent of the amount of US dollars that such Holder or the Trustee, as the case may be, could purchase in the London foreign exchange markets with the amount of the Judgment Currency in accordance with normal banking procedures at the rate of exchange prevailing on the first Business Day following receipt of the payment in the Judgment Currency. If the amount of US dollars that could be so purchased is less than the amount of US dollars that is originally due to such Holder or the Trustee, as the case may be, the Issuer and the Guarantors shall indemnify and hold harmless the Holder or the Trustee, as the case may be, from and against all loss or damage arising out of, or as a result of, such deficiency. This indemnity shall constitute an obligation separate and independent from the other obligations contained in this Senior Notes Indenture or the Senior Notes, shall give rise to a separate and independent cause of action, shall apply irrespective of any indulgence granted by any Holder or the Trustee from time to time and shall continue in full force and effect notwithstanding any judgment or order for a liquidated sum in respect of an amount due hereunder or under any judgment or order.
Section 12.14.Prescription. Claims against the Issuer or any Guarantor for the payment of principal or Additional Amounts, if any, on the Senior Notes will be prescribed ten years after the applicable due date for payment thereof. Claims against the Issuer or any Guarantor for the payment of interest on the Senior Notes will be prescribed six years after the applicable due date for payment of interest.
Section 12.15.Electronic Signature. The parties hereto acknowledge and agree that they may execute this Senior Notes Indenture and any variation or amendment to the same, by electronic instrument.
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The parties agree that the electronic signatures appearing on this Senior Notes Indenture shall have the same effect as handwritten signatures and the use of an electronic signature on this Senior Notes Indenture shall have the same validity and legal effect as the use of a signature affixed by hand and is made with the intention of authenticating this Senior Notes Indenture and evidencing the parties’ intention to be bound by the terms and conditions contained herein. For the purposes of using an electronic signature, parties authorize each other to the lawful processing of personal data of the signers for contract performance and their legitimate interests including contract management.
Section 12.16.Additional Information. Upon written request by any Holder or holder of a Book-Entry Interest to the Issuer at the address set out in Section 12.01 hereof, the Issuer will mail or cause to be mailed, by first class mail, to such Holder or holder (at the expense of the Issuer) a copy of this Senior Notes Indenture, and the form of Senior Note.
(Signatures on following pages)
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IN WITNESS HEREOF, the parties have caused this Senior Notes Indenture to be duly executed as of the date first written above.
|
IHS Holding Limited |
|
|
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Steve Howden |
|
|
|
/s/ Steve Howden |
(Signature Page to Senior Notes Indenture)
|
KROLL TRUSTEE SERVICES LIMITED, as |
|
|
|
Cairy Bailey |
|
|
|
/s/ Cairy Bailey |
|
CITIBANK, N.A., LONDON BRANCH, as |
|
|
|
Rose Robison |
|
|
|
/s/ Rose Robinson |
|
CITIBANK, N.A., LONDON BRANCH, as |
|
|
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Rose Robison |
|
|
|
/s/ Rose Robinson |
(Signature Page to Senior Notes Indenture)
EXHIBIT A
FORM OF GLOBAL NOTES
[Face of Note]
ISIN: [US44963HAC97] 1[US44963HAD70]2[XS2941354487] 3[XS2941354727]4
CUSIP: [44963H AC9] 5[ 44963H AD7]6
COMMON CODE: [294135448] 7[294135472]8
[7.875% Senior Notes due 2030]9[8.250% Senior Notes due 2031]10
No. |
|
|
$ |
|
IHS HOLDING LIMITED
promises to pay to _____________ or registered assigns,
the principal sum of ______________________________________U.S. DOLLARS or such greater or lesser amount as indicated in the schedule of Exchanges of Interests in the Global Note on November 29, [2030]11[2031.]12
Interest Payment Dates: Semi-annually on November 29 and May 29 of each year, commencing May 29, 2025
Record Dates: One business day prior to the interest payment date while in global form and 15 calendar days prior to the interest payment date while in definitive form.
1 |
Include for Rule 144A 2030 Senior Notes |
2 |
Include for Rule 144A 2031 Senior Notes |
3 |
Include for Regulation S 2030 Senior Notes |
4 |
Include for Regulation S 2031 Senior Notes |
5 |
Include for Rule 144A 2030 Senior Notes |
6 |
Include for Rule 144A 2031 Senior Notes |
7 |
Include for Regulation S 2030 Senior Notes |
8 |
Include for Regulation S 2031 Senior Notes |
9 |
Include for 2030 Senior Notes |
10 |
Include for 2031 Senior Notes |
11 |
Include for 2030 Senior Notes |
12 |
Include for 2031 Senior Notes |
Exh A-1
IN WITNESS WHEREOF, the Issuer has caused this Senior Note to be signed manually or by facsimile by the duly authorized officer referred to below.
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IHS HOLDING LIMITED |
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By |
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Name: |
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Exh A-2
This is one of the Senior Notes referred to
in the within-mentioned Senior Notes Indenture:
KROLL TRUSTEE SERVICES LIMITED
not in its personal capacity but in its capacity as
Trustee,
By: |
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Authorized Signatory |
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Exh A-3
[Back of Note]
[7.875% Senior Notes due 2030]13 [8.250% Senior Notes due 2031]14
[Insert the Global Note Legend, if applicable pursuant to the provisions of the Senior Notes Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions of the Senior Notes Indenture]
Capitalized terms used herein have the meanings assigned to them in the Senior Notes Indenture referred to below unless otherwise indicated.
(1)[INTEREST. IHS Holding Limited, an exempted company with limited liability incorporated under the laws of the Cayman Islands, having its registered office at 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008, Cayman Islands, registered with the Cayman Islands General Registry under number WC-382000 (the “Issuer”), promises to pay or cause to be paid interest on the principal amount of this 2030 Senior Note at 7.875% per annum from November 29, 2024 until maturity. The Issuer will pay interest semi-annually in arrear on May 29 and November 29 of each year, or if any such day is not a Business Day, on the next succeeding Business Day of each year (each, an “Interest Payment Date”). Interest on the 2030 Senior Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided that if there is no existing Default in the payment of interest, and if this 2030 Senior Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided further that the first Interest Payment Date shall be May 29, 2025. The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at a rate that is 1% per annum higher than the then applicable interest rate on the 2030 Senior Notes to the extent lawful. The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue instalments of interest and Additional Amounts, if any (without regard to any applicable grace periods), at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.]15
[INTEREST. IHS Holding Limited, an exempted company with limited liability incorporated under the laws of the Cayman Islands, having its registered office at 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008, Cayman Islands, registered with the Cayman Islands General Registry under number WC-382000 (the “Issuer”), promises to pay or cause to be paid interest on the principal amount of this 2031 Senior Note at 8.250% per annum from November 29, 2024 until maturity. The Issuer will pay interest semi-annually in arrear on May 29 and November 29 of each year, or if any such day is not a Business Day, on the next succeeding Business Day of each year (each, an “Interest Payment Date”). Interest on the 2031 Senior Notes will accrue from the most
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Exh A-4
recent date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided that if there is no existing Default in the payment of interest, and if this 2031 Senior Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided further that the first Interest Payment Date shall be May 29, 2025. The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at a rate that is 1% per annum higher than the then applicable interest rate on the 2031 Senior Notes to the extent lawful. The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue instalments of interest and Additional Amounts, if any (without regard to any applicable grace periods), at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.]16
(2)METHOD OF PAYMENT. The Issuer will pay interest on the [2030]17[2031]18 Senior Notes (except defaulted interest) to the Persons who are registered Holders of [2030]19[2031]20 Senior Notes at the close of business on the Business Day preceding the next Interest Payment Date, even if such [2030]21[2031]22 Senior Notes are cancelled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Senior Notes Indenture with respect to defaulted interest. The [2030]23[2031]24 Senior Notes will be payable as to principal, premium, if any, interest and Additional Amounts, if any, through the Paying Agent as provided in the Senior Notes Indenture or, at the option of the Issuer, payment of interest and Additional Amounts, if any, may be made by check mailed to the Holders at their addresses set forth in the register of Holders; provided that payment by wire transfer of immediately available funds will be required with respect to principal of and interest, premium and Additional Amounts, if any, on, all Global Notes and all other Notes the Holders of which will have provided wire transfer instructions to the Issuer or the Paying Agent. Such payment shall be made in U.S. dollars.
(3)PAYING AGENT, REGISTRAR AND TRANSFER AGENT. Initially, Citibank, N.A., London Branch will act as Principal Paying Agent and Transfer Agent. Citibank, N.A., London Branch will act as Registrar. The Issuer may change the Paying Agent, the Registrar or the Transfer Agent without prior written notice to the holders. For so long as the [2030]25[2031]26 Senior Notes are listed on the Official List of the Exchange and the rules of The International Stock Exchange
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Exh A-5
Authority Limited so require, the Issuer will notify The International Stock Exchange Authority Limited of any change of the Paying Agent, Registrar or Transfer Agent.
(4)SENIOR NOTES INDENTURE AND GUARANTEE AGREEMENT. The Issuer issued the [2030]27[2031]28 Senior Notes under a Senior Notes Indenture dated as of November 29, 2024 (the “Senior Notes Indenture”) between the Issuer, Kroll Trustee Services Limited as Trustee, Citibank N.A., London Branch as Principal Paying Agent and Transfer Agent and Citibank, N.A., London Branch as Registrar. The Issuer, IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., IHS Nigeria Limited, IHS Towers NG Limited, INT Towers Limited, Nigeria Tower Interco B.V. and INT Towers NG Finco 1 Plc and Kroll Trustee Services Limited as Trustee, entered into a guarantee agreement dated as of November 29, 2024 (the ''2024 Guarantee Agreement''). The [2030]29[2031]30 Senior Notes are subject to all such terms, and Holders are referred to the Senior Notes Indenture and the 2024 Guarantee Agreement for a statement of such terms. To the extent any provision of this [2030]31[2031]32 Senior Note or the 2024 Guarantee Agreement conflicts with the express provisions of the Senior Notes Indenture, the provisions of the Senior Notes Indenture shall govern and be controlling.
(5)OPTIONAL REDEMPTION.
(a)At any time prior to November 29, [2026]33[2027]34, the Issuer may on any one or more occasions redeem up to 40% of the aggregate principal amount of the [2030]35[2031]36 Senior Notes issued under the Senior Notes Indenture, upon not less than 10 nor more than 60 days' prior written notice to the Holders, at a redemption price equal to [107.875%,]37[108.250%]38 of the principal amount thereof, plus accrued and unpaid interest and Additional Amounts, if any, to the date of redemption (subject to the rights of Holders of the [2030]39[2031]40 Senior Notes on the relevant record date to receive interest on the relevant interest payment date), with the net cash proceeds of any Equity Offering of the Issuer or any Parent Holdco of the Issuer to the extent the proceeds from such Equity Offering are contributed to the Issuer's common equity capital or are
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Exh A-6
paid to the Issuer as consideration for the issuance of ordinary shares of the Issuer or as Subordinated Shareholder Debt (in each case, excluding proceeds from any Parent Debt Contribution); provided that:
(1) |
at least 50% of the aggregate principal amount of the [2030]41[2031]42 Senior Notes being redeemed originally issued under the Senior Notes Indenture (excluding [2030]43[2031]44 Senior Notes held by the Issuer and its Subsidiaries and their respective Affiliates) remain outstanding immediately after the occurrence of such redemption; and |
(2) |
the redemption occurs within 180 days of the date of the closing of such Equity Offering. |
(b)At any time prior to November 29, [2026]45[2027]46, the Issuer may on any one or more occasions redeem all or a part of the [2030]47[2031]48 Senior Notes upon not less than 10 nor more than 60 days' prior written notice to the Holders, at a redemption price equal to 100.000% of the principal amount of the [2030]49[2031]50 Senior Notes redeemed, plus the Applicable Premium as of, and accrued and unpaid interest and Additional Amounts, if any, to the date of redemption, subject to the rights of Holders of the [2030]51[2031]52 Senior Notes on the relevant record date to receive interest due on the relevant interest payment date.
(c)Except pursuant to the preceding clause (5)(a) and (5)(b) and except pursuant to clause (6) and clause (8), the [2030]53[2031]54 Senior Notes will not be redeemable at the Issuer's option prior to November 29, [2026]55[2027]56.
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Exh A-7
(d)On or after November 29, [2026]57[2027]58, the Issuer may on any one or more occasions redeem all or a part of the [2030]59[2031]60 Senior Notes upon not less than 10 nor more than 60 days' prior written notice to the Holders, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest and Additional Amounts, if any, on the [2030]61[2031]62 Senior Notes redeemed, to the applicable date of redemption, if redeemed on or after the dates indicated below, subject to the rights of Holders of the [2030]63[2031]64 Senior Notes on the relevant record date to receive interest on the relevant interest payment date:
[2030 Senior Notes
Date |
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Redemption |
November 29, 2026 |
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103.93750% |
November 29, 2027 |
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101.96875% |
November 29, 2028 and thereafter |
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100.00000% |
] 65
[2031 Senior Notes
Date |
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Redemption |
November 29, 2027 |
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104.12500% |
November 29, 2028 |
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102.06250% |
November 29, 2029 and thereafter |
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100.00000% |
] 66
(e)Unless the Issuer defaults in the payment of the redemption price, interest will cease to accrue on the [2030]67[2031]68 Senior Notes or portions thereof called for redemption on the applicable redemption date.
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Exh A-8
(f)Any redemption pursuant to Section 3.07 of the Senior Notes Indenture shall be made pursuant to the provisions of Sections 3.01 through 3.06 of the Senior Notes Indenture.
(6)REDEMPTION FOR CHANGES IN TAXES.
The Issuer may redeem the Senior Notes, in whole but not in part, at its discretion at any time upon giving not less than 10 nor more than 60 days' prior written notice of the redemption (which date shall be no earlier than 60 days prior to the next date on which any amount would be payable in respect of the Notes) to the Holders (with a copy to the Trustee and the Paying Agent) (which notice will be irrevocable and given in accordance with the procedures described in Section 3.03 and Section 12.01 hereof), at a redemption price equal to 100% of the aggregate principal amount thereof, together with accrued and unpaid interest, if any, to (but excluding) the date fixed by the Issuer for redemption (a “Tax Redemption Date”) and all Additional Amounts (if any) due on the Tax Redemption Date as a result of the redemption or otherwise in accordance with Section 4.18 of the Senior Notes Indenture, (and subject to the right of Holders on the Tax Redemption Date to receive accrued and unpaid interest due on the relevant interest payment date and Additional Amounts (if any) in respect thereof and (in respect of the payment of any Additional Amounts) insofar only as the obligation to pay Additional Amounts applies also at the time such notice is given), if on the next date on which any amount would be payable in respect of the Senior Notes, the Issuer or a Guarantor is or would be required to pay Additional Amounts, and the Issuer or Guarantor cannot avoid any such payment obligation by taking reasonable measures available, and the requirement arises as a result of:
(1)any amendment to, or change in, the laws (or any regulations or rulings promulgated thereunder) of a relevant Tax Jurisdiction which amendment or change becomes effective on or after the Issue Date (or, if the applicable Tax Jurisdiction became a Tax Jurisdiction with respect to the Issuer or such Guarantor, as applicable, on a date after the Issue Date, such later date); or
(2)any amendment to, or change in, an official position, or the introduction of an official position, regarding the interpretation, administration or application of such laws, regulations or rulings (including by virtue of a holding, judgment, or order by a court of competent jurisdiction or a change in published tax authority practice or other administrative practice) which amendment, change or introduction becomes effective on or after the Issue Date (or, if the applicable Tax Jurisdiction became a Tax Jurisdiction with respect to the Issuer or such Guarantor, as applicable, after the Issue Date, such later date)
(each of the foregoing clauses (i) and (ii), a “Change in Tax Law”).
Prior to the publication or, where relevant, sending of any notice of redemption of the Senior Notes pursuant to this Senior Notes Indenture, the Issuer will deliver to the Trustee (i) an Officer's Certificate stating that obligation to pay such Additional Amounts cannot be avoided by the Issuer (or the relevant Guarantor, as applicable) taking reasonable measures available to it; and (ii) a written opinion of independent tax counsel to the Issuer of recognized standing in the relevant Tax Jurisdiction and reasonably satisfactory to the Trustee (such approval not to be unreasonably withheld) to the effect that the Issuer (or the relevant Guarantor, as applicable) has or will become obligated to pay such Additional Amounts as a result of a Change in Tax Law.
Exh A-9
The Trustee will accept and shall be entitled to rely on such Officer's Certificate and Opinion of Counsel without further inquiry, investigation, independent verification or liability as sufficient evidence of the existence and satisfaction of the conditions precedent as described above, in which event it will be conclusive and binding on the Holders.
(7)REPURCHASE AT THE OPTION OF HOLDER.
(a)Upon the occurrence of a Change of Control, the Issuer will make an offer (a “Change of Control Offer”) to each Holder to repurchase all or any part (in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part) of that Holder's Senior Notes pursuant to a Change of Control Offer on the terms set forth in the Senior Notes Indenture. In the Change of Control Offer, the Issuer will offer a payment in cash equal to 101% of the aggregate principal amount of Senior Notes repurchased, plus accrued and unpaid interest and Additional Amounts, if any, on the Senior Notes repurchased to the date of purchase (the “Change of Control Payment”), subject to the rights of Holders on the relevant record date to receive interest due on the relevant interest payment date. Within 30 days following any Change of Control, the Issuer will mail a notice to each Holder, with a copy to the Trustee, setting forth the procedures governing the Change of Control Offer as required by the Senior Notes Indenture.
(b)If the Issuer or a Restricted Subsidiary of the Issuer consummates any Asset Sales, within 10 Business Days of each date on which the aggregate amount of Excess Proceeds exceeds $100.0 million, the Issuer will make an Asset Sale Offer to all Holders and may, to the extent the Issuer so elects, make an offer to holders of Pari Passu Indebtedness to purchase, prepay or redeem with the proceeds of sales of assets in accordance with Section 3.10 of the Senior Notes Indenture the maximum principal amount of Senior Notes and such other Pari Passu Indebtedness (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith) that may be purchased, prepaid or redeemed out of the Excess Proceeds. The offer price for the Senior Notes in any Asset Sale Offer will be equal to (i) solely in the case of the Senior Notes, 100% of the principal amount of the applicable series, which shall be repurchased in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part; and (ii) solely in the case of any other Pari Passu Indebtedness, no greater than 100% of the principal amount, plus, in the case of (i) and (ii), accrued and unpaid interest and Additional Amounts, if any, to the date of purchase, prepayment or redemption, subject to the rights of the Holders on the relevant record date to receive interest due on the relevant interest payment date, and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Issuer and its Restricted Subsidiaries may use those Excess Proceeds for any purpose not otherwise prohibited by this Senior Notes Indenture. If the aggregate principal amount of Senior Notes and other Pari Passu Indebtedness tendered into (or to be prepaid or redeemed in connection with) such Asset Sale Offer exceeds the amount of Excess Proceeds, or if the aggregate principal amount of Senior Notes tendered pursuant to an Asset Sale Offer that is an application of Net Proceeds pursuant to Section 4.10(b)(i) of the Senior Notes Indenture exceeds the amount of the Net Proceeds so applied, the Trustee or the Registrar, as applicable, will select the Senior Notes and such other Pari Passu Indebtedness, if applicable, to be purchased on a pro rata basis (or in the manner described under Section 3.02 of the Senior Notes Indenture), based on the amounts tendered or required to be prepaid or redeemed in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part.
Exh A-10
Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. Holders of Senior Notes that are the subject of an offer to purchase will receive an Asset Sale Offer from the Issuer prior to any related purchase date and may elect to have such Senior Notes purchased by completing the form entitled “Option of Holder to Elect Purchase” attached to the Senior Notes.
(8)NOTICE OF REDEMPTION. At least 10 days but not more than 60 days before a redemption date, the Issuer will mail or cause to be mailed, pursuant to Section 12.01 of the Senior Notes Indenture, a notice of redemption to each Holder whose Senior Notes are to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Senior Notes or the satisfaction and discharge pursuant to the Senior Notes Indenture.
(9)DENOMINATIONS, TRANSFER, EXCHANGE. The Global Notes are in registered form without coupons attached in denominations of $200,000 and integral multiples of $1,000 in excess thereof. The transfer of Senior Notes may be registered and Senior Notes may be exchanged as provided in the Senior Notes Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Issuer may require a Holder to pay any taxes and fees required by law or permitted by the Senior Notes Indenture. The Issuer shall not be required to register the transfer of any Definitive Registered Notes: (A) for a period of 15 days prior to any date fixed for the redemption of such Definitive Registered Notes under Section 3.03 of the Senior Notes Indenture; (B) for a period of 15 days immediately prior to the date fixed for selection of such Definitive Registered Notes to be redeemed in part; (C) for a period of 15 days prior to the record date with respect to any Interest Payment Date applicable to such Definitive Registered Notes; or (D) which the Holder has tendered (and not withdrawn) for repurchase in connection with a Change of Control Offer or an Asset Sale Offer.
(10)PERSONS DEEMED OWNERS. The registered Holder of a Senior Note may be treated as the owner of it for all purposes.
(11)AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the Senior Notes Indenture, any Guarantee Agreement (including the 2024 Guarantee Agreement), the Senior Notes, and the Note Guarantees may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the Senior Notes then outstanding (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes); provided that, if any amendment, supplement, waiver or other modification will only affect one series of the Senior Notes, only the consent of a majority in principal amount of the then outstanding Senior Notes of such series shall be required, and, subject to Section 6.04 and Section 6.07 of the Senior Notes Indenture, any existing Default or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium on, if any, interest or Additional Amounts, if any, on, the Senior Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of the Senior Notes Indenture, any Guarantee Agreement (including the 2024 Guarantee Agreement), the Senior Notes, and the Note Guarantees may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding Senior Notes (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes); provided that, if any amendment, supplement, waiver or other modification will only affect one series of the Senior Notes, only the consent of a majority in principal amount of the then outstanding Senior Notes of such series shall be required.
Exh A-11
Without the consent of any Holder of Senior Notes, the Senior Notes Indenture, any Guarantee Agreement (including the 2024 Guarantee Agreement), the Senior Notes, and the Note Guarantees may be amended or supplemented to cure any ambiguity, defect or inconsistency, to provide for uncertificated Senior Notes in addition to or in place of certificated Senior Notes, to provide for the assumption of the Issuer's or a Guarantor's obligations to Holders and Note Guarantees in the case of a merger or consolidation or sale of all or substantially all of the Issuer's or such Guarantor's assets, as applicable, or in the case of any Substitution, to make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect the legal rights under the Senior Notes Indenture or any Guarantee Agreement (including the 2024 Guarantee Agreement) of any such Holder in any material respect, to conform the text of the Senior Notes Indenture, any Guarantee Agreement (including the 2024 Guarantee Agreement), the Note Guarantees or the Senior Notes to any provision of the “Description of the Notes” section of the Offering Memorandum to the extent that such provision in such “Description of the Notes” section of the Offering Memorandum was intended to be a verbatim recitation of a provision of the Senior Notes Indenture, any Guarantee Agreement (including the 2024 Guarantee Agreement), the Note Guarantees and the Senior Notes, to release any Note Guarantee in accordance with the terms of the Senior Notes Indenture, to provide for the issuance of Additional Senior Notes in accordance with the limitations set forth in the Senior Notes Indenture and the 2024 Guarantee Agreement as of the Issue Date, to allow any Guarantor to execute a supplemental indenture, a supplemental guarantee agreement and/or a Note Guarantee with respect to the Senior Notes, to provide for uncertificated Senior Notes in addition to or in place of certificated Senior Notes (provided that the uncertificated Senior Notes are deemed issued in registered form for purposes of Section 163(f) of the Code), or to evidence and provide the acceptance of the appointment of a successor Trustee under the Senior Notes Indenture and any Guarantee Agreement (including the 2024 Guarantee Agreement).
(12)DEFAULTS AND REMEDIES.
Exh A-12
Events of Default include: (1) default for 30 days in the payment when due of interest or Additional Amounts, if any, with respect to the relevant series of Senior Notes; (2) default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the relevant series of Senior Notes; (3) failure by the Issuer or relevant Guarantor to comply with the provisions of Sections 5.01 or 5.03 of the Senior Notes Indenture; (4) failure by the Issuer or relevant Guarantor for 60 days after written notice (i) to the Issuer by the Trustee or (ii) to the Issuer and the Trustee by the Holders of at least 25% in aggregate principal amount of the Senior Notes then outstanding voting as a single class to comply with any of the agreements in the Senior Notes Indenture (other than a default in performance, or breach, or a covenant or agreement which is specifically dealt with in Sections 6.01(a)(i), 6.01(a)(ii) or 6.01(a)(iii) of the Senior Notes Indenture); (5) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Issuer or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Issuer or any of its Restricted Subsidiaries), whether such Indebtedness or guarantee now exists, or is created after the Issue Date, if that default: (i) is caused by a Payment Default, or (ii) results in the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $75.0 million or more; (6) failure by the Issuer or any Restricted Subsidiary of the Issuer that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary, to pay final judgments entered by a court or courts of competent jurisdiction aggregating in excess of $75.0 million (exclusive of any amounts that a solvent insurance company has acknowledged liability for), which judgments shall not have been discharged or waived and there shall have been a period of 60 consecutive days during which a stay of enforcement of such judgment or order, by reason of an appeal, waiver or otherwise, shall not have been in effect; (7) except as permitted by the Senior Notes Indenture (including with respect to any limitations), any Guarantee Agreement (including the 2024 Guarantee Agreement), any Note Guarantee of any Guarantor that is a Significant Subsidiary or any group of Guarantors that, taken together, would constitute a Significant Subsidiary is held in any judicial proceeding to be unenforceable or invalid or ceases for any reason to be in full force and effect, or any Guarantor that is a Significant Subsidiary or any group of Guarantors that, taken together, would constitute a Significant Subsidiary, or the Issuer, or any Person acting on behalf of any such Guarantor or Guarantors, denies or disaffirms its obligations under its Note Guarantee; and (8) certain events of bankruptcy or insolvency described in the Senior Notes Indenture with respect to the Issuer or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary. The Issuer is required to deliver to the Trustee annually a statement regarding compliance with the Senior Notes Indenture, and the Issuer is required, upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default. The Trustee may assume without inquiry, in the absence of written notice, that the Issuer is duly complying with its obligations contained in the Senior Notes Indenture required to be observed and performed by it, and that no Default or Event of Default or other event that would require repayment of the Senior Notes has occurred.
(13)AUTHENTICATION. This Senior Note will not be valid until authenticated by the manual or facsimile signature of the authorized signatory of the Trustee or an authenticating agent.
(14)ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
(15)CUSIP, ISIN AND COMMON CODE NUMBERS. The Issuer has caused CUSIP, Common Code and ISIN numbers, as applicable, to be printed on the Senior Notes and the Trustee may use such CUSIP, Common Code and ISIN numbers, as applicable, in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of any such numbers either as printed on the Senior Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon, and any such redemption or exchange shall not be affected by any defect in or omission of such numbers.
(16)GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THE SENIOR NOTES INDENTURE, THE 2024 GUARANTEE AGREEMENT, THIS SENIOR NOTE AND THE NOTE GUARANTEES.
Exh A-13
The Issuer will furnish to any Holder upon written request and a copy of the Senior Notes Indenture, the 2024 Guarantee Agreement and the form of Senior Note. Requests may be made to:
IHS HOLDING LIMITED
190 Elgin Avenue
George Town, Grand Cayman
KY1-9008, Cayman Islands
Exh A-14
ASSIGNMENT FORM
To assign this Senior Note, fill in the form below:
(I) or (we) assign and transfer this Senior Note to: | |
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(Insert assignee's legal name) |
(Insert assignee's soc. sec. or tax I.D. no.)
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(Print or type assignee's name, address and zip code)
and irrevocably appoint ______________________________________________________________________
to transfer this Senior Note on the books of the Issuer. The agent may substitute another to act for him.
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Your Signature: |
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(Sign exactly as your name appears on the face of this Senior Note) |
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Signature Guarantee*: |
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Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). |
Exh A-15
OPTION OF HOLDER TO ELECT PURCHASE*
If you want to elect to have this Senior Note purchased by the Issuer pursuant to Section 4.10 or 4.13 of the Senior Notes Indenture, check the appropriate box below
◻ Section 4.10 |
◻ Section 4.13 |
If you want to elect to have only part of the Senior Note purchased by the Issuer pursuant to Section 4.10 or Section 4.13 of the Senior Notes Indenture, state the amount you elect to have purchased (in denominations of $200,000 and integral multiples of $1,000 in excess thereof):
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Your Signature: |
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(Sign exactly as your name appears on the face of this Senior Note) |
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Tax Identification No.: |
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Signature Guarantee*: |
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Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). |
Exh A-16
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Registered Note, or exchanges of a part of another Global Note or Definitive Registered Note for an interest in this Global Note, have been made:
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This schedule should be included only if the Senior Note is issued in global form. |
Exh A-17
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
IHS HOLDING LIMITED
190 Elgin Avenue
George Town, Grand Cayman
KY1-9008, Cayman Islands
Attention: Chief Executive Officer
[Trustee/Registrar address block]
Re:[7.875% Senior Notes due 2030]69 [8.250% Senior Notes due 2031]70 (the “Senior Notes”) of IHS Holding Limited
Reference is hereby made to the Senior Notes Indenture, dated as of November 29, 2024 (the “Senior Notes Indenture”), between, among others, IHS Holding Limited, a private limited liability company incorporated under the laws of the Cayman Islands, having its registered office at 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008, Cayman Islands (the “Issuer”), Kroll Trustee Services Limited as Trustee, Citibank, N.A., London Branch as Principal Paying Agent and Transfer Agent, and Citibank, N.A., London Branch as Registrar. Capitalized terms used but not defined herein shall have the meanings given to them in the Senior Notes Indenture.
________________, (the “Transferor”) owns and proposes to transfer the Senior Note[s] or interest in such Senior Note[s] specified in Annex A hereto, in the principal amount of $____ in such Senior Note[s] or interests (the “Transfer”), to ________________ (the “Transferee”), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1.☐ Check if Transferee will take delivery of a Book-Entry Interest in a 144A Global Note or a Definitive Registered Note pursuant to Rule 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), and, accordingly, the Transferor hereby further certifies that the beneficial interest or the Book-Entry Interest or Definitive Registered Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or the Book-Entry Interest or Definitive Registered Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a “qualified institutional buyer” within the meaning of Rule 144A under the U.S. Securities Act in a transaction meeting the requirements of Rule 144A under the U.S. Securities Act and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in
69 |
Include for 2030 Senior Notes |
70 |
Include for 2031 Senior Notes |
Exh B-1
accordance with the terms of the Senior Notes Indenture, the transferred beneficial interest or the Book-Entry Interest or Definitive Registered Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant 144A Global Note and/or the Definitive Registered Note and in the Senior Notes Indenture and the U.S. Securities Act.
2.☐ Check if Transferee will take delivery of a Book-Entry Interest in a Regulation S Global Note or a Definitive Registered Note pursuant to Regulation S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the U.S. Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market, (ii) such Transferor does not know that the transaction was prearranged with a buyer in the United States, (iii) no directed selling efforts have been made in connection with the Transfer in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the U.S. Securities Act, (iv) the transaction is not part of a plan or scheme to evade the registration requirements of the U.S. Securities Act and (v) if the proposed transfer is being effected prior to the expiration of a Restricted Period, the transferee is not a U.S. Person, as such term is defined pursuant to Regulation S of the Securities Act, and will take delivery only as a Book-Entry Interest so transferred through Euroclear or Clearstream. Upon consummation of the proposed transfer in accordance with the terms of the Senior Notes Indenture, the transferred Book-Entry Interest or Definitive Registered Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the relevant Regulation S Global Note and/or the Definitive Registered Note and in the Senior Notes Indenture and the U.S. Securities Act.
3.☐ Check and complete if Transferee will take delivery of a Book-Entry Interest in a Global Note or a Definitive Registered Note pursuant to any provision of the U.S. Securities Act other than Rule 144A or Regulation S. The Transfer is being effected in compliance with the transfer restrictions applicable to Book-Entry Interests in Global Notes and Definitive Registered Notes and pursuant to and in accordance with the U.S. Securities Act and any applicable blue sky securities laws of any state of the United States.
Exh B-2
This certificate and the statements contained herein are made for your benefit and the benefit of the Issuer.
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[Insert Name of Transferor] |
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Dated: |
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Exh B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1.The Transferor owns and proposes to transfer the following:
[CHECK ONE]
(a)☐ a Book-Entry Interest held through Euroclear Account No. _______ or Clearstream Account No. _______, in the Regulation S Global Note (ISIN _______ or Common Code _______); or
(b)☐ a Book-Entry Interest held through DTC Account No. _______ in the 144A Global Note (ISIN _______ or CUSIP _______); or
(c)☐ a 144A Definitive Registered Note; or
(d)☐ a Regulation S Definitive Registered Note.
2.After the Transfer the Transferee will hold:
[CHECK ONE]
(a)☐ a Book-Entry Interest held through Euroclear Account No. _______ or Clearstream Account No. _______, in the Regulation S Global Note (ISIN _______ or Common Code __________); or
(b)☐ a Book-Entry Interest held through DTC Account No. _______ in the 144A Global Note (ISIN _______ or CUSIP _______); or
(c)☐ a 144A Definitive Registered Note; or
(d)☐ a Regulation S Definitive Registered Note.
Exh B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
IHS HOLDING LIMITED
190 Elgin Avenue
George Town, Grand Cayman
KY1-9008, Cayman Islands
Attention: Chief Executive Officer
Re:[7.875% Senior Notes due 2030]71 [8.250% Senior Notes due 2031]72 (the “Senior Notes”) of IHS Holding Limited
(ISIN _______; [CUSIP / Common Code] _______)
Reference is hereby made to the Senior Notes Indenture, dated as of November 29, 2024 (the “Senior Notes Indenture”), between, among others, IHS Holding Limited, a private limited liability company incorporated under the laws of the Cayman Islands, having its registered office at 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008, Cayman Islands (the “Issuer”), Kroll Trustee Services Limited as Trustee, Citibank, N.A., London Branch as Principal Paying Agent and Transfer Agent, and Citibank, N.A., London Branch as Registrar. Capitalized terms used but not defined herein shall have the meanings given to them in the Senior Notes Indenture.
__________________, (the “Owner”) owns and proposes to exchange the Senior Note[s] or interest in such Senior Note[s] specified herein, in the principal amount of $_______________ in such Senior Note[s] or interests (the “Exchange”). In connection with the Exchange, the Owner hereby certifies that:
1.☐ Check if Exchange is from Book-Entry Interest in a Global Note for Definitive Registered Notes. In connection with the Exchange of the Owner's Book-Entry Interest in a Global Note for Definitive Registered Notes in an equal amount, the Owner hereby certifies that such Definitive Registered Notes are being acquired for the Owner's own account without transfer. The Definitive Registered Notes issued pursuant to the Exchange will bear the Private Placement Legend and will be subject to restrictions on transfer enumerated in the Senior Notes Indenture and the U.S. Securities Act.
2.☐ Check if Exchange is from Definitive Registered Notes for Book-Entry Interest in a Global Note. In connection with the Exchange of the Owner's Definitive Registered Notes for Book-Entry Interest in a Global Note in an equal amount, the Owner hereby certifies that such Book-Entry Interest in a Global Note are being acquired for the Owner's own account
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Include for 2030 Senior Notes |
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Include for 2031 Senior Notes |
Exh C-1
without transfer. The Book-Entry Interests transferred in exchange will be subject to restrictions on transfer enumerated in the Senior Notes Indenture and the U.S. Securities Act.
This certificate and the statements contained herein are made for your benefit and the benefit of the Issuer.
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Exh C-2
ANNEX A TO CERTIFICATE OF EXCHANGE
1.The Owner owns and proposes to exchange the following:
[CHECK ONE]
(a)☐ a Book-Entry Interest held through Euroclear Account No.____________ or Clearstream Account No. ____________, in the Regulation S Global Note (ISIN ____________ or Common Code ____________); or
(b)☐ a Book-Entry Interest held through DTC Account No. ____________ in the 144A Global Note (ISIN ____________ or CUSIP ____________); or
(c)☐ a 144A Definitive Registered Note; or
(d)☐ a Regulation S Definitive Registered Note.
2.After the Transfer the Transferee will hold:
[CHECK ONE]
(e)☐ a Book-Entry Interest held through Euroclear Account No. ____________ or Clearstream Account No. ____________, in the Regulation S Global Note (ISIN ____________ or Common Code ____________); or
(f)☐ a Book-Entry Interest held through DTC Account No. ____________ in the 144A Global Note (ISIN ____________ or CUSIP ____________); or
(g)☐ a 144A Definitive Registered Note; or
(h)☐ a Regulation S Definitive Registered Note;
Exh C-3
EXHIBIT D
FORM OF SUPPLEMENTAL SENIOR NOTES INDENTURE TO BE DELIVERED BY
SUBSEQUENT GUARANTORS
SUPPLEMENTAL SENIOR NOTES INDENTURE (this “Supplemental Senior Notes Indenture”), dated as of _____________, among _____________, a company organized and existing under the laws of _____________ (the “Subsequent Guarantor”), a subsidiary of IHS Holding Limited (or its permitted successor), a private limited liability company incorporated in the Cayman Islands, having its registered office at 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008, Cayman Islands (the “Issuer”) and Kroll Trustee Services Limited, as Trustee.
W I T N E S S E T H
WHEREAS, the Issuer has heretofore executed and delivered to the Trustee an indenture (the “Senior Notes Indenture”), dated as of November 29, 2024, providing for the issuance of 7.875% Senior Notes due 2030 (the “2030 Senior Notes”) and the 8.250% Senior Notes due 2031 (the “2031 Senior Notes,” and together with the 2030 Senior Notes, the “Senior Notes”);
WHEREAS, the Senior Notes Indenture provides that under certain circumstances the Subsequent Guarantor shall execute and deliver to the Trustee a supplemental indenture and notation of guarantee pursuant to which the Subsequent Guarantor shall unconditionally guarantee all of the Issuer's Obligations under the Senior Notes and the Senior Notes Indenture on the terms and conditions set forth herein (including but not limited to Article 10 thereof) (the “Note Guarantee”); and
WHEREAS, pursuant to Section 9.01 of the Senior Notes Indenture, the Issuer, the Guarantors, and the Trustee are authorized to execute and deliver this Supplemental Senior Notes Indenture.
NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Subsequent Guarantor and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Senior Notes as follows:
1.CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Senior Notes Indenture.
2.AGREEMENT TO GUARANTEE. The Subsequent Guarantor hereby agrees to provide an unconditional Note Guarantee on the terms and subject to the conditions set forth in the Senior Notes Indenture including but not limited to Article 10 thereof.
Exh D-1
3.EXECUTION AND DELIVERY.
(a)The execution of this Supplemental Senior Notes Indenture shall constitute due delivery of the Note Guarantee set forth in this Supplemental Senior Notes Indenture on behalf of the Subsequent Guarantor.
(b)If an Officer whose signature is on this Supplemental Indenture no longer holds that office at the time the Trustee authenticates the Supplemental Indenture in which the Note Guarantee is contained, the Note Guarantee shall be valid nevertheless
4.NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator, stockholder or agent of any Subsequent Guarantor, as such, shall have any liability for any obligations of the Issuer or any Subsequent Guarantor under the Senior Notes, the Senior Notes Indenture, the Note Guarantees or this Supplemental Senior Notes Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Senior Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Senior Notes.
5.INCORPORATION BY REFERENCE. Section 12.06 of the Senior Notes Indenture is incorporated by reference to this Supplemental Senior Notes Indenture as if more fully set out herein.
6.NEW YORK LAW TO GOVERN. THIS SUPPLEMENTAL SENIOR NOTES INDENTURE AND THE SENIOR NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
7.COUNTERPARTS. The parties may sign any number of copies of this Supplemental Senior Notes Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.
8.EFFECT OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof.
9.THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Senior Notes Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Subsequent Guarantor and the Issuer.
Exh D-2
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Senior Notes Indenture to be duly executed and attested, all as of the date first above written.
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IHS HOLDING LIMITED |
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Exh D-3
Exhibit 2.8
Execution Version
Dated November 29, 2024
THIRD SUPPLEMENTAL SENIOR NOTES INDENTURE
TO THE
SENIOR NOTES INDENTURE
DATED AS OF SEPTEMBER 18, 2019
8.000% SENIOR NOTES DUE 2027
among
IHS NETHERLANDS HOLDCO B.V.
as Issuer
THE GUARANTORS PARTY HERETO
and
CITIBANK, N.A., LONDON BRANCH
as Trustee, Principal Paying Agent, Registrar and Transfer Agent
TABLE OF CONTENTS
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Section 1. |
Capitalized Terms. |
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Section 2. |
Effectiveness; Conditions Precedent. |
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Section 3. |
Proposed Amendments. |
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Section 4. |
Global Notes. |
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Section 5. |
Conformed Indenture. |
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Section 6. |
Ratification and Effect. |
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Section 7. |
Incorporation by Reference. |
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Section 8. |
Governing Law. |
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Section 9. |
Counterpart Originals. |
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Section 10. |
The Trustee. |
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Section 11. |
Severability. |
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Section 12. |
Effect of Headings. |
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Section 13. |
Conflicts. |
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Section 14. |
Entire Agreement. |
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Section 15. |
Successors. |
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Exhibit 1 - Conformed Indenture |
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i
This THIRD SUPPLEMENTAL SENIOR NOTES INDENTURE (this “Third Supplemental Senior Notes Indenture”), dated as of November 29, 2024, among IHS Netherlands Holdco B.V., a private limited liability company incorporated under the laws of the Netherlands, having its registered office at Herikerbergweg 88, 1101CM Amsterdam, The Netherlands (the “Issuer”), IHS Holding Limited (the “Parent Guarantor”), IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., IHS Nigeria Limited, IHS Towers NG Limited, Nigeria Tower Interco B.V., INT Towers Limited and INT Towers NG Finco 1 Plc (collectively, the “Guarantors”), and Citibank, N.A., London Branch, as trustee (the “Trustee”), Principal Paying Agent, Registrar and Transfer Agent supplements and amends the indenture, (the “Senior Notes Indenture”), dated as of September 18, 2019, as amended by the first supplemental indenture dated June 17, 2021, among the Issuer, the guarantors party thereto and the Trustee (the “First Supplemental Indenture”) and as further amended by the second supplemental indenture dated July 26, 2024 , among the Issuer, INT Towers NG Finco 1 Plc as subsequent guarantor and the Trustee (the “Second Supplemental Indenture”), providing for the issuance of the 8.000% Senior Notes due 2027 (the “Senior Notes”).
RECITALS
1) |
WHEREAS, the Issuer and the Guarantors have heretofore executed and delivered to the Trustee, Principal Paying Agent, Registrar and Transfer Agent the Senior Notes Indenture, providing for the issuance of the Senior Notes; |
2) |
WHEREAS, pursuant to Section 9.02(a) of the Senior Notes Indenture, the Issuer, the Guarantors and the Trustee may amend or supplement certain provisions of the Senior Notes Indenture, the Senior Notes or the guarantees for the Senior Notes (the “Note Guarantees”) with the consent of the Holders of at least a majority in aggregate principal amount of the Senior Notes then outstanding, subject to certain limitations set forth in the Senior Notes Indenture (the “Required Consents”); |
3) |
WHEREAS, upon the terms and subject to the conditions set forth in its tender offer and consent solicitation statement, dated as of November 12, 2024 (the “Tender Offer and Consent Solicitation Statement”), the Issuer has solicited consents of the Holders of Senior Notes to the Proposed Amendments (as defined in the Tender Offer and Consent Solicitation Statement), which, for the avoidance of doubt do not impair or affect a Holder’s right to receive principal, premium, if any, interest or Additional Amounts, if any, on the Senior Note held by such Holder in accordance with Section 6.07 of the Senior Notes Indenture), and the Issuer has now obtained the Required Consents, and as such, this Third Supplemental Senior Notes Indenture, the amendments set forth herein and Trustee’s entry into this Third Supplemental Senior Notes Indenture are authorized pursuant to Section 9.02(a) of the Senior Notes Indenture; |
4) |
WHEREAS, Kroll Issuer Services Limited, as information, tender and tabulation agent under the Tender Offer and Consent Solicitation Statement, has advised the Issuer and the Trustee that it has received validly the Required Consents on or prior to the date hereof and that those Required Consents have not been revoked; |
5) |
WHEREAS, pursuant to Section 9.02(a) of the Senior Notes Indenture, the Issuer, the Parent Guarantor, the Guarantors and the Trustee are authorized to execute and deliver this Third Supplemental Senior Notes Indenture; and |
6) |
WHEREAS, pursuant to Section 9.02(a) and Section 9.03 of the Senior Notes Indenture, the execution and delivery of this Third Supplemental Senior Notes Indenture has been duly authorized by the parties hereto, and all conditions and requirements necessary to make this Third Supplemental Senior Notes Indenture a valid and binding instrument effectively amending the Senior Notes Indenture as set forth |
herein have been duly performed and fulfilled by the parties hereto, including the receipt of all conditions precedent to which the Trustee is entitled under the Indenture.
AGREEMENT
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration the receipt of which is hereby acknowledged, the Issuer, the Parent Guarantor, the Guarantors and the Trustee each mutually covenant and agree for the equal and ratable benefit of the Holders of the Seniors Notes as follows:
Section 1. |
Capitalized Terms. |
Capitalized terms used herein without definition shall have the meanings assigned to them in the Senior Notes Indenture.
Section 2.Effectiveness; Conditions Precedent.
(a)The Issuer and the Guarantors represent and warrant that each of the conditions precedent under the Senior Notes Indenture to the amendment and supplement of the Senior Notes Indenture (including such conditions pursuant to Sections 7.02, 9.02, 9.03 and 9.05 of the Senior Notes Indenture) have been satisfied in all respects. With respect to the amendments set forth in Section 3 hereof, and pursuant to Section 9.02 (a) of the Senior Notes Indenture, the Required Consents have been received, which have authorized and directed the Trustee to execute this Third Supplemental Senior Notes Indenture. Upon delivery to the Trustee, Principal Paying Agent, Registrar and Transfer Agent of an Officer’s Certificate and Opinions of Counsel, in form and substance reasonably satisfactory to the Trustee as required by Section 9.05 of the Senior Notes Indenture, the Issuer, the Parent Guarantor, the Guarantors and the Trustee are on this date executing this Third Supplemental Senior Notes Indenture which will become effective on the date hereof upon execution by each party hereto (the “Effective Date”).
(b)The Issuer will provide to the Trustee the notice announcing the payment of the Consent Payment (as defined in the Tender Offer and Consent Solicitation Statement) and confirming that the amendments set forth in Section 3 and Section 4 hereof have become operative.
Section 3.Proposed Amendments.
Pursuant to Section 9.02(a) of the Senior Notes Indenture, and subject to Section 2(b) hereof, the Senior Notes Indenture will hereby be amended, such amendments to be operative at and from the Effective Date, and upon payment of the Consent Payment (as defined in the Tender Offer and Consent Solicitation Statement) as follows (with additions shown as a double-underline and deletions shown in strikethrough):
1. |
Amendments to certain definitions in Article I. |
a. |
Section 1.01 and the definitions found therein are hereby amended as follows, and re- inserted into alphabetical order where required: |
“2024 Notes Issue Date” means the date of issuance of the New Notes by the Parent Guarantor, part of the proceeds of which are to be used to fund a tender offer for, among other debt securities, the Notes, as described in the tender offer and consent solicitation memorandum dated November 12, 2024.
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“Existing 2026 Notes” means the $500 million aggregate principal amount of 5.625% Senior Notes due 2026 issued by the Parent Guarantor.
“Existing 2028 Notes” means the $500 million aggregate principal amount of 6.250% Senior Notes due 2028 issued by the Parent Guarantor.
“Existing Notes” means, collectively, the Existing 2026 Notes and the Existing 2028 Notes.
“Guarantor Redomiciliation” means any redomiciliation of any Guarantor or Guarantors from where they are currently domiciled to be domiciled in any Approved Jurisdiction (in one or more steps), and each of the filings, registrations and other steps in relation thereto.
“IHS Holding 2020 Revolving Credit Facility” means that certain senior revolving credit facility agreement originally dated March 30, 2020 and as amended and restated on June 2, 2021 and November 6, 2023 by and among the Parent Guarantor, the Issuer and the Subsidiary Guarantors as obligors thereunder, the senior lenders named therein, and the agent, including any related notes, guarantees, collateral documents, instruments, and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“IPO Market Capitalization” means an amount equal to (i) the total number of issued and outstanding shares of common stock or common equity interests of the IPO Entity at the time of closing of the Public Equity Offering multiplied by (ii) the price per share at which such shares of common stock or common equity interests are sold in such Public Equity Offering.
“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest, assignment by way of security, or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement or any lease in the nature thereof.
“Management Advances” means loans or advances not exceeding USthe greater of $6.020.0 million and 0.5% of Total Assets in aggregate outstanding amount following the 2024 Notes Issuance Date, and in each case made to, or guarantees with respect to loans or advances made to, directors, officers or employees of any Parent Guarantor or any Restricted Subsidiary: (1) in respect of travel, entertainment or moving related expenses incurred in the ordinary course of business; (2) in respect of moving related expenses incurred in connection with any closing or consolidation of any facility or office; or (3) in the ordinary course of business.
“Management Fees” means (1) customary annual fees for the performance of monitoring services by any Permitted Holder for the Parent Guarantor or any of its Restricted Subsidiaries; provided that such fees will not, in the aggregate, exceed US$10.0 million per annum (inclusive of out of pocket expenses); and (2) customary fees and related expenses for the performance of transaction, management, consulting, financial or other advisory services or underwriting, placement or other investment banking activities, including in connection with mergers, acquisitions, dispositions or joint ventures, by any Permitted Holder or any of its Affiliates for the Parent Guarantor or any Restricted Subsidiary, which payments in respect of this clause (2) have been approved by a majority of the disinterested members of the Board of Directors of the Parent Guarantor, or, if there are not sufficient disinterested members of the Board of Directors of the Parent Guarantor to form a majority, by a majority of the Board of Directors.
3
“New Notes” means the $550 million in aggregate principal amount of 7.875% senior notes due 2030 and $650 million in aggregate principal amount of 8.250% senior notes due 2031.
“Nigeria 2023 Revolving Credit Facility” means that certain senior revolving credit facility agreement originally dated January 3, 2023 by and among the Parent Guarantor, the Issuer and the Subsidiary Guarantors as obligors thereunder, the senior lenders named therein, and the agent, including any related notes, guarantees, collateral documents, instruments, and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“Nigeria 2023 Term Loan” means that certain term facility agreement, originally dated on or around, January 3, 2023, by and among the Parent Guarantor, the Issuer and the Subsidiary Guarantors as obligors thereunder, the senior lenders named therein, and the agent, including any related notes, guarantees, instruments and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“Officer” means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, the Treasurer, director, manager or a responsible accounting or financial officer of such Person, or any other individual designated as an “Officer” for the purposes of the Indenture by the Board of Directors of such Person.
“Priority Debt Cap” means the greater of U.S.$1,6301,890 million and 200% of Consolidated EBITDA.
“Specified Change of Control Event” means the occurrence of any event that would constitute a Change of Control pursuant to the definition thereof; provided that giving pro forma effect thereto, the Consolidated Net Leverage Ratio would not exceed 3.54.0 to 1.0. Notwithstanding the foregoing, only one Specified Change of Control Event shall be permitted under the Indenture after the Issue Date.
b. |
Paragraph (1) of the proviso to the definition of “Asset Sale” set forth in Section 1.01 is hereby amended as follows: |
(1) any single transaction or series of related transactions that involves assets having a fair market value of less than the greater of US$20.025.0 million and 0.8% of the Total Assets of the Parent Guarantor;
c. |
A new paragraph (2) to the definition of “Board of Directors” set forth in Section 1.01 is hereby included as follows and the remaining paragraphs shall be renumbered accordingly: |
(2) with respect to an exempted company, the board of directors of the exempted company or any committee thereof duly authorized to act on behalf of such board;
d. |
Paragraphs (1) and (2) of the definition of “Cash Equivalents” set forth in Section 1.01 are hereby amended as follows: |
(1)direct obligations (or certificates representing an interest in such obligations) issued by, or unconditionally guaranteed by, the government of a member state of the European Union (including the United Kingdom), Nigeria, the United States of America or any state thereof, Switzerland (or the government of the jurisdiction of organization of any Restricted Subsidiary (including, in each case, any agency or instrumentality thereof), as the case may be, the payment of which is backed by the full faith and credit of the relevant member state of the European Union (including the United Kingdom), the Federal Republic of Nigeria, the United States of America or Switzerland, as the case may be, and which are not callable or redeemable at the issuer’s option;
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(2)overnight bank deposits, time deposit accounts, certificates of deposit, banker’s acceptances and money market deposits with maturities (and similar instruments) of 12 months or less from the date of acquisition issued by a bank or trust company, or a local branch or Subsidiary of a bank or trust company, which is organized under, or authorized to operate as a bank or trust company under, the laws of a member state of the European Union (including the United Kingdom), Nigeria, or of the United States of America or any state thereof or, Switzerland or the government of the jurisdiction of organization of any Restricted Subsidiary or any commercial banking institution that is a member of the U.S. Federal Reserve System, in each case, either (a) having combined capital and surplus and undivided profits of not less than $250.0 million (or the foreign currency equivalent thereof as of the date of such investment), whose long term, unsecured, unsubordinated and unguaranteed debt has a rating, at the time any investment is made therein, of at least “BBB” or the equivalent thereof from S&P and at least “Ba3” or the equivalent thereof from Moody’s or the equivalent rating category of another internationally recognized rating agency; (b) which has its primary registration in a jurisdiction in which the Parent Guarantor or a Restricted Subsidiary conducts its business or is organized and which would rank, in terms of combined capital and surplus and undivided profits or the ratings on its long term debt, among the top ten such banks registered in such jurisdiction or (c) which is a lender under any Credit Facility to which the Issuer or any Guarantor is a party;
e. |
Paragraph (4) to the definition of “Consolidated Net Income” set forth in Section 1.01 is hereby amended as follows: |
(4) any one time non-cash charges or any amortization or depreciation resulting from purchase accounting, in each case, in relation to any acquisition of, or merger or consolidation with, another Person or business or resulting from any reorganization or, restructuring, liquidation (including provisional liquidation), winding up or like proceeding involving the Parent Guarantor or its Subsidiaries will be excluded;
f. |
Paragraph 16 to the definition of “Permitted Investments” set forth in Section 1.01 is hereby amended as follows: |
(16)other Investments in any Person having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (16) that are at the time outstanding not to exceed the greater of (a) US$50.0250.0 million and (b) 2.05.0% of the Total Assets of the Parent Guarantor at any time outstanding; provided that if an Investment is made pursuant to this clause in a Person that is not a Restricted Subsidiary and such Person subsequently becomes a Restricted Subsidiary or is subsequently designated a Restricted Subsidiary pursuant to Section 4.07, such Investment shall thereafter be deemed to have been made pursuant to clause (1) or (3) of the definition of “Permitted Investments” and not this clause.
g. |
Paragraphs 8, 21 and 33 to the definition of “Permitted Liens” set forth in Section 1.01 are hereby amended as follows: |
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(8)any Liens imposed by the operation of law in the ordinary course of business (including any netting or set-off as a result of a fiscal unity (fiscal eenheid) for Dutch corporate tax or value added tax purposes or of any other jurisdiction having similar effect);
(21)(a) mortgages, liens, security by way of assignment, security interests, pledges, restrictions, encumbrances or any other matters of record that have been placed by any developer, landlord or other third party on property over which the Parent Guarantor or any Restricted Subsidiary has easement rights or on any real property leased by the Parent Guarantor or any Restricted Subsidiary (including any rental deposits) and subordination or similar agreements relating thereto and (b) any condemnation or eminent domain proceedings or compulsory purchase order affecting real property;
(33)Liens incurred in the ordinary course of business of the Parent Guarantor or any Restricted Subsidiary securing Indebtedness of the Parent Guarantor and its Restricted Subsidiaries that does not exceed the greater of US$75.0100.0 million and 3.02.0% of the Total Assets of the Parent Guarantor at any one time outstanding following the 2024 Notes Issuance Date.
h. |
The first sentence of the definition of “Permitted Reorganization” set forth in Section 1.01 is hereby amended as follows: |
means any amalgamation, demerger, merger, voluntary liquidation, consolidation, reorganization, restructuring, redomiciliation, winding up or corporate reconstruction involving the Parent Guarantor or any Restricted Subsidiary that is made on a solvent basis; provided that (1) any payments, business, property or assets distributed in connection with such Reorganization remain within the Parent Guarantor and the Restricted Subsidiaries; and (2) if any Note Guarantees are released in connection with such Reorganization in accordance with the Note Guarantee release provisions of the Indenture, Note Guarantees must be provided promptly following the completion of such Reorganization such that the Note Guarantees in place following the Reorganization are not materially worse for the holders of the Notes than the pre- existing Note Guarantees (in the good faith judgment of the Parent Guarantor).
2. |
Amendments to certain provisions of Article IV. |
a. |
References in Section 4.07(a)(v)(C) to “Issue Date” are hereby deleted and replaced by references to “2024 Notes Issue Date”. |
b. |
Paragraphs (A)-(B) of Section 4.07(b)(iv) are hereby amended and restated in its entirety as follows: |
(A) (i) from Net Proceeds to the extent permitted under Section 4.10 hereof, but only if the Parent Guarantor shall have first complied with the terms of such covenant described under Section 4.10 and purchased all Senior Notes tendered pursuant to any offer to repurchase all the Senior Notes required thereby, prior to purchasing, repurchasing, redeeming, defeasing or otherwise acquiring or retiring such Subordinated Obligations and (ii) at a purchase price not greater than 100% of the principal amount of such Subordinated Obligations plus accrued and unpaid interest and any premium payable thereon;
(B) to the extent required by the agreement governing such Subordinated Obligations, following the occurrence of a Change of Control (or other similar event described therein as a “change of control”), but only (i) if the Parent Guarantor shall have first complied with the terms described under Section 4.13 hereof and purchased all Senior Notes tendered pursuant to the offer to repurchase all the Senior Notes required thereby, prior to purchasing, repurchasing, redeeming, defeasing or otherwise acquiring or retiring such Subordinated Obligations and (ii) at a purchase price not greater than 101% of the principal amount of such Subordinated Indebtedness plus accrued and unpaid interest and any premium payable thereon; or
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c. |
Paragraph (v) of Section 4.07(b) is hereby amended and restated in its entirety as follows: |
(v) the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Parent Guarantor or any Restricted Subsidiary held by any current or former officer, director, employee or consultant of the Parent Guarantor or any of its Restricted Subsidiaries pursuant to any equity subscription agreement, stock option agreement, restricted stock grant, shareholders’ agreement or similar agreement; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests may not exceed $6.020.0 million per calendar year (with unused amounts in any calendar year being carried over to the next two succeeding calendar yearsyear; provided that the amounts carried over under this Section 4.07(b)(v) in any calendar year do not exceed $6.0 million); and provided further, that such amount in any calendar year may be increased by an amount not to exceed the cash proceeds (excluding proceeds from any Parent Debt Contributions) from the sale of Equity Interests of the Parent Guarantor or a Restricted Subsidiary received by the Parent Guarantor or a Restricted Subsidiary during such calendar year, in each case to members of management, directors or consultants of the Parent Guarantor, any of its Restricted Subsidiaries or any Parent Holdco of the Parent Guarantor to the extent the cash proceeds from the sale of Equity Interests have not otherwise been applied to the making of Restricted Payments pursuant to Section 4.07(a)(v)(C)(2) hereof or this Section 4.07(b)(ii) and are not Excluded Contributions or Excluded Amounts;
d. |
Paragraph (ix) of Section 4.07(b) is hereby amended and restated in its entirety as follows: |
(ix) advances or loans to (a) any future, present or former officer, director, employee or consultant of the Parent Guarantor or a Restricted Subsidiary to pay for the purchase or other acquisition for value of Equity Interests of the Parent Guarantor (other than Disqualified Stock or Designated Preference Shares), or any obligation under a forward sale agreement, deferred purchase agreement or deferred payment arrangement pursuant to any management equity plan or stock option plan or any other management or employee benefit or incentive plan or other agreement or arrangement or (b) any management equity plan, employee benefit trust or stock option plan or any other management or employee benefit or incentive plan or unit trust or the trustees of any such plan or trust to pay for the purchase or other acquisition for value of Equity Interests of the Parent Guarantor (other than Disqualified Stock or Designated Preference Shares); provided that the total aggregate amount of Restricted Payments made under this Section 4.07(b)(ix) does not exceed $6.020.0 million at any time outstanding following the 2024 Notes Issuance Date,;
e. |
Paragraph (xvi) of Section 4.07(b) is hereby amended and restated in its entirety as follows: |
(xvi) so long as no Default or Event of Default has occurred and is continuing (or would result therefrom), any Restricted Payment; provided that the Consolidated Net Leverage Ratio on a pro forma basis after giving effect to any such dividend, distribution, advance, loan or other payment and any Indebtedness incurred in connection therewith does not exceed 3.253.50 to 1.0;
f. |
Paragraph (xviii) of Section 4.07(b) is hereby amended and restated in its entirety as follows: |
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(xviii) so long as no Default or Event of Default has occurred and is continuing (or would result therefrom), the declaration and payment by the Parent Guarantor of, or loans, advances, dividends or distributions to any Parent Holdco to pay, dividends on the common stock or common equity interests of the Parent Guarantor or any Parent Holdco following a Public Equity Offering of such common stock or common equity interests following September 18, 2019, in an amount not to exceed in any fiscal year the greater of (a) 6% of the Net Cash Proceeds received by the Parent Guarantor from such Public Equity Offering or contributed to the equity (other than through the issuance of Disqualified Stock or Designated Preference Shares or through an Excluded Contribution or Excluded Amounts or a Parent Debt Contribution) of the Parent Guarantor and (b) following the Public Equity Offering, an amount equal to the greater of either (A) 6% of the Market Capitalization or (B) 6% of the IPO Market Capitalization; provided that in the case of this clause (b ) after giving pro forma effect to such loans, advances, dividends or distributions, the Consolidated Net Leverage Ratio shall be equal to or less than 3.754.0 to 1.0;
g. |
Paragraph (xx) of Section 4.07(b) is hereby amended and restated in its entirety as follows: |
(xx) so long as no Default or Event of Default has occurred and is continuing, other Restricted Payments in an aggregate amount not to exceed the greater of $50.0350.0 million and 2.06.0% of the Total Assets of the Parent Guarantor following the 2024 Notes Issue Date; in any fiscal year since the Issue Date, pro rated for any partial fiscal year (including the fiscal year in which the Issue Date falls).
h. |
Section 4.09(a) is hereby amended and restated in its entirety as follows: |
(a) The Parent Guarantor will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, “incur”) any Indebtedness (including Acquired Debt), and the Parent Guarantor will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Parent Guarantor may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock and any Restricted Subsidiary may incur Indebtedness or issue preferred stock, if on the date on which such Indebtedness is incurred or such Disqualified Stock or preferred stock is issued, as the case may be, the Parent Guarantor’s Consolidated Net Leverage Ratio would not exceed 4.004.50 to 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the Indebtedness had been incurred or the Disqualified Stock or preferred stock had been issued on such date.
i. |
Paragraphs (i)-(iv) of Section 4.09(b) are hereby amended and restated in its entirety as follows: |
(i) the incurrence of Indebtedness under (A) the Parent RevolvingCredit FacilityFacilities in an aggregate principal amount at any one time outstanding under this Section 4.09(b)(i)(A) not to exceed $300.0 million; and (B) Credit Facilities not described in Section 4.09(b)(i)(A) hereof in an aggregate principal amount at any one time outstanding under this Section 4.09(b)(i)(B) not to exceed U.S.$500.0$1,000.0 million, plus in the case of any refinancing of any Indebtedness permitted under thesethis Sections 4.09(b)(i)(A) or (B) or any portion thereof, the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing; (ii) Indebtedness outstanding on the 2024 Notes Issue Date after giving pro forma effect to the Transactions and the use of the net proceeds thereof (other than Indebtedness described in Sections 4.09(b)(i) and (iii) hereof);
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(iii) the incurrence by the Issuer and the Guarantors of Indebtedness represented by the Senior Notes (other than Additional Senior Notes) and the related Note Guarantees (including any future Note Guarantees) and the Existing Notes and guarantees of the Existing Notes and, without limitation, any lending made with the proceeds thereof between or among the Parent Guarantor and its Restricted Subsidiaries;
(iv)the incurrence by the Parent Guarantor or any Restricted Subsidiary of Indebtedness representing (x) Capital Lease Obligations, mortgage financings, purchase money obligations or other Indebtedness incurred for the purpose of financing all or any part of the purchase price, lease expense, rental payments or cost of design, construction, installation or improvement of property, plant or equipment or other assets (including Capital Stock) used in the business of the Parent Guarantor or any of its Restricted Subsidiaries not to exceed the greater of $75.0150.0 million or 3.0% of the Total Assets of the Parent Guarantor at any time outstanding following the 2024 Notes Issuance Date; or (y) any Non-Issuer Group Lease Obligations;, or (z) without prejudice to any other permission set forth herein, (i) Capital Lease Obligations incurred in the ordinary course of business and consistent with past practice and (ii) consisting of any obligations in respect of a lease, concession or license of property (or guarantee thereof) which would be considered an operating lease under IFRS (or would have previously been categorized as operating leases prior to the adoption of IFRS 16 (Leases));
j. |
A new paragraph (vii) is hereby added to Section 4.09(b) as follows and the remaining paragraphs shall be renumbered accordingly: |
(vii) the incurrence by the Issuer or any Restricted Subsidiary of intercompany Indebtedness between or among the Issuer or any Restricted Subsidiary; provided that the Indebtedness arises under guarantees entered into pursuant to section 2:403 of the Dutch Civil Code in respect of a Restricted Subsidiary incorporated in the Netherlands and any residual liability with respect to such guarantees arising under Section 2:404 of the Dutch Civil Code;
k. |
Paragraph (xiv) of Section 4.09(b) is hereby amended and restated in its entirety as follows: |
(xiv) Indebtedness of (A) any Person outstanding on the date on which such Person becomes a Restricted Subsidiary or is merged, consolidated, amalgamated or otherwise combined with (including pursuant to any acquisition of assets and assumption of related liabilities) the Parent Guarantor or any Restricted Subsidiary (other than Indebtedness incurred to provide all or any portion of the funds used to consummate the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary or was otherwise acquired by the Parent Guarantor or a Restricted Subsidiary or otherwise in connection with, or in contemplation of, such acquisition) or (B) the Parent Guarantor or any Restricted Subsidiary incurred in relation to any such acquisition, merger, consolidation, amalgamation or combination; provided, however, with respect to this Section 4.09(b)(xiv), that at the time of the acquisition or other transaction pursuant to which such Indebtedness was incurred or deemed to be incurred (x) the Parent Guarantor would have been able to incur $1.00 of additional Indebtedness pursuant to Section 4.09(a) hereof after giving effect to the incurrence of such Indebtedness pursuant to this Section 4.09(b)(xiv) calculated on a pro forma basis or (y) the Consolidated Net Leverage Ratio would be equal or less than the Consolidated Net Leverage Ratio immediately prior to giving effect to such acquisition or other transaction on a pro forma basis or, in the case of any Indebtedness incurred in reliance on Section 4.09(b)(xiv)(A), the principal amount of such Indebtedness is discharged, or otherwise reclassified in any manner that complies with this Section 4.09, within one year of incurrence;
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l. |
Paragraphs (xxii)-(xxiii) of Section 4.09(b) are hereby amended and restated in its entirety as follows: |
(xxii) Indebtedness incurred by the Parent Guarantor and any Restricted Subsidiary under local Credit Facilities in an aggregate principal amount at any one time outstanding under this clause this Section 4.09(b)(xxii), not to exceed $25.050.0 million, plus in the case of any refinancing of any Indebtedness permitted under this Section 4.09(b)(xxii) or any portion thereof, the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing;
(xxiii)any joint and several liability in respect of any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same) as a result of a fiscal unity (fiscale eenheid) for Dutch corporate tax or value added tax purposes (or any similar structure of any other jurisdiction having similar effect) in respect of the Parent Guarantor or any Restricted Subsidiary;
m. |
Paragraph (xxv) of Section 4.09(b) is hereby amended and restated in its entirety as follows: |
(xxv)the incurrence of Indebtedness by the Parent Guarantor or any of its Restricted Subsidiaries in an aggregate principal amount at any time outstanding, including all Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this Section 4.09(b)(xxv), not to exceed the greater of $75.0150.0 million and 3.0% of the Total Assets of the Parent Guarantor at any time outstanding following the 2024 Notes Issue Date,
n. |
The last paragraph of Section 4.09(b) is hereby amended and restated in its entirety as follows: |
provided that the amount of Indebtedness incurred by any Restricted Subsidiary that is not a Guarantor in reliance on Sections 4.09(a) or clauses (b)(ii) or (b)(xxv) hereof (x) with respect to any Issuer Group Restricted Subsidiary, shall be limited to the greater of U.S.$75.0150.0 million and 3.0% of the Total Assets of the Issuer and (y) with respect to any other Restricted Subsidiary that is not an Issuer Group Restricted Subsidiary, shall be limited to the Priority Debt Cap at any time outstanding.
o. |
The last sentence of paragraph (i) of Section 4.09(c) is hereby amended and restated in its entirety as follows: |
All Indebtedness under the IHS Holding 2020 Revolving Credit Facility, the Nigeria 2023 Revolving Credit Facility and the Nigeria 2023 Term Loan the Parent Revolving Credit Facility and the Senior Credit Facilities outstanding on thefollowing the 2024 Notes Issue Date shall be incurred under Section 4.09(b)(i)(A) and 4.09(b)(i)(B) hereof, respectively, and may not be reclassified;
p. |
Paragraph (G) of Section 4.10(a)(ii) is hereby amended and restated in its entirety as follows: |
(G)any Designated Non-Cash Consideration received by the Parent Guarantor or any of its Restricted Subsidiaries in such Asset Sales having an aggregate fair market value, when taken together with all other Designated Non-Cash Consideration received pursuant to this Section 4.10(a)(ii)(G) that is at that time outstanding, not to exceed the greater of $50.0100.0 million and 2.0% of the Total Assets of the Parent Guarantor following the 2024 Notes Issue Date, measured at the time of the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value).
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q. |
Paragraph (i) of Section 4.10(b) is hereby amended and restated in its entirety as follows: |
(i) (A) prepay, repay, redeem or purchase (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) Pari Passu Indebtedness at a price of no more than 100% of the principal amount of such Pari Passu Indebtedness plus accrued and unpaid interest to the date of such prepayment, repayment, purchase or redemption; provided that the Parent Guarantor shall redeem, repay or repurchase Pari Passu Indebtedness that is Public Debt pursuant to this Section 4.10(b)(i)(A) only if the Parent Guarantor makes (at such time or subsequently in compliance with this covenant) an offer to all holders of the Senior Notes to purchase their Senior Notes in accordance with the provisions set forth below for an Asset Sale Offer for an aggregate principal amount of Senior Notes at least equal to the proportion that (x) the total aggregate principal amount of Senior Notes outstanding bears to (y) the sum of the total aggregate principal amount of Senior Notes outstanding plus the total aggregate principal amount outstanding of such Pari Passu Indebtedness (a “Public Debt Offer”), provided further that such Public Debt Offer shall not be required if the Issuer was eligible to, and has, made a Non-Pro Rata Election (as defined below) in respect of such Net Proceeds; (B) with respect to assets of a Restricted Subsidiary that is not a Guarantor, prepay, repay, repurchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any of its Indebtedness; or (C) prepay, repay, repurchase or redeem any Indebtedness that is secured on any asset which security does not also secure the Senior Notes on a pari passu or senior basis (and in each of Sections 4.10(b)(i)(A) and (B) hereof and this Section 4.10(b)(i)(C), other than Indebtedness that is owed to the Parent Guarantor or a Restricted Subsidiary);
r. |
A new paragraph (c) is hereby added to Section 4.10 as follows and the remaining paragraphs shall be renumbered accordingly: |
(c) The Issuer shall be permitted, at any time and from time to time following the 2024 Notes Issuance Date through the date that is three years from the 2024 Notes Issuance Date, to make one or more elections to apply up to a maximum of $1.0 billion in aggregate (or its equivalent in other currencies) of the Net Proceeds of Asset Sales pursuant to clause (1) above to the redemption, repayment or repurchase of any Pari Passu Indebtedness that is Public Debt without being required to make a Public Debt Offer (any such election, a “Non-Pro Rata Election”). Following any such Non-Pro Rata Election, any proceeds so applied shall be considered a permitted application of Net Proceeds pursuant to this Indenture.
s. |
Section 4.10(e) is hereby amended and restated in its entirety as follows: |
(e) Any Net Proceeds from Asset Sales that are not applied or invested as provided in Section 4.10(b) hereof will constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $40.0100.0 million, within ten Business Days thereof, or at any earlier time at the Issuer’s election, the Issuer will make an offer (an “Asset Sale Offer”) to all Holders and may, to the extent the Issuer so elects, make an offer to holders of Pari Passu Indebtedness to purchase, prepay or redeem with the proceeds of sales of assets in accordance with Section 3.10 hereof the maximum principal amount of Senior Notes and such other Pari Passu Indebtedness (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith) that may be purchased, prepaid or redeemed out of the Excess Proceeds.
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The offer price for the Senior Notes in any Asset Sale Offer will be equal to (i) solely in the case of the Senior Notes, 100% of the principal amount of the applicable series, which shall be repurchased in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part; and (ii) solely in the case of any other Pari Passu Indebtedness, no greater than 100% of the principal amount, plus, in the case of (i) and (ii), accrued and unpaid interest and Additional Amounts, if any, to the date of purchase, prepayment or redemption, subject to the rights of the Holders on the relevant record date to receive interest due on the relevant interest payment date, and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Parent Guarantor and its Restricted Subsidiaries may use those Excess Proceeds for any purpose not otherwise prohibited by this Senior Notes Indenture. If the aggregate principal amount of Senior Notes and other Pari Passu Indebtedness tendered into (or to be prepaid or redeemed in connection with) such Asset Sale Offer exceeds the amount of Excess Proceeds, or if the aggregate principal amount of Senior Notes tendered pursuant to an Asset Sale Offer that is an application of Net Proceeds pursuant to Section 4.10(b)(i) hereof exceeds the amount of the Net Proceeds so applied, the Trustee or the Registrar, as applicable, will select the Senior Notes and such other Pari Passu Indebtedness, if applicable, to be purchased on a pro rata basis (or in the manner described under Section 3.02 hereof), based on the amounts tendered or required to be prepaid or redeemed in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. Neither the Trustee nor the Registrar shall be liable for any selections made by it in accordance with this Section 4.10.
t. |
Section 4.11(a) is hereby amended and restated in its entirety as follows: |
(a) The Parent Guarantor will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, enter into or conduct any transaction or series of related transactions (including the purchase, sale, lease or exchange of any property or the rendering of any services) with any Affiliate of the Parent Guarantor (any such transaction or series of related transactions being, an “Affiliate Transaction”) involving aggregate value in excess of $10.040.0 million, unless
(i) the Affiliate Transaction is on terms that are not materially less favorable to the Parent Guarantor or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Parent Guarantor or such Restricted Subsidiary with an unrelated Person; and
(ii) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate value in excess of U.S.$30.050.0 million, a resolution of the Board of Directors of the Parent Guarantor set forth in an Officer’s Certificate certifying that such Affiliate Transaction complies with this covenant and that such Affiliate Transaction has been approved by a majority of the disinterested members of the Board of Directors of the Parent Guarantor, or, if there are not sufficient disinterested members of the Board of Directors of the Parent Guarantor to form a majority, by a majority of the Board of Directors.
u. |
Section 4.14(a) is hereby amended and restated in its entirety as follows: |
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(a) The Parent Guarantor will not cause or permit any of its Restricted Subsidiaries that is not a Guarantor, directly or indirectly, to guarantee the payment of, assume or in any manner become liable with respect to any other Indebtedness of the Parent Guarantor or a Guarantor incurred under Credit Facilities in excess of the greater of $20.040.0 million and 0.8% of the Total Assets of the Parent Guarantor or that constitutes Public Debt unless such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture providing for the guarantee of the payment of the Senior Notes by such Restricted Subsidiary, which Note Guarantee will be senior to or pari passu with such Restricted Subsidiary’s guarantee of such other Indebtedness.
3. |
Amendments to certain provisions of Article V. |
a. |
Section 5.01(d) is hereby amended and restated in its entirety as follows: |
(d)This Section 5.01 will not apply to (i) any consolidation or merger of any Restricted Subsidiary that is not a Guarantor with and into the Issuer or a Guarantor; (ii) any consolidation or merger of any Guarantor with or into the Issuer or any other Guarantor; or (iii) any Permitted Reorganization effected in compliance with the definition thereof or (iv) any Guarantor Redomiciliation; provided that, in the case of Sections 5.01(d)(i) and (ii) hereof, Sections 5.01(a)(ii) and 5.01(a)(v) hereof will be complied with. Sections 5.01(a)(iii), 5.01(a)(iv) and 5.01(b)(ii) hereof will not apply to any merger or consolidation of the Issuer or any Guarantor with or into an Affiliate solely for the purpose of reincorporating the Issuer or such Guarantor in another jurisdiction. This Section 5.01 will not apply to any transaction undertaken in accordance with Section 5.03 hereof.
4. |
Amendments to certain provisions of Article VI. |
a. |
References in Sections 6.01(a)(v) and 6.01(a)(vi) to “$50.0 million” are hereby deleted and replaced by references to “$75.0 million”. |
Section 4. Global Notes and General.
(a)Each Global Note shall be deemed supplemented, modified and amended in such manner as necessary to make the terms of such Global Note consistent with the terms of the Senior Notes Indenture, as supplemented and amended by this Third Supplemental Senior Notes Indenture. To the extent of any conflict between the terms of the Global Notes and the terms of the Senior Notes Indenture, as supplemented by this Third Supplemental Senior Notes Indenture, the terms of the Senior Notes Indenture, as supplemented by this Third Supplemental Senior Notes Indenture, shall govern and be controlling.
(b)By consenting to the Proposed Amendments (as defined in the Tender Offer and Consent Solicitation Statement), the holders in respect of the 2027 Notes consented to any and all ancillary and conforming changes to the Indenture and the 2027 Notes which, in the good faith determination of the Issuer, are necessary to give effect to the form and substance of the Proposed Amendments (as defined in the Tender Offer and Consent Solicitation Statement), provided however that any such ancillary and conforming changes shall only be permitted to the extent they can be made under the Indenture in accordance with the Required Consents (as defined in the Tender Offer and Consent Solicitation Statement) obtained. The Trustee shall rely conclusively and without further investigation or liability on an Officer’s Certificate from the Issuer and an Opinion of Counsel, each in accordance with the terms of the Indenture, to the effect that the Trustee in respect of the 2027 Notes is authorized and permitted under the Indenture to enter into any further supplemental indenture to effect the Proposed Amendments (as defined in the Tender Offer and Consent Solicitation Statement) and such ancillary and conforming changes relating thereto.
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Section 5.Conformed Indenture.
Attached hereto as Exhibit 1 (Conformed Indenture), is a copy of the Senior Notes Indenture which has been amended to reflect the amendments set forth in Section 3 and Section 4 hereof (the “Conformed Indenture”). For the avoidance of doubt, the Conformed Indenture has been included solely at the request of the Trustee, is for convenience, and to the extent there is any conflict between the Conformed Indenture and the Indenture, as amended by this Third Supplemental Senior Notes Indenture, then the Indenture, as amended by this Third Supplemental Indenture, shall prevail.
Section 6.Ratification and Effect.
(a)Except as hereby expressly waived, supplemented, modified and amended, the Senior Notes Indenture is in all respects ratified and confirmed and all the terms, provisions and conditions thereof shall be and remain in full force and effect, including without limitation, Section 7.06 thereof.
(b)Upon and after the execution of this Third Supplemental Senior Notes Indenture, each reference in the Senior Notes Indenture to “this Senior Notes Indenture,” “hereunder,” “hereof” or words of like import referring to the Senior Notes Indenture shall mean and be a reference to the Senior Notes Indenture as modified hereby.
Section 7.Incorporation by Reference.
Section 12.06 of the Senior Notes Indenture is incorporated by reference to this Third Supplemental Senior Notes Indenture as if more fully set out herein.
Section 8.Governing Law.
THIS THIRD SUPPLEMENTAL SENIOR NOTES INDENTURE, THE SENIOR NOTES AND THE NOTE GUARANTEES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 9.Counterpart Originals.
The parties may sign any number of copies of this Third Supplemental Senior Notes Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.
Section 10. |
The Trustee. |
The Trustee, in any of its capacities under the Senior Notes Indenture, shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Third Supplemental Senior Notes Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Issuer, the Parent Guarantor and the Guarantors.
Section 11. |
Severability. |
If any provision of this Third Supplemental Senior Notes Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
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Section 12. |
Effect of Headings. |
The Section headings herein are for convenience only and shall not affect the construction hereof.
Section 13. |
Conflicts. |
To the extent of any inconsistency between the terms of the Senior Notes Indenture or the Global Notes and this Third Supplemental Senior Notes Indenture, the terms of this Third Supplemental Senior Notes Indenture will control.
Section 14. |
Entire Agreement. |
This Third Supplemental Senior Notes Indenture constitutes the entire agreement of the parties hereto with respect to the amendments to the Senior Notes Indenture and waivers under the Senior Notes Indenture set forth herein.
Section 15. |
Successors. |
All covenants and agreements in this Third Supplemental Senior Notes Indenture given by the parties hereto shall bind their successors.
(Signature pages follow)
15
IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental Senior Notes Senior Notes Indenture to be duly executed and attested, all as of the date first above written.
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IHS NETHERLANDS HOLDCO B.V. |
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Mohammed Darwish |
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/s/ Mohammed Darwish |
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Laurens Klein |
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/s/ Laurens Klein |
(Signature page to Third Supplemental Senior Notes Indenture)
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IHS Holding Limited |
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Steve Howden |
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/s/ Steve Howden |
(Signature page to Third Supplemental Senior Notes Indenture)
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IHS Netherlands NG1 B.V. |
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Mohammed Darwish |
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/s/ Mohammed Darwish |
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Laurens Klein |
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/s/ Laurens Klein |
(Signature page to Third Supplemental Senior Notes Indenture)
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IHS Netherlands NG2 B.V. |
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Mohammed Darwish |
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/s/ Mohammed Darwish |
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Laurens Klein |
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/s/ Laurens Klein |
(Signature page to Third Supplemental Senior Notes Indenture)
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IHS Nigeria Limited |
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Mohammed Darwish |
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/s/ Mohammed Darwish |
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Mustafa Tharoo |
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/s/ Mustafa Tharoo |
(Signature page to Third Supplemental Senior Notes Indenture)
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IHS Towers NG Limited |
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William Saad |
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/s/ William Saad |
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Mustafa Tharoo |
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/s/ Mustafa Tharoo |
(Signature page to Third Supplemental Senior Notes Indenture)
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Nigeria Tower Interco B.V. |
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William Saad |
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/s/ William Saad |
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Laurens Klein |
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/s/ Laurens Klein |
(Signature page to Third Supplemental Senior Notes Indenture)
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INT Towers Limited |
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Mohammed Darwish |
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/s/ Mohammed Darwish |
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Mustafa Tharoo |
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/s/ Mustafa Tharoo |
(Signature page to Third Supplemental Senior Notes Indenture)
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INT Towers NG Finco 1 Plc |
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Mohammed Darwish |
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/s/ Mohammed Darwish |
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Mustafa Tharoo |
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/s/ Mustafa Tharoo |
(Signature page to Third Supplemental Senior Notes Indenture)
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CITIBANK, N.A., LONDON BRANCH, as Trustee |
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Katy Legros |
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/s/ Katy Legros |
(Signature page to Third Supplemental Senior Notes Indenture)
Exhibit 1 - Conformed Indenture CONFORMED COPY REFLECTING THIRD SUPPLEMENTAL INDENTURE DATED NOVEMBER 29, 2024
E-1
DATED AS OF SEPTEMBER 18, 2019
IHS NETHERLANDS HOLDCO B.V.,
AS THE ISSUER
EACH OF THE GUARANTORS PARTY HERETO
AS GUARANTORS
AND
CITIBANK N.A., LONDON BRANCH,
AS TRUSTEE, PRINCIPAL PAYING AGENT, TRANSFER AGENT AND REGISTRAR
SENIOR NOTES INDENTURE
7.125% SENIOR NOTES DUE 2025
8.000% SENIOR NOTES DUE 2027
TABLE OF CONTENTS
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Page |
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Article 1 DEFINITIONS AND INCORPORATION BY REFERENCE |
1 |
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Section 1.01. |
Definitions |
1 |
Section 1.02. |
Other Definitions |
38 |
Section 1.03. |
Rules of Construction |
39 |
Article 2 THE SENIOR NOTES |
39 |
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Section 2.01. |
Form and Dating |
39 |
Section 2.02. |
Execution and Authentication |
41 |
Section 2.03. |
Paying Agent, Registrars and Transfer Agent |
41 |
Section 2.04. |
Paying Agent to Hold Money |
42 |
Section 2.05. |
Holder Lists |
43 |
Section 2.06. |
Transfer and Exchange |
43 |
Section 2.07. |
Replacement Senior Notes |
50 |
Section 2.08. |
Outstanding Senior Notes |
50 |
Section 2.09. |
Treasury Notes |
51 |
Section 2.10. |
Temporary Notes |
51 |
Section 2.11. |
Cancellation |
51 |
Section 2.12. |
Defaulted Interest |
51 |
Section 2.13. |
Computation of Interest |
52 |
Section 2.14. |
Further Issues. |
52 |
Section 2.15. |
CUSIP, ISIN or Common Code Number |
53 |
Section 2.16. |
Deposit of Moneys |
53 |
Section 2.17. |
Agents |
53 |
Article 3 REDEMPTION AND PREPAYMENT |
53 |
|
Section 3.01. |
Notices to Trustee |
53 |
Section 3.02. |
Selection of Senior Notes to Be Redeemed or Purchased |
54 |
Section 3.03. |
Notice of Redemption |
54 |
Section 3.04. |
Effect of Notice of Redemption |
55 |
Section 3.05. |
Deposit of Redemption or Purchase Price |
56 |
Section 3.06. |
Notes Redeemed or Purchased in Part |
56 |
Section 3.07. |
Optional Redemption |
56 |
Section 3.08. |
Redemption for Changes in Taxes |
58 |
Section 3.09. |
Mandatory Redemption; Open Market Purchases |
59 |
Section 3.10. |
Offer to Purchase by Application of Excess Proceeds |
60 |
Section 3.11. |
Optional Redemption upon Completion of Certain Tender Offers |
62 |
Article 4 COVENANTS |
62 |
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Section 4.01. |
Payment of Senior Notes |
62 |
Section 4.02. |
Maintenance of Office or Agency |
63 |
Section 4.03. |
Reports |
63 |
Section 4.04. |
Compliance Certificate |
65 |
Section 4.05. |
Taxes |
66 |
Section 4.06. |
Stay, Extension and Usury Laws |
66 |
Section 4.07. |
Restricted Payments |
66 |
Section 4.08. |
Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries |
72 |
Section 4.09. |
Incurrence of Indebtedness and Issuance of Preferred Stock |
75 |
Section 4.10. |
Asset Sales |
81 |
Section 4.11. |
Transactions with Affiliates |
85 |
Section 4.12. |
Liens |
87 |
Section 4.13. |
Offer to Repurchase upon Change of Control |
88 |
Section 4.14. |
Additional Guarantees |
90 |
Section 4.15. |
[Reserved] |
91 |
Section 4.16. |
Designation of Restricted and Unrestricted Subsidiaries |
91 |
Section 4.17. |
Maintenance of Listing |
91 |
Section 4.18. |
Additional Amounts |
92 |
Section 4.19. |
Suspension of Certain Covenants when Senior Notes Rated Investment Grade |
94 |
Section 4.20. |
[Reserved] |
95 |
Section 4.21. |
Anti-Layering |
95 |
Section 4.22. |
Financial Calculations |
95 |
Article 5 SUCCESSORS |
96 |
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Section 5.01. |
Merger, Consolidation or Sale of Assets |
96 |
Section 5.02. |
Successor Corporation Substituted |
98 |
Section 5.03. |
Issuer Substitution |
98 |
Section 5.04. |
Parent Guarantor Substitution |
99 |
Article 6 DEFAULTS AND REMEDIES |
100 |
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Section 6.01. |
Events of Default |
100 |
Section 6.02. |
Acceleration |
102 |
Section 6.03. |
Other Remedies |
103 |
Section 6.04. |
Waiver of Past Defaults |
103 |
Section 6.05. |
Control by Majority |
103 |
Section 6.06. |
Limitation on Suits |
103 |
Section 6.07. |
Rights of Holders of Senior Notes to Receive Payment |
104 |
Section 6.08. |
Collection Suit by Trustee |
104 |
Section 6.09. |
Trustee May File Proofs of Claim |
105 |
Section 6.10. |
Priorities |
105 |
Section 6.11. |
Undertaking for Costs |
105 |
Section 6.12. |
Restoration of Rights and Remedies |
106 |
Section 6.13. |
Rights and Remedies Cumulative |
106 |
Section 6.14. |
Delay or Omission Not Waiver |
106 |
Article 7 TRUSTEE |
106 |
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Section 7.01. |
Duties of Trustee |
106 |
Section 7.02. |
Rights of Trustee |
108 |
Section 7.03. |
Individual Rights of Trustee |
110 |
Section 7.04. |
Trustee’s Disclaimer |
110 |
Section 7.05. |
Notice of Defaults |
110 |
Section 7.06. |
Compensation and Indemnity |
111 |
Section 7.07. |
Replacement of Trustee |
112 |
Section 7.08. |
Successor Trustee by Merger, etc |
113 |
Section 7.09. |
Eligibility; Disqualification |
113 |
Section 7.10. |
Agents |
113 |
Section 7.11. |
FATCA |
113 |
Article 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE |
115 |
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Section 8.01. |
Option to Effect Legal Defeasance or Covenant Defeasance |
115 |
Section 8.02. |
Legal Defeasance and Discharge |
115 |
Section 8.03. |
Covenant Defeasance |
116 |
Section 8.04. |
Conditions to Legal or Covenant Defeasance |
116 |
Section 8.05. |
Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions |
117 |
Section 8.06. |
Repayment to Issuer |
118 |
Section 8.07. |
Reinstatement |
118 |
Article 9 AMENDMENT, SUPPLEMENT AND WAIVER |
118 |
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Section 9.01. |
Without Consent of Holders of Senior Notes |
118 |
Section 9.02. |
With Consent of Holders of Senior Notes |
120 |
Section 9.03. |
Revocation and Effect of Consents |
122 |
Section 9.04. |
Notation on or Exchange of Senior Notes |
122 |
Section 9.05. |
Trustee to Sign Amendments, etc |
122 |
Article 10 NOTE GUARANTEES |
123 |
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Section 10.01. |
Guarantee |
123 |
Section 10.02. |
Limitation on Guarantor Liability |
124 |
Section 10.03. |
[Reserved] |
124 |
Section 10.04. |
[Reserved] |
124 |
Section 10.05. |
Releases |
125 |
Article 11 SATISFACTION AND DISCHARGE |
126 |
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Section 11.01. |
Satisfaction and Discharge |
126 |
Section 11.02. |
Application of Trust Money |
127 |
Article 12 MISCELLANEOUS |
127 |
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Section 12.01. |
Notices |
127 |
Section 12.02. |
Certificate and Opinion as to Conditions Precedent |
129 |
Section 12.03. |
Statements Required in Certificate or Opinion |
129 |
Section 12.04. |
Rules by Trustee and Agents |
129 |
Section 12.05. |
No Personal Liability of Directors, Officers, Employees and Stockholders |
129 |
Section 12.06. |
Agent for Service; Submission to Jurisdiction; Waiver of Immunities |
129 |
Section 12.07. |
Governing Law |
130 |
Section 12.08. |
No Adverse Interpretation of Other Agreements |
130 |
Section 12.09. |
Successors |
130 |
Section 12.10. |
Severability |
130 |
Section 12.11. |
Counterpart Originals |
130 |
Section 12.12. |
Table of Contents, Headings, etc |
130 |
Section 12.13. |
Judgment Currency |
131 |
Section 12.14. |
Prescription |
131 |
Section 12.15. |
Additional Information |
131 |
EXHIBITS
Exhibit A |
FORM OF SENIOR NOTE |
Exhibit B |
FORM OF CERTIFICATE OF TRANSFER |
Exhibit C |
FORM OF CERTIFICATE OF EXCHANGE |
Exhibit D |
FORM OF SUPPLEMENTAL SENIOR NOTES INDENTURE TO BE DELIVERED BY SUBSEQUENT GUARANTORS |
SENIOR NOTES INDENTURE dated as of September 18, 2019 among IHS NETHERLANDS HOLDCO B.V., a private limited liability company incorporated under the laws of the Netherlands, having its registered office at Herikerbergweg 88, 1101CM Amsterdam, The Netherlands, registered with the Dutch trade register under number 66017912 (the “Issuer”), the Guarantors (as defined), CITIBANK, N.A., LONDON BRANCH, as trustee, principal paying agent, transfer agent and registrar.
The Issuer, the Guarantors and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders (as defined) of the 7.125% Senior Notes due 2025 (the “2025 Senior Notes”) and the 8.000% Senior Notes due 2027 (the “2027 Senior Notes” and, together with the 2025 Notes, the “Senior Notes”) and the Holders of any Additional Senior Notes (as defined below):
DEFINITIONS AND INCORPORATION BY REFERENCE
Definitions.
“144A Definitive Registered Note” means a Definitive Registered Note resold in reliance on Rule 144A.
“144A Global Note” means a 2025 144A Global Note or a 2027 144A Global Note.
“2024 Notes Issue Date” means the date of issuance of the New Notes by the Parent Guarantor, part of the proceeds of which are to be used to fund a tender offer for, among other debt securities, the Notes, as described in the tender offer and consent solicitation memorandum dated November 12, 2024.
“2025 144A Global Note” means a Global Note bearing the Global Note Legend and the Private Placement Legend and deposited with Citibank, N.A., London Branch as Custodian for DTC and registered in the name of Cede & Co. as nominee that will be issued in an initial amount equal to the principal amount of the 2025 Senior Notes sold in reliance on Rule 144A.
“2027 144A Global Note” means a Global Note bearing the Global Note Legend and the Private Placement Legend and deposited with Citibank, N.A., London Branch as Custodian for DTC and registered in the name of Cede & Co. as nominee that will be issued in an initial amount equal to the principal amount of the 2027 Senior Notes sold in reliance on Rule 144A.
“2025 Global Note” means a 2025 144A Global Note and a 2025 Regulation S Global Note.
“2027 Global Note” means a 2027 144A Global Note and a 2027 Regulation S Global Note.
“2025 Regulation S Global Note” means a Global Note bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of and registered in the name of Citivic Nominees Limited as nominee for Euroclear and Clearstream that will be issued in an initial amount equal to the principal amount of the 2025 Senior Notes initially resold in reliance on Regulation S.
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“2027 Regulation S Global Note” means a Global Note bearing the Global Note Legend and the Private Placement Legend and deposited with or on behalf of and registered in the name of Citivic Nominees Limited as nominee for Euroclear and Clearstream that will be issued in an initial amount equal to the principal amount of the 2027 Senior Notes initially resold in reliance on Regulation S.
“2025 Senior Notes” means the 7.125% Senior Notes due 2025 issued under this Senior Notes Indenture.
“2027 Senior Notes” means the 8.000% Senior Notes due 2027 issued under this Senior Notes Indenture.
“Acquired Debt” means, with respect to any specified Person:
(1)Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Restricted Subsidiary; and
(2)Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.
“Additional 2025 Senior Notes” means additional 2025 Senior Notes (other than the Initial 2025 Senior Notes) issued under this Senior Notes Indenture in accordance with Section 2.02 hereof, as part of the same series as the Initial Senior Notes.
“Additional 2027 Senior Notes” means additional 2027 Senior Notes (other than the Initial 2027 Senior Notes) issued under this Senior Notes Indenture in accordance with Section 2.02 hereof, as part of the same series as the Initial Senior Notes.
“Additional Senior Notes” means any Additional 2025 Senior Notes and Additional 2027 Senior Notes.
“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control,” as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise. For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” have correlative meanings.
“Agent” means any Registrar, co-registrar, Transfer Agent, Authenticating Agent, Paying Agent or additional paying agent.
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“Amendment Date” means the date on which the Supplemental Indenture with respect to the Proposed Amendments is entered into.
“Applicable Premium” means, with respect to any Senior Note of any series on any redemption date, the greater of:
(1)1.0% of the principal amount of the Note of such series; or
(2)the excess of:
(a)the present value at such redemption date of (x) the redemption price of such Senior Note at September 18, 2021 in the case of the 2025 Notes and September 18, 2022 in the case of the 2027 Notes (such redemption price for each series being set forth in the table appearing in Section 3.07 (d) hereof), plus (y) all required interest payments due on such Senior Note through September 18, 2021 in the case of the 2025 Notes and September 18, 2022 in the case of the 2027 Notes (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points; over
(b)the principal amount of such Senior Note,
as calculated by the Issuer or on behalf of the Issuer by such Person as the Issuer may engage.
For the avoidance of doubt, calculation of the Applicable Premium shall not be a duty or obligation of the Trustee, the Registrar or any Paying Agent.
“Applicable Procedures” means, with respect to any transfer or exchange of or for Book-Entry Interests in any Global Note, the rules and procedures of the DTC, Euroclear and/or Clearstream that apply to such transfer or exchange.
“Approved Issuer Substitution Jurisdiction” means an Approved Jurisdiction (other than the Federal Republic of Nigeria) and any other jurisdiction considered suitable for listing by any Recognized Stock Exchange, provided that, in both cases, such jurisdiction will not cause the New Issuer to have the right to redeem any Senior Notes pursuant to Section 3.08 hereof immediately following the Substitution.
“Approved Jurisdiction” means any state which is a member of the European Union (including the United Kingdom), the Federal Republic of Nigeria, the Cayman Islands, Mauritius, Switzerland, Canada, the United States, any state thereof or the District of Columbia.
“Asset Sale” means:
(1)the sale, lease, conveyance or other disposition of any assets by the Parent Guarantor or any of its Restricted Subsidiaries; provided that the sale, lease, conveyance or other disposition of all or substantially all of the assets of the Parent Guarantor and its Restricted Subsidiaries taken as a whole will be governed by Section 4.13 hereof and/or Section 5.01 hereof and not by Section 4.10 hereof; and (2)the issuance of Equity Interests by any Restricted Subsidiary or the sale by the Parent Guarantor or any of its Restricted Subsidiaries of Equity Interests in any Subsidiary of the Parent Guarantor (in each case, other than directors’ qualifying shares).
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Notwithstanding the preceding, none of the following items will be deemed to be an Asset Sale:
(1)any single transaction or series of related transactions that involves assets having a fair market value of less than the greater of $25.0 million and 0.8% of the Total Assets of the Parent Guarantor;
(2)a transfer of assets or Equity Interests between or among the Parent Guarantor and any Restricted Subsidiary;
(3)an issuance of Equity Interests by a Restricted Subsidiary to the Parent Guarantor or to another Restricted Subsidiary;
(4)the sale, lease or other transfer of accounts receivable, inventory or other assets in the ordinary course of business and any sale or other disposition of damaged, worn-out or obsolete assets or assets disposed of in connection with any decommissioned sites or assets that are no longer useful in the conduct of the business of the Parent Guarantor and its Restricted Subsidiaries;
(5)licenses and sublicenses by the Parent Guarantor or any of its Restricted Subsidiaries in the ordinary course of business;
(6)any surrender or waiver of contract rights or settlement, release, recovery on or surrender of contract, tort or other claims in the ordinary course of business;
(7)the granting of Liens not prohibited by Section 4.12 hereof;
(8)the sale or other disposition of cash or Cash Equivalents;
(9)a Restricted Payment that does not violate Section 4.07 hereof, a Permitted Investment or any transaction specifically excluded from the definition of Restricted Payment or, solely for purposes of Section 4.10 (b) hereof, asset sales, the proceeds of which are used to make such Restricted Payments (in accordance with Section 4.07 hereof) or Permitted Investments; (12)the disposition of assets to a Person who is providing services (the provision of which have been or are to be outsourced by the Parent Guarantor or any Restricted Subsidiary to such Person) related to such assets; and
(10)the disposition of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of business or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements;
(11)the foreclosure, condemnation or any similar action (including as a result of a seizure, expropriation, nationalization, intervention, restriction or other action by or on behalf of any governmental, regulatory or other authority) with respect to any property or other assets or a surrender or waiver of contract rights or the settlement, release or surrender of contract, tort or other claims of any kind;
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(13)sales or dispositions of receivables in connection with any Qualified Receivables Financing or any factoring transaction or in the ordinary course of business.
“Bankruptcy Law” means (1) Title 11 of the U.S. Code or (2) any other law of the United States (or any political subdivision thereof), the Federal Republic of Nigeria (or any political subdivision thereof), the Netherlands (or any political subdivision thereof), or the laws of any other jurisdiction or any political subdivision thereof relating to bankruptcy, insolvency, receivership, winding up, liquidation, reorganization or relief of debtors as may be amended from time to time.
“Beneficial Owner” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the U.S. Exchange Act, except that in calculating the beneficial ownership of any particular “person” (as that term is used in Section 13(d)(3) of the U.S. Exchange Act), (i) such “person” will be deemed to have beneficial ownership of all securities that such “person” has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only after the passage of time; and (ii) such “person” will not be deemed to have beneficial ownership of the securities of any other person solely because each such person is party to the shareholders agreement relating to the Capital Stock of IHS Holding Limited or any Parent Holdco to the extent the terms of such agreement as it exists on the Issue Date convey beneficial ownership. The terms “Beneficially Owns,” “Beneficially Owned” and “Beneficial Ownership” have corresponding meanings.
“Board of Directors” means:
(1)with respect to a corporation, the board of directors of the corporation or any committee thereof duly authorized to act on behalf of such board;
(2)with respect to an exempted company, the board of directors of the exempted company or any committee thereof duly authorized to act on behalf of such board;
(3)with respect to a partnership, the board of directors of the general partner of the partnership or any committee thereof duly authorized to act on behalf of such board;
(4)with respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof; and
(5)with respect to any other Person, the board or committee of such Person serving a similar function.
“Book-Entry Interest” means a beneficial interest in a Global Note held by or through a Participant.
“Business Day” means a day other than a Saturday, Sunday or other day on which banking institutions in London, New York, Lagos, the jurisdiction of incorporation of the Issuer or a place of payment under this Senior Notes Indenture are authorized or required by law to close.
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“Capital Lease Obligation” means an obligation that is required to be classified and accounted for as a capitalized lease for financial reporting purposes on the basis of IFRS. The amount of Indebtedness will be, at the time any determination is to be made, the amount of such obligation required to be capitalized on a balance sheet (excluding any notes thereto) prepared in accordance with IFRS, and the stated maturity thereof will be the date of the last payment of rent or any other amount due under such lease prior to the first date such lease may be terminated without penalty.
“Capital Stock” means:
(1)in the case of a corporation, corporate stock;
(2)in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;
(3)in the case of a partnership or limited liability company, partnership interests (whether general or limited), shares or membership interests; and
(4)any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person, but excluding from all of the foregoing any debt securities convertible into Capital Stock, whether or not such debt securities include any right of participation with Capital Stock.
“Cash Equivalents” means:
(1)direct obligations (or certificates representing an interest in such obligations) issued by, or unconditionally guaranteed by, the government of a member state of the European Union (including the United Kingdom), Nigeria, the United States of America or any state thereof, Switzerland or the government of the jurisdiction of organization of any Restricted Subsidiary (including, in each case, any agency or instrumentality thereof), as the case may be, the payment of which is backed by the full faith and credit of the relevant member state of the European Union (including the United Kingdom), the Federal Republic of Nigeria, the United States of America or Switzerland, as the case may be, and which are not callable or redeemable at the issuer’s option;
(2)overnight bank deposits, time deposit accounts, certificates of deposit, banker’s acceptances and money market deposits with maturities (and similar instruments) of 12 months or less from the date of acquisition issued by a bank or trust company, or a local branch or Subsidiary of a bank or trust company, which is organized under, or authorized to operate as a bank or trust company under, the laws of a member state of the European Union (including the United Kingdom), Nigeria, or of the United States of America or any state thereof, Switzerland or the government of the jurisdiction of organization of any Restricted Subsidiary or any commercial banking institution that is a member of the U.S. Federal Reserve System, in each case, either (a) having combined capital and surplus and undivided profits of not less than $250.0 million (or the foreign currency equivalent thereof as of the date of such investment), whose long term, unsecured, unsubordinated and unguaranteed debt has a rating, at the time any investment is made therein, of at least “BBB” or the equivalent thereof from S&P and at least “Ba3” or the equivalent thereof from Moody’s or the equivalent rating category of another internationally recognized rating agency; (b) which has its primary registration in a jurisdiction in which the Parent Guarantor or a Restricted Subsidiary conducts its business or is organized and which would rank, in terms of combined capital and surplus and undivided profits or the ratings on its long term debt, among the top ten such banks registered in such jurisdiction or (c) which is a lender under any Credit Facility to which the Issuer or any Guarantor is a party;
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(3)repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clauses (1) and (2) above entered into with any financial institution meeting the qualifications specified in clause (2) above;
(4)commercial paper having one of the two highest ratings obtainable from Moody’s or S&P and, in each case, maturing within one year after the date of acquisition;
(5)money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (1) through (4) of this definition; and
(6) other instruments customarily utilized for high quality investments that can be readily monetized without material risk of loss in the good faith judgment of a responsible financial or accounting officer of the Parent Guarantor or any of its Restricted Subsidiaries.
“Change of Control” means the occurrence of any of the following:
(1)the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Parent Guarantor and its Subsidiaries, taken as a whole, to any Person (including any “person” (as that term is used in Section 13(d)(3) of the U.S. Exchange Act)) other than one or more Permitted Holders (other than any such sale, lease, transfer, conveyance or other disposition of all or substantially all of the assets of the Parent Guarantor to an Affiliate of the Parent Guarantor for the purpose of reincorporating the Parent Guarantor in another jurisdiction provided that such transaction complies with Article 5 hereof);
(2)the adoption of a plan relating to the liquidation or dissolution of the Parent Guarantor; or
(3)the consummation of any transaction (including, without limitation, any merger or consolidation), the result of which is that any Person (including any “person” (as defined above), other than one or more Permitted Holders, becomes the Beneficial Owner, directly or indirectly, of more than 50% of the Voting Stock of the Parent Guarantor, measured by voting power rather than number of shares; provided that any Voting Stock of which any Permitted Holder is the “beneficial owner” (other than deemed beneficial ownership derived from membership in a “group”) shall not be included in any Voting Stock of which any such person or group is the “beneficial owner” (as so defined), unless that person or group is not an affiliate of a Permitted Holder and has greater voting power with respect to that Voting Stock,
provided that, in the case of the preceding clauses (1) and (3), a Change of Control shall not be deemed to have occurred if such Change of Control is also a Specified Change of Control Event.
“Clearstream” means Clearstream Banking, société anonyme.
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“Code” means the U.S. Internal Revenue Code of 1986, as amended.
“Common Depositary” means a depositary common to Euroclear and Clearstream, being initially Citibank Europe plc, until a successor replaces it and thereafter means the successor serving hereunder.
“Consolidated EBITDA” means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for such period plus the following to the extent deducted in calculating such Consolidated Net Income, without duplication:
(1)provision for current and deferred taxes based on income or profits of such Person and its Subsidiaries which are Restricted Subsidiaries for such period; plus
(2)without double counting, the Consolidated Interest Expense of such Person and its Subsidiaries which are Restricted Subsidiaries for such period and Receivables Fees; plus
(3)depreciation, amortization (including, without limitation, amortization of intangibles and deferred financing fees) and other non-cash charges and expenses (including without limitation write downs and impairment of property, plant, equipment and intangibles and other long-lived assets and the impact of purchase accounting on the Parent Guarantor and its Restricted Subsidiaries for such period) of the Parent Guarantor and its Restricted Subsidiaries (excluding any such non-cash charge or expense to the extent that it represents an accrual of or reserve for cash charges or expenses in any future period or amortization of a prepaid cash charge or expense that was paid in a prior period) for such period; plus
(4)any expenses, charges or other costs related to the issuance of any Capital Stock, any Permitted Investment, acquisition, disposition, recapitalization, listing or the incurrence of Indebtedness permitted to be incurred under Section 4.09 hereof (including refinancing thereof) whether or not successful, including (a) such fees, expenses or charges related to any incurrence of Indebtedness issuance and (b) any amendment or other modification of any incurrence; plus
(5)any foreign currency translation losses (including losses related to currency remeasurements of Indebtedness) of the Parent Guarantor and its Restricted Subsidiaries; plus
(6)the amount of management, monitoring, consulting and advisory fees and related expenses paid in such period to any Parent Holdco of the Parent Guarantor to the extent permitted by Section 4.11 hereof; plus (11)any foreign currency translation gains (including gains related to currency re-measurements of Indebtedness) of the Parent Guarantor and its Restricted Subsidiaries; minus
(7)the amount of any minority interest expense consisting of subsidiary income attributable to minority equity interests of third parties in any non-Wholly-Owned Subsidiary in such period or any prior period; plus
(8)any impairment of property, plant and equipment and prepaid land rent, or withholding tax receivable; plus
(9)the unwinding of discount on decommissioning liability; plus
(10)loss on revaluation of derivative financial instruments; plus
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(12)any extraordinary, exceptional or unusual gain; minus
(13)non-cash items increasing such Consolidated Net Income for such period (other than any non-cash items increasing such Consolidated Net Income pursuant to clauses (1) through (11) of the definition of Consolidated Net Income), other than the reversal of a reserve for cash charges in a future period in the ordinary course of business,
in each case, on a consolidated basis and determined in accordance with IFRS.
“Consolidated Interest Expense” means, for any period (in each case, determined on the basis of IFRS), the consolidated net interest income/expense of the Parent Guarantor and its Restricted Subsidiaries, whether paid or accrued, including any pension liability interest cost, plus or including (without duplication) any interest, costs and charges consisting of:
(1)interest expense attributable to Capital Lease Obligations;
(2)amortization of debt discount, debt issuance cost and premium;
(3)non-cash interest expense;
(4)commissions, discounts and other fees and charges owed with respect to financings not included in clause (2) above;
(5)costs associated with Hedging Obligations;
(6)dividends on other distributions in respect of all Disqualified Stock of the Parent Guarantor and all preferred stock of any Restricted Subsidiary, to the extent held by Persons other than the Parent Guarantor or a Subsidiary of the Parent Guarantor;
(7)any consolidated interest expense that was capitalized during such period; and
(8)interest actually paid by the Parent Guarantor or any Restricted Subsidiary under any Guarantee of Indebtedness or other obligation of any other Person.
Notwithstanding any of the foregoing, Consolidated Interest Expense shall not include (i) any interest accrued, capitalized or paid in respect of Subordinated Shareholder Debt and (ii) any commissions, discounts, yield and other fees and charges related to a Qualified Receivables Financing.
“Consolidated Net Income” means, with respect to any specified Person for any period, the aggregate of the net income (loss) of such Person and its Subsidiaries which are Restricted Subsidiaries for such period, on a consolidated basis (excluding the net income (loss) of any Unrestricted Subsidiary), determined in accordance with IFRS and without any reduction in respect of preferred stock dividends; provided that:
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(1)the net income (loss) of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method of accounting will be included only to the extent of the amount of dividends or similar distributions paid in cash to the specified Person or a Restricted Subsidiary which is a Subsidiary of the Person;
(2)solely for the purpose of determining the amount available for Restricted Payments under Section 4.07(a)(v)(C)(1) hereof, any net income of any Restricted Subsidiary (other than any Guarantor) will be excluded if such Subsidiary is subject to restrictions, directly or indirectly, on the payment of dividends or the making of distributions by such Restricted Subsidiary, directly or indirectly, to the Parent Guarantor (or any Guarantor that holds the Equity Interests of such Restricted Subsidiary, as applicable) by operation of the terms of such Restricted Subsidiary’s charter or any agreement, instrument, judgment, decree, order, statute or governmental rule or regulation applicable to such Restricted Subsidiary or its shareholders (other than (a) restrictions that have been waived or otherwise released, (b) restrictions pursuant to the Senior Notes or this Senior Notes Indenture or that are not prohibited under Section 4.08 hereof, (c) contractual restrictions in effect on the Issue Date with respect to the Restricted Subsidiary and other restrictions with respect to such Restricted Subsidiary that taken as a whole, are not materially less favorable to the holders of the Senior Notes than such restrictions in effect on the Issue Date or (d) restrictions pursuant to applicable law, rule, regulation or order or the terms of any license, authorization, concession or permit), except that the Parent Guarantor’s equity in the net income of any such Restricted Subsidiary for such period will be included in such Consolidated Net Income up to the aggregate amount of cash or Cash Equivalents actually distributed or that could have been distributed by such Restricted Subsidiary during such period to the Parent Guarantor or another Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend to another Restricted Subsidiary (other than any Guarantor or the Issuer), to the limitation contained in this clause);
(3)any net gain (or loss) realized upon the sale or other disposition of any asset or disposed operations of the Parent Guarantor or any Restricted Subsidiaries (including pursuant to any sale leaseback transaction) which is not sold or otherwise disposed of in the ordinary course of business (as determined in good faith by the Parent Guarantor) will be excluded;
(4)any one time non-cash charges or any amortization or depreciation resulting from purchase accounting, in each case, in relation to any acquisition of, or merger or consolidation with, another Person or business or resulting from any reorganization or restructuring, liquidation (including provisional liquidation), winding up or like proceeding involving the Parent Guarantor or its Subsidiaries will be excluded;
(5)the cumulative effect of a change in accounting principles will be excluded;
(6)any extraordinary, exceptional or nonrecurring gains or losses or any charges in respect of any restructuring, redundancy or severance (in each case, as determined in good faith by the Parent Guarantor) will be excluded;
(7)any unrealized gains or losses in respect of Hedging Obligations or any ineffectiveness recognized in earnings related to qualifying hedge transactions or the fair value or changes therein recognized in earnings for derivatives that do not qualify as hedge transactions, in each case, in respect of Hedging Obligations will be excluded;
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(8)any non-cash compensation charge or expenses arising from any grant of stock, stock options or other equity-based awards will be excluded;
(9)any goodwill or other intangible asset impairment charges will be excluded;
(10)all deferred financing costs written off and premium paid in connection with any early extinguishment of Indebtedness and any net gain or loss from any write-off or forgiveness of Indebtedness will be excluded; and
(11)the impact of any accrued interest (including accreting or pay-in-kind interest) on any Subordinated Shareholder Debt will be excluded.
(12)the net gain or loss from the receipt of any insurance proceeds shall be excluded.
“Consolidated Net Leverage” means, as of any date of determination, the sum, expressed in U.S. dollars, of the aggregate outstanding Indebtedness of the Parent Guarantor and its Restricted Subsidiaries on a consolidated basis (excluding Hedging Obligations except to the extent provided in Sections 4.09(e) and 4.09(f) hereof), less cash and Cash Equivalents of such specified person on that date of determination. The U.S. dollar equivalent of the principal amount of Indebtedness denominated in a different currency shall be calculated based on the applicable provisions of Section 4.09 hereof.
“Consolidated Net Leverage Ratio” means, as of any date of determination, with respect to any specified Person, the ratio of (a) Consolidated Net Leverage on such date to (b) the product of (i) the Consolidated EBITDA of the Parent Guarantor for the most recently ended four consecutive fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or other transaction for which the Consolidated Net Leverage Ratio is being calculated is completed provided, however, that, solely for the purpose of calculating the Consolidated Net Leverage Ratio for the incurrence of Indebtedness pursuant to Section 4.09 hereof, the pro forma calculation of the Consolidated Net Leverage Ratio shall not give effect to (i) any Indebtedness incurred on the date on which the event for which the calculation of the Consolidated Net Leverage Ratio is made (the “Calculation Date”) pursuant to the provisions described in Section 4.09 (b) hereof, (other than Section 4.09 (b) (xiv) hereof, the incurrence of which is itself subject to the Consolidated Net Leverage Ratio) or (ii) the discharge on the Calculation Date of any Indebtedness to the extent that such discharge results from the proceeds incurred pursuant to the provisions described in Section 4.09 (b) hereof (other than Section 4.09 (b) (xiv) hereof).
In addition, for purposes of calculating the Consolidated EBITDA for such period:
(1)acquisitions that have been made by the specified Person or any of its Subsidiaries which are Restricted Subsidiaries, including through mergers or consolidations, or by any Person or any of its Subsidiaries which are Restricted Subsidiaries acquired by the specified Person or any of its Subsidiaries which are Restricted Subsidiaries, and including all related financing transactions and including increases in ownership of Subsidiaries which are Restricted Subsidiaries, during the four consecutive fiscal quarter reference period or subsequent to such reference period and on or prior to the relevant Calculation Date, or that are to be made on the relevant Calculation Date, will be given pro forma effect (as determined in good faith by a responsible accounting or financial officer of the Parent Guarantor and may include anticipated cost synergies and expense and cost reductions) as if they had occurred on the first day of the four consecutive fiscal quarter reference period;
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(2)if since the beginning of such four consecutive fiscal quarter reference period the Parent Guarantor or any Restricted Subsidiary has disposed of any company, any business, or any group of assets constituting an operating unit of a business (any such disposition, a “Sale”) or if the transaction giving rise to the need to calculate the Consolidated Net Leverage Ratio is such a Sale, Consolidated EBITDA for such period will be reduced by an amount equal to the Consolidated EBITDA (if positive) attributable to the assets which are the subject of such Sale for such period or increased by an amount equal to the Consolidated EBITDA (if negative) attributable thereto for such period; provided that if any such sale constitutes “discontinued operations” in accordance with IFRS, Consolidated Net Income shall be reduced by an amount equal to the Consolidated Net Income (if positive) attributable to such operations for such period or increased by an amount equal to the Consolidated Net Income (if negative) attributable thereto for such period;
(3)any Person that is a Restricted Subsidiary on the relevant Calculation Date will be deemed to have been a Restricted Subsidiary at all times during such four consecutive fiscal quarter period; and
(4)any Person that is not a Restricted Subsidiary on the relevant Calculation Date will be deemed not to have been a Restricted Subsidiary at any time during such four consecutive fiscal quarter period.
“Contingent Obligations” means, with respect to any Person, any obligation of such Person guaranteeing in any manner, whether directly or indirectly, any operating lease, dividend or other obligation that, in each case, does not constitute Indebtedness (“primary obligations”) of any other Person (the “primary obligor”), including any obligation of such Person, whether or not contingent:
(1)to purchase any such primary obligation or any property constituting direct or indirect security therefor;
(2)to advance or supply funds:
(a)for the purchase or payment of any such primary obligation; or
(b)to maintain the working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; or
(3)to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation against loss in respect thereof.
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“continuing” means, with respect to any Default or Event of Default, that such Default or Event of Default has not been cured or waived.
“Credit Facility” means, one or more debt facilities, instruments or arrangements incurred (including the Parent Revolving Credit Facility and the Senior Credit Facilities) or commercial paper facilities and overdraft facilities or indentures or trust deeds or note purchase agreements, in each case, with banks, other institutions, funds or investors, providing for revolving credit loans, term loans, performance guarantees, receivables financing (including through the sale of receivables to such institutions or to special purpose entities formed to borrow from such institutions against such receivables), letters of credit, bonds, notes debentures or other corporate debt instruments or other Indebtedness, in each case, as amended, restated, modified, renewed, refunded, replaced, restructured, refinanced, repaid, increased or extended in whole or in part from time to time (and whether or not with the original administrative agent and lenders or another administrative agent or agents or trustees or other banks or institutions and whether provided under the Parent Revolving Credit Facility and the Senior Credit Facilities or one or more other credit or other agreements, indentures, financing agreements or otherwise) and in each case including all agreements, instruments and documents executed and delivered pursuant to or in connection with the foregoing (including any notes and letters of credit issued pursuant thereto and any guarantee and collateral agreement, patent and trademark security agreement, mortgages or letter of credit applications and other guarantees, pledges, agreements, security agreements and collateral documents). Without limiting the generality of the foregoing, the term “Credit Facilities” shall include any agreement or instrument (1) changing the maturity of any Indebtedness incurred thereunder or contemplated thereby, (2) adding Subsidiaries of the Parent Guarantor as additional borrowers, issuers or guarantors thereunder, (3) increasing the amount of Indebtedness incurred thereunder or available to be borrowed thereunder or (4) otherwise altering the terms and conditions thereof.
“Currency Exchange Protection Agreement” means, in respect of any Person, any foreign exchange contract, currency swap agreement, currency option, cap, floor, ceiling or collar or agreement or other similar agreement or arrangement designed to protect such Person against fluctuations in currency exchange rates as to which such Person is a party.
“Custodian” means Citibank, N.A., London Branch and any and all successors thereto appointed as Custodian hereunder and having become such pursuant to the applicable provisions of this Senior Notes Indenture.
“Default” means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.
“Definitive Registered 2025 Note” means a certificated 2025 Senior Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 hereof, substantially in the form of Exhibit A hereto and bearing the Private Placement Legend, except that such Senior Note shall not bear the Global Note Legend and shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto.
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“Definitive Registered 2027 Note” means a certificated 2025 Senior Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 hereof, substantially in the form of Exhibit A hereto and bearing the Private Placement Legend, except that such Senior Note shall not bear the Global Note Legend and shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto.
“Definitive Registered Note” means the Definitive Registered 2025 Note or the Definitive Registered 2027 Note.
“Depositary” means, with respect to the Senior Notes issuable or issued in whole or in part in global form, DTC or Euroclear and Clearstream, in each case, including any and all successors thereto appointed as Depositary hereunder and having become such pursuant to the applicable provision(s) of this Senior Notes Indenture.
“Designated Non-Cash Consideration” means the fair market value of non-cash consideration received by the Parent Guarantor or one of its Restricted Subsidiaries in connection with an Asset Sale that is so designated as “Designated Non-Cash Consideration” pursuant to an Officer’s Certificate, setting forth the basis of such valuation, less the amount of cash or Cash Equivalents received in connection with a subsequent sale of such Designated Non-Cash Consideration.
“Designated Preference Shares” means, with respect to the Parent Guarantor or any Parent Holdco of the Parent Guarantor, preferred stock (other than Disqualified Stock) (1) that is issued for cash (other than to the Parent Guarantor or a Subsidiary of the Parent Guarantor or an employee stock ownership plan or trust established by the Parent Guarantor or any such Subsidiary for the benefit of their employees to the extent funded by the Parent Guarantor or such Subsidiary) and (2) that is designated as “Designated Preference Shares” pursuant to an Officer’s Certificate of the Parent Guarantor at or prior to the issuance thereof, the net proceeds of which are excluded from the calculation set forth in Section 4.07(a)(v)(C)(2) hereof.
“Disqualified Stock” means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, in each case, at the option of the holder of the Capital Stock), or upon the happening of any event, (1) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder of the Capital Stock, in whole or in part, on or prior to the six-month anniversary of the date that the Senior Notes mature or (2) provides for, either mandatorily or at the option of the holder of the Capital Stock, the payment of dividends or distributions (other than in the form of Equity Interests that are not Disqualified Stock). Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Stock solely because the holders of the Capital Stock have the right to require the issuer thereof to repurchase such Capital Stock upon the occurrence of a Change of Control or an Asset Sale will not constitute Disqualified Stock if the terms of such Capital Stock provide that the issuer thereof may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with Section 4.07 hereof. For purposes hereof, the amount of Disqualified Stock which does not have a fixed repurchase price shall be calculated in accordance with the terms of such Disqualified Stock as if such Disqualified Stock were purchased on any date on which Indebtedness shall be required to be determined pursuant to this Senior Notes Indenture, and if such price is based upon, or measured by, the fair market value of such Disqualified Stock, such fair market value to be determined as set forth herein.
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“DTC” means The Depository Trust Company, a New York corporation, or any successor.
“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).
“Equity Offering” means any sale of Capital Stock (other than Disqualified Stock or Designated Preference Shares) of the Parent Guarantor or a Parent Holdco of the Parent Guarantor pursuant to which the net cash proceeds are contributed to the Parent Guarantor in the form of a subscription for, or a capital contribution in respect of, Capital Stock (other than Disqualified Stock) of the Parent Guarantor or as Subordinated Shareholder Debt of the Parent Guarantor.
“Euroclear” means Euroclear Bank, SA/NV, or any successor securities clearing agency.
“European Union” means the European Union as of January 1, 2004, including the countries of Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom, but not including any country which became or becomes a member of the European Union after January 1, 2004.
“Exchange” means The International Stock Exchange.
“Excluded Contributions” means the net cash proceeds, property or assets received by the Parent Guarantor after the Issue Date (other than any such cash proceeds, property or assets that are Excluded Amounts or Parent Debt Contributions) from:
(1)contributions to its Equity Interests; and
(2)the sale (other than to a Subsidiary of the Parent Guarantor) of Capital Stock (other than Disqualified Stock or Designated Preference Shares) of the Parent Guarantor,
in each case designated as “Excluded Contributions” pursuant to an Officer’s Certificate (which shall be designated no later than the date on which such Excluded Contribution has been received by the Parent Guarantor), the net cash proceeds of which are excluded from the calculation set forth in Section 4.07(a)(v)(C)(2) hereof.
“Existing 2026 Notes” means the $500 million aggregate principal amount of 5.625% Senior Notes due 2026 issued by the Parent Guarantor.
“Existing 2028 Notes” means the $500 million aggregate principal amount of 6.250% Senior Notes due 2028 issued by the Parent Guarantor.
“Existing Notes” means, collectively, the Existing 2026 Notes and the Existing 2028 Notes.
“fair market value” wherever such term is used in this Senior Notes Indenture (except as otherwise specifically provided in this Senior Notes Indenture), is as determined in good faith by the Parent Guarantor’s Chief Executive Officer, Chief Financial Officer or a responsible accounting or financial officer of the Parent Guarantor.
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“Fitch” means Fitch Ratings Inc.
“Global Note Legend” means the legend set forth in Section 2.06 (f) (ii) hereof, which is required to be placed on all Global Notes issued under this Senior Notes Indenture.
“Global Notes” means, individually and collectively, each of the 2025 144A Global Note, 2027 144A Global Note, 2025 Regulation S Global Note and the 2027 Regulation S Global Note, substantially in the form of Exhibit A hereto, bearing the Private Placement Legend and the Global Note Legend, issued in accordance with Sections 2.01, 2.06(b), 2.06(d) and 2.06(e).
“Government Securities” means direct non-callable and non-redeemable obligations of, or obligations guaranteed by the United States government, and the payment for which the United States government pledges its full faith and credit.
“guarantee” means a guarantee other than by endorsement of negotiable instruments for collection or deposit in the ordinary course of business, of all or any part of any Indebtedness (whether arising by agreements to keep-well, to take or pay or to maintain financial statement conditions, pledges of assets or otherwise).
“Guarantor Redomiciliation” means any redomiciliation of any Guarantor or Guarantors from where they are currently domiciled to be domiciled in any Approved Jurisdiction (in one or more steps), and each of the filings, registrations and other steps in relation thereto.
“Guarantors” means the Parent Guarantor and the Subsidiary Guarantors, collectively, unless otherwise indicated herein.
“Hedging Obligations” means, with respect to any specified Person, the obligations of such Person under:
(1)interest rate swap agreements, (whether from fixed to floating or from floating to fixed), interest rate cap agreements and interest rate collar agreements;
(2)other agreements or arrangements designed to manage interest rates or interest rate risk; and
(3)other agreements or arrangements designed to protect such Person against fluctuations in currency exchange rates, including Currency Exchange Protection Agreements, or commodity prices.
“Holder” means a Person in whose name a Senior Note is registered.
“IFRS” means International Financial Reporting Standards (formerly International Accounting Standards) endorsed from time to time by the European Union or any variation thereof with which the Parent Guarantor or its Restricted Subsidiaries comply as in effect on the Issue Date or, with respect to the covenant described under the heading “Reports,” as in effect from time to time.
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Except as otherwise set forth in this Senior Notes Indenture, all ratios, calculations and determinations based on IFRS contained in this Senior Notes Indenture shall be computed in accordance with IFRS as in effect on the Issue Date. At any time after the Issue Date, the Parent Guarantor may elect to establish that IFRS shall mean the IFRS as in effect on or prior to the date of such election (the “Elected IFRS Date”); provided that any such election, once made, shall be irrevocable.
“IHS Holding 2020 Revolving Credit Facility” means that certain senior revolving credit facility agreement originally dated March 30, 2020 and as amended and restated on June 2, 2021 and November 6, 2023 by and among the Parent Guarantor, the Issuer and the Subsidiary Guarantors as obligors thereunder, the senior lenders named therein, and the agent, including any related notes, guarantees, collateral documents, instruments, and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“Indebtedness” means, with respect to any specified Person, any indebtedness of such Person (excluding accrued expenses and trade payables):
(1)in respect of borrowed money;
(2)evidenced by bonds, debentures, notes, loan stock, commercial paper, acceptance credits, letters of credit, bills or promissory notes drawn, accepted, endorsed or issued by such Person (but not Trade Instruments);
(3)representing the deferred purchase price of assets or services (except trade accounts incurred and payable in the ordinary course of business within 365 days of the date they are incurred);
(4)representing non-contingent obligations of such Person to reimburse any other Person for amounts paid by that Person under a letter of credit or similar instrument (excluding any letters of credit or similar instrument incurred and payable in the ordinary course of business within 365 days of the date they were incurred);
(5)representing Capital Lease Obligations;
(6)representing the balance deferred and unpaid of the purchase price of any property or services due more than one year after such property is acquired or such services are completed;
(7)representing any Hedging Obligations in respect of interest rate or currency hedging; and
(8)the principal component of all obligations, or liquidation preferences, with respect to any Disqualified Stock or, with respect to any Restricted Subsidiary, any preferred stock (but excluding, in each case, any accrued dividends),
if and to the extent any of the preceding items (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet (excluding the footnotes thereto) of the specified Person prepared in accordance with IFRS.
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In addition, the term “Indebtedness” includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent not otherwise included, the guarantee by the specified Person of any Indebtedness of any other Person.
The term “Indebtedness” shall not include:
(1)Subordinated Shareholder Debt;
(2)Contingent Obligations in the ordinary course of business;
(3)in connection with the purchase by the Parent Guarantor or any Restricted Subsidiary of any business, any post-closing payment adjustments to which the seller may become entitled to the extent such payment is determined by a final closing balance sheet or such payment depends on the performance of such business after the closing;
(4)purchase price hold-backs in respect of a portion of the purchase price of an asset to satisfy warranty claims or other unperforming obligations of the seller;
(5)obligations under or in respect of a Qualified Receivables Financing to the extent such obligations are non-recourse to the Parent Guarantor or any Restricted Subsidiary to the extent provided in the definitions relating thereto; or
(6)for the avoidance of doubt, any contingent obligations in respect of workers’ compensation claims, early retirement or termination obligations, pension fund obligations or contributions or similar claims, obligations or contributions or social security or wage Taxes.
“Indirect Participant” means a Person who holds a Book-Entry Interest in a Global Note through a Participant.
“Initial 2025 Senior Notes” means the first $500.0 million aggregate principal amount of 2025 Senior Notes issued under this Senior Notes Indenture on the date hereof.
“Initial 2027 Senior Notes” means the first $800.0 million aggregate principal amount of 2027 Senior Notes issued under this Senior Notes Indenture on the date hereof.
“Initial Senior Notes” means Initial 2025 Senior Notes and the Initial 2027 Senior Notes.
“Investment Grade Status” shall occur when the Senior Notes are rated “Baa3” or better by Moody’s and “BBB-” or better by S&P and “BBB-” or better by Fitch (or, if either such entity ceases to rate the Senior Notes, the equivalent investment grade credit rating from any other “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the U.S. Exchange Act selected by the Parent Guarantor as a replacement agency).
“Investments” means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates) in the forms of loans (including guarantees or other obligations, but excluding advances or extensions of credit to customers or suppliers made in the ordinary course of business), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as Investments on a balance sheet (excluding the footnotes) prepared in accordance with IFRS.
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If the Parent Guarantor or any Restricted Subsidiary sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary, the Parent Guarantor will be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Parent Guarantor’s Investments in such Restricted Subsidiary that were not sold or disposed of in an amount determined as provided in Section 4.07(c) hereof. The acquisition by the Parent Guarantor or any Restricted Subsidiary of a Person that holds an Investment in a third Person will be deemed to be an Investment by the Parent Guarantor or such Restricted Subsidiary in such third Person in an amount equal to the fair market value of the Investments held by the acquired Person in such third Person in an amount determined as provided in Section 4.07(c) hereof. Except as otherwise provided in this Senior Notes Indenture, the amount of an Investment will be determined at the time the Investment is made and without giving effect to subsequent changes in value and, to the extent applicable, shall be determined based on the equity value of such Investment.
“Issue Date” means September 18, 2019.
“Issuer” means IHS Netherlands Holdco B.V. until a successor or substitute replaces it in accordance with the provisions of this Senior Notes Indenture, after which “Issuer” shall mean such successor.
“Issuer Group Restricted Subsidiaries” means Restricted Subsidiaries that are also Subsidiaries of the Issuer on the Amendment Date, and as may be so designated by the Parent Guarantor after the Amendment Date from time to time.
“Land Lease” means any lease which would be treated as a “lease liability” in accordance with IFRS relating to the lease of land.
“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest, assignment by way of security or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement or any lease in the nature thereof.
“Management Advances” means loans or advances not exceeding the greater of $20.0 million and 0.5% of Total Assets in aggregate outstanding amount following the 2024 Notes Issuances Date, and in each case made to, or guarantees with respect to loans or advances made to, directors, officers or employees of any Parent Guarantor or any Restricted Subsidiary: (1) in respect of travel, entertainment or moving related expenses incurred in the ordinary course of business; (2) in respect of moving related expenses incurred in connection with any closing or consolidation of any facility or office; or (3) in the ordinary course of business.
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“Management Fees” means customary fees and related expenses for the performance of transaction, management, consulting, financial or other advisory services or underwriting, placement or other investment banking activities, including in connection with mergers, acquisitions, dispositions or joint ventures, by any Permitted Holder or any of its Affiliates for the Parent Guarantor or any Restricted Subsidiary, which payments in respect of this clause (2) have been approved by a majority of the disinterested members of the Board of Directors of the Parent Guarantor, or, if there are not sufficient disinterested members of the Board of Directors of the Parent Guarantor to form a majority, by a majority of the Board of Directors.
“Market Capitalization” means an amount equal to (1) the total number of issued and outstanding shares of common stock or common equity interests of the IPO Entity on the date of the declaration of the relevant dividend multiplied by (2) the arithmetic mean of the closing prices per share of such common stock or common equity interests for the 30 consecutive trading days immediately preceding the date of declaration of such dividend.
“Moody’s” means Moody’s Investors Service, Inc.
“Net Proceeds” means the aggregate cash proceeds received by the Parent Guarantor or any of its Restricted Subsidiaries in respect of any Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration or Cash Equivalents substantially concurrently received in any Asset Sale), net of (1) the direct costs relating to such Asset Sale, including, without limitation, legal, accounting and investment banking fees, and sales commissions, and any relocation expenses incurred as a result of the Asset Sale, (2) taxes paid or payable as a result of the Asset Sale, (3) all distributions and other payments required to be made to minority interest holders (other than the Parent Guarantor or any of its Subsidiaries) in Subsidiaries or joint ventures as a result of such Asset Sale, (4) any reserve for adjustment or indemnification obligations in respect of the sale price of such asset or assets established in accordance with IFRS, and (5) all payments made on any Indebtedness incurred pursuant to clause (iv) of the definition of Permitted Debt secured by any assets subject to such Asset Sale, as required in accordance with the terms of any Lien upon such assets, or which by applicable law is required be repaid out of the proceeds from such Asset Sale.
“New Notes” means the $550 million in aggregate principal amount of 7.875% senior notes due 2030 and $650 million in aggregate principal amount of 8.250% senior notes due 2031.
“Nigeria 2023 Revolving Credit Facility” means that certain senior revolving credit facility agreement originally dated January 3, 2023 by and among the Parent Guarantor, the Issuer and the Subsidiary Guarantors as obligors thereunder, the senior lenders named therein, and the agent, including any related notes, guarantees, collateral documents, instruments, and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“Nigeria 2023 Term Loan” means that certain term facility agreement, originally dated on or around, January 3, 2023, by and among the Parent Guarantor, the Issuer and the Subsidiary Guarantors as obligors thereunder, the senior lenders named therein, and the agent, including any related notes, guarantees, instruments and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
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“Non-Issuer Group Lease Obligations” means any leases of the Parent Guarantor or any Restricted Subsidiary that is not an Issuer Group Restricted Subsidiary that would not have constituted a Capital Lease Obligation prior to the adoption of IFRS 16 (Leases).
“Non-Recourse Debt” means Indebtedness as to which neither the Parent Guarantor nor any of its Restricted Subsidiaries (1) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness) or (2) is directly or indirectly liable as a guarantor or otherwise.
“Note Guarantee” means the guarantee by each Guarantor of the Issuer’s obligations under this Senior Notes Indenture and the Senior Notes, executed pursuant to the provisions of this Senior Notes Indenture.
“Obligations” means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness.
“Offering Memorandum” means the offering memorandum dated September 10, 2019, relating to the offering of the Initial Senior Notes.
“Officer” means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, the Treasurer, director, manager or a responsible accounting or financial officer of such Person, or any other individual designated as an “Officer” for the purposes of the Indenture by the Board of Directors of such Person.
“Officer’s Certificate” means a certificate signed by an Officer.
“Opinion of Counsel” means a written opinion from legal counsel who is reasonably acceptable to the Trustee, that meets the requirements of Section 12.03 hereof. The counsel may be an employee of or counsel to the Parent Guarantor, any Subsidiary of the Parent Guarantor or the Trustee.
“Parent Debt Contribution” means a contribution to the Parent Guarantor or any of its Restricted Subsidiaries in the form of equity, funding the issuance or sale of Capital Stock of the Parent Guarantor or as Subordinated Shareholder Debt or otherwise on lent as a proceeds loan, bonds or other debt financing instrument to the Parent Guarantor or any of its Restricted Subsidiaries and which meets the conditions of Section 4.07(b)(xvii) under which dividends or other distributions may be paid.
“Parent Guarantor” means IHS Holding Limited and its successors and assigns.
“Parent Holdco” means any Person (other than a natural person) which legally and beneficially owns more than 50% of the Voting Stock and/or Capital Stock of another Person, either directly or through one or more Subsidiaries.
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“Parent Revolving Credit Facility” means that certain senior revolving credit facility agreement, originally dated on August 25, 2016, and as amended on or around the Issue Date, by and among IHS Holding Limited, the senior lenders named therein, and the agent, and to which the Issuer and each Guarantor is expected to accede as guarantor on or before the Issue Date, including any related notes, guarantees, collateral documents, instruments and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“Pari Passu Indebtedness” means (1) with respect to the Issuer, any Indebtedness that ranks pari passu in right of payment to the Senior Notes and (2) with respect to a Guarantor, any Indebtedness that ranks pari passu in right of payment to the Note Guarantee of such Guarantor.
“Participant” means, with respect to DTC, Euroclear or Clearstream, a Person who has an account with DTC, Euroclear or Clearstream, respectively.
“Permitted Business” means (1) any businesses activities engaged in by the Parent Guarantor or any of its Subsidiaries on the Issue Date and (2) any businesses, services and activities engaged in by the Parent Guarantor or any of the Restricted Subsidiaries that are related, complementary, incidental, ancillary or similar to any of the foregoing or are extensions or developments of any thereof.
“Permitted Holders” means (1) any Successor Parent of the Parent Guarantor and (2) any Person who is acting as an underwriter in connection with a public or private offering of Capital Stock of the Parent Guarantor or any Parent Holdco, acting in such capacity. Any person or group whose acquisition of beneficial ownership constitutes (1) a Change of Control in respect of which a Change of Control Offer is made in accordance with the requirements of this Senior Notes Indenture or (2) a Change of Control which is also a Specified Change of Control Event, will thereafter, together with its Affiliates, constitute an additional Permitted Holder.
“Permitted Investments” means:
(1)any Investment in the Parent Guarantor or in a Restricted Subsidiary;
(2)any Investment in cash and Cash Equivalents;
(3)any Investment by the Parent Guarantor or any Restricted Subsidiary in a Person, if as a result of such Investment:
(a)such Person becomes a Restricted Subsidiary; or
(b)such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Parent Guarantor or a Restricted Subsidiary; (5)any acquisition of assets or Capital Stock solely in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Parent Guarantor or Subordinated Shareholder Debt;
(4)any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with Section 4.10 hereof;
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(6)any Investments received in compromise or resolution of (a) obligations of trade creditors or customers that were incurred in the ordinary course of business of the Parent Guarantor or any of its Restricted Subsidiaries, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer; or (b) litigation, arbitration or other disputes or foreclosure of Liens;
(7)Investments in receivables owing to the Parent Guarantor or any Restricted Subsidiary created or acquired in the ordinary course of business;
(8)Investments represented by Hedging Obligations, which obligations are permitted by Section 4.09(b)(ix) hereof;
(9)Investments in the Senior Notes and any other Indebtedness of the Parent Guarantor or any Restricted Subsidiary (other than Indebtedness constituting Subordinated Obligations);
(10)any guarantee of Indebtedness permitted to be incurred by Section 4.09 hereof;
(11)guarantees of performance or other obligations (other than Indebtedness) arising in the ordinary course of the business of the Parent Guarantor and its Restricted Subsidiaries, including obligations under licenses, concessions or operating leases related to the ordinary course of the business of the Parent Guarantor and its Restricted Subsidiaries;
(12)any Investment existing on, or made pursuant to binding commitments existing on, the Issue Date by the Parent Guarantor or any Restricted Subsidiary of the Parent Guarantor and any Investment consisting of an extension, modification or renewal of any such Investment existing on, or made pursuant to a binding commitment existing on, the Issue Date; provided that the amount of any such Investment may be increased (a) as required by the terms of such Investment as in existence on the Issue Date or (b) as otherwise permitted under this Senior Notes Indenture;
(13)Investments acquired after the Issue Date as a result of the acquisition by the Parent Guarantor or any Restricted Subsidiary of another Person, including by way of a merger, amalgamation or consolidation with or into the Parent Guarantor or any of its Restricted Subsidiaries in a transaction that is not prohibited by Section 5.01 hereof after the Issue Date to the extent that such Investments were not made in contemplation of such acquisition, merger, amalgamation or consolidation and were in existence on the date of such acquisition, merger, amalgamation or consolidation;
(14)Management Advances;
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(15)any Investment to the extent made using as consideration Capital Stock of the Parent Guarantor (other than Disqualified Stock), Subordinated Shareholder Debt or Capital Stock of any Parent Holdco; and (16)other Investments in any Person having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (16) that are at the time outstanding not to exceed the greater of (a) $250.0 million and (b) 5.0% of the Total Assets of the Parent Guarantor at any time outstanding; provided that if an Investment is made pursuant to this clause in a Person that is not a Restricted Subsidiary and such Person subsequently becomes a Restricted Subsidiary or is subsequently designated a Restricted Subsidiary pursuant to Section 4.07 hereof, such Investment shall thereafter be deemed to have been made pursuant to clause (1) or (3) of the definition of “Permitted Investments” and not this clause.
“Permitted Liens” means:
(1)Liens in favor of the Parent Guarantor or any Restricted Subsidiary;
(2)Liens on property (including Capital Stock) of a Person existing at the time such Person becomes a Restricted Subsidiary or is merged with or into or consolidated with the Parent Guarantor or any Restricted Subsidiary; provided that such Liens do not extend to any assets other than those of the Person that becomes a Restricted Subsidiary or is merged with or into or consolidated with the Parent Guarantor or any Restricted Subsidiary;
(3)Liens to secure the performance of statutory obligations, trade contracts, insurance, surety or appeal bonds, workers compensation obligations, leases (including, without limitation, statutory and common law landlord’s liens), performance bonds, surety and appeal bonds or other obligations of a like nature incurred (including Liens to secure letters of credit issued to assure payment of such obligations) or Liens in connection with bids, tenders, contracts or leases to secure licenses, public or statutory obligations, in each case, incurred in the ordinary course of business;
(4)Liens to secure Indebtedness permitted by Section 4.09(b)(iv) hereof covering only the assets acquired with or financed by such Indebtedness;
(5)Liens securing Indebtedness under Hedging Obligations, which obligations are permitted by Section 4.09(b)(ix) hereof;
(6)Liens existing on the Issue Date after giving effect to the offering of the Senior Notes and the application of proceeds therefrom as described in this Offering Memorandum under the heading “Use of Proceeds”;
(7)Liens for taxes, assessments or governmental charges or claims that (a) are not yet due and payable or (b) are being contested in good faith;
(8)any Liens imposed by the operation of law in the ordinary course of business (including any netting or set-off as a result of a fiscal unity (fiscal eenheid) for Dutch corporate tax or value added tax purposes or of any other jurisdiction having similar effect);
(9)survey exceptions, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real property that were not incurred in connection with Indebtedness and that do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person;
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(10)Liens created for the benefit of (or to secure) the Senior Notes (or the Note Guarantees);
(11)Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of customs duties in connection with the importation of goods;
(12)Liens to secure any Permitted Refinancing Indebtedness (excluding Liens to secure Permitted Refinancing Indebtedness initially secured pursuant to clause (32) of this definition) permitted to be incurred under this Senior Notes Indenture; provided, however, that:
(a)the new Lien is limited to all or part of the same property and assets that secured or, under the written agreements pursuant to which the original Lien arose, could secure the original Lien (plus improvements and accessions to such property or proceeds or distributions thereof); and
(b)the Indebtedness secured by the new Lien is not increased to any amount greater than the sum of (i) the outstanding principal amount, or, if greater, committed amount, of the Indebtedness renewed, refunded, refinanced, replaced, defeased or discharged with such Permitted Refinancing Indebtedness and (ii) an amount necessary to pay any fees and expenses, including premiums, related to such renewal, refunding, refinancing, replacement, defeasance or discharge;
(13)Liens on insurance policies and proceeds thereof, or other deposits, to secure insurance premium financings;
(14)Liens arising in favor of the Trustee for its own benefit and similar Liens in favor of other trustees, agents and representatives arising under instruments governing Indebtedness permitted to be incurred; provided, however, that such Liens are solely for the benefit of the trustees, agents or representatives in their capacities as such and not for the benefit of the holders of the Indebtedness;
(15)filing of Uniform Commercial Code financing statements under U.S. state law (or similar filings under other applicable laws) in connection with operating leases in the ordinary course of business;
(16)bankers’ Liens, rights of setoff or similar rights and remedies as to deposit accounts, Liens arising out of judgments or awards not constituting an Event of Default and notices of lis pendens and associated rights related to litigation being contested in good faith by appropriate proceedings and for which adequate reserves have been made;
(17)Liens on cash, Cash Equivalents or other property arising in connection with the defeasance, discharge or redemption of Indebtedness;
(18)Liens on specific items of inventory or other goods (and the proceeds thereof) of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created in the ordinary course of business for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
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(19)leases (including operating leases), licenses, subleases and sublicenses of assets in the ordinary course of business;
(20)Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of assets entered into in the ordinary course of business;
(21)(a) mortgages, liens, security by way of assignment, security interests, pledges, restrictions, encumbrances or any other matters of record that have been placed by any developer, landlord or other third party on property over which the Parent Guarantor or any Restricted Subsidiary has easement rights or on any real property leased by the Parent Guarantor or any Restricted Subsidiary (including any rental deposits) and subordination or similar agreements relating thereto and (b) any condemnation or eminent domain proceedings or compulsory purchase order affecting real property;
(22)Liens on property or assets under construction (and related rights) in favor of a contractor or developer or arising from progress or partial payments by a third party relating to such property or assets;
(23)(a) Liens securing or arising by reason of any netting or set-off arrangement entered into in the ordinary course of banking or other trading activities; or (b) Liens in connection with specified bank accounts (and cash therein) in connection with the incurrence and repayment of Indebtedness under any daylight facilities permitted to be incurred under Section 4.09 hereof;
(24)Liens (including put and call arrangements) on Capital Stock or other securities of any Unrestricted Subsidiary that secure Indebtedness of such Unrestricted Subsidiary;
(25)pledges of goods, the related documents of title and/or other related documents arising or created in the ordinary course of the Parent Guarantor or any Restricted Subsidiary’s business or operations as Liens only for Indebtedness to a bank or financial institution directly relating to the goods or documents on or over which the pledge exists;
(26)Liens over cash paid into an escrow account pursuant to any purchase price retention arrangement as part of any permitted disposal by the Parent Guarantor or a Restricted Subsidiary on condition that the cash paid into such escrow account in relation to a disposal does not represent more than 15% of the net proceeds of such disposal;
(27)limited recourse Liens in respect of the ownership interests in, or assets owned by, any joint ventures which are not Restricted Subsidiaries securing obligations of such joint ventures;
(28)Liens created on any asset of the Parent Guarantor or a Restricted Subsidiary established to hold assets of any stock option plan or any other management or employee benefit or incentive plan or unit trust of the Parent Guarantor or a Restricted Subsidiary securing any loan to finance the acquisition of such assets; (31)(a) Liens on property or assets of a Restricted Subsidiary that is not a Guarantor to secure Indebtedness of such Restricted Subsidiary or any other Restricted Subsidiary that is not a Guarantor or (b) any Liens, to the extent such Liens are securing Priority Debt and are not on property, assets or Capital Stock of an Issuer Group Restricted Subsidiary;
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(29)Liens (a) on escrowed proceeds for the benefit of the related holders of debt securities or other Indebtedness (or the underwriters or arrangers thereof) or (b) on cash set aside at the time of the incurrence of any Indebtedness or government securities purchased with such cash, in the case of each of clause (a) and (b), to the extent such cash or government securities prefund the payment of interest on such Indebtedness and are held in an escrow account or similar arrangement to be applied for such purpose;
(30)Liens on Receivables Assets incurred in connection with a Qualified Receivables Financing or Liens securing Indebtedness or other obligations of a Receivables Subsidiary;
(32)any cash collateral provided in respect of letters of credit or bank guarantees to the issuer of such letters of credit or bank guarantees to the extent that the Indebtedness to which such letters of credit or bank guarantees relate is permitted or not prohibited to be incurred under this Senior Notes Indenture; and
(33)Liens incurred in the ordinary course of business of the Parent Guarantor or any Restricted Subsidiary securing Indebtedness of the Parent Guarantor and its Restricted Subsidiaries that does not exceed the greater of $100.0 million and 2.0% of the Total Assets of the Parent Guarantor at any one time outstanding following the 2024 Notes Issuance Date.
“Permitted Parent Payments” means, without duplication as to amounts, payments to any Parent Holdco of the Parent Guarantor to permit such entity to pay:
(1)customary indemnification obligations of any Parent Holdco owing to directors, officers, employees or other Persons under its charter or by-laws or pursuant to written agreements with any such Person to the extent relating to the Parent Guarantor and its Subsidiaries;
(2)obligations of any Parent Holdco in respect of directors’ fees, remuneration and expenses (including director and officer insurance (including premiums therefore)) to the extent relating to the Parent Guarantor and its Subsidiaries;
(3)professional fees and expenses of any Parent Holdco related to the ownership of the Capital Stock of the Parent Guarantor and, indirectly through the Parent Guarantor, its Subsidiaries (including, without limitation, accounting, legal, audit corporate reporting, and administrative expenses and other reasonable and normal course expenses required to maintain such Parent Holdco’s corporate existence or its holding of the Capital Stock of the Parent Guarantor); and
(4)expenses incurred by any Parent Holdco in connection with any public offering or other sale of Capital Stock or Indebtedness, whether consummated or not, (a) where the net proceeds of such offering or sale are intended to be received by or contributed to the Parent Guarantor or a Subsidiary of the Parent Guarantor; or (b) in a pro-rated amount of such expenses in proportion to the amount of such net proceeds intended to be so received or contributed; and “Permitted Refinancing Indebtedness” means any Indebtedness of the Parent Guarantor or any of its Restricted Subsidiaries issued in exchange for, or the net proceeds of which are used to renew, refund, refinance, replace, exchange, defease or discharge other Indebtedness of the Parent Guarantor or any of its Restricted Subsidiaries (other than intercompany Indebtedness); provided that:
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(5)any Related Taxes.
(1)the aggregate principal amount (or accreted value, if applicable), or if issued with original issue discount, aggregate issue price) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable, or if issued with original issue discount, aggregate issue price) of the Indebtedness renewed, refunded, refinanced, replaced, exchanged, defeased or discharged (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith);
(2)such Permitted Refinancing Indebtedness has (a) a final maturity date that is either (i) no earlier than the final maturity date of the Indebtedness being renewed, refunded, refinanced, replaced, exchanged, defeased or discharged or (ii) after the final maturity date of the Senior Notes and (b) has a Weighted Average Life to Maturity that is equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged;
(3)if the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged is expressly, contractually subordinated in right of payment to the Senior Notes or a Note Guarantee, such Permitted Refinancing Indebtedness is subordinated in right of payment to the Senior Notes or such Note Guarantee, as the case may be, on terms at least as favorable to the holders of Senior Notes as those contained in the documentation governing the Indebtedness being renewed, refunded, refinanced, replaced, exchanged, defeased or discharged; and
(4)if the Issuer or any Guarantor was the obligor on the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged, such Indebtedness is incurred either by the Issuer or a Guarantor.
Permitted Refinancing Indebtedness in respect of any Indebtedness may be incurred from time to time after the termination, discharge or repayment of any such Indebtedness.
“Permitted Reorganization” means any amalgamation, demerger, merger, voluntary liquidation, consolidation, reorganization, restructuring, redomiciliation, winding up or corporate reconstruction involving the Parent Guarantor or any Restricted Subsidiary that is made on a solvent basis; provided that (1) any payments, business, property or assets distributed in connection with such Reorganization remain within the Parent Guarantor and the Restricted Subsidiaries; and (2) if any Note Guarantees are released in connection with such Reorganization in accordance with the Note Guarantee release provisions of this Senior Notes Indenture, Note Guarantees must be provided promptly following the completion of such Reorganization such that the Note Guarantees in place following the Reorganization are not materially worse for the holders of the Senior Notes than the pre-existing Note Guarantees (in the good faith judgment of the Parent Guarantor).
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Promptly upon consummation of a Permitted Reorganization, the Parent Guarantor will file with the Trustee a copy of the resolution of the Board of Directors of the Parent Guarantor or the applicable Restricted Subsidiary authorizing such Permitted Reorganization and deliver an Officer’s Certificate certifying that such Permitted Reorganization complied or will comply with the terms of this Senior Notes Indenture and did not result or will not result in a Default or Event of Default. The Trustee at the direction and request of the Parent Guarantor shall take any action necessary to effect any releases of Note Guarantees (as well as any subsequent giving of Note Guarantees) requested by the Parent Guarantor in connection with a Permitted Reorganization.
“Person” means any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization, limited liability company or government or other entity.
“Priority Debt” means Indebtedness permitted to be incurred pursuant to the provisions of sub-paragraph (y) of the last paragraph of Section 4.09(b) or would not otherwise cause the Priority Debt Cap to be exceeded, assuming that such Indebtedness were so incurred.
“Priority Debt Cap” means the greater of U.S.$.1,890 million and 200% of Consolidated EBITDA.
“Private Placement Legend” means the legend set forth in Section 2.06(f)(i) hereof to be placed on all Senior Notes issued under this Senior Notes Indenture except where otherwise permitted by the provisions of this Senior Notes Indenture.
“Proceeds Bonds” means one or more bonds issued pursuant to an intragroup proceeds bonds agreement entered into on the Issue Date between the Issuer and one or more of the Guarantors with the proceeds of the Senior Notes.
“Public Debt” means any Indebtedness consisting of bonds, debentures, notes or other similar debt securities issued in (1) a public offering registered under the U.S. Securities Act or (2) a private placement to institutional investors that is underwritten for resale in accordance with Rule 144A under the U.S. Securities Act or Regulation S under the U.S. Securities Act, whether or not it includes registration rights entitling the holders of such securities to registration thereof with the SEC for public resale.
“Public Equity Offering” means, with respect to any Person, a bona fide public offering of the ordinary shares or common equity of such Person either:
(1)pursuant to a flotation on a Recognized Stock Exchange or Listing Authority; or
(2)pursuant to an effective registration statement under the U.S. Securities Act (other than a registration statement on Form S-8 or otherwise relating to Equity Interests issued or issuable under any employee benefit plan).
“QIB” means a “qualified institutional buyer” as defined in Rule 144A.
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“Qualified Receivables Financing” means any Receivables Financing of a Receivables Subsidiary that meets the following conditions: (1) an Officer or the Board of Directors of the Parent Guarantor shall have determined in good faith that such Qualified Receivables Financing (including financing terms, covenants, termination events and other provisions) is in the aggregate economically fair and reasonable to the Parent Guarantor and the Receivables Subsidiary, (2) all sales of accounts receivable and related assets to the Receivables Subsidiary are made at fair market value (as determined in good faith by an Officer or the Board of Directors of the Parent Guarantor), and (3) the financing terms, covenants, termination events and other provisions thereof shall be on market terms (as determined in good faith by the Parent Guarantor) and may include Standard Securitization Undertakings.
The grant of a security interest in any accounts receivable of the Parent Guarantor or any of its Restricted Subsidiaries (other than a Receivables Subsidiary) to secure Indebtedness under Credit Facilities or Indebtedness in respect of the Senior Notes shall not be deemed a Qualified Receivables Financing.
“Receivable” means a right to receive payment arising from a sale or lease of goods or services by a Person pursuant to an arrangement with another Person pursuant to which such other Person is obligated to pay for goods or services under terms that permit the purchase of such goods and services on credit, as determined on the basis of IFRS.
“Receivables Assets” means any assets that are or will be the subject of a Qualified Receivables Financing.
“Receivables Fees” means distributions or payments made directly or by means of discounts with respect to any participation interest issued or sold in connection with, and other fees paid to a Person that is not a Restricted Subsidiary in connection with, any Receivables Financing.
“Receivables Financing” means any transaction or series of transactions that may be entered into by the Parent Guarantor or any of its Subsidiaries pursuant to which the Parent Guarantor or any of its Subsidiaries may sell, convey or otherwise transfer to (1) a Receivables Subsidiary (in the case of a transfer by the Parent Guarantor or any of its Subsidiaries), or (2) any other Person (in the case of a transfer by a Receivables Subsidiary), or may grant a security interest in, any accounts receivable (whether now existing or arising in the future) of the Parent Guarantor or any of its Subsidiaries, and any assets related thereto, including all collateral securing such accounts receivable, all contracts and all guarantees or other obligations in respect of such accounts receivable, proceeds of such accounts receivable and other assets which are customarily transferred or in respect of which security interest are customarily granted in connection with asset securitization transactions involving accounts receivable and any Hedging Obligations entered into by the Parent Guarantor or any such Subsidiary in connection with such accounts receivable.
“Receivables Repurchase Obligation” means any obligation of a seller of receivables in a Qualified Receivables Financing to repurchase receivables arising as a result of a breach of a representation, warranty or covenant or otherwise, including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, off-set or counterclaim of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller.
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“Receivables Subsidiary” means a Wholly-Owned Subsidiary of the Parent Guarantor (or another Person formed for the purposes of engaging in a Qualified Receivables Financing with the Parent Guarantor in which the Parent Guarantor or any Subsidiary of the Parent Guarantor makes an Investment and to which the Parent Guarantor or any Subsidiary of the Parent Guarantor transfers accounts receivable and related assets) which engages in no activities other than in connection with the financing of accounts receivable of the Parent Guarantor and its Subsidiaries, all proceeds thereof and all rights (contractual or other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and which is designated by the Board of Directors of the Parent Guarantor (as provided below) as a Receivables Subsidiary and:
(1)no portion of the Indebtedness or any other obligations (contingent or otherwise) of which (A) is guaranteed by the Parent Guarantor or any other Restricted Subsidiary of the Parent Guarantor (excluding guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings), (B) is subject to terms that are substantially equivalent in effect to a guarantee of any losses on securitized or sold receivables by the Parent Guarantor or any other Restricted Subsidiary of the Parent Guarantor, (C) is recourse to or obligates the Parent Guarantor or any other Restricted Subsidiary of the Parent Guarantor in any way other than pursuant to Standard Securitization Undertakings, or (D) subjects any property or asset of the Parent Guarantor or any other Restricted Subsidiary of the Parent Guarantor, directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings,
(2)with which neither the Parent Guarantor nor any other Restricted Subsidiary of the Parent Guarantor has any contract, agreement, arrangement or understanding other than on terms which the Parent Guarantor reasonably believes to be no less favorable to the Parent Guarantor or such Restricted Subsidiary than those that might be obtained at the time from Persons that are not Affiliates of the Parent Guarantor, and
(3)to which neither the Parent Guarantor nor any other Restricted Subsidiary of the Parent Guarantor has any obligation to maintain or preserve such entity’s financial condition or cause such entity to achieve certain levels of operating results.
Any such designation by the Board of Directors of the Parent Guarantor shall be evidenced to the Trustee by filing with the Trustee a copy of the resolution of the Board of Directors of the Parent Guarantor giving effect to such designation and an Officer’s Certificate certifying that such designation complied with the foregoing conditions.
“Recognized Stock Exchange” means any nationally recognized stock exchange in the United States or any member of the European Union (including, for the avoidance of doubt, the United Kingdom) or Switzerland.
“Regulation S” means Regulation S promulgated under the U.S. Securities Act.
“Regulation S Definitive Registered Note” means a Definitive Registered Note resold in reliance on Regulation S.
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“Regulation S Global Note” means a 2025 Regulation S Global Note or a 2027 Regulation S Global Note.
“Related Taxes” means:
(1)any Taxes required to be paid (provided that such Taxes are in fact paid) by any Parent Holdco by virtue of its:
(a)being organized or having Capital Stock outstanding (but not by virtue of owning stock or other equity interests of any corporation or other entity other than, directly or indirectly, the Parent Guarantor or any of the Parent Guarantor’s Subsidiaries);
(b)issuing or holding Subordinated Shareholder Debt; or
(c)being a holding company, directly or indirectly, of the Parent Guarantor or any of the Parent Guarantor’s Subsidiaries; and
(2)if and for so long as the Parent Guarantor is a member of a group filing a consolidated or combined tax return with any Parent Holdco, any consolidated or combined Taxes measured by income for which such Parent Holdco is liable up to an amount not to exceed the lesser of the amount of any such Taxes that the Parent Guarantor and its Subsidiaries would have been required to pay on (i) a separate company basis or (ii) on a consolidated basis if the Parent Guarantor and its Subsidiaries had paid tax on a consolidated, combined, group, affiliated or unitary basis on behalf of an affiliated group consisting only of the Parent Guarantor and its Subsidiaries; provided that distributions shall be permitted in respect of the income of an Unrestricted Subsidiary only to the extent such Unrestricted Subsidiary distributed cash for such purpose to the Parent Guarantor or its Restricted Subsidiaries.
“Responsible Officer” when used with respect to the Trustee, means any officer or assistant officer of the Trustee (or any successor of the Trustee) including any director, associate director, assistant secretary or any other officer or assistant officer of the Trustee customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject.
“Replacement Assets” means (1) properties and assets that replace the properties and assets that were the subject of an Asset Sale or (2) properties and assets received in exchange (directly or indirectly through equity interests or similar participations) for the properties and assets that are the subject of the Asset Sale and that, in each case, will be used in a Permitted Business.
“Restricted Investment” means an Investment other than a Permitted Investment.
“Restricted Period” means the 40-day distribution compliance period as defined in Regulation S.
“Restricted Subsidiary” means any Subsidiary of the Parent Guarantor that is not an Unrestricted Subsidiary.
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“Rule 144” means Rule 144 promulgated under the U.S. Securities Act.
“Rule 144A” means Rule 144A promulgated under the U.S. Securities Act.
“Rule 903” means Rule 903 promulgated under the U.S. Securities Act.
“Rule 904” means Rule 904 promulgated under the U.S. Securities Act.
“S&P” means Standard & Poor’s Ratings Group.
“SEC” means the U.S. Securities and Exchange Commission.
“Senior Credit Facilities” means that certain credit facility agreement, dated on or around September 3, 2019, by and among the Issuer and IHS Nigeria, ITNG and INT Towers as borrowers, the other Guarantors, as additional obligors, the senior lenders named therein, and the agent, including any related notes, guarantees, instruments and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time.
“Senior Notes” has the meaning assigned to it in the preamble to this Senior Notes Indenture. Unless the context otherwise requires, all references to the Senior Notes shall include the Initial Senior Notes and any Additional Senior Notes.
“Senior Notes Indenture” means this indenture for the Senior Notes, as amended or supplemented from time to time.
“Senior Notes Initial Purchasers” has the meaning ascribed to such term in the Offering Memorandum.
“Senior Notes Trustee” means the trustee for the Senior Notes under the Senior Notes Indenture.
“Significant Subsidiary” means, at the date of determination, any Restricted Subsidiary that together with its Subsidiaries that are Restricted Subsidiaries (1) for the most recent fiscal year, accounted for more than 10% of the consolidated revenues of the Parent Guarantor or (2) as of the end of the most recent fiscal year, was the owner of more than 10% of the consolidated Total Assets of the Parent Guarantor.
“Specified Change of Control Event” means the occurrence of any event that would constitute a Change of Control pursuant to the definition thereof; provided that giving pro forma effect thereto, the Consolidated Net Leverage Ratio would not exceed 4.0 to 1.0. Notwithstanding the foregoing, only one Specified Change of Control Event shall be permitted under this Senior Notes Indenture after the Issue Date.
“Standard Securitization Undertakings” means representations, warranties, covenants, indemnities and guarantees of performance entered into by the Parent Guarantor or any Subsidiary of the Parent Guarantor which the Parent Guarantor has determined in good faith to be customary in a Receivables Financing, including those relating to the servicing of the assets of a Receivables Subsidiary, it being understood that any Receivables Repurchase Obligation shall be deemed to be a Standard Securitization Undertaking.
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“Stated Maturity” means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which the payment of interest or principal was scheduled to be paid in the documentation governing such Indebtedness as of the Issue Date, and will not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.
“Subordinated Obligation” means, with respect to any Person, any Indebtedness of the Parent Guarantor which is expressly subordinated in right of payment to the Senior Notes pursuant to a written agreement.
“Subordinated Shareholder Debt” means, collectively, any debt provided to the Parent Guarantor by any direct or indirect Parent Holdco of the Parent Guarantor or any Permitted Holder, including any Subsidiary or Affiliate of any Parent Holdco that is not a Subsidiary of the Parent Guarantor, in exchange for or pursuant to any security, instrument or agreement other than Capital Stock, together with any such security, instrument or agreement and any other security or instrument other than Capital Stock issued in payment of any obligation under any Subordinated Shareholder Debt; provided that such Subordinated Shareholder Debt:
(1)does not (including upon the occurrence of any event) mature or require any amortization or other payment of principal prior to the maturity of the Senior Notes (other than through conversion or exchange of any such security or instrument for Equity Interests of the Parent Guarantor (other than Disqualified Stock) or for any other security or instrument meeting the requirements of the definition);
(2)does not (including upon the occurrence of any event) require the payment of cash interest prior to the maturity of the Senior Notes;
(3)does not (including upon the occurrence of any event) provide for the acceleration of its maturity nor confers on its holders any right (including upon the happening of any event) to declare a default or event of default or take any enforcement action, in each case, prior to the maturity of the Senior Notes;
(4)is not secured by a Lien on any assets of the Parent Guarantor or a Restricted Subsidiary and is not guaranteed by the Parent Guarantor or any Subsidiary of the Parent Guarantor; and
(5)is contractually subordinated in right of payment to the prior payment in full in cash of all obligations of the Parent Guarantor under the Senior Notes and the Note Guarantees pursuant to subordination on insolvency, enforcement limitation, payment blockage, turnover, filing of claims and release of claims provisions,
provided, however, that after any event or circumstance that results in such Indebtedness ceasing to qualify as Subordinated Shareholder Debt, such Indebtedness shall constitute an incurrence of such Indebtedness by the Parent Guarantor, and any and all Restricted Payments made through the use of the net proceeds from the incurrence of such Indebtedness since the date of the original issuance of such Subordinated Shareholder Debt shall constitute new Restricted Payments that are deemed to have been made after the date of the original issuance of such Subordinated Shareholder Debt.
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“Subsidiary” means, with respect to any specified Person:
(1)any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency and after giving effect to any voting agreement or stockholders’ agreement that effectively transfers voting power) to vote in the election of directors, managers or trustees of the corporation, association or other business entity is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person (or a combination thereof);
(2)any partnership or limited liability company of which (a) more than 50% of the capital accounts, distribution rights, total equity and voting interests or general and limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof, whether in the form of membership, general, special or limited partnership interests or otherwise, and (b) such Person or any Subsidiary of such Person is a controlling general partner or otherwise controls such entity; and
(3)any corporation, company, association, partnership, limited liability company or other business entity which is or is eligible to be consolidated in the financial statements of such Person in accordance with IFRS.
“Subsidiary Guarantors” means IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., IHS Nigeria Limited, IHS Towers NG Limited, Nigeria Tower Interco B.V., INT Towers Limited and INT Towers NG Finco 1 Plc and any other Person that executes a supplemental indenture in accordance with the provisions of this Senior Notes Indenture, and their respective successors and assigns, in each case, until the Note Guarantee of such Person has been released in accordance with the provisions of this Senior Notes Indenture.
“Successor Parent” means, with respect to any Person, any other Person more than 50% of the total voting power of the Voting Stock of which is, at the time the first Person becomes a Subsidiary of such other Person, “beneficially owned” (as defined below) by one or more Persons that “beneficially owned” (as defined below) more than 50% of the total voting power of the Voting Stock of the first Person immediately prior to the first Person becoming a Subsidiary of such other Person. For purposes hereof, “beneficially own” has the meaning correlative to the term “beneficial owner,” as such term is defined in Rules 13d-3 and 13d-5 under the U.S. Exchange Act (as in effect on the Issue Date).
“Tax” means any tax, duty, levy, impost, assessment or other governmental charge (including penalties, interest and any other additions thereto, and, for the avoidance of doubt, including any withholding or deduction for or on account of Tax). “Taxes” and “Taxation” shall be construed to have corresponding meanings.
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“Tax Sharing Agreement” means any tax sharing or profit and loss pooling or similar agreement with customary or arm’s length terms entered into with any Parent Holdco of the Parent Guarantor or Unrestricted Subsidiary, as the same may be amended, supplemented, waived or otherwise modified from time to time in accordance with the terms thereof and of this Senior Notes Indenture.
“Total Assets” means, with respect to any specified Person as of any date, the total assets of such Person, calculated on a consolidated basis in accordance with IFRS, excluding all intra-group items and investments in any Subsidiaries of such Person of or by such Person or any of its Restricted Subsidiaries.
“Trade Instruments” means any performance bonds, advance payment bonds or documentary letters of credit issued in respect of the obligations of any of the Parent Guarantor or its Restricted Subsidiaries arising in the ordinary course of business which, in each case, is not (or will not be) outstanding for a period longer than 9 months from the date such instrument is issued.
“Transactions” means the offering of the Senior Notes and the use of proceeds thereof as described in the Offering Memorandum.
“Treasury Rate” means, as of any redemption date, the yield to maturity at the time of computation of U.S. Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) which has become publicly available on a day no earlier than two Business Days prior to the redemption date (or, if such statistical release is not so published or available, any publicly available source of similar market date selected by the Issuer in good faith)) most nearly equal to the period from the redemption date to September 18, 2021 in the case of the 2025 Notes and September 18, 2022 in the case of the 2027 Notes; provided, however, that if the period from the redemption date to September 18, 2021 in the case of the 2025 Notes and September 18, 2022 in the case of the 2027 Notes is not equal to the constant maturity of a U.S. Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by a linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields to U.S. Treasury securities for which such yields are given, except that if the period from the redemption date to September 18, 2021 in the case of the 2025 Notes and September 18, 2022 in the case of the 2027 Notes is less than one year, the weekly average yield on actually traded U.S. Treasury securities adjusted to a constant maturity of one year shall be used.
“Trustee” means Citibank, N.A., London Branch, until a successor replaces it in accordance with the applicable provisions of this Senior Notes Indenture and thereafter means the successor serving hereunder.
“Unrestricted Subsidiary” means any Subsidiary of the Parent Guarantor that is designated by the Board of Directors of the Parent Guarantor as an Unrestricted Subsidiary pursuant to a resolution of the Board of Directors but only to the extent that such Subsidiary at the time of such designation:
(1)has no Indebtedness other than Non-Recourse Debt;
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(2)except as permitted by Section 4.11 hereof, is not party to any agreement, contract, arrangement or understanding with the Parent Guarantor or any Restricted Subsidiary unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Parent Guarantor or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Parent Guarantor; and
(3)is a Person with respect to which neither the Parent Guarantor nor any Restricted Subsidiary has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve such Person’s financial condition or to cause such Person to achieve any specified levels of operating results.
Towers Infrastructure Company Limited and IHS Towers Netherlands FinCo NG B.V. have been designated as “Unrestricted Subsidiaries” as of the Issue Date for the purposes of this Senior Notes Indenture.
“U.S. Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended and the rules and regulations promulgated pursuant thereto.
“U.S. Securities Act” means the U.S. Securities Act of 1933, as amended and the rules and regulations promulgated pursuant thereto.
“U.S. Person” means a U.S. Person as defined in Rule 902(k) promulgated under the U.S. Securities Act.
“Voting Stock” of any specified Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.
“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing:
(1)the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect of the Indebtedness, by
(b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by
(2)the then outstanding principal amounts of such Indebtedness.
“Wholly-Owned Subsidiary” means a Restricted Subsidiary of the Parent Guarantor, all of the Capital Stock of which (other than directors’ qualifying shares or shares required by any applicable law or regulation to be held by a Person other than the Parent Guarantor or another Wholly-Owned Subsidiary) is owned by the Parent Guarantor or another Wholly-Owned Subsidiary.
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Other Definitions.
Term |
|
Defined in |
|
“Additional Amounts” |
|
4.18 |
|
“Affiliate Transaction” |
|
4.11 |
|
“Applicable Law” |
|
7.11 |
|
“Asset Sale Offer” |
|
4.10 |
|
“Authenticating Agent” |
|
2.02 |
|
“Authentication Order” |
|
2.02 |
|
“Authority” |
|
7.11 |
|
“Authorized Agent” |
|
12.06 |
|
“Calculation Date” |
|
1.01 |
|
“Change in Tax Law” |
|
3.08 |
|
“Change of Control Offer” |
|
4.13 |
|
“Change of Control Payment” |
|
4.13 |
|
“Change of Control Payment Date” |
|
4.13 |
|
“Covenant Defeasance” |
|
8.03 |
|
“Event of Default” |
|
6.01 |
|
“Excess Proceeds” |
|
4.10 |
|
“Excluded Amounts” |
|
4.07 |
|
“FATCA Withholding” |
|
7.11 |
|
“incur” |
|
4.09 |
|
“Increased Amount” |
|
4.12 |
|
“Initial Lien” |
|
4.12 |
|
“IPO Entity” |
|
3.07 |
|
“Judgment Currency” |
|
12.13 |
|
“Legal Defeasance” |
|
8.02 |
|
“Notes Offer” |
|
4.10 |
|
“Offer Amount” |
|
3.10 |
|
“Offer Period” |
|
3.10 |
|
“Party” |
|
7.11 |
|
“Paying Agent” |
|
2.03 |
|
“Payment Default” |
|
6.01 |
|
“Permitted Debt” |
|
4.09 |
|
“Permitted Payments” |
|
4.07 |
|
“Proceeds Bond Withholding” |
|
3.08 |
|
“Principal Paying Agent” |
|
2.03 |
|
“Purchase Date” |
|
3.10 |
|
“Qualifying IPO” |
|
4.03 |
|
“Register” |
|
2.03 |
|
“Registrar” |
|
2.03 |
|
“Restricted Payments” |
|
4.07 |
|
“Substitution” |
|
5.03 |
|
“Suspension Period” |
|
4.19 |
|
“Tax Jurisdiction” |
|
4.18 |
|
“Tax Redemption Date” |
|
3.08 |
|
“Transaction Commitment Date Election” |
|
4.22 |
|
“Transfer Agent” |
|
2.03 |
|
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Rules of Construction. Unless the context otherwise requires:
a term has the meaning assigned to it;
an accounting term not otherwise defined has the meaning assigned to it in accordance with IFRS;
“or” is not exclusive;
words in the singular include the plural, and in the plural include the singular;
“will” shall be interpreted to express a command;
provisions apply to successive events and transactions;
references to sections of or rules under the U.S. Securities Act will be deemed to include substitute, replacement of successor sections or rules adopted by the SEC from time to time;
all references to the principal, premium, interest or any other amount payable pursuant to this Senior Notes Indenture shall be deemed also to refer to any Additional Amounts which may be payable hereunder in respect of payments of principal, premium, interest and any other amounts payable pursuant to this Senior Notes Indenture or any undertakings given in addition thereto or in substitution therefor pursuant to this Senior Notes Indenture and express reference to the payment of Additional Amounts in any provisions hereof shall not be construed as excluding Additional Amounts in those provisions hereof where such express reference is not made; and
unsecured or unguaranteed Indebtedness shall not be deemed to be subordinate or junior to secured Indebtedness or guaranteed Indebtedness merely by virtue of its nature as unsecured or unguaranteed Indebtedness.
THE SENIOR NOTES
Form and Dating. 1. General. The Senior Notes and the Trustee's or Authenticating Agent's certificate of authentication will be substantially in the form of Exhibit A hereto. The Senior Notes may have notations, legends or endorsements required by law, stock exchange rule or usage and as provided herein. The Issuer shall approve the form of the Senior Notes and any notation, legend or endorsement thereon. Each Note will be dated the date of its authentication.
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The terms and provisions contained in the Senior Notes will constitute, and are hereby expressly made, a part of this Senior Notes Indenture and the Issuer, the Guarantors and the Trustee, by their execution and delivery of this Senior Notes Indenture, expressly agree to such terms and provisions and to be bound thereby. However, to the extent any provision of any Senior Note conflicts with the express provisions of this Senior Notes Indenture, the provisions of this Senior Notes Indenture shall govern and be controlling.
Global Notes. Senior Notes issued in global form will be substantially in the form of Exhibit A hereto (including the Global Note Legend thereon and the "Schedule of Exchanges of Interests in the Global Note" attached thereto). Each Global Note will represent such of the outstanding Senior Notes as will be specified therein and each shall provide that it represents the aggregate principal amount of outstanding Senior Notes from time to time endorsed thereon and that the aggregate principal amount of outstanding Senior Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions and purchases and cancellations. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Senior Notes represented thereby will be made by the Trustee or the Depositary or the Principal Paying Agent at the direction of the Trustee, in accordance with instructions given by the Holder thereof as required by Section 2.06 hereof.
144A Global Notes and Regulation S Global Notes. The 2025 Senior Notes sold within the United States to QIBs pursuant to Rule 144A under the U.S. Securities Act shall be issued initially in the form of a 2025 144A Global Note, which shall be deposited with the Custodian, and registered in the name of Cede & Co., as nominee for DTC, duly executed by the Issuer and authenticated by the Trustee or the Authenticating Agent as hereinafter provided. The aggregate principal amount of a 2025 144A Global Note may from time to time be increased or decreased by adjustments made on Schedule A to each such Global Note, as hereinafter provided.
The 2027 Senior Notes sold within the United States to QIBs pursuant to Rule 144A under the U.S. Securities Act shall be issued initially in the form of a 2027 144A Global Note, which shall be deposited with the Custodian, and registered in the name of Cede & Co., as nominee for DTC, duly executed by the Issuer and authenticated by the Trustee or the Authenticating Agent as hereinafter provided. The aggregate principal amount of a 2027 144A Global Note may from time to time be increased or decreased by adjustments made on Schedule A to each such Global Note, as hereinafter provided.
The 2025 Senior Notes offered and sold in reliance on Regulation S shall be issued initially in the form of a 2025 Regulation S Global Note, which shall be deposited with the Common Depositary for Euroclear and Clearstream, duly executed by the Issuer and authenticated by the Trustee or the Authenticating Agent as hereinafter provided. The aggregate principal amount of a 2025 Regulation S Global Note may from time to time be increased or decreased by adjustments made on Schedule A to each such Global Note, as hereinafter provided.
The 2027 Senior Notes offered and sold in reliance on Regulation S shall be issued initially in the form of a 2027 Regulation S Global Note, which shall be deposited with the Common Depositary for Euroclear and Clearstream, duly executed by the Issuer and authenticated by the Trustee or the Authenticating Agent as hereinafter provided. The aggregate principal amount of a 2027 Regulation S Global Note may from time to time be increased or decreased by adjustments made on Schedule A to each such Global Note, as hereinafter provided.
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Definitive Registered Notes. Definitive Registered Notes issued upon transfer of a Book-Entry Interest or a Definitive Registered Note, or in exchange for a Book-Entry Interest or a Definitive Registered Note, shall be issued in accordance with this Senior Notes Indenture.
Notes issued in definitive registered form will be substantially in the form of Exhibit A hereto (excluding the Global Note Legend thereon and without the “Schedule of Exchanges of Interests in the Global Note” in the form of Schedule A attached thereto).
Book-Entry Provisions. The Applicable Procedures shall be applicable to Book-Entry Interests in the Global Notes that are held by Participants through DTC, Euroclear or Clearstream.
Denomination. The Senior Notes shall be in denominations of $200,000 and integral multiples of $1,000 in excess thereof.
Execution and Authentication. At least one Officer must sign the Senior Notes for the Issuer by manual or facsimile signature.
If an Officer whose signature is on a Senior Note no longer holds that office at the time a Senior Note is authenticated, the Senior Note will nevertheless be valid.
A Senior Note will not be valid until authenticated by the manual or facsimile signature of the authorized signatory of the Trustee or the Authenticating Agent. The signature will be conclusive evidence that the Senior Note has been authenticated under this Senior Notes Indenture. Notwithstanding the foregoing, if any Senior Note shall have been authenticated and delivered hereunder but never issued and sold by the Issuer, the Issuer shall deliver such Senior Note to the Trustee for cancellation pursuant to Section 2.11 hereof.
The Trustee will, upon receipt of a written order of the Issuer signed by an authorized representative (an “Authentication Order”), authenticate or cause the Authenticating Agent to authenticate the Senior Notes for original issue that may be validly issued under this Senior Notes Indenture, including any Additional Senior Notes. The aggregate principal amount of Senior Notes outstanding at any time may not exceed the aggregate principal amount of Senior Notes authorized for issuance by the Issuer pursuant to one or more Authentication Orders, except as provided in Section 2.07 hereof.
The Trustee may appoint one or more authentication agents (each, an “Authenticating Agent”) acceptable to the Issuer to authenticate Notes. Such an agent may authenticate Notes whenever the Trustee may do so. Each reference in this Senior Notes Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with Holders or an Affiliate of the Issuer.
Paying Agent, Registrars and Transfer Agent. The Issuer will maintain one or more paying agents (each, a “Paying Agent”) for the Senior Notes in London. The initial Paying Agent will be Citibank, N.A., London Branch (the “Paying Agent” or “Principal Paying Agent”) and Citibank, N.A., London Branch hereby accepts such appointment.
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The Issuer will also maintain a registrar (the “Registrar”) with an office in London. The Issuer will also maintain a transfer agent (the “Transfer Agent”). The Issuer hereby appoints Citibank N.A., London Branch as the initial Registrar and Citibank N.A., London Branch hereby accepts such appointment. The Issuer hereby appoints Citibank, N.A., London Branch in London as the initial Transfer Agent and Citibank, N.A., London Branch hereby accepts such appointment.
The Registrar will maintain a register (the “Register”) for the Senior Notes reflecting ownership of the Definitive Registered Notes (as defined herein) outstanding from time to time and will make payments on and facilitate transfers of Definitive Registered Notes on behalf of the Issuer. Each Transfer Agent shall perform the functions of a transfer agent.
The Registrar will send, on request, a copy of the Register to the Issuer on the Issue Date and after any change to the Register made by the Registrar, with such copy to be held by the Issuer at its registered office.
Upon notice to the Trustee, the Issuer may change the Paying Agent, the Registrar or the Transfer Agent without prior notice to the Holders (subject, in the case of a Paying Agent, to the condition described in the first paragraph of this Section 2.03). For so long as the Senior Notes are listed on the Official List of the Exchange and the rules of The International Stock Exchange Authority Limited so require, the Issuer will notify The International Stock Exchange Authority Limited of any change of the Paying Agent, Registrar or Transfer Agent.
Paying Agent to Hold Money. The Issuer will require each Paying Agent (other than the Trustee in circumstances in which it is required to act as Paying Agent) to agree in writing that each Paying Agent will hold for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal of, premium or Additional Amounts, if any, or interest on, the Senior Notes, and will notify the Trustee of any default by the Issuer in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Issuer at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Issuer or a Subsidiary of the Issuer) will have no further liability for the money. If the Issuer or a Subsidiary of the Issuer acts as Paying Agent, it will segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent and in no event shall any Paying Agent be liable for interest on any money received by it hereunder. Upon any insolvency, bankruptcy or reorganization proceedings relating to the Issuer (including, without limitation, its bankruptcy, voluntary or judicial liquidation, composition with creditors, reprieve from payment, controlled management, fraudulent conveyance, general settlement with creditors, reorganization or similar laws affecting the rights of creditors generally), the Trustee may serve as Paying Agent for the Senior Notes. The Issuer shall no later than 10:00 a.m. (London time) on the second Business Day prior to the day on which the Paying Agent is to receive payment, procure that the bank effecting payment for it confirms via fax or tested SWIFT MT100 message to the Paying Agent the payment instructions relating to such payment. A Paying Agent shall not be obliged to pay the Holders of the Senior Notes (or make any other payment) unless and until such time as it has confirmed receipt of funds sufficient to make the relevant payment.
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Money held by the initial Paying Agent (as described in Section 2.03 above) will not be held in trust but will be held by such Paying Agent as banker and such money shall not be held subject to the United Kingdom’s Financial Conduct Authority’s Client Money Rules.
Holder Lists. The Registrar will preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of all Holders. If the Trustee or the Principal Paying Agent is not the Registrar, the Issuer will furnish or cause the Registrar to furnish, to the Trustee and each Paying Agent at least seven Business Days before each interest payment date and at such other times as the Trustee or the Principal Paying Agent may request in writing, a list of the names and addresses of the Holders of Senior Notes in such form and as of such date as the Trustee or the Principal Paying Agent may reasonably require.
Transfer and Exchange. 2. Transfer and Exchange of Global Notes. The Global Notes may not be transferred except as a whole to any Person other than to another Depositary or Common Depositary, another Custodian or nominee of the Depositary or Common Depositary or to a successor clearing agency or its depositary or common depositary or custodian or nominee approved by the Issuer, the Guarantors and the Trustee. All Global Notes will be exchanged by the Issuer for Definitive Registered Notes:
if DTC (in the case of the 144A Global Note) or Euroclear or Clearstream (in the case of the Regulation S Global Note) notifies the Issuer that it is unwilling or unable to continue to act as a clearing system for such Global Note, or if at any time DTC ceases (in the case of the 144A Global Note) to be a “clearing agency” registered under the U.S. Exchange Act and a successor depositary is not appointed by the Issuer within 120 days of such notice;
if the Custodian or the Common Depositary, as the case may be, so requests following an Event of Default under this Senior Notes Indenture; or
if the owner of a Book-Entry Interest requests such exchange in writing delivered through the Custodian or the Common Depositary following a Default or Event of Default under this Senior Notes Indenture.
Upon the occurrence of any of the preceding events in clauses (i) through (ii) above, the Issuer shall issue or cause to be issued Definitive Registered Notes in such names as the Custodian or Common Depositary shall instruct the Trustee. Global Notes also may be exchanged or replaced, in whole or in part, as provided in Section 2.07 and 2.10 hereof. Every Senior Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form of, and shall be, a Global Note. A Global Note may not be exchanged for another Senior Note other than as provided in this (a). Book-Entry Interests in a Global Note may be transferred and exchanged as provided in (b) or (c) hereof.
General Provisions Applicable to Transfer and Exchange of Book-Entry Interests in the Global Notes.
The transfer and exchange of Book-Entry Interests shall be effected through the relevant Depositary, in accordance with the provisions of this Senior Notes Indenture and the Applicable Procedures.
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Transfers of Book-Entry Interests shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the U.S. Securities Act. Transfers and exchanges of Book-Entry Interests for Book-Entry Interests also shall require compliance with either subparagraph (b)(i) or (b)(ii) below, as applicable, as well as subparagraph (b)(iii) below, if applicable:
Transfer of Book-Entry Interests in the Same Global Note. Book-Entry Interests in a Global Note may be transferred to Persons who take delivery thereof in the form of a Book-Entry Interest in the same Global Note in accordance with the transfer restrictions set forth in the Private Placement Legend; provided, however, that prior to the expiration of the Restricted Period, Book-Entry Interests in the Regulation S Global Notes will be limited to Persons that have accounts with Euroclear or Clearstream or Persons who hold interests through Euroclear or Clearstream, and any sale or transfer of such interest to U.S. Persons shall not be permitted during the Restricted Period unless such resale or transfer is made pursuant to Rule 144A. No written orders or instructions shall be required to be delivered to the Trustee, Registrar or Transfer Agent to effect the transfers described in this Section 2.06 (b) (i).
All Other Transfers and Exchanges of Book-Entry Interests in Global Notes. A holder may transfer or exchange a Book-Entry Interest in Global Notes in a transaction not subject to Section 2.06(b)(i) above only if the Trustee and the Registrar or the relevant Transfer Agent (copied to the Trustee) receives either:
both:
a written order from a Participant or an Indirect Participant given to the Custodian or the Common Depositary, as applicable, in accordance with the Applicable Procedures directing the Custodian or the Common Depositary, as applicable, to credit or cause to be credited a Book-Entry Interest in another Global Note in an amount equal to the Book-Entry Interest to be transferred or exchanged; and
instructions given by the Custodian or the Common Depositary, as applicable, in accordance with the Applicable Procedures containing information regarding the Participant’s account to be credited with such increase; or
both:
a written order from a Participant or an Indirect Participant given to Custodian or the Common Depositary, as applicable, in accordance with the Applicable Procedures directing the Custodian or the Common Depositary, as applicable, to cause to be issued a Definitive Registered Note in an amount equal to the Book-Entry Interest to be transferred or exchanged; and
instructions given by Custodian or the Common Depositary, as applicable, to the Registrar containing information specifying the identity of the Person in whose name such Definitive Registered Note shall be registered to effect the transfer or exchange referred to in Section 2.06(b)(i) above, the principal amount of such securities and the CUSIP, ISIN, Common Code or other similar number identifying the Senior Notes, provided that any such transfer or exchange is made in accordance with the transfer restrictions set forth in the Private Placement Legend.
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Transfer of Book-Entry Interests to Another Global Note. A Book-Entry Interest in any Global Note may be transferred to a Person who takes delivery thereof in the form of a Book-Entry Interest in another Global Note if the transfer complies with the requirements of Section 2.06 (b) (ii) above and the Trustee and the Registrar receives the following:
if the transferee will take delivery in the form of a Book-Entry Interest in a 144A Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof; and
if the transferee will take delivery in the form of a Book-Entry Interest in a Regulation S Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) and/or item (3) thereof.
Transfer or Exchange of Book-Entry Interests in Global Notes for Definitive Registered Notes. If any holder of a Book-Entry Interest in a Global Note proposes to exchange such Book-Entry Interest for a Definitive Registered Note or to transfer such Book-Entry Interest to a Person who takes delivery thereof in the form of a Definitive Registered Note, then, upon receipt by the Trustee and the Registrar of the following documentation:
in the case of a transfer on or before the expiration of the Restricted Period by a holder of a Book-Entry Interest in a Regulation S Global Note, the Trustee shall have received a certificate to the effect set forth in Exhibit B hereto, including the certifications in either item (1) or item (2) thereof;
in the case of an exchange by a holder of a Book-Entry Interest in a Global Note of such Book-Entry Interest for a Definitive Registered Note, the Trustee shall have received a certificate from such holder in the form of Exhibit C hereto, including the certifications in items (1) thereof;
in the case of a transfer after the expiration of the Restricted Period by a holder of a Book-Entry Interest in a Regulation S Global Note, the transfer complies with Section 2.06(b) hereof;
in the case of a transfer by a holder of a Book-Entry Interest in a 144A Global Note to a QIB in reliance on Rule 144A, the Trustee shall have received a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof;
in the case of a transfer by a holder of a Book-Entry Interest in a 144A Global Note in reliance on Regulation S, the Trustee shall have received a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof; or
in the case of a transfer by a holder of a Book-Entry Interest in a 144A Global Note in reliance on Rule 144, the Trustee shall have received a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to (g) hereof, and the Issuer shall execute and the Trustee or the Authenticating Agent shall authenticate and deliver to the Person designated in the instructions a Definitive Registered Note in the appropriate principal amount.
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Any Definitive Registered Note issued in exchange for a Book-Entry Interest in a Global Note pursuant to this (c) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such Book-Entry Interest shall instruct the applicable Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Registrar shall deliver such Definitive Registered Notes to the Persons in whose names such Senior Notes are so registered. Any Definitive Registered Note issued in exchange for a Book-Entry Interest in a Global Note pursuant to this (c) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein.
Transfer and Exchange of Definitive Registered Notes for Book-Entry Interests in the Global Notes. If any Holder of a Definitive Registered Note proposes to exchange such Definitive Registered Note for a Book-Entry Interest in a Global Note or to transfer such Definitive Registered Note to a Person who takes delivery thereof in the form of a Book-Entry Interest in a Global Note, then, upon receipt by the Trustee, the relevant Transfer Agent and the Registrar of the following documentation:
if the Holder of such Definitive Registered Note proposes to exchange such Senior Note for a Book-Entry Interest in a Global Note, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in item (2) thereof;
if such Definitive Registered Note is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof;
if such Definitive Registered Note is being transferred in reliance on Regulation S or Rule 144, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) or (3) thereof, as applicable; and
if such Definitive Registered Note is being transferred to the Parent Guarantor or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3) thereof, the Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent (other than the Parent Guarantor or a Subsidiary of the Parent Guarantor) and no one else will cancel the Definitive Registered Note, and the Trustee will increase or cause to be increased the aggregate principal amount of the appropriate Global Note.
Transfer and Exchange of Definitive Registered Notes for Definitive Registered Notes. Upon request by a Holder of Definitive Registered Notes and such Holder’s compliance with the provisions of this (e), the Transfer Agent or the Registrar will register the transfer or exchange of Definitive Registered Notes of which registration the Issuer will be informed of by the Transfer Agent or the Registrar (as the case may be). Prior to such registration of transfer or exchange, the requesting Holder must present or surrender to the Transfer Agent or the Registrar the Definitive Registered Notes duly endorsed and accompanied by a written instruction of transfer in a form satisfactory to the Transfer Agent or the Registrar duly executed by such Holder or its attorney, duly authorized to execute the same in writing. In the event that the Holder of such Definitive Registered Notes does not transfer the entire principal amount of Senior Notes represented by any such Definitive Registered Note, the Transfer Agent or the Registrar will cancel or cause to be cancelled such Definitive Registered Note and the Issuer (who has been informed of such cancellation) shall execute and the Trustee or the Authenticating Agent shall authenticate and deliver to the requesting Holder and any transferee Definitive Registered Notes in the appropriate principal amounts.
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In addition, the requesting Holder shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this (e).
Any Definitive Registered Note may be transferred to and registered in the name of Persons who take delivery thereof in the form of a Definitive Registered Note if the Registrar receives the following:
if the transfer will be made pursuant to Rule 144A, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof; and
if the transfer will be made in reliance on Regulation S, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof.
Legends. The following legends will appear on the face of all Senior Notes issued under this Senior Notes Indenture unless specifically stated otherwise in the applicable provisions of this Senior Notes Indenture.
Private Placement Legend. Each Global Note and each Definitive Registered Note (and all Senior Notes issued in exchange therefor or in substitution thereof) shall bear the legend in substantially the following form:
“THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR OTHER SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN “OFFSHORE TRANSACTION” PURSUANT TO RULE 904 OF REGULATION S UNDER THE U.S.
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SECURITIES ACT, (2) AGREES THAT IT WILL NOT, ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR FOR WHICH IT HAS PURCHASED SECURITIES, PRIOR TO (X) THE DATE WHICH IS, [IN THE CASE OF RULE 144A NOTES], ONE YEAR [AND IN THE CASE OF REGULATION S NOTES], 40 DAYS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WERE THE OWNERS OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE “RESALE RESTRICTION TERMINATION DATE”), OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE U.S. SECURITIES ACT, (C) FOR SO LONG AS THE SENIOR NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE U.S. SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE U.S. SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A UNDER THE U.S. SECURITIES ACT, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT, AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; SUBJECT IN EACH OF THE FOREGOING CASES TO ANY REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH INVESTOR ACCOUNT OR ACCOUNTS BE AT ALL TIMES WITHIN ITS OR THEIR CONTROL AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND ANY APPLICABLE LOCAL LAWS AND REGULATIONS AND FURTHER SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHTS PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE.”
Global Note Legend. Each Global Note will bear a legend in substantially the following form:
“THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE SENIOR NOTES INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE SENIOR NOTES INDENTURE, (2) THIS GLOBAL NOTE MAY BE TRANSFERRED OR EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(A) OF THE SENIOR NOTES INDENTURE, AND (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE SENIOR NOTES INDENTURE."
Cancellation and/or Adjustment of Global Notes. At such time as all Book-Entry Interests in a particular Global Note have been exchanged for Definitive Registered Notes or a particular Global Note has been redeemed, repurchased or cancelled in whole and not in part, each such Global Note will be returned to or retained and cancelled by the Trustee in accordance with Section 2.11 hereof.
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At any time prior to such cancellation, if any Book-Entry Interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a Book-Entry Interest in another Global Note or for Definitive Registered Notes, the principal amount of Senior Notes represented by such Global Note will be reduced accordingly and an endorsement will be made on such Global Note by the Trustee or the Custodian or the Common Depositary, as applicable, at the direction of the Trustee, to reflect such reduction; and if the Book-Entry Interests is being exchanged for or transferred to a Person who will take delivery thereof in the form of a Book-Entry Interests in another Global Note, such other Global Note will be increased accordingly and an endorsement will be made on such Global Note by the Trustee or by the Custodian or the Common Depositary, as applicable, at the direction of the Trustee to reflect such increase.
General Provisions Relating to Transfers and Exchanges.
To permit registrations of transfers and exchanges, the Issuer will execute and the Trustee or the Authenticating Agent will authenticate Global Notes and Definitive Registered Notes upon receipt of an Authentication Order in accordance with Section 2.02 hereof or at the Registrar's request.
No service charge will be made by the Issuer or the Registrar to a Holder of a Book-Entry Interest in a Global Note, a Holder of a Global Note or a Holder of a Definitive Registered Note for any registration of transfer or exchange, but the Issuer may require payment of a sum sufficient to cover any stamp duty, stamp duty reserve, documentary or other similar tax or governmental charge that may be imposed in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 4.10 and 4.13 hereof).
No Transfer Agent or Registrar will be required to register the transfer of or exchange of any Senior Note selected for redemption in whole or in part, except the unredeemed portion of any Senior Note being redeemed in part.
All Global Notes and Definitive Registered Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Registered Notes will be the valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits under this Senior Notes Indenture, as the Global Notes or Definitive Registered Notes surrendered upon such registration of transfer or exchange.
Neither the Registrar nor the Issuer shall be required to register the transfer into its register kept at its registered office of any Definitive Registered Notes: (A) for a period of 15 days prior to any date fixed for the redemption of such Definitive Registered Notes under Section 3.03 hereof; (B) for a period of 15 days immediately prior to the date fixed for selection of such Definitive Registered Notes to be redeemed in part; (C) for a period of 15 days prior to the record date with respect to any interest payment date applicable to such Definitive Registered Notes; or (D) which the Holder has tendered (and not withdrawn) for repurchase in connection with a Change of Control Offer or an Asset Sale Offer. Any such transfer will be made without charge to the Holder, other than any taxes, duties and governmental charges payable in connection with such transfer.
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The Trustee, any Agent and the Issuer may deem and treat the Person in whose name any Senior Note is registered as the absolute owner of such Senior Note for the purpose of receiving payment of principal of, interest and Additional Amounts, if any, on such Senior Notes and for all other purposes, and none of the Trustee, any Agent or the Issuer shall be affected by notice to the contrary.
All certifications, certificates and Opinions of Counsel required to be submitted to the Issuer, the Trustee or the applicable Registrar pursuant to this Section 2.06 to effect a registration of transfer or exchange may be submitted initially by facsimile with originals to be delivered promptly thereafter to the Trustee.
Limitation on Transfers and Exchanges between 2025 Global Notes and 2027 Global Notes. Notwithstanding any provision of this Senior Notes Indenture, (i) no Book-Entry Interest in any 2025 Global Note and no Definitive Registered 2025 Note issued in exchange for a Book-Entry Interest in any 2025 Global Note may be transferred or exchanged for any Book-Entry Interest in any 2027 Global Note or any Definitive Registered 2027 Note issued in exchange for a Book-Entry Interest in any 2027 Global Note, and (ii) no Book-Entry Interest in any 2027 Global Note and no Definitive Registered 2027 Note issued in exchange for a Book-Entry Interest in any 2025 Global Note may be transferred or exchanged for any Book-Entry Interest in any 2025 Global Note or any Definitive Registered 2025 Note issued in exchange for a Book-Entry Interest in any 2025 Global Note.
Replacement Senior Notes. If any mutilated Note is surrendered to the Registrar, the Trustee or the Issuer and the Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Senior Note, the Issuer will issue and the Trustee, upon receipt of an Authentication Order, will authenticate or cause the Authenticating Agent to authenticate a replacement Note if the Trustee’s requirements are met. If required by the Trustee or the Issuer, an indemnity bond must be supplied by the Holder that is sufficient in the judgment of the Trustee and the Issuer to protect the Issuer, the Trustee, any Agent from any loss that any of them may suffer if a Senior Note is replaced. The Issuer may charge the Holder for its expenses in replacing a Senior Note, including reasonable fees and expenses of counsel.
Every replacement Note is an additional obligation of the Issuer and will be entitled to all of the benefits of this Senior Notes Indenture equally and proportionately with all other Notes duly issued hereunder.
Outstanding Senior Notes. The Senior Notes outstanding at any time are all the Senior Notes authenticated by the Trustee or the Authenticating Agent except for those cancelled by it, those delivered to the Paying Agent for cancellation, those reductions in the interest in a Global Note effected by the Trustee in accordance with the provisions hereof, and those described in this Section 2.08 as not outstanding. Except as set forth in Section 2.09 hereof, a Senior Note does not cease to be outstanding because the Parent Guarantor or an Affiliate of the Parent Guarantor holds the Senior Note; however, Senior Notes held by the Parent Guarantor or a Subsidiary of the Parent Guarantor shall not be deemed to be outstanding for purposes of Section 3.07(a) hereof.
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If a Senior Note is replaced pursuant to Section 2.07 hereof, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a protected purchaser.
If the principal amount of any Senior Note is considered paid under Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If a Paying Agent (other than the Parent Guarantor, a Subsidiary of the Parent Guarantor or an Affiliate of any thereof) holds, on a redemption date or maturity date, money sufficient to pay Notes payable on that date, then on and after that date such Senior Notes will be deemed to be no longer outstanding and will cease to accrue interest.
Treasury Notes. In determining whether the Holders of the required principal amount of Senior Notes have concurred in any direction, waiver or consent, Senior Notes owned by the Issuer or any Guarantor, or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer or any Guarantor, will be considered as though not outstanding, except that for the purposes of determining whether the Trustee will be protected in relying on any such direction, waiver or consent, only Senior Notes that the Trustee knows are so owned will be so disregarded.
Temporary Notes. Until certificates representing Senior Notes are ready for delivery, the Issuer may prepare and the Trustee, upon receipt of an Authentication Order, will authenticate or cause the Authenticating Agent to authenticate temporary Senior Notes. Temporary Notes will be substantially in the form of certificated Senior Notes but may have variations that the Issuer considers appropriate for temporary Senior Notes and as may be reasonably acceptable to the Trustee. Without unreasonable delay, the Issuer will prepare and the Trustee or the Authenticating Agent will authenticate definitive Senior Notes in exchange for temporary Notes.
Holders of temporary Senior Notes will be entitled to all of the benefits of this Senior Notes Indenture.
Cancellation. The Issuer at any time may deliver Senior Notes to the Trustee for cancellation. The Registrar, each Paying Agent and any Transfer Agent will forward to the Trustee any Senior Notes surrendered to them for registration of transfer, exchange or payment. The Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent (other than the Parent Guarantor or a Subsidiary of the Parent Guarantor) and no one else will cancel all Senior Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and will destroy cancelled Senior Notes (subject to the record retention requirement of the U.S. Exchange Act). Certification of the destruction of all cancelled Notes will be delivered to the Issuer following a written request from the Issuer. The Issuer may not issue new Notes to replace Notes that it has paid or that have been delivered to the Trustee for cancellation. The Issuer undertakes to promptly inform the Irish Stock Exchange (as long as the Senior Notes are admitted to trading on the Global Exchange Market and listed on the Official List of the Irish Stock Exchange) on any such cancellation.
Defaulted Interest. If the Issuer defaults in a payment of interest on the Senior Notes, it will pay the defaulted interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, in each case at the rate provided in the Senior Notes and in Section 4.01 hereof.
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The Issuer will notify the Trustee as soon as practicable in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment. The Issuer will fix or cause to be fixed each such special record date and payment date; provided that no such special record date may be less than 10 days prior to the related payment date for such defaulted interest. At least 15 days before the special record date, the Issuer (or, upon the written request of the Issuer, the Trustee in the name and at the expense of the Issuer) will mail or cause to be mailed to the Holders in accordance with Section 12.01 hereof a notice that states the special record date, the related payment date and the amount of such interest to be paid. The Issuer undertakes to promptly inform the Irish Stock Exchange (as long as the Senior Notes are admitted to trading on the Global Exchange Market and listed on the Official List of the Irish Stock Exchange) of any such special record date.
Computation of Interest. Interest on the 2025 Senior Notes will accrue at the rate of 7.125% per annum and will be computed on the basis of a 360-day year comprised of twelve 30-day months. Interest on the 2027 Senior Notes will accrue at the rate of 8.000% per annum and will be computed on the basis of a 360-day year comprised of twelve 30-day months.
Further Issues. (a) From time to time, subject to the Issuer's compliance with Section 4.09 and Section 4.12 hereof, the Issuer will be permitted to issue Additional Senior Notes under this Senior Notes Indenture, which shall have terms substantially identical to the Senior Notes of either series issued on the Issue Date, except in respect of any of the following terms which shall be set forth in an Officer's Certificate supplied to the Trustee:
the title of such Additional Senior Notes;
the aggregate principal amount of such Additional Senior Notes;
the date or dates on which such Additional Senior Notes have been issued;
the rate or rates at which such Additional Senior Notes shall bear interest, the date or dates from which such interest shall accrue, the interest payment dates on which such interest shall be payable, the record dates for the determination of holders thereof to whom such interest is payable and the basis upon which such interest will be calculated;
the currency or currencies in which such Additional Senior Notes shall be denominated and the currency in which cash or government obligations in connection with such series of Additional Senior Notes may be payable;
the date or dates and price or prices at which, the period or periods within which, and the terms and conditions upon which, such Additional Senior Notes may be redeemed, in whole or in part; and
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if other than denominations of $200,000 and in integral multiples of $1,000 in excess, thereof, the denominations in which such Additional Senior Notes shall be issued and redeemed The Additional Senior Notes will constitute a separate series of Senior Notes but will be treated as a single class of securities for all purposes of this Senior Notes Indenture, including, without limitation, with respect to waivers, amendments and all other matters which are not specially distinguished for such series, provided, however, that if any Additional Senior Notes are not fungible with Initial Notes for U.S. federal income tax purposes, such Additional Senior Notes shall have a separate CUSIP number, ISIN or other identifying number from the Initial Notes. Unless the context otherwise requires, for all purposes of this Senior Notes Indenture, references to “Senior Notes” shall be deemed to include references to the Initial Notes as well as any Additional Senior Notes.
CUSIP, ISIN or Common Code Number. The Issuer in issuing the Senior Notes may use “CUSIP,” “ISIN” or “Common Code” numbers and, if so, such CUSIP, ISIN or Common Code number shall be included in notices of redemption or exchange as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness or accuracy of the CUSIP, ISIN or Common Code number printed in the notice or on the Senior Notes, and that reliance may be placed only on the other identification numbers printed on the Senior Notes, and any such redemption or exchange shall not be affected by any defect in or omission of such numbers.
The Issuer will promptly notify the Trustee of any change in the CUSIP, ISIN or Common Code number.
Deposit of Moneys. No later than 10:00 a.m. (London time), on the Business Day prior to each interest payment date and the maturity date of the Senior Notes and on the Business Day immediately following any acceleration of the Senior Notes pursuant to Section 6.02 hereof, the Issuer shall deposit with the Paying Agent, in immediately available funds, money in U.S. dollars sufficient to make cash payments, if any, due on such day or date, as the case may be. Subject to actual receipt of such funds as provided by this Section 2.16 by the designated Paying Agent, such Paying Agent shall remit such payment in a timely manner to the Holders on such day or date, as the case may be, to the Persons and in the manner set forth in paragraph 2 of the Senior Notes. The Issuer shall promptly notify the Trustee and the Paying Agent of its failure to so act.
Agents. 3. The rights, powers, duties and obligations and actions of each Agent under this Senior Notes Indenture are several and not joint or joint and several.
The Issuer and the Agents acknowledge and agree that in the event of a Default or Event of Default, the Trustee may, by notice in writing to the Issuer and the Agents, require that the Agents act as agents of, and take instructions exclusively from, the Trustee.
REDEMPTION AND PREPAYMENT
Notices to Trustee. If the Issuer elects to redeem Senior Notes pursuant to the optional redemption provisions of Section 3.07 hereof, it must furnish to the Trustee in accordance with Section 12.01 hereof, at least 10 days but not more than 60 days before a redemption date (and, in any case, concurrently with any notice given to Holders pursuant to Section 3.03 hereof), an Officer's Certificate setting forth:
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the clause of this Senior Notes Indenture pursuant to which the redemption shall occur;
the redemption date and the record date;
the principal amount of Senior Notes to be redeemed;
the redemption price; and
the CUSIP, ISIN or Common Code numbers of the Senior Notes, as applicable.
Selection of Senior Notes to Be Redeemed or Purchased. If less than all of the Senior Notes of any series are to be redeemed or purchased in an offer to purchase at any time, the Trustee (or the Registrar, as applicable) will select Senior Notes for redemption or purchase on a pro rata basis (or, in the case of Senior Notes issued in global form pursuant to Article 2 hereof, based on a method that most nearly approximates a pro rata selection as the Trustee or the Registrar deems fair and appropriate), unless otherwise required by law or applicable stock exchange or depositary requirements. Neither the Trustee nor the Registrar shall be liable for any selections made by it in accordance with this Section 3.02.
The Trustee will promptly notify the Issuer in writing of the Senior Notes selected for redemption or purchase and, in the case of any Senior Note selected for partial redemption or purchase, the principal amount thereof to be redeemed or purchased. Senior Notes and portions of Senior Notes selected will be in amounts of $200,000 or in integral multiples of $1,000 in excess thereof; except that if all of the Senior Notes of a Holder are to be redeemed or purchased, the entire outstanding amount of Senior Notes held by such Holder shall be redeemed or purchased. Except as provided in the preceding sentence, provisions of this Senior Notes Indenture that apply to Senior Notes called for redemption or purchase also apply to portions of Senior Notes called for redemption or purchase.
Notice of Redemption. 4. Subject to the provisions of Section 3.10 hereof, at least 10 days but not more than 60 days before a redemption date, the Issuer will mail or cause to be mailed, by first class mail, a notice of redemption to each Holder of the relevant series whose Senior Notes are to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the relevant series of Senior Notes or the satisfaction and discharge of this Senior Notes Indenture pursuant to Articles 8 or 11 hereof. For Senior Notes which are represented by Global Notes, notices may be given by delivery of the relevant notices to DTC, Euroclear or Clearstream of any series, as applicable, for communication to entitled account holders in substitution for the aforesaid mailing. So long as any Senior Notes of such series are listed on the Official List of the Exchange and the rules of The International Stock Exchange Authority Limited so require, the Issuer will forthwith notify The International Stock Exchange Authority Limited of any such redemption and the principal amount of any Senior Notes of the relevant series outstanding following any partial redemption of such Senior Notes.
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The notice will identify the Senior Notes to be redeemed and corresponding CUSIP, ISIN or Common Code numbers, as applicable, and will state:
the redemption date and the record date;
the redemption price and the amount of accrued interest, if any, and Additional Amounts, if any, to be paid;
if any Global Note is being redeemed in part, the portion of the principal amount of such Global Note to be redeemed and that, after the redemption date upon surrender of such Global Note, the principal amount thereof will be decreased by the portion thereof redeemed pursuant thereto;
if any Definitive Registered Note is being redeemed in part, the portion of the principal amount of such Senior Note to be redeemed, and that, after the redemption date, upon surrender of such Senior Note, a new Definitive Registered Note or Definitive Registered Notes in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Definitive Registered Note;
the name and address of the Paying Agent(s) to which the Senior Notes are to be surrendered for redemption;
that Notes called for redemption must be surrendered to the relevant Paying Agent to collect the redemption price, plus accrued and unpaid interest, if any, and Additional Amounts, if any;
that, unless the Issuer defaults in making such redemption payment, interest, and Additional Amounts, if any, on Notes called for redemption cease to accrue on and after the redemption date;
the paragraph of the Senior Notes and/or Section of this Senior Notes Indenture pursuant to which the Senior Notes called for redemption are being redeemed; and
that no representation is made as to the correctness or accuracy of the CUSIP, ISIN or Common Code numbers, if any, listed in such notice or printed on the Senior Notes.
At the Issuer’s request, the Trustee will give the notice of redemption in the Issuer’s name and at its expense; provided, however, that the Issuer will have delivered to the Trustee, at least five days (or such shorter period as agreed by the Trustee) prior to the date on which the notice of redemption is published or mailed to Holders, as the case may be, an Officer’s Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in (b) hereof.
Effect of Notice of Redemption. Any redemption or notice of redemption may, at the Issuer’s discretion, be subject to one or more conditions precedent. In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such notice may state that, in the Issuer’s discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied (provided, however, that, in no case shall the notice have been delivered less than 10 days or more than 60 days prior to the date on which such redemption (if any) occurs), or such redemption may not occur and such notice may be modified or rescinded in the event that any or all such conditions shall not have been satisfied by the redemption date, or by the redemption date so delayed.
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The Issuer shall send a supplemental notices to the clearing system confirming the satisfaction of the conditions precedent to any conditional redemption. In addition, such notice of redemption may be extended if such conditions precedent have not been satisfied or waived by the Issuer by notice to the Holders of the applicable series of Senior Notes and the Issuer may provide in such notice that payment of the redemption or purchase price and performance of the Issuer’s obligations with respect to such redemption may be performed by another Person. Notice of any satisfaction and discharge under the Indenture may be subject to a notice period of more than 60 days, at the Issuer’s discretion.
Deposit of Redemption or Purchase Price. 5. No later than 10:00 a.m. (London time) on the Business Day prior to the redemption or purchase date, the Issuer will deposit with the Trustee or with the Paying Agent money in U.S. dollars sufficient to pay the redemption or purchase price of, and accrued interest and Additional Amounts (if any) on, all Senior Notes to be redeemed on that date. The Trustee or the Paying Agent will promptly return to the Issuer any money deposited with the Trustee or the Paying Agent, as applicable, by the Issuer in excess of the amounts necessary to pay the redemption or purchase price of, and accrued interest and Additional Amounts, if any, on, all Senior Notes to be purchased or redeemed. The Issuer shall, no later than 10:00 a.m. (London time) on the second Business Day prior to the date on which the applicable Paying Agent receives payment, procure that the bank effecting payment for it confirms by fax or tested SWIFT MT100 message to the relevant Paying Agent that an irrevocable instruction has been given.
If the Issuer complies with the provisions of Section 3.05(a) hereof, on and after the redemption or purchase date, interest will cease to accrue on the Senior Notes or the portions of Senior Notes called for redemption or purchase. If a Senior Note is redeemed or purchased on or after a record date for the payment of interest but on or prior to the related interest payment date, then any accrued and unpaid interest shall be paid to the Person in whose name such Senior Note was registered at the close of business on such record date. If any Senior Note called for redemption is not so paid upon surrender for redemption or purchase because of the failure of the Issuer to comply with Section 3.05(a) hereof, interest shall be paid on the unpaid principal, from the redemption or purchase date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Senior Notes and in Section 4.01 hereof.
Notes Redeemed or Purchased in Part. Upon surrender of a Definitive Registered Note that is redeemed or purchased in part, the Issuer will issue and, upon receipt of an Authentication Order, the Trustee or the Authenticating Agent will authenticate for (and in the name of) the Holder at the expense of the Issuer a new Note equal in principal amount to the unredeemed or unpurchased portion of the Senior Note surrendered; provided that any Definitive Registered Note shall be in a principal amount of $200,000 and integral multiples of $1,000 in excess thereof.
Optional Redemption. 6.
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At any time prior to September 18, 2021, in the case of the 2025 Senior Notes, and September 18, 2022, in the case of the 2027 Senior Notes, the Issuer may on any one or more occasions redeem up to 40% of the aggregate principal amount of Senior Notes of the applicable series issued under this Senior Notes Indenture, upon not less than 10 nor more than 60 days’ prior written notice to the Holders, at a redemption price equal to 107.125%, in the case of the 2025 Senior Notes, and 108.000% in the case of the 2027 Senior Notes, of the principal amount thereof, plus accrued and unpaid interest and Additional Amounts, if any, to the date of redemption (subject to the rights of Holders of the Senior Notes of the applicable series on the relevant record date to receive interest on the relevant interest payment date), with the net cash proceeds of any Public Equity Offering of the Parent Guarantor or any Equity Offering of the Parent Guarantor or any Parent Holdco of the Parent Guarantor (any of them, an “IPO Entity”) to the extent the proceeds from such Equity Offering or Public Equity Offering are contributed to the Parent Guarantor’s common equity capital or are paid to the Parent Guarantor as consideration for the issuance of ordinary shares of the Parent Guarantor or as Subordinated Shareholder Debt (in each case, excluding proceeds from any Parent Debt Contribution); provided that:
at least 50% of the aggregate principal amount of the Senior Notes of the series being redeemed originally issued under this Senior Notes Indenture (excluding Senior Notes of such series held by the Parent Guarantor and its Subsidiaries and their respective Affiliates) remain outstanding immediately after the occurrence of such redemption; and
the redemption occurs within 180 days of the date of the closing of such Equity Offering or Public Equity Offering.
At any time prior to September 18, 2021, in the case of the 2025 Senior Notes, and September 18, 2022 in the case of the 2027 Senior Notes, the Issuer may on any one or more occasions redeem all or a part of the Senior Notes of the applicable series upon not less than 10 nor more than 60 days’ prior written notice to the Holders, at a redemption price equal to 100.000% of the principal amount of the Senior Notes of such series redeemed, plus the Applicable Premium as of, and accrued and unpaid interest and Additional Amounts, if any, to the date of redemption, subject to the rights of Holders of the Senior Notes of such series on the relevant record date to receive interest due on the relevant interest payment date.
Except pursuant to Sections 3.07(a) and 3.07(b) hereof and except pursuant to Section 3.08 and Section 4.13(a) hereof, the 2025 Senior Notes will not be redeemable at the Issuer's option prior to September 18, 2021 and the 2027 Senior Notes will not be redeemable at the Issuer's option prior to September 18, 2022.
On or after September 18, 2021, in the case of the 2025 Senior Notes, and September 18, 2022, in the case of the 2027 Senior Notes, the Issuer may on any one or more occasions redeem all or a part of the Senior Notes of the applicable series upon not less than 10 nor more than 60 days’ prior written notice to the Holders, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest and Additional Amounts, if any, on the Senior Notes of such series redeemed, to the applicable date of redemption, if redeemed on or after the dates indicated below, subject to the rights of Holders of Senior Notes of such series on the relevant record date to receive interest on the relevant interest payment date:
2025 Senior Notes:
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Date |
|
Redemption |
|
September 18, 2021 |
|
103.563 |
% |
September 18, 2022 |
|
101.781 |
% |
September 18, 2023 and thereafter |
|
100.000 |
% |
2027 Senior Notes:
Date |
|
Redemption |
|
September 18, 2022 |
|
104.000 |
% |
September 18, 2023 |
|
102.000 |
% |
September 18, 2024 and thereafter |
|
100.000 |
% |
Unless the Issuer defaults in the payment of the redemption price, interest will cease to accrue on the applicable series of Senior Notes or portions thereof called for redemption on the applicable redemption date.
Any redemption pursuant to this Section 3.07 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof.
If requested in writing by the Issuer, which request may be included in the applicable notice of redemption or pursuant to the applicable Officer’s Certificate, the Trustee or the Paying Agent (or such other entity directed, designated or appointed (as agent) by the Trustee, for this purpose) shall distribute any amounts deposited to the Holders prior to the applicable redemption date, provided, however that the Holders and the Paying Agent shall have received at least three Business Days’ notice from the Issuer of such earlier repayment (which may be included in the notice of redemption). For the avoidance of doubt, the distribution and payment to Holders prior to the applicable redemption date as set forth above will not include any negative interest, present value adjustment, break costs or any other premium on such amounts. To the extent that either series of Senior Notes are represented by Global Notes deposited with a common depositary for a clearing system, any payment to the beneficial holders holding Book Entry Interests as participants of such clearing system will be subject to the then applicable procedures of such clearing system.
Redemption for Changes in Taxes. 7. The Issuer may redeem the Senior Notes, in whole but not in part, at its discretion at any time upon giving not less than 10 nor more than 60 days' prior written notice to the Holders (which notice will be irrevocable and given in accordance with the procedures described in Section 3.03 and Section 12.01 hereof), at a redemption price equal to 100% of the aggregate principal amount thereof, together with accrued and unpaid interest, if any, to (but excluding) the date fixed by the Issuer for redemption (a “Tax Redemption Date”) and all Additional Amounts (if any) then due and which will become due on the Tax Redemption Date as a result of the redemption or otherwise (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date and Additional Amounts (if any) in respect thereof), if on the next date on which any amount would be payable in respect of the Senior Notes, (x) the Issuer or a Guarantor is or would be required to pay Additional Amounts or (y) any payments on the Proceeds Bonds would become subject to withholding or deduction for, or on account of, any Taxes imposed or levied by or on behalf of Nigeria or any political subdivision or any authority thereof or therein having power to tax at a rate in excess of 7.5% (calculated after giving effect to any reduction of such rate under the applicable tax treaty between the Netherlands and Nigeria) (“Proceeds Bond Withholding”), and in each case the Issuer or Guarantor cannot avoid any such payment obligation by taking reasonable measures available, and the requirement arises as a result of:
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any amendment to, or change in, the laws or treaties (or any regulations or rulings promulgated thereunder) of a relevant Tax Jurisdiction which change or amendment becomes effective on or after the Issue Date (or, if the applicable Tax Jurisdiction became a Tax Jurisdiction with respect to the Issuer or such Guarantor, as applicable, on a date after the Issue Date, such later date); or any amendment to, or change in, an official position, or the introduction of an official position, regarding the interpretation, administration or application of such laws, regulations, treaties or rulings (including by virtue of a holding, judgment, or order by a court of competent jurisdiction or a change in published administrative practice) which amendment, change or introduction becomes effective on or after the Issue Date (or, if the applicable Tax Jurisdiction became a Tax Jurisdiction with respect to the Issuer or such Guarantor, as applicable on a date after the Issue Date, such later date)
(each of the foregoing clauses (i) and (ii), a “Change in Tax Law”).
The Issuer will not give any such notice of redemption earlier than 60 days prior to the earliest date on which the Issuer would be obligated to make such payment or withholding if a payment in respect of the Senior Notes was then due, and the obligation to pay Additional Amounts or Proceeds Bond Withholding must be in effect at the time such notice is given. Prior to the publication or, where relevant, mailing of any notice of redemption of the Senior Notes pursuant to this Senior Notes Indenture, the Issuer will deliver to the Trustee (i) an Officer’s Certificate stating that obligation to pay such Additional Amounts or Proceeds Bond Withholding cannot be avoided by the Issuer (or the relevant Guarantor, as applicable) taking reasonable measures available to it; and (ii) a written opinion of independent tax counsel to the Issuer of recognized standing qualified under the laws of the relevant Tax Jurisdiction and reasonably satisfactory to the Trustee (such approval not to be unreasonably withheld) to the effect that the Issuer (or the relevant Guarantor, as applicable) has or will become obligated to pay such Additional Amounts or Proceeds Bond Withholding as a result of a Change in Tax Law.
The Trustee will accept and shall be entitled to rely on such Officer’s Certificate and Opinion of Counsel as sufficient evidence of the existence and satisfaction of the conditions precedent as described above, in which event it will be conclusive and binding on the Holders.
Mandatory Redemption; Open Market Purchases. The Issuer is not required to make mandatory redemption payments or sinking fund payments with respect to the Senior Notes. The Issuer and its Affiliates may at any time and from time to time purchase Senior Notes in the open market or privately negotiated transactions with third parties or pursuant to one or more tender or exchange offers or otherwise, upon such terms and at such prices as well as with such consideration as the Issuer or any such Affiliates may determine.
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Offer to Purchase by Application of Excess Proceeds. 8. In the event that, pursuant to Section 4.10 hereof, the Issuer is required to commence an Asset Sale Offer or to commence a Notes Offer, it will follow the procedures specified in this Section 3.10.
Each Asset Sale Offer will be made to all Holders and, to the extent the Issuer elects to do so, to holders of other Indebtedness that is Pari Passu Indebtedness to purchase, prepay or redeem with the proceeds of sales of assets. In addition, each Notes Offer will be made to all Holders. Each Asset Sale Offer and Notes Offer will remain open for such period as is required by applicable law (the “Offer Period”). No later than three Business Days after the termination of the Offer Period (the “Purchase Date”), the Issuer will apply all Excess Proceeds, in the case of an Asset Sale Offer, or Net Proceeds, in the case of a Notes Offer (the “Offer Amount”), to the purchase of the Senior Notes and, if applicable, such other Pari Passu Indebtedness (on a pro rata basis based on the principal amount of Senior Notes and such other Pari Passu Indebtedness surrendered, if applicable) or, if less than the Offer Amount has been tendered, all Senior Notes and, if applicable, such other Indebtedness tendered in response to the Asset Sale Offer or Notes Offer, as the case may be. Payment for any Senior Notes so purchased will be made in the same manner as interest payments are made.
If the Purchase Date is on or after a record date for the payment of interest and on or before the related payment date, any accrued and unpaid interest, if any, will be paid to the Person in whose name a Senior Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Sale Offer or Notes Offer, as the case may be.
Upon the commencement of an Asset Sale Offer or Notes Offer, the Issuer will send, by first class mail, a notice to the Trustee and each of the Holders with a copy to the Trustee. The notice will contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Asset Sale Offer or Notes Offer, as the case may be. The notice, which will govern the terms of the Asset Sale Offer or Notes Offer (as applicable), will state:
that the Asset Sale Offer or Notes Offer (as applicable) is being made pursuant to this Section 3.10 and Section 4.10 hereof and the length of time the Asset Sale Offer or Notes Offer (as applicable) will remain open;
the Offer Amount, the purchase price and the Purchase Date;
that any Senior Note not tendered or accepted for payment will continue to accrue interest;
that, unless the Issuer defaults in making such payment, any Senior Note accepted for payment pursuant to the Asset Sale Offer or Notes Offer (as applicable) will cease to accrue interest after the Purchase Date;
that Holders electing to have a Senior Note purchased pursuant to an Asset Sale Offer or Notes Offer (as applicable) may elect to have Senior Notes purchased in denominations of $1,000, or integral multiples thereof; provided that Senior Notes of $200,000 or less may only be purchased in whole and not in part; that Holders electing to have a Senior Note purchased pursuant to any Asset Sale Offer or Notes Offer (as applicable) will be required to surrender the Senior Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Senior Note completed, or transfer by book-entry transfer through the facilities of the Depositary, to the account of the Issuer, or a Paying Agent at the address specified in the notice at least three days before the Purchase Date;
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that Holders will be entitled to withdraw their election if the Issuer, the Depositary or the Paying Agent, as the case may be, receives, not later than the expiration of the Offer Period, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Senior Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Senior Note purchased;
that, if the aggregate principal amount of Senior Notes and, if applicable, other Pari Passu Indebtedness surrendered by holders thereof exceeds the Offer Amount, the Issuer will select the Senior Notes and other Pari Passu Indebtedness to be purchased on a pro rata basis based on the principal amount of Senior Notes and such other Pari Passu Indebtedness surrendered (with such adjustments as may be deemed appropriate by the Issuer so that only Senior Notes in denominations of $1,000, or integral multiples thereof, will be purchased; provided that Senior Notes of $200,000 or less may only be purchased in whole and not in part; and
that Holders whose Definitive Registered Notes were purchased only in part will be issued new Definitive Registered Notes equal in principal amount to the unpurchased portion of the Senior Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Issuer will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Offer Amount of Senior Notes or portions thereof tendered pursuant to the Asset Sale Offer or Notes Offer (as applicable), or if less than the Offer Amount has been tendered, all Senior Notes tendered, and will deliver or cause to be delivered to the Trustee the Senior Notes properly accepted together with an Officer’s Certificate stating that such Senior Notes or portions thereof were accepted for payment by the Issuer in accordance with the terms of this Section 3.10. The Issuer, the relevant Depositary or the Paying Agent, as the case may be, will promptly (but in any case not later than five days after the Purchase Date) mail or deliver to each tendering Holder in the manner specified in the Senior Notes an amount equal to the purchase price of the Senior Notes tendered by such Holder and accepted by the Issuer for purchase. In connection with any purchase of Global Notes pursuant hereto, the Trustee will endorse such Global Notes to reflect the decrease in principal amount of such Global Note resulting from such purchase. In connection with any partial purchase of Definitive Registered Notes, the Issuer will promptly issue a new Definitive Registered Note, and the Trustee, upon written request from the Issuer, will procure the authentication of and mail or deliver such new Definitive Registered Note to the tendering Holder, in a principal amount equal to any unpurchased portion of the Definitive Registered Note surrendered. Any Senior Note tendered but not accepted will be promptly mailed or delivered by the Issuer to the Holder thereof. The Issuer will publicly announce and inform The International Stock Exchange Authority Limited (for as long as the Senior Notes (if any) are listed on the Exchange) of the results of the Asset Sale Offer or Notes Offer (as applicable) on the Purchase Date.
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Other than as specifically provided in this Section 3.10, any purchase pursuant to this Section 3.10 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof (it being understood that any purchase pursuant to this Section 3.10 shall not be subject to conditions precedent).
Optional Redemption upon Completion of Certain Tender Offers. In connection with any tender offer for any series of Senior Notes (including, without limitation, any Change of Control Offer and any Asset Sale Offer), if Holders of Senior Notes of not less than 90% in aggregate principal amount of the applicable outstanding Notes validly tender and do not withdraw such Senior Notes in such tender offer and the Issuer, or any third party making such a tender offer in lieu of the Issuer, purchases all of the Senior Notes validly tendered and not withdrawn by such Holders, all of the holders of the applicable series of Senior Notes will be deemed to have consented to such tender or other offer and, accordingly, the Issuer or such third party will have the right upon not less than 10 nor more than 60 days’ prior notice, given not more than 30 days following such tender offer expiration date, to redeem the applicable series of Senior Notes that remain outstanding in whole, but not in part, following such purchase at a price equal to the price (excluding any early tender fee) offered to each other Holder of Senior Notes in such tender offer, plus, to the extent not included in the tender offer payment, accrued and unpaid interest, if any, thereon, to, but excluding, such redemption date. In determining whether the Holders of at least 90% of the aggregate principal amount of the then outstanding Notes of the relevant series have validly tendered and not validly withdrawn their Notes in a tender offer, Notes owned by the Issuer or its Affiliates or by funds controlled or managed by any Affiliate of the Issuer, or any successor thereof, shall be deemed to be outstanding for the purposes of such tender offer.
ARTICLE 4
COVENANTS
Payment of Senior Notes. The Issuer will pay or cause to be paid the principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes on the dates and in the manner provided in the Senior Notes and this Senior Notes Indenture. Principal, premium, if any, interest and Additional Amounts, if any, will be considered paid on the date due if the Paying Agent, if other than the Parent Guarantor or a Subsidiary of the Parent Guarantor, holds as of 10:00 a.m. London Time one Business Day prior to the due date money deposited by the Issuer in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest and Additional Amounts, if any, then due. If the Parent Guarantor or any of its Subsidiaries acts as Paying Agent, principal, premium, if any, interest and Additional Amounts, if any, shall be considered paid on the due date if the entity acting as Paying Agent complies with Section 2.16 hereof.
Principal of, interest, premium and Additional Amounts, if any, on the Senior Notes will be payable at the corporate trust office or agency of the Principal Paying Agent maintained in London, for such purposes. All payments on the Global Notes will be made by transfer of immediately available funds to an account of the Holder of the Global Notes in accordance with instructions given by that Holder.
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Principal of, interest, premium and Additional Amounts, if any, on any Definitive Registered Notes will be payable at the corporate trust office or agency of any Paying Agent in any location required to be maintained for such purposes pursuant to Section 2.03 hereof. In addition, interest on Definitive Registered Notes may be paid by check mailed to the person entitled thereto as shown on the Register for such Definitive Registered Notes.
The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at a rate that is 1% per annum higher than the then applicable interest rate on the Senior Notes to the extent lawful. The Issuer will pay interest (including post- petition interest in any proceeding under any Bankruptcy Law) on overdue instalments of interest and Additional Amounts, if any (without regard to any applicable grace period), at the same rate to the extent lawful.
Maintenance of Office or Agency. The Issuer will maintain the offices and agencies specified in Section 2.03 and Section 12.06 hereof. The Issuer shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Issuer fails to maintain any such required office or agency or fails to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the trust office of the Trustee (the address of which is specified in Section 12.01 hereof).
The Issuer may also from time to time designate one or more other offices or agencies where the Senior Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission will in any manner relieve the Issuer of its obligation to maintain an office or agency in the City of London. The Issuer will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.
The Issuer hereby designates the trust office of the Trustee (the address of which is specified in Section 12.01 hereof) as one such office or agency of the Issuer in accordance with Section 2.03 hereof.
Reports. Article 5 For so long as any Senior Notes are outstanding, the Parent Guarantor will furnish to the Trustee the following reports:
within 120 days after the end of the Parent Guarantor’s fiscal year beginning with the fiscal year ending December 31, 2021, annual reports containing the following information: (a) audited consolidated balance sheet of the Parent Guarantor as of the end of the two most recent fiscal years and audited consolidated income statements and statements of cash flow of the Parent Guarantor for the two most recent fiscal years, including complete footnotes to such financial statements and the report of the independent auditors on the financial statements; (b) pro forma income statement and balance sheet information of the Parent Guarantor (which need not comply with Article 11 of Regulation S-X under the U.S. Exchange Act), together with explanatory footnotes, for any material acquisitions, dispositions or recapitalizations that have occurred since the beginning of the most recently completed fiscal year to which such annual report relates (unless such pro forma information has been provided in a previous report pursuant to clause (ii) or (iii) below (provided that such pro forma financial information will be provided only to the extent available without unreasonable expense, in which case, the Parent Guarantor will provide, in the case of a material acquisition, acquired company financial statements)); (c) an operating and financial review of the audited financial statements, including a discussion of the results of operations, a discussion of financial condition and liquidity and capital resources, and a discussion of material commitments and contingencies and critical accounting policies; (d) a description of the business, management and shareholders of the Parent Guarantor, material affiliate transactions and material debt instruments; and (e) material risk factors and material recent developments;
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within 60 days following the end of each of the first three fiscal quarters in each fiscal year of the Parent Guarantor beginning with the quarter ending June 30, 2021, quarterly reports containing the following information: (a) an unaudited condensed consolidated balance sheet as of the end of such quarter and unaudited condensed statements of income and cash flow for the quarterly and year to date periods ending on the unaudited condensed balance sheet date, and the comparable prior year periods for the Parent Guarantor, together with condensed footnote disclosure; (b) pro forma income statement and balance sheet information of the Parent Guarantor (which need not comply with Article 11 of Regulation S-X under the U.S. Exchange Act), together with explanatory footnotes, for any material acquisitions, dispositions or recapitalizations that have occurred since the beginning of the most recently completed fiscal quarter to which such quarterly report relates (provided that such pro forma financial information will be provided only to the extent available without unreasonable expense, in which case, the Parent Guarantor will provide, in the case of a material acquisition, acquired company financial statements); (c) an operating and financial review of the unaudited financial statements, including a discussion of the consolidated financial condition and results of operations of the Parent Guarantor, and any material change between the current quarterly period and the corresponding period of the prior year; (d) material recent developments; and
promptly after the occurrence of any material acquisition, disposition or restructuring of the Parent Guarantor and the Restricted Subsidiaries, taken as a whole, or any changes of the Chief Executive Officer or Chief Financial Officer at the Parent Guarantor or change in auditors of the Parent Guarantor or any other material event that the Parent Guarantor or any of its Restricted Subsidiaries announces publicly, information describing such event.
In addition, if the Parent Guarantor has designated any of its Subsidiaries as Unrestricted Subsidiaries and such Subsidiaries are Significant Subsidiaries, then the quarterly and annual financial information required by Sections 4.03(a)(i) and 4.03(a)(ii) hereof will include a reasonably detailed presentation, either on the face of the financial statements or in the footnotes thereto, of the financial condition and results of operations of the Parent Guarantor and its Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the Parent Guarantor.
Following a Public Equity Offering on a Recognized Stock Exchange (a “Qualifying IPO”) the requirements of this covenant shall be considered to have been fulfilled if the IPO Entity complies with the reporting requirements of such stock exchange; provided that quarterly information is also provided, should such Recognized Stock Exchange not have a formal requirement for quarterly reporting. Such reports may consolidate reporting at the level of the IPO Entity or any Parent Holdco of the Parent Guarantor, provided that such reports contain such information with respect to the Parent Guarantor and the Restricted Subsidiaries, taken as a whole, that is at least as reasonably detailed (including with respect to financial information) as that provided under this covenant immediately prior to such Qualifying IPO.
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All financial statements will be prepared in accordance with IFRS. Except as provided for above, no report need include separate financial statements for the Parent Guarantor or Subsidiaries of the Parent Guarantor or any disclosure with respect to the results of operations or any other financial or statistical disclosure not of a type included in the Offering Memorandum.
In addition, for so long as Senior Notes of a series remain outstanding, the Issuer has agreed that it will furnish to the Holders and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the U.S. Securities Act.
Substantially concurrently with the issuance to the Trustee of the reports specified in Sections 4.03(a)(i), 4.03(a)(ii) and 4.03(a)(iii) hereof, the Parent Guarantor shall also (a) use its commercially reasonable efforts (i) to post copies of such reports on such website as may be then maintained by the Parent Guarantor and its Subsidiaries or (ii) otherwise to provide substantially comparable availability of such reports to holders (as determined by the Parent Guarantor in good faith) or (b) to the extent the Parent Guarantor determines in good faith that it cannot make such reports available in the manner described in the preceding clause (a) owing to applicable law or after the use of its commercially reasonable efforts, furnish such reports to the holders and, upon their request, prospective purchasers of the Senior Notes. For the avoidance of doubt, there shall be no requirement to issue the information specified in Section 4.03(a)(iii) hereof to the Trustee if it shall already have been made publicly available under Section 4.03(f)(a)(i) hereof, unless the Trustee so requests. If the Parent Guarantor delivers the reports required by this section to the Trustee, the Trustee is holding these as a ministerial act and shall not be charged with the knowledge of their contents.
The Parent Guarantor may satisfy its obligations in this covenant with respect to financial information relating to the Parent Guarantor by furnishing financial information relating to any Parent Holdco; provided the same is accompanied by consolidating information that explains in reasonable detail the material differences between the information relating to such Parent Holdco and its Subsidiaries, on the one hand, and the information relating to the Parent Guarantor and its Restricted Subsidiaries, on the other hand.
Compliance Certificate. Article 6 The Parent Guarantor and the Issuer shall deliver to the Trustee, within 120 days after the end of each fiscal year, an Officer’s Certificate stating that a review of the activities of the Parent Guarantor and its Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether each of the Parent Guarantor and the Issuer has kept, observed, performed and fulfilled its obligations under this Senior Notes Indenture, and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge, the Parent Guarantor is not in default and the Issuer is not in default in the performance or observance of any of the terms, provisions and conditions of this Senior Notes Indenture (or, if a Default or Event of Default has occurred, describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Parent Guarantor or Issuer (as applicable) is taking or proposes to take with respect thereto).
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So long as any of the Senior Notes are outstanding, the Parent Guarantor and the Issuer will deliver to the Trustee, as soon as reasonably practicable after (but not later than thirty days) upon any Officer becoming aware of any Default or Event of Default, an Officer’s Certificate specifying such Default or Event of Default and what action the Parent Guarantor and the Issuer is taking or proposes to take with respect thereto.
Taxes. The Issuer and the Parent Guarantor will pay, and the Parent Guarantor will cause each of its Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and governmental levies except such as are contested in good faith and by appropriate proceedings or where the failure to effect such payment is not adverse in any material respect to the Holders of the Senior Notes.
Stay, Extension and Usury Laws. The Issuer and each of the Guarantors covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Senior Notes Indenture; and the Issuer and each of the Guarantors (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law has been enacted.
Restricted Payments. (a) The Parent Guarantor will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly:
declare or pay any dividend or make any other payment or distribution on account of the Parent Guarantor’s Equity Interests or any of its Restricted Subsidiaries’ Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving the Parent Guarantor or any of its Restricted Subsidiaries) or to the direct or indirect holders of the Parent Guarantor’s or any of its Restricted Subsidiaries’ Equity Interests in their capacity as holders (other than dividends or distributions payable in Equity Interests (other than Disqualified Stock or Designated Preference Shares of the Parent Guarantor)) other than dividends or distributions payable to the Parent Guarantor or a Restricted Subsidiary;
purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving the Parent Guarantor) any Equity Interests of the Parent Guarantor or any Parent Holdco of the Parent Guarantor;
make any principal payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Subordinated Obligations (excluding any intercompany Indebtedness between or among the Parent Guarantor and any of its Restricted Subsidiaries), except (i) at the Stated Maturity thereof or (ii) the purchase, repurchase or other acquisition of Indebtedness purchased in anticipation of satisfying a sinking fund obligation, principal installment or scheduled maturity, in each case due within one year of the date of such purchase, repurchase or other acquisition;
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make any payment (except through capitalization) on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Subordinated Shareholder Debt; or
make any Restricted Investment,
(all such payments and other actions set forth in the Sections 4.07(a)(i) through (v) above being collectively referred to as “Restricted Payments”), unless, at the time of any such Restricted Payment:
no Default or Event of Default has occurred and is continuing or would occur as a consequence of such Restricted Payment;
the Parent Guarantor would, at the time of such Restricted Payment and after giving pro forma effect thereto, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Consolidated Net Leverage Ratio test set forth in Section 4.09 (a) hereof; and
such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Parent Guarantor and its Restricted Subsidiaries since the 2024 Notes Issue Date (excluding Restricted Payments permitted by Section 4.07(b) hereof other than Sections 4.07(b)(i), (xvi), (xviii) and (xx) hereof), is less than the sum, without duplication, of:
50% of the Consolidated Net Income of the Parent Guarantor for the period (taken as one accounting period) from the beginning of the fiscal quarter commencing immediately prior to the Issue Date to the end of the Parent Guarantor’s most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, if such Consolidated Net Income for such period is a deficit, less 100% of such deficit); plus
100% of the aggregate net cash proceeds and the fair market value of marketable securities or other property received by the Parent Guarantor since the Issue Date as a contribution to its common equity capital or from the issue or sale of Equity Interests of the Parent Guarantor (other than Disqualified Stock, Excluded Contributions and Designated Preference Shares) or from the issue or sale of convertible or exchangeable Disqualified Stock of the Parent Guarantor or convertible or exchangeable debt securities of the Parent Guarantor, in each case that have been converted into or exchanged for Equity Interests of the Parent Guarantor (other than Equity Interests (or Disqualified Stock, Designated Preference Shares or debt securities) sold to a Subsidiary of the Parent Guarantor) or from the issuance or sale of Subordinated Shareholder Debt (other than an issuance or sale to a Subsidiary of the Parent Guarantor), other than any Parent Debt Contributions; plus
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to the extent that any Restricted Investment that was made after the Issue Date is (a) sold, disposed of or otherwise cancelled, liquidated or repaid, 100% of the aggregate amount received in cash and the fair market value of the property and marketable securities or other property received by the Parent Guarantor or any Restricted Subsidiary, or (b) made in an entity that subsequently becomes a Restricted Subsidiary, 100% of the fair market value of the Restricted Investment of the Parent Guarantor and its Restricted Subsidiaries as of the date such entity becomes a Restricted Subsidiary; plus
to the extent that any Unrestricted Subsidiary of the Parent Guarantor designated as such after the Issue Date is redesignated as a Restricted Subsidiary or is merged or consolidated into the Parent Guarantor or a Restricted Subsidiary, or all of the assets of such Unrestricted Subsidiary are transferred to the Parent Guarantor or a Restricted Subsidiary, the fair market value of the property received by the Parent Guarantor or Restricted Subsidiary or the Parent Guarantor’s Restricted Investment in such Subsidiary as of the date of such redesignation, merger, consolidation or transfer of assets, to the extent such investments reduced the Restricted Payments capacity under this clause (C) and were not previously repaid or otherwise reduced; plus
100% of any dividends or distributions received by the Parent Guarantor or a Restricted Subsidiary after the Issue Date from an Unrestricted Subsidiary, to the extent that such dividends or distributions were not otherwise included in the Consolidated Net Income of the Parent Guarantor for such period; plus
upon the full and unconditional release of a Restricted Investment that is a guarantee made by the Parent Guarantor or one of its Restricted Subsidiaries to any Person, an amount equal to the amount of such guarantee,
provided, however, that notwithstanding the foregoing, any amounts (such amounts, the “Excluded Amounts”) that would otherwise be included in the calculation of the amount available for Restricted Payments pursuant to Section 4.07(a)(v)(C) hereof will be excluded to the extent (1) such amounts result from the receipt of net cash proceeds or property or marketable securities received in contemplation of, or in connection with, an event that would otherwise constitute a Change of Control pursuant to the definition thereof, (2) the purpose of, or the effect of, the receipt of such net cash proceeds or property or assets or marketable securities was to reduce the Consolidated Net Leverage Ratio so that there would be an occurrence of a Specified Change of Control Event that would not have been achieved without the receipt of such net cash proceeds or property or assets or marketable securities and (3) no Change of Control Offer is made in connection with such Change of Control in accordance with the requirements of this Senior Notes Indenture.
The preceding provisions will not prohibit any of the following (collectively, “Permitted Payments”):
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the payment of any dividend or the consummation of any redemption within 60 days after the date of declaration of the dividend or giving of the redemption notice, as the case may be, if at the date of declaration or notice, the dividend or redemption payment would have complied with the provisions of this Senior Notes Indenture; the making of any Restricted Payment in exchange for, or out of or with the net cash proceeds of the substantially concurrent sale or issuance (other than to a Subsidiary of the Parent Guarantor) of, Equity Interests of the Parent Guarantor (other than Disqualified Stock, Parent Debt Contributions, Excluded Amounts or Designated Preference Shares), Subordinated Shareholder Debt or from the substantially concurrent contribution of common equity capital to the Parent Guarantor; provided that the amount of any such net cash proceeds that are utilized for any such Restricted Payment will be excluded from Section 4.07(a)(v)(C)(2) hereof and will not be considered to be net cash proceeds from an Equity Offering for the purposes of Section 3.07 hereof;
the repurchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Obligations made in exchange for, or out of the proceeds of a substantially concurrent sale or issuance of, Permitted Refinancing Indebtedness;
any purchase, repurchase, redemption, defeasance or other acquisition or retirement of Subordinated Obligations:
(i) from Net Proceeds to the extent permitted under Section 4.10 hereof, but only if the Parent Guarantor shall have first complied with the terms of such covenant described under Section 4.10 and purchased all Senior Notes tendered pursuant to any offer to repurchase all the Senior Notes required thereby, prior to purchasing, repurchasing, redeeming, defeasing or otherwise acquiring or retiring such Subordinated Obligations and (ii) at a purchase price not greater than 100% of the principal amount of such Subordinated Obligations plus accrued and unpaid interest and any premium payable thereon;
to the extent required by the agreement governing such Subordinated Obligations, following the occurrence of a Change of Control (or other similar event described therein as a “change of control”), but only (i) if the Parent Guarantor shall have first complied with the terms described under Section 4.13 hereof and purchased all Senior Notes tendered pursuant to the offer to repurchase all the Senior Notes required thereby, prior to purchasing, repurchasing, redeeming, defeasing or otherwise acquiring or retiring such Subordinated Obligations and (ii) at a purchase price not greater than 101% of the principal amount of such Subordinated Indebtedness plus accrued and unpaid interest and any premium payable thereon; or
(i) consisting of Acquired Debt (other than Indebtedness incurred (a) to provide all or any portion of the funds utilized to consummate the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary or was otherwise acquired by the Parent Guarantor or a Restricted Subsidiary or (b) otherwise in connection with or contemplation of such acquisition) and (ii) at a purchase price not greater than 100% of the principal amount of such Subordinated Obligations plus accrued and unpaid interest and any premium required by the terms of any Acquired Debt;
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the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Parent Guarantor or any Restricted Subsidiary held by any current or former officer, director, employee or consultant of the Parent Guarantor or any of its Restricted Subsidiaries pursuant to any equity subscription agreement, stock option agreement, restricted stock grant, shareholders’ agreement or similar agreement; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests may not exceed $20.0 million per calendar year (with unused amounts in any calendar year being carried over to the next two succeeding calendar years; and provided further, that such amount in any calendar year may be increased by an amount not to exceed the cash proceeds (excluding proceeds from any Parent Debt Contributions) from the sale of Equity Interests of the Parent Guarantor or a Restricted Subsidiary received by the Parent Guarantor or a Restricted Subsidiary during such calendar year, in each case to members of management, directors or consultants of the Parent Guarantor, any of its Restricted Subsidiaries or any Parent Holdco of the Parent Guarantor to the extent the cash proceeds from the sale of Equity Interests have not otherwise been applied to the making of Restricted Payments pursuant to Section 4.07(a)(v)(C)(2) hereof or this Section 4.07 (b) (ii) and are not Excluded Contributions or Excluded Amounts;
the repurchase of Equity Interests deemed to occur upon the exercise of stock options to the extent such Equity Interests represent a portion of the exercise price of those stock options;
the declaration and payment of regularly scheduled or accrued dividends to holders of any class or series of Disqualified Stock of the Parent Guarantor or any preferred stock of any Restricted Subsidiary issued on or after the Issue Date in accordance with Section 4.09 hereof;
(a) payments of cash, dividends, distributions, advances or other Restricted Payments by the Parent Guarantor or any of its Restricted Subsidiaries to allow the payment of cash in lieu of the issuance of fractional shares upon (x) the exercise of options or warrants or (y) the conversion or exchange of Capital Stock of any such Person and (b) payments made or expected to be made by the Parent Guarantor or any Restricted Subsidiary pursuant to the exercise, in each case on a “cashless” or “net exercise” basis, of any option to purchase Capital Stock granted to any future, present or former employee, director, officer, contractor or consultant of the Parent Guarantor or any Restricted Subsidiary pursuant to any employee benefit plans or arrangements, including for the purpose of satisfying any taxes (including estimated taxes) due as a result of the exercise of any such option;
advances or loans to (a) any future, present or former officer, director, employee or consultant of the Parent Guarantor or a Restricted Subsidiary to pay for the purchase or other acquisition for value of Equity Interests of the Parent Guarantor (other than Disqualified Stock or Designated Preference Shares), or any obligation under a forward sale agreement, deferred purchase agreement or deferred payment arrangement pursuant to any management equity plan or stock option plan or any other management or employee benefit or incentive plan or other agreement or arrangement or (b) any management equity plan, employee benefit trust or stock option plan or any other management or employee benefit or incentive plan or unit trust or the trustees of any such plan or trust to pay for the purchase or other acquisition for value of Equity Interests of the Parent Guarantor (other than Disqualified Stock or Designated Preference Shares); provided that the total aggregate amount of Restricted Payments made under this Section 4.07(b)(ix) does not exceed $20.0 million at any time outstanding following the 2024 Notes Issuance Date; payments or distributions to dissenting shareholders pursuant to applicable law in connection with or contemplation of a merger, amalgamation, consolidation or transfer of assets that complies with the provisions of the Senior Notes relating to mergers, amalgamations, consolidations or transfers of substantially all of a Guarantor’s assets;
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the payment of any dividend (or, in the case of any partnership or limited liability company, any similar distribution) by a Restricted Subsidiary to the holders of its Equity Interests (other than the Parent Guarantor or any Restricted Subsidiary) then entitled to participate in such dividends on a pro rata basis or otherwise in compliance with the terms of the instruments governing such Equity Interests;
dividends, loans, advances or distributions (including any repayment of any Subordinated Shareholder Debt) to any Parent Holdco or other payments by the Parent Guarantor or any Restricted Subsidiary in an amount equal to (without duplication) (A) the amounts required to make Permitted Parent Payments; or (B) amounts constituting or to be used for purposes of making payments (i) as disclosed in the Offering Memorandum under the heading “Use of Proceeds” on or after the Issue Date, including without limitation, as contemplated in footnote (5) thereof; or (ii) to the extent specified in Sections 4.11(b)(i), (iv), (v) and (x) hereof;
Restricted Payments that are made with Excluded Contributions;
so long as no Default or Event of Default has occurred and is continuing, the payment of Management Fees;
the declaration and payment of dividends to holders of any class or series of Designated Preference Shares of the Parent Guarantor issued after the Issue Date; provided, however, that, the amount of all dividends declared or paid pursuant to this Section 4.07(b)(xv) shall not exceed the net proceeds received by the Parent Guarantor or the aggregate amount contributed in cash to the equity (other than through the issuance of Disqualified Stock, a Parent Debt Contribution, Excluded Amounts or an Excluded Contribution) of the Parent Guarantor or contributed as Subordinated Shareholder Debt to the Parent Guarantor, as applicable, from the issuance or sale of such Designated Preference Shares;
so long as no Default or Event of Default has occurred and is continuing (or would result therefrom), any Restricted Payment; provided that the Consolidated Net Leverage Ratio on a pro forma basis after giving effect to any such dividend, distribution, advance, loan or other payment and any Indebtedness incurred in connection therewith does not exceed 3.50 to 1.0;
dividends or other distributions in amounts required and used by a Parent Holdco of the Parent Guarantor to make a substantially concurrent payment of interest on Indebtedness, the proceeds of which have been contributed as a Parent Debt Contribution to the Parent Guarantor or any of its Restricted Subsidiaries, and that has been guaranteed by, or is otherwise considered Indebtedness of, the Parent Guarantor or any of its Restricted Subsidiaries incurred in accordance with Section 4.09 hereof; provided that any amounts payable (A) as interest on any proceeds loan or other Indebtedness of the Parent Guarantor or any Restricted Subsidiary pursuant to which the Parent Debt Contribution was made, or (B) on any guarantee or other obligation of the Parent Guarantor or any Restricted Subsidiary on such Indebtedness will, in each case, reduce the amount available for making restricted payments under this Section 4.07(b)(xvii);
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so long as no Default or Event of Default has occurred and is continuing (or would result therefrom), the declaration and payment by the Parent Guarantor of, or loans, advances, dividends or distributions to any Parent Holdco to pay, dividends on the common stock or common equity interests of the Parent Guarantor or any Parent Holdco following a Public Equity Offering of such common stock or common equity interests following September 18, 2019, in an amount not to exceed in any fiscal year the greater of (a) 6% of the Net Cash Proceeds received by the Parent Guarantor from such Public Equity Offering or contributed to the equity (other than through the issuance of Disqualified Stock or Designated Preference Shares or through an Excluded Contribution or Excluded Amounts or a Parent Debt Contribution) of the Parent Guarantor and (b) following the Public Equity Offering, an amount equal to 6% of the Market Capitalization; provided that in the case of this clause (b) after giving pro forma effect to such loans, advances, dividends or distributions, the Consolidated Net Leverage Ratio shall be equal to or less than 4.0 to 1.0;
payment of Receivables Fees and purchases of Receivables Assets pursuant to a Receivables Repurchase Obligation in connection with a Qualified Receivables Financing; and
so long as no Default or Event of Default has occurred and is continuing, other Restricted Payments in an aggregate amount not to exceed the greater of $350.0 million and 6.0% of the Total Assets of the Parent Guarantor following the 2024 Notes Issue Date;
The amount of all Restricted Payments (other than cash) will be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Parent Guarantor or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any cash Restricted Payment shall be its face amount, and the fair market value of any non-cash Restricted Payment shall be determined conclusively by Parent Guarantor acting in good faith.
For purposes of determining compliance with this Section 4.07, in the event that a Restricted Payment (or portion thereof) meets the criteria of more than one of the categories of Permitted Payments described in the foregoing Sections 4.07(b)(i) through (xx), or is permitted pursuant to Section 4.07(a) hereof and/or one or more of the clauses contained in the definition of “Permitted Investment,” the Parent Guarantor will be entitled to classify such Restricted Payment or Investment (or portion thereof) on the date of its payment or later reclassify (based on circumstances existing on the date of such reclassification) such Restricted Payment or Investment (or portion thereof) in any manner that complies with this covenant, including as an Investment pursuant to one of more clauses contained in the definition of Permitted Investment.
Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries. Article 7 The Parent Guarantor will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:
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pay dividends or make any other distributions on its Capital Stock to the Parent Guarantor or any Restricted Subsidiary, or with respect to any other interest or participation in, or measured by, its profits, or pay any Indebtedness owed to the Parent Guarantor or any Restricted Subsidiary;
make loans or advances to the Parent Guarantor or any Restricted Subsidiary; or
sell, lease or transfer any of its properties or assets to the Parent Guarantor or any Restricted Subsidiary,
provided that (x) the priority of any preferred stock in receiving dividends or liquidating distributions prior to dividends or liquidating distributions being paid on common stock and (y) the subordination of (including the application of any standstill period to) loans or advances made to the Parent Guarantor or any Restricted Subsidiary to other Indebtedness incurred by the Parent Guarantor or any Restricted Subsidiary, in each case, shall not be deemed to constitute such an encumbrance or restriction.
However, Section 4.08(a) hereof will not apply to encumbrances or restrictions existing under or by reason of:
any encumbrance or restriction pursuant to (A) any Credit Facility (including the Parent Revolving Credit Facility and the Senior Credit Facilities), (B) the Indenture, the Senior Notes, the Note Guarantees or (C) any other agreement or instrument, in each case in effect at or entered into on or as of the Amendment Date;
agreements governing other Indebtedness permitted to be incurred under Section 4.09 hereof and any amendments, restatements, modifications, renewals, supplements, refundings, replacements or refinancings of those agreements; provided that the restrictions therein (A) are not materially less favorable to the holders of the Senior Notes than is customary in comparable financings (as determined in good faith by the Issuer); (B) are customary in comparable financings; or (C) would not, in the good faith determination of the Issuer or the Parent Guarantor, materially impair the ability of the Issuer to make payments on the Senior Notes;
applicable law, rule, regulation or order or the terms of any license, authorization, concession or permit;
any instrument governing Indebtedness or Capital Stock of a Person acquired by the Parent Guarantor or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness or Capital Stock was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired; provided that, in the case of Indebtedness, such Indebtedness was permitted by the terms of this Senior Notes Indenture to be incurred;
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purchase money obligations for property acquired in the ordinary course of business and Capital Lease Obligations that impose restrictions on the property purchased or leased of the nature described in Section 4.08(a)(iii) hereof; any encumbrance or restriction: (A) entered into in the ordinary course of business that restricts in a customary manner the subletting, assignment or transfer of any property or asset that is subject to a lease, license or similar contract, or the assignment or transfer of any lease, license or other contract; (B) contained in mortgages, pledges or other security agreements permitted under this Senior Notes Indenture or securing Indebtedness of the Parent Guarantor or a Restricted Subsidiary permitted under this Senior Notes Indenture to the extent such encumbrances or restrictions restrict the transfer of the property or assets subject to such mortgages, pledges or other security agreements; or (C) pursuant to customary provisions restricting dispositions of real property interests set forth in any reciprocal easement agreements of the Parent Guarantor or any Restricted Subsidiary;
any agreement for the sale or other disposition of the Capital Stock or all or substantially all of the property and assets of a Restricted Subsidiary that restricts distributions by that Restricted Subsidiary pending its sale or other disposition;
Permitted Refinancing Indebtedness; provided that the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced as determined in good faith by the Issuer or the Parent Guarantor or would not in the good faith determination of the Issuer, materially impair the ability of the Issuer to make payments on the Senior Notes;
Liens permitted to be incurred under the provisions of Section 4.12 hereof that limit the right of the debtor to dispose of the assets subject to such Liens;
customary provisions limiting the disposition or distribution of assets or property in joint venture agreements, asset sale agreements, sale-leaseback agreements, stock sale agreements and other similar agreements in the ordinary course of business (including agreements entered into in connection with an Investment), which limitation is applicable only to the assets that are the subject of such agreements;
restrictions on cash or other deposits or net worth imposed by customers or suppliers or required by insurance, surety or bonding companies, in each case, under contracts entered into in the ordinary course of business;
restrictions effected in connection with a Qualified Receivables Financing that, in the good faith determination of an Officer or the Board of Directors of the Parent Guarantor, are necessary or advisable to effect such Qualified Receivables Financing;
any encumbrance or restriction pursuant to or ancillary to Hedging Obligations; or
any encumbrance or restriction existing under any agreement that extends, renews, refinances or replaces the agreements containing the encumbrances or restrictions in the foregoing Sections 4.08(b)(i) through 4.08(b)(xiii), or in this Section 4.08(b)(xiv); provided that the terms and conditions of any such encumbrances or restrictions are no more restrictive in any material respect than those under or pursuant to the agreement so extended, renewed, refinanced or replaced or would not in the good faith determination of the Issuer, materially impair the ability of the Issuer to make payments on the Senior Notes.
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Incurrence of Indebtedness and Issuance of Preferred Stock. Article 8 The Parent Guarantor will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, “incur”) any Indebtedness (including Acquired Debt), and the Parent Guarantor will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Parent Guarantor may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock and any Restricted Subsidiary may incur Indebtedness or issue preferred stock, if on the date on which such Indebtedness is incurred or such Disqualified Stock or preferred stock is issued, as the case may be, the Parent Guarantor’s Consolidated Net Leverage Ratio would not exceed 4.50 to 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the Indebtedness had been incurred or the Disqualified Stock or preferred stock had been issued on such date.
Section 4.09 (a) hereof will not prohibit the incurrence of any of the following items of Indebtedness (collectively, “Permitted Debt”):
the incurrence of Indebtedness under Credit Facilities, in an aggregate principal amount at any one time outstanding under this Section 4.09(b)(i) not to exceed $1,000.0 million, plus in the case of any refinancing of any Indebtedness permitted under this Section 4.09(b)(i) or any portion thereof, the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing;
Indebtedness outstanding on the 2024 Notes Issue Date after giving pro forma effect to the Transactions and the use of the net proceeds thereof (other than Indebtedness described in Sections 4.09(b)(i) and (iii) hereof);
the incurrence by the Issuer and the Guarantors of Indebtedness represented by the Senior Notes (other than Additional Senior Notes) and the related Note Guarantees (including any future Note Guarantees) and the Existing Notes and guarantees of the Existing Notes and, without limitation, any lending made with the proceeds thereof between or among the Parent Guarantor and its Restricted Subsidiaries;
the incurrence by the Parent Guarantor or any Restricted Subsidiary of Indebtedness representing (x) Capital Lease Obligations, mortgage financings, purchase money obligations or other Indebtedness incurred for the purpose of financing all or any part of the purchase price, lease expense, rental payments or cost of design, construction, installation or improvement of property, plant or equipment or other assets (including Capital Stock) used in the business of the Parent Guarantor or any of its Restricted Subsidiaries not to exceed the greater of $150.0 million or 3.0% of the Total Assets of the Parent Guarantor at any time outstanding following the 2024 Notes Issuance Date; (y) any Non-Issuer Group Lease Obligations, or (z) without prejudice to any other permission set forth herein, (i) Capital Lease Obligations incurred in the ordinary course of business and consistent with past practice and (ii) consisting of any obligations in respect of a lease, concession or license of property (or guarantee thereof) which would be considered an operating lease under IFRS (or would have previously been categorized as operating leases prior to the adoption of IFRS 16 (Leases));
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the incurrence by the Parent Guarantor or any Restricted Subsidiary of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge any Indebtedness (other than intercompany Indebtedness) incurred under Sections 4.09(a), 4.09(b)(ii), 4.09(b)(iii), 4.09(b)(v) or 4.09(b)(xiv) hereof;
the incurrence by the Parent Guarantor or any Restricted Subsidiary of intercompany Indebtedness between or among the Parent Guarantor or any Restricted Subsidiary; provided that:
if the Issuer or any Guarantor is the obligor on such Indebtedness and the obligee is not the Issuer or a Guarantor, such Indebtedness must be unsecured and ((i) except in respect of the intercompany current liabilities incurred in the ordinary course of business in connection with the cash management operations of the Parent Guarantor and its Restricted Subsidiaries and (ii) only to the extent legally permitted (the Parent Guarantor and its Restricted Subsidiaries having completed all procedures required in the reasonable judgment of directors of officers of the obligee or obligor to protect such Persons from any penalty or civil or criminal liability in connection with the subordination of such Indebtedness)) expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Senior Notes, in the case of the Issuer, or the Note Guarantee, in the case of a Guarantor; and
(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Parent Guarantor or a Restricted Subsidiary and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Parent Guarantor or a Restricted Subsidiary, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Parent Guarantor or such Restricted Subsidiary, as the case may be, that was not permitted by this Section 4.09(b)(vi);
the incurrence by the Issuer or any Restricted Subsidiary of intercompany Indebtedness between or among the Issuer or any Restricted Subsidiary; provided that the Indebtedness arises under guarantees entered into pursuant to section 2:403 of the Dutch Civil Code in respect of a Restricted Subsidiary incorporated in the Netherlands and any residual liability with respect to such guarantees arising under Section 2:404 of the Dutch Civil Code;
the issuance by any Restricted Subsidiary to the Parent Guarantor or to any of its Restricted Subsidiaries of preferred stock; provided that:
any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Parent Guarantor or a Restricted Subsidiary; and
any sale or other transfer of any such preferred stock to a Person that is not either the Parent Guarantor or a Restricted Subsidiary, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this Section 4.09(b)(viii);
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the incurrence by the Parent Guarantor or any Restricted Subsidiary of Hedging Obligations not for speculative purposes (as determined in good faith by the Parent Guarantor or such Restricted Subsidiary, as the case may be);
the guarantee by the Parent Guarantor or any Restricted Subsidiary of Indebtedness of the Parent Guarantor or any Restricted Subsidiary to the extent that the guaranteed Indebtedness was permitted to be incurred by another provision of this covenant; provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Senior Notes or a Note Guarantee, then the guarantee must be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
the incurrence by the Parent Guarantor or any of its Restricted Subsidiaries of Indebtedness in respect of workers’ compensation claims, self-insurance obligations, captive insurance companies, bankers’ acceptances, performance and surety bonds in the ordinary course of business;
the incurrence by the Parent Guarantor or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within 30 Business Days;
Indebtedness represented by guarantees of any Management Advances;
Indebtedness of (A) any Person outstanding on the date on which such Person becomes a Restricted Subsidiary or is merged, consolidated, amalgamated or otherwise combined with (including pursuant to any acquisition of assets and assumption of related liabilities) the Parent Guarantor or any Restricted Subsidiary (other than Indebtedness incurred to provide all or any portion of the funds used to consummate the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary or was otherwise acquired by the Parent Guarantor or a Restricted Subsidiary or otherwise in connection with, or in contemplation of, such acquisition) or (B) the Parent Guarantor or any Restricted Subsidiary incurred in relation to any such acquisition, merger, consolidation, amalgamation or combination; provided, however, with respect to this Section 4.09(b)(xiv), that at the time of the acquisition or other transaction pursuant to which such Indebtedness was incurred or deemed to be incurred (x) the Parent Guarantor would have been able to incur $1.00 of additional Indebtedness pursuant to Section 4.09(a) hereof after giving effect to the incurrence of such Indebtedness pursuant to this Section 4.09 (b) (xiv) calculated on a pro forma basis or (y) the Consolidated Net Leverage Ratio would be equal or less than the Consolidated Net Leverage Ratio immediately prior to giving effect to such acquisition or other transaction on a pro forma basis or, in the case of any Indebtedness incurred in reliance on Section 4.09(b)(xiv)(A), the principal amount of such Indebtedness is discharged, or otherwise reclassified in any manner that complies with this Section 4.09, within one year of incurrence; Indebtedness arising from agreements of the Parent Guarantor or a Restricted Subsidiary providing for customary indemnification, obligations in respect of earnouts or other adjustments of purchase price or, in each case, similar obligations, in each case, incurred or assumed in connection with the acquisition or disposition of any business or assets or Person or any Equity Interests of a Subsidiary, provided that the maximum liability of the Parent Guarantor and its Restricted Subsidiaries in respect of all such Indebtedness shall at no time exceed the gross proceeds, including the fair market value of non-cash proceeds (measured at the time received and without giving effect to any subsequent changes in value), actually received by (or held in escrow as collateral for such Indebtedness for later release to) the Parent Guarantor and its Restricted Subsidiaries in connection with such disposition;
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Indebtedness of the Parent Guarantor and its Restricted Subsidiaries in respect of (A) letters of credit, surety, performance or appeal bonds, completion guarantees, judgment, advance payment, customs, VAT or other tax guarantees or similar instruments issued in the ordinary course of business of such Person or in respect of any governmental requirement and not in connection with the borrowing of money, including letters of credit or similar instruments in respect of self-insurance and workers compensation obligations, and (B) any customary cash management, cash pooling or netting or setting off arrangements, including customary credit card facilities, entered into in the ordinary course of business; provided, however, that upon the drawing of such letters of credit or other instrument, such obligations are reimbursed within 30 days following such drawing;
(A) customer deposits and advance payments received in the ordinary course of business from customers for goods or services purchased in the ordinary course of business; (B) Indebtedness owed on a short-term basis of no longer than 30 days to banks and other financial institutions incurred in the ordinary course of business of the Parent Guarantor and its Restricted Subsidiaries with such banks or financial institutions that arises in connection with ordinary banking arrangements to manage cash balances of the Parent Guarantor and its Restricted Subsidiaries; and (C) Indebtedness incurred by a Restricted Subsidiary in connection with bankers acceptances, discounted bills of exchange or the discounting or factoring of receivables for credit management of bad debt purposes, in each case incurred or undertaken in the ordinary course of business;
Indebtedness of the Issuer and the Guarantors in an aggregate outstanding principal amount which, when taken together with any Permitted Refinancing Indebtedness in respect thereof and the principal amount of all other Indebtedness incurred pursuant to this Section 4.09(b)(xviii) and then outstanding, will not exceed 100% of the net proceeds (other than proceeds from any Parent Debt Contribution) received by the Parent Guarantor from the issuance or sale (other than to a Restricted Subsidiary) of its Subordinated Shareholder Debt or Capital Stock (other than Disqualified Stock, Designated Preference Shares, Excluded Amounts or an Excluded Contribution) or otherwise contributed to the equity (other than through the issuance of Disqualified Stock, Designated Preference Shares, Excluded Amounts, an Excluded Contribution or a Parent Debt Contribution) of the Parent Guarantor, in each case, subsequent to the Issue Date; provided, however, that (i) any such net proceeds that are so received or contributed shall be excluded for purposes of making Restricted Payments under Section 4.07(a) hereof and Sections 4.07(b)(ii) and 4.07(b)(v) hereof to the extent the Parent Guarantor and its Restricted Subsidiaries incur Indebtedness in reliance thereon and (ii) any net proceeds that are so received or contributed shall be excluded for purposes of incurring Indebtedness pursuant to this Section 4.09(b)(xviii) to the extent the Parent Guarantor or any of its Restricted Subsidiaries makes a Restricted Payment under Section 4.07(a) hereof and Sections 4.07(b)(ii) and 4.07(b)(v) hereof in reliance thereon;
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guarantees by the Parent Guarantor or any Restricted Subsidiary granted to any trustee of any management equity plan or stock option plan or any other management or employee benefit or incentive plan or unit trust scheme approved by the Board of Directors of the Parent Guarantor, so long as the proceeds of the Indebtedness so guaranteed are used to purchase Equity Interests of the Parent Guarantor (other than Disqualified Stock); provided that the amount of any net cash proceeds from the sale of such Equity Interests of the Parent Guarantor will be excluded from Section 4.07(a)(v)(C)(2) hereof and will not be considered to be net cash proceeds from an Equity Offering for purposes of Section 3.07 hereof;
Indebtedness under daylight borrowing facilities incurred in connection with any refinancing of Indebtedness (including by way of set-off or exchange); provided that such Indebtedness does not exceed the principal amount of the Indebtedness being refinanced and the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing, so long as any such Indebtedness is repaid within three days of the date on which such Indebtedness is incurred;
Indebtedness incurred by a Receivables Subsidiary in a Qualified Receivables Financing;
Indebtedness incurred by the Parent Guarantor and any Restricted Subsidiary under local Credit Facilities in an aggregate principal amount at any one time outstanding under this clause this Section 4.09(b)(xxii), not to exceed $50.0 million, plus in the case of any refinancing of any Indebtedness permitted under this Section 4.09(b)(xxii) or any portion thereof, the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses incurred in connection with such refinancing;
any joint and several liability in respect of any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same) as a result of a fiscal unity (fiscale eenheid) for Dutch corporate tax or value added tax purposes (or any similar structure of any other jurisdiction having similar effect) in respect of the Parent Guarantor or any Restricted Subsidiary;
the incurrence of Indebtedness under Land Leases entered into by the Parent Guarantor or any Restricted Subsidiary in the ordinary course of business; or
the incurrence of Indebtedness by the Parent Guarantor or any of its Restricted Subsidiaries in an aggregate principal amount at any time outstanding, including all Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this Section 4.09(b)(xxv), not to exceed the greater of $150.0 million and 3.0% of the Total Assets of the Parent Guarantor at any time outstanding following the 2024 Notes Issue Date, provided that the amount of Indebtedness incurred by any Restricted Subsidiary that is not a Guarantor in reliance on Sections 4.09(a) or clauses (b)(ii) or (b)(xxiv) hereof (x) with respect to any Issuer Group Restricted Subsidiary, shall be limited to the greater of U.S.$150.0 million and 3.0% of the Total Assets of the Issuer and (y) with respect to any other Restricted Subsidiary that is not an Issuer Group Restricted Subsidiary, shall be limited to the Priority Debt Cap at any time outstanding.
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For purposes of determining compliance with this Section 4.09, (i) in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in Section 4.09(b)(i) through 4.09(b)(xxiii) hereof, or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Parent Guarantor, in its sole discretion, will be permitted to classify such item of Indebtedness on the date of its incurrence and only be required to include the amount and type of such Indebtedness in one of such clauses and will be permitted on the date of such incurrence to divide and classify an item of Indebtedness in more than one of the types of Indebtedness described in the Sections 4.09(a) and 4.09(b) hereof, from time to time to reclassify all or a portion of such item of Indebtedness, in any manner that complies with this covenant. All Indebtedness under the IHS Holding 2020 Revolving Credit Facility, the Nigeria 2023 Revolving Credit Facility and the Nigeria 2023 Term Loan outstanding following the 2024 Notes Issue Date shall be incurred under Section 4.09(b)(i) hereof, and may not be reclassified; (ii) guarantees of, or obligations in respect of letters of credit, bankers' acceptances or other similar instruments relating to, or Liens securing, Indebtedness that is otherwise included in the determination of a particular amount of Indebtedness shall not be included; (iii) if obligations in respect of letters of credit, bankers' acceptances or other similar instruments are incurred pursuant to any Credit Facility and are being treated as incurred pursuant to Section 4.09(b) hereof and the letters of credit, bankers' acceptances or other similar instruments relate to other Indebtedness, then such other Indebtedness shall not be included; and (iv) Indebtedness permitted by this covenant need not be permitted solely by reference to one provision permitting such Indebtedness but may be permitted in part by one such provision and in part by one or more other provisions of this covenant permitting such Indebtedness.
The accrual of interest or preferred stock dividends, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on preferred stock or Disqualified Stock in the form of additional shares of the same class of preferred stock or Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of preferred stock or Disqualified Stock for purposes of this Section 4.09.
For purposes of determining compliance with the Consolidated Net Leverage Ratio on the date of any proposed incurrence of Indebtedness, the U.S. dollar equivalent principal amount of Indebtedness denominated in a different currency shall be utilized, calculated based on the relevant currency exchange rate in effect on the last balance sheet date, or at the option of the Parent Guarantor, the date first committed, in the case of Indebtedness incurred under Credit Facilities; provided, that if such Indebtedness denominated in currency other than U.S. dollars is subject to a Currency Exchange Protection Agreement with respect to U.S. dollars the amount of such Indebtedness expressed in U.S. dollars will be calculated so as to take account of the effects of such Currency Exchange Protection Agreement.
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The principal amount of any refinancing Indebtedness incurred in the same currency as the Indebtedness being refinanced will be the U.S. dollar equivalent of the Indebtedness refinanced determined by reference to the currency exchange rate in effect on the last balance sheet date to the date on which such refinancing Indebtedness is being incurred, except that to the extent that such U.S. dollar equivalent was determined based on a Currency Exchange Protection Agreement, in which case the refinancing Indebtedness will be determined in accordance with Section 4.09(e) hereof.
Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Parent Guarantor or any Restricted Subsidiary may incur pursuant to this covenant shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values.
The amount of any Indebtedness outstanding as of any date will be:
in the case of any Indebtedness issued with original issue discount, the amount of the liability in respect thereof determined in accordance with IFRS;
the principal amount of the Indebtedness, in the case of any other Indebtedness;
in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
the fair market value of such assets at the date of determination; and
the amount of the Indebtedness of the other Person
any “parallel debt” obligation relating to Indebtedness that is otherwise included in the determination of a particular amount of Indebtedness shall not be included; and
the principal amount of any Disqualified Stock of the Parent Guarantor, or preferred stock of a Restricted Subsidiary, which will be equal to the greater of the maximum mandatory redemption or repurchase price (not including, in either case, any redemption or repurchase premium) or the liquidation preference thereof.
Asset Sales. Article 9 The Parent Guarantor will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, consummate an Asset Sale unless:
the Parent Guarantor (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at least equal to the fair market value (determined at the time of contracting such Asset Sale) of the assets or Equity Interests issued or sold or otherwise disposed of; and at least 75% of the consideration received in the Asset Sale by the Parent Guarantor or such Restricted Subsidiary is in the form of cash or Cash Equivalents.
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For purposes of this provision, each of the following will be deemed to be cash:
any liabilities, as recorded on the balance sheet of the Parent Guarantor or any Restricted Subsidiary (other than contingent liabilities), that are assumed by the transferee of any such assets and as a result of which the Parent Guarantor and its Restricted Subsidiaries are no longer obligated with respect to such liabilities or are indemnified against further liabilities;
any securities, notes or other obligations received by the Parent Guarantor or any such Restricted Subsidiary from such transferee that are converted by the Parent Guarantor or such Restricted Subsidiary into cash or Cash Equivalents within 180 days following the closing of the Asset Sale, to the extent of the cash or Cash Equivalents received in that conversion;
any Capital Stock or assets of the kind referred to in Sections 4.10(b)(iii), 4.10(b)(v) or 4.10(b)(vi) hereof;
Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Sale, to the extent that the Parent Guarantor and each Restricted Subsidiary are released from any guarantee of such Indebtedness in connection with such Asset Sale;
consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent Guarantor or any Restricted Subsidiary that is cancelled;
accounts receivable of a business retained by the Parent Guarantor or any Restricted Subsidiary, as the case may be, following the sale of such business; and
any Designated Non-Cash Consideration received by the Parent Guarantor or any of its Restricted Subsidiaries in such Asset Sales having an aggregate fair market value, when taken together with all other Designated Non-Cash Consideration received pursuant to this Section 4.10(a)(ii)(G) that is at that time outstanding, not to exceed the greater of $100.0 million and 2.0% of the Total Assets of the Parent Guarantor following the 2024 Notes Issue Date, measured at the time of the receipt of such Designated Non-Cash Consideration (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value).
Within 365 days after the receipt of any Net Proceeds from an Asset Sale, the Parent Guarantor (or the applicable Restricted Subsidiary, as the case may be) may apply such Net Proceeds (at the option of the Parent Guarantor or such Restricted Subsidiary) to:
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(A) prepay, repay, redeem or purchase (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) Pari Passu Indebtedness; provided that the Parent Guarantor shall redeem, repay or repurchase Pari Passu Indebtedness that is Public Debt pursuant to this Section 4.10(b)(i)(A) only if the Parent Guarantor makes (at such time or subsequently in compliance with this covenant) an offer to all holders of the Senior Notes to purchase their Senior Notes in accordance with the provisions set forth below for an Asset Sale Offer for an aggregate principal amount of Senior Notes at least equal to the proportion that (x) the total aggregate principal amount of Senior Notes outstanding bears to (y) the sum of the total aggregate principal amount of Senior Notes outstanding plus the total aggregate principal amount outstanding of such Pari Passu Indebtedness (a “Public Debt Offer”), provided further that such Public Debt Offer shall not be required if the Issuer was eligible to, and has, made a Non-Pro Rata Election (as defined below) in respect of such Net Proceeds; (B) with respect to assets of a Restricted Subsidiary that is not a Guarantor, prepay, repay, repurchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any of its Indebtedness; or (C) prepay, repay, repurchase or redeem any Indebtedness that is secured on any asset which security does not also secure the Senior Notes on a pari passu or senior basis (and in each of Sections 4.10(b)(i)(A) and (B) hereof and this Section 4.10(b)(i)(C), other than Indebtedness that is owed to the Parent Guarantor or a Restricted Subsidiary);
purchase Senior Notes (a) pursuant to an offer to all holders of the Senior Notes at a purchase price in cash equal to at least 100% of the principal amount thereof, plus accrued and unpaid interest to, but not including, the date of purchase (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date) (a “Notes Offer”) or (b) pursuant to Section 3.07 hereof;
acquire all or substantially all of the assets of, or any Capital Stock of, another Permitted Business, if, after giving effect to any such acquisition of Capital Stock, the Permitted Business is or becomes a Restricted Subsidiary;
make a capital expenditure;
acquire other assets (other than Capital Stock) that are used or useful in a Permitted Business;
invest in any Replacement Assets;
enter into a commitment approved by the Board of Directors or otherwise binding on the Parent Guarantor to apply the Net Proceeds pursuant to Sections 4.10 (b) (iii), (iv), (v) or (vi) hereof; provided that such commitment shall be treated as a permitted application of the Net Proceeds from the date of such commitment until the earlier of (x) the date on which such acquisition or expenditure is consummated, and (y) the 180th day following the expiration of the aforementioned 365 day period; or
any combination of the foregoing.
The Issuer shall be permitted, at any time and from time to time following the 2024 Notes Issuance Date through the date that is three years from the 2024 Notes Issuance Date, to make one or more elections to apply up to a maximum of $1.0 billion in aggregate (or its equivalent in other currencies) of the Net Proceeds of Asset Sales pursuant to clause (1) above to the redemption, repayment or repurchase of any Pari Passu Indebtedness that is Public Debt without being required to make a Public Debt Offer (any such election, a “Non-Pro Rata Election”).
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Following any such Non-Pro Rata Election, any proceeds so applied shall be considered a permitted application of Net Proceeds pursuant to this Indenture.
Pending the final application of any Net Proceeds, the Parent Guarantor (or the applicable Restricted Subsidiary) may temporarily reduce revolving credit borrowings or otherwise invest the Net Proceeds in any manner that is not prohibited by this Senior Notes Indenture.
Any Net Proceeds from Asset Sales that are not applied or invested as provided in Section 4.10(b) hereof will constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $100.0 million, within ten Business Days thereof, or at any earlier time at the Issuer’s election, the Issuer will make an offer (an “Asset Sale Offer”) to all Holders and may, to the extent the Issuer so elects, make an offer to holders of Pari Passu Indebtedness to purchase, prepay or redeem with the proceeds of sales of assets in accordance with Section 3.10 hereof the maximum principal amount of Senior Notes and such other Pari Passu Indebtedness (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith) that may be purchased, prepaid or redeemed out of the Excess Proceeds. The offer price for the Senior Notes in any Asset Sale Offer will be equal to (i) solely in the case of the Senior Notes, 100% of the principal amount of the applicable series, which shall be repurchased in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part; and (ii) solely in the case of any other Pari Passu Indebtedness, no greater than 100% of the principal amount, plus, in the case of (i) and (ii), accrued and unpaid interest and Additional Amounts, if any, to the date of purchase, prepayment or redemption, subject to the rights of the Holders on the relevant record date to receive interest due on the relevant interest payment date, and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Parent Guarantor and its Restricted Subsidiaries may use those Excess Proceeds for any purpose not otherwise prohibited by this Senior Notes Indenture. If the aggregate principal amount of Senior Notes and other Pari Passu Indebtedness tendered into (or to be prepaid or redeemed in connection with) such Asset Sale Offer exceeds the amount of Excess Proceeds, or if the aggregate principal amount of Senior Notes tendered pursuant to an Asset Sale Offer that is an application of Net Proceeds pursuant to Section 4.10 (b) (i) hereof exceeds the amount of the Net Proceeds so applied, the Trustee or the Registrar, as applicable, will select the Senior Notes and such other Pari Passu Indebtedness, if applicable, to be purchased on a pro rata basis (or in the manner described under Section 3.02 hereof), based on the amounts tendered or required to be prepaid or redeemed in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. Neither the Trustee nor the Registrar shall be liable for any selections made by it in accordance with this Section 4.10.
The Issuer will comply with the requirements of Rule 14e-1 under the U.S. Exchange Act and any other applicable securities laws and regulations to the extent those laws and regulations are applicable in connection with each repurchase of Senior Notes pursuant to a Change of Control Offer, an Asset Sale Offer or a Notes Offer. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control or Asset Sale provisions of this Senior Notes Indenture, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control or Asset Sale provisions of this Senior Notes Indenture by virtue of such compliance.
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The Parent Guarantor or a Restricted Subsidiary, as the case may be, may make an Asset Sale Offer prior to the expiration of the 365-day period mentioned in this Section 4.10. The provisions of this Senior Notes Indenture relating to the Parent Guarantor’s obligation to make an Asset Sale Offer may be waived or modified with the consent of Holders of a majority in outstanding aggregate principal amount of the Senior Notes.
Transactions with Affiliates. Article 10 The Parent Guarantor will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, enter into or conduct any transaction or series of related transactions (including the purchase, sale, lease or exchange of any property or the rendering of any services) with any Affiliate of the Parent Guarantor (any such transaction or series of related transactions being, an “Affiliate Transaction”) involving aggregate value in excess of $40.0 million, unless:
the Affiliate Transaction is on terms that are not materially less favorable to the Parent Guarantor or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Parent Guarantor or such Restricted Subsidiary with an unrelated Person; and
with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate value in excess of U.S.$50.0 million, a resolution of the Board of Directors of the Parent Guarantor set forth in an Officer’s Certificate certifying that such Affiliate Transaction complies with this covenant and that such Affiliate Transaction has been approved by a majority of the disinterested members of the Board of Directors of the Parent Guarantor, or, if there are not sufficient disinterested members of the Board of Directors of the Parent Guarantor to form a majority, by a majority of the Board of Directors.
The following items will not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions of Section 4.11(a) hereof:
any issuance or sale of Capital Stock, Subordinated Shareholder Debt, options, other equity-related interests or other securities, or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, or entering into, or maintenance of, any employment, consulting, collective bargaining or benefit plan, program, agreement or arrangement, related trust or other similar agreement and other compensation arrangements, options, warrants or other rights to purchase Capital Stock of the Parent Guarantor, any Restricted Subsidiary or any Parent Holdco, restricted stock plans, long-term incentive plans, stock appreciation rights plans, participation plans or similar employee benefits or consultants’ plans or indemnities provided on behalf of officers, employees, directors or consultants approved or ratified by the Board of Directors of the Parent Guarantor;
transactions between or among the Parent Guarantor and/or its Restricted Subsidiaries, or between and among Restricted Subsidiaries and any Receivables Subsidiary;
any transaction in the ordinary course of business between or among the Parent Guarantor or any Restricted Subsidiary and any Affiliate of the Parent Guarantor that would constitute an Affiliate Transaction solely because the Parent Guarantor or a Restricted Subsidiary owns an equity interest in or otherwise controls such Affiliate; payment of reasonable and customary fees and reimbursements of expenses (pursuant to indemnity arrangements or otherwise) of officers, directors, employees or consultants of the Parent Guarantor or any of its Restricted Subsidiaries;
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the execution, delivery and performance (without duplication of any Permitted Parent Payments) of any Tax Sharing Agreement or any arrangement pursuant to which the Parent Guarantor or any of its Restricted Subsidiaries is required or permitted to file a consolidated tax return, or the formation and maintenance of any consolidated group for tax, accounting or cash pooling or management purposes in the ordinary course of business;
any Restricted Payment that is permitted pursuant to Section 4.07 hereof (other than pursuant to Section 4.07(b)(xii)(B)(ii) hereof);
any Permitted Investment (other than Permitted Investments described in clauses (3), (10) and (16) of the definition thereof);
(A) issuances or sales of Capital Stock (other than Disqualified Stock or Designated Preference Shares) of the Parent Guarantor or options, warrants or other rights to acquire such Capital Stock or Subordinated Shareholder Debt; provided that the interest rate and other financial terms of such Subordinated Shareholder Debt are approved by a majority of the members of the Board of Directors of the Parent Guarantor in their reasonable determination and (B) any amendment, waiver or other transaction with respect to any Subordinated Shareholder Debt made in compliance with the other provisions of this Senior Notes Indenture;
transactions pursuant to, or contemplated by any agreement in effect on the Issue Date and transactions pursuant to any amendment, modification or extension to such agreement, so long as such amendment, modification or extension, taken as a whole, is not materially more disadvantageous to the holders of the Senior Notes than the original agreement as in effect on the Issue Date;
Management Advances and the payment of Management Fees;
transactions with customers, clients, suppliers, or purchasers or sellers of goods or services or providers of employees or other labor, in each case in the ordinary course of business and otherwise in compliance with the terms of this Senior Notes Indenture that are fair to the Parent Guarantor or the Restricted Subsidiaries, in the reasonable determination of the members of the Board of Directors of the Parent Guarantor or the senior management thereof, or are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated Person;
transactions, agreements or other arrangements with customers, suppliers, contractors, lessors or sellers of goods or services that are negotiated with an Affiliate or any Parent Holdco, in each case, which are otherwise in compliance with the terms of this Senior Notes Indenture; provided that the terms and conditions of any such transaction, agreement or other arrangement as applicable to the Parent Guarantor and its Restricted Subsidiaries are fair to the Parent Guarantor and its Restricted Subsidiaries and are on terms no less favorable to the Parent Guarantor and its Restricted Subsidiaries than those that could have reasonably been obtained in respect of an analogous transaction or agreement that would not constitute an Affiliate Transaction (in each case, as determined in good faith by the Board of Directors of the Parent Guarantor);
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any agreements or other arrangements entered into from time to time with IHS Holding Limited or any Parent Holdco that is entered into for the provision of group services, provided that such agreements or arrangements are on terms which are fair to the Parent Guarantor or the relevant Restricted Subsidiary in the reasonable determination of the Board of Directors or an Officer of the Parent Guarantor or the relevant Restricted Subsidiary;
any participation in a rights offer or public tender or exchange offer for publicly-held securities or debt instruments issued by the Parent Guarantor or any of its Restricted Subsidiaries that are conducted on arm’s length terms and provide for the same price or exchange ratio, as the case may be, to all holders accepting such rights, tender or exchange offer;
transactions between the Parent Guarantor or any Restricted Subsidiary and any other Person that would constitute an Affiliate Transaction solely because a director of such other Person is also a director of the Parent Guarantor or any Parent Holdco of the Parent Guarantor; provided, however, that such director abstains from voting as a director of the Parent Guarantor or such Parent Holdco, as the case may be, on any matter including such other Person;
transactions pursuant to, or contemplated by the Parent Revolving Credit Facility Agreement, any guarantee thereof, any Parent Debt Contribution and any related notes, guarantees, collateral documents, instruments, and agreements executed in connection therewith, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after termination or otherwise) or refinanced in whole or in part from time to time; provided that any such amendment, modification, renewal, refunding, replacement or refinancing, taken as a whole, is not materially more disadvantageous to the holders of the Senior Notes than the original instrument; and
any transaction effected as part of a Qualified Receivables Financing.
Liens. The Parent Guarantor will not, and will not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or otherwise cause or suffer to exist or become effective any Lien (an “Initial Lien”) of any kind securing Indebtedness upon any of their property or assets, now owned or hereafter acquired, except (a) Permitted Liens; or (b) if such Lien is not a Permitted Lien, to the extent that all Obligations due under this Senior Notes Indenture, the Senior Notes and the Note Guarantees are, in each case, secured on an equal and ratable basis or on a priority basis with the Obligations secured by the Initial Lien (and on a priority basis if such Obligations secured by the Initial Lien are subordinated in right of payment to either the Senior Notes or any Note Guarantee). With respect to any Lien securing Indebtedness that was permitted to secure such Indebtedness at the time of the incurrence of such Indebtedness, such Lien shall also be permitted to secure any Increased Amount of such Indebtedness. The “Increased Amount” of any Indebtedness shall mean any increase in the amount of such Indebtedness in connection with any accrual of interest, the accretion of accreted value, the amortization of original issue discount, the payment of interest in the form of additional Indebtedness with the same terms, accretion of original issue discount or liquidation preference and increases in the amount of Indebtedness outstanding solely as a result of fluctuations in the exchange rate of currencies or increases in the value of property securing such Indebtedness.
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Offer to Repurchase upon Change of Control. Article 11 Upon the occurrence of a Change of Control, the Issuer will make an offer (a “Change of Control Offer”) to each Holder to repurchase all or any part (in integral multiples of $1,000 in excess thereof; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part) of that Holder’s Senior Notes pursuant to a Change of Control Offer on the terms set forth in this Senior Notes Indenture. In the Change of Control Offer, the Issuer will offer a payment in cash equal to 101% of the aggregate principal amount of Senior Notes repurchased, plus accrued and unpaid interest and Additional Amounts, if any, on the Senior Notes repurchased to the date of purchase (the “Change of Control Payment”), subject to the rights of Holders on the relevant record date to receive interest due on the relevant interest payment date. Within 30 days following any Change of Control, the Issuer will mail a notice to each Holder, with a copy to the Trustee, at such Holder’s registered address or otherwise deliver a notice in accordance with the procedures of Section 3.03 and Section 12.01 hereof, stating that a Change of Control Offer is being made and offering to repurchase Senior Notes of the applicable series on the date (the “Change of Control Payment Date”) specified in the notice:
that the Change of Control Offer is being made pursuant to this Section 4.13 and that all Senior Notes tendered will be accepted for payment;
the purchase price and the Change of Control Payment Date, which shall be no earlier than 30 days and no later than 60 days from the date such notice is mailed or delivered;
that any Senior Note not tendered will continue to accrue interest;
that, unless the Issuer defaults in the payment of the Change of Control Payment, all Senior Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest after the Change of Control Payment Date;
that Holders electing to have any Senior Notes purchased pursuant to a Change of Control Offer will be required to surrender the Senior Notes, with the form entitled “Option of Holder to Elect Purchase” attached to the Senior Notes completed, or transfer by book-entry transfer, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date;
that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the second Business Day preceding the Change of Control Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of Senior Notes delivered for purchase, and a statement that such Holder is withdrawing his election to have the Senior Notes purchased; and
that Holders whose Senior Notes are being purchased only in part will be issued new Senior Notes equal in principal amount to the unpurchased portion of the Senior Notes surrendered, which unpurchased portion must be equal to $200,000 in principal amount or an integral multiple of $1,000 in excess thereof.
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The Issuer will comply with the requirements of Rule 14e-1 under the U.S. Exchange Act and any other applicable securities laws and regulations to the extent those laws and regulations are applicable in connection with the repurchase of the Senior Notes as a result of a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control provisions of this Senior Notes Indenture, the Issuer will comply with any applicable securities laws and regulations and will not be deemed to have breached its obligations under this Senior Notes Indenture by virtue of such compliance.
On the Change of Control Payment Date, the Issuer will, to the extent lawful:
accept for payment all Senior Notes or portions of Senior Notes properly tendered pursuant to the Change of Control Offer;
deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Senior Notes or portions of Senior Notes properly tendered and not withdrawn; and
deliver or cause to be delivered to the Trustee the Senior Notes properly accepted together with an Officer’s Certificate stating the aggregate principal amount of Senior Notes or portions of Senior Notes being purchased by the Issuer.
The Paying Agent will promptly mail (or cause to be delivered) to each Holder properly tendered and not withdrawn the Change of Control Payment for such Senior Notes, and the Trustee (or an authentication agent approved by it, upon receipt of an authentication order from the Issuer) will promptly authenticate and mail (or cause to be transferred by book-entry) to each Holder a new Senior Note equal in principal amount to any unpurchased portion of the Senior Notes surrendered, if any. The Issuer will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.
The provisions of this Section 4.13 that require the Issuer to make a Change of Control Offer following a Change of Control will be applicable whether or not any other provisions of this Senior Notes Indenture are applicable.
Notwithstanding anything to the contrary in this Section 4.13, the Issuer will not be required to make a Change of Control Offer upon a Change of Control if (1) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Senior Notes Indenture applicable to a Change of Control Offer made by the Issuer and purchases all Senior Notes properly tendered and not withdrawn under the Change of Control Offer, or (2) an unconditional notice of redemption has been given pursuant to Section 3.07 hereof or all conditions to redemption under Section 3.07 hereof have been satisfied or waived, unless and until there is a default in payment of the applicable redemption price. Notwithstanding anything to the contrary contained in this Section 4.13, a Change of Control Offer may be made in advance of a Change of Control, conditioned upon the consummation of such Change of Control, provided a definitive agreement is in place for the Change of Control at the time the Change of Control Offer is made.
The provisions of this Senior Notes Indenture relating to the Issuer’s obligation to make an offer to repurchase the Senior Notes as a result of a Change of Control may be waived or modified with the written consent of Holders of a majority in outstanding aggregate principal amount of the Senior Notes of such series.
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If and for so long as the Senior Notes of the relevant series are listed on the Official List of the Exchange and the rules of the Exchange so require, the Issuer will publish notices relating to the Change of Control Offer to the extent and in the manner permitted by such rules.
Additional Guarantees. Article 12 The Parent Guarantor will not cause or permit any of its Restricted Subsidiaries that is not a Guarantor, directly or indirectly, to guarantee the payment of, assume or in any manner become liable with respect to any other Indebtedness of the Parent Guarantor or a Guarantor incurred under Credit Facilities in excess of the greater of $40.0 million and 0.8% of the Total Assets of the Parent Guarantor or that constitutes Public Debt unless such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture providing for the guarantee of the payment of the Senior Notes by such Restricted Subsidiary, which Note Guarantee will be senior to or pari passu with such Restricted Subsidiary’s guarantee of such other Indebtedness.
Notwithstanding Section 4.14 (a) hereof:
the Note Guarantee by such Restricted Subsidiary may be limited in amount to the extent such Note Guarantee may reasonably be expected to give rise to or result in (a) any breach or violation of statutory limitations, corporate benefit, financial assistance, fraudulent preference, thin capitalization rules, capital maintenance rules, guidance and coordination rules or the laws rules or regulations (or analogous restriction) of any applicable jurisdiction; (b) any risk or liability for the officers, directors or (except in the case of a Restricted Subsidiary that is a partnership) shareholders of such Restricted Subsidiary (or, in the case of a Restricted Subsidiary that is a partnership, directors or shareholders of the partners of such partnership); or (c) any material cost, expense, liability or obligation (including with respect to any Taxes but excluding any obligation under the Note Guarantee itself) that cannot be avoided by reasonable measures available to the Parent Guarantor other than reasonable out of pocket expenses (but, in such a case each of the Parent Guarantor and the Restricted Subsidiaries will use their reasonable best efforts to overcome the relevant legal limit and will procure that the relevant Restricted Subsidiary undertakes all whitewash or similar procedures which are legally available to eliminate the relevant limit);
for so long as it is not permissible under applicable law or regulation for a Restricted Subsidiary to become a Guarantor, such Restricted Subsidiary need not become a Guarantor (but, in such a case, each of the Parent Guarantor and the Restricted Subsidiaries will use their reasonable best efforts to overcome the relevant legal prohibition precluding the giving of the guarantee and will procure that the relevant Restricted Subsidiary undertakes all whitewash or similar procedures which are legally available to eliminate the relevant legal prohibition, and shall give such guarantee at such time (and to the extent) that it thereafter becomes permissible); and This Section 4.14 shall not be applicable to any guarantees by any Restricted Subsidiary:
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that existed at the time such Person became a Restricted Subsidiary if the guarantee was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary (or any Permitted Refinancing thereof);
given to a bank or trust company having, at the time such guarantee was given, combined capital and surplus and undivided profits of not less than $500.0 million and whose debt has a rating of at least “A” or the equivalent thereof by S&P and at least “A2” or the equivalent thereof by Moody’s in connection with the operation of cash management programs established for the Parent Guarantor’s benefit or that of any Restricted Subsidiary; or
in respect of any Priority Debt.
[Reserved].
Designation of Restricted and Unrestricted Subsidiaries. The Board of Directors of the Parent Guarantor may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause a Default. If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Parent Guarantor and its Restricted Subsidiaries in the Subsidiary designated as an Unrestricted Subsidiary will be deemed to be an Investment made as of the time of the designation and will reduce the amount available for Restricted Payments under Section 4.07 hereof or under one or more clauses of the definition of Permitted Investments, as determined by the Parent Guarantor. That designation will only be permitted if the Investment would be permitted at that time and if the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
Any designation of a Subsidiary of the Parent Guarantor as an Unrestricted Subsidiary will be evidenced to the Trustee by filing with the Trustee a copy of a resolution of the Parent Guarantor’s Board of Directors giving effect to such designation and an Officer’s Certificate certifying that such designation complies with the preceding conditions and was permitted by Section 4.07 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Senior Notes Indenture and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary as of such date and, if such Indebtedness is not permitted to be incurred as of such date under Section 4.09 hereof, the Parent Guarantor will be in default of such covenant. The Board of Directors of the Parent Guarantor may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such designation will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of any outstanding Indebtedness of such Unrestricted Subsidiary, and such designation will only be permitted if (a) such Indebtedness is permitted under Section 4.09 hereof, calculated on a pro forma basis as if such designation had occurred at the beginning of the applicable reference period; and (b) no Default or Event of Default would be in existence following such designation.
Maintenance of Listing.
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The Issuer will use its commercially reasonable efforts to list and to maintain the listing of the 2025 Senior Notes and the 2027 Senior Notes on the Official List of the Exchange for so long as such 2025 Senior Notes and 2027 Senior Notes are outstanding; provided that if the Issuer is unable to obtain admission to listing of the 2025 Senior Notes or 2027 Senior Notes on the Official List of the Exchange or if at any time the Issuer determines that it will not so list or maintain such listing, it will use its commercially reasonable efforts to obtain and maintain a listing of such Senior Notes on another “recognised stock exchange” (as defined under section 1005 of the UK Income Tax Act 2007), in which case, references in this Section 4.17 to the Exchange will be deemed to refer to such other “recognised stock exchange.”
Additional Amounts. Article 13 All payments made by or on behalf of the Issuer under or with respect to the Senior Notes (whether or not in the form of Definitive Registered Notes) or any of the Guarantors with respect to any Note Guarantee will be made free and clear of and without withholding or deduction for, or on account of, any present or future Taxes unless the withholding or deduction of such Taxes is then required by law. If any deduction or withholding for, or on account of, any Taxes imposed or levied by or on behalf of (1) any jurisdiction in which the Issuer or any Guarantor is then incorporated, organized, engaged in business for tax purposes or otherwise resident for tax purposes or any political subdivision thereof or therein or (2) any jurisdiction from or through which payment is made by or on behalf of the Issuer or any Guarantor (including the jurisdiction of any Paying Agent) or any political subdivision thereof or therein (each, a “Tax Jurisdiction”) will at any time be required to be made from any payments made by or on behalf of the Issuer under or with respect to the Senior Notes or any of the Guarantors under or with respect to any Note Guarantee, including payments of principal, redemption price, purchase price, interest or premium, the Issuer or the relevant Guarantor, as applicable, will pay such additional amounts (the “Additional Amounts”) as may be necessary in order that the net amounts received in respect of such payments by each Holder after such withholding, deduction or imposition (including any such withholding, deduction or imposition from such Additional Amounts) will equal the respective amounts that would have been received in respect of such payments in the absence of such withholding or deduction; provided, however, that no Additional Amounts will be payable with respect to:
any Taxes, to the extent such Taxes would not have been imposed but for the existence of any actual or deemed (pursuant to applicable Tax law of the relevant Tax Jurisdiction, such as, if applicable, a connection of a partnership that is attributed to the partners/beneficial owners) present or former connection between the Holder or the beneficial owner of the Senior Notes and the relevant Tax Jurisdiction (including being a resident of such jurisdiction for Tax purposes), other than the holding of such Senior Note, the enforcement of rights under such Senior Note or under a Note Guarantee or the receipt of any payments in respect of such Senior Note or a Note Guarantee;
any Taxes, to the extent such Taxes were imposed as a result of the presentation of a Senior Note for payment (where Senior Notes are in the form of Definitive Registered Notes and presentation is required) more than 30 days after the relevant payment is first made available for payment to the Holder (except to the extent that the Holder would have been entitled to Additional Amounts had the Senior Note been presented on the last day of such 30 day period);
any estate, inheritance, gift, sales, personal property, transfer or similar Taxes; any Taxes payable other than by deduction or withholding from payments under, or with respect to, the Senior Notes or with respect to any Note Guarantee;
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any Taxes, to the extent such Taxes were imposed or withheld by reason of the failure of the Holder or beneficial owner of Senior Notes to comply with any reasonable written request of the Issuer addressed to the Holder or beneficial owner, as applicable and made at least 60 days before any such withholding or deduction would be payable to satisfy any certification, identification, information or other reporting requirements, whether required by statute, treaty, regulation or administrative practice of a Tax Jurisdiction, as a precondition to exemption from, or reduction in the rate of deduction or withholding of, Taxes imposed by the Tax Jurisdiction (including, without limitation, a certification that the Holder or beneficial owner is not resident in the Tax Jurisdiction), but in each case, only to the extent the Holder or beneficial owner is legally entitled to provide such certification or documentation;
any Taxes imposed on or with respect to any payment by the Issuer or the relevant Guarantor to the Holder if such Holder is a fiduciary or partnership or person other than the sole beneficial owner of such payment to the extent that Taxes would not have been imposed on such payment had such Holder been the sole beneficial owner of such Senior Note;
any Taxes, to the extent such Taxes were imposed pursuant to Section 1471(b) of the Code, or otherwise imposed pursuant to Sections 1471 through 1474 of the Code, any regulations or agreements thereunder, official interpretations thereof, or any law implementing an intergovernmental approach thereto; or
any combination of items from Sections 4.18(a)(i) through (vii) above.
In addition to the foregoing, the Issuer and the Guarantors will also pay and indemnify the Holder for any present or future stamp, issue, registration, court or documentary Taxes, or any other excise or property Taxes, charges or similar levies (including penalties, interest and any other reasonable expenses related thereto) which are levied by any Tax Jurisdiction on the execution, delivery, issuance, or registration of any of the Senior Notes, this Senior Notes Indenture, any Note Guarantee or any other document or instrument referred to therein, or enforcement of, any of the Senior Notes or any Note Guarantee (other than on or in connection with a transfer of the Senior Notes that is not part of the initial resale of the Senior Notes by the Senior Notes Initial Purchasers).
If the Issuer or any Guarantor, as the case may be, becomes aware that it will be obligated to pay Additional Amounts with respect to any payment under or with respect to the Senior Notes or any Note Guarantee, each of the Issuer or the relevant Guarantor, as the case may be, will deliver to the Trustee on a date that is at least 30 days prior to the date of that payment (unless the obligation to pay Additional Amounts arises less than 45 days prior to that payment date, in which case the Issuer or the relevant Guarantor shall notify the Trustee promptly thereafter) an Officer’s Certificate stating the fact that Additional Amounts will be payable and the amount estimated to be so payable. The Officer’s Certificate(s) must also set forth any other information necessary to enable the Paying Agent to pay such Additional Amounts to Holders on the relevant payment date. The Issuer and the relevant Guarantor will provide the Trustee with documentation satisfactory to the Trustee evidencing the payment of Additional Amounts. The Trustee shall be entitled to rely solely on such Officer’s Certificate as conclusive proof that such payments are necessary.
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The Issuer or the relevant Guarantor will make all withholdings and deductions required by law and will remit the full amount deducted or withheld to the relevant Tax authority in accordance with applicable law. The Issuer or the relevant Guarantor will use its reasonable efforts to obtain Tax receipts from each Tax authority evidencing the payment of any Taxes so deducted or withheld. The Issuer or the relevant Guarantor will furnish to the Trustee, within a reasonable time after the date the payment of any Taxes so deducted or withheld is made, certified copies of Tax receipts evidencing payment by the Issuer or a Guarantor, as the case may be, or if, notwithstanding such entity’s efforts to obtain receipts, receipts are not obtained, other evidence of payments (reasonably satisfactory to the Trustee) by such entity. Upon reasonable request, copies of Tax receipts or other evidence of payments, as the case may be, will be made available by the Trustee to the Holders and beneficial owners of the Senior Notes.
Whenever in this Senior Notes Indenture there is mentioned, in any context, the payment of amounts based upon the principal amount of the Senior Notes or of principal, interest or of any other amount payable under, or with respect to, any of the Senior Notes or any Note Guarantee, such mention shall be deemed to include mention of the payment of Additional Amounts to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof.
The obligations in this Section 4.18 will survive any termination, defeasance or discharge of this Senior Notes Indenture, any transfer by a Holder or beneficial owner of its Senior Notes, and will apply, mutatis mutandis, to any jurisdiction in which any successor Person to the Issuer or any Guarantor is incorporated, organized, engaged in business for tax purposes, or otherwise resident for tax purposes or any jurisdiction from or through which such Person makes any payment on the Senior Notes (or any Note Guarantee) and any department or political subdivision thereof or therein.
Suspension of Certain Covenants when Senior Notes Rated Investment Grade.
If on any date following the Issue Date:
the Senior Notes have achieved Investment Grade Status; and
no Default or Event of Default shall have occurred and be continuing on such date,
then, beginning on that day and continuing until such time, if any, at which the Senior Notes cease to have Investment Grade Status (such period, the “Suspension Period”), Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.14 and 4.16 and Section 5.01(a)(iv) hereof will no longer be applicable to the Senior Notes and any related default provisions of this Senior Notes Indenture will cease to be effective and will not be applicable to the Parent Guarantor and its Restricted Subsidiaries.
The foregoing sections and any related default provisions will again apply according to their terms from the first day on which the Senior Notes cease to have Investment Grade Status.
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The foregoing sections will not, however, be of any effect with regard to the actions of Parent Guarantor and the Restricted Subsidiaries properly taken during the continuance of the Suspension Period; provided that (1) with respect to the Restricted Payments made after any such reinstatement, the amount of Restricted Payments will be calculated as though Section 4.07 hereof had been in effect prior to, but not during, the Suspension Period and (2) all Indebtedness incurred, or Disqualified Stock or preferred stock issued, during the Suspension Period will be classified to have been incurred or issued pursuant to Section 4.09(b)(ii) hereof. Upon the occurrence of a Suspension Period, the amount of Excess Proceeds shall be reset at zero.
The Issuer shall notify the Trustee in writing that Sections 4.19(a)(i) and 4.19(a)(ii) hereof have been satisfied, provided that such notification shall not be a condition for the suspension of the covenants set forth above to be effective. The Trustee shall not be obliged to notify Holders of such event. The Issuer shall deliver an Officer's Certificate to the Trustee on the date the Senior Notes achieve Investment Grade Status and shall deliver an Officer's Certificate to the Trustee if the Senior Notes cease to have Investment Grade Status thereafter.
[Reserved].
Anti-Layering. Neither the Issuer nor any Guarantor will incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Issuer or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Senior Notes and the applicable Note Guarantee on substantially identical (or more favorable) terms; provided, however, that no Indebtedness will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Issuer or any Guarantor solely (a) by virtue of being unsecured, (b) by virtue of being secured with different collateral, (c) by virtue of being secured on a junior priority basis, (d) by virtue of not being guaranteed or (e) by virtue of the application of waterfall or other payment ordering provisions affecting different tranches of Indebtedness under Credit Facilities.
Financial Calculations. Article 14 When determining the availability under any basket or ratio under this Senior Notes Indenture in connection with any transaction or whether such transaction is permitted under this Senior Notes Indenture (including, for the avoidance of doubt and without limitation, testing any incurrence or assumption of Indebtedness or Liens, the making of any Restricted Payment, Permitted Payment or Investment, any Asset Sale, any acquisition, merger, consolidation, amalgamation or other business combination and any other transaction requiring the testing of any basket based on the Consolidated EBITDA of the Parent Guarantor), the date of determination of such basket or ratio or the testing of any such transaction and of any Default or Event of Default shall, at the option of the Issuer, be the date the definitive agreements for such transaction are entered into (the “Transaction Commitment Date Election”).
If the Issuer makes a Transaction Commitment Date Election, such baskets or ratios shall be calculated with such pro forma adjustments as are appropriate and consistent with the pro forma provisions set forth in the definition of Consolidated Net Leverage Ratio after giving effect to such transaction and other transactions to be entered into in connection therewith (including any incurrence of Indebtedness and the use of proceeds thereof) as if they had occurred at the beginning of the applicable period for purposes of determining the ability to consummate any such transaction, and, for the avoidance of doubt (x) if any of such baskets or ratios are exceeded as a result of fluctuations in such basket or ratio (including due to fluctuations in the Consolidated Net Income or Consolidated EBITDA of the Parent Guarantor or that arises from an asset or a target company subject to such transaction) subsequent to such date of determination and at or prior to the consummation of the relevant transaction, such baskets or ratios will not be deemed to have been exceeded as a result of such fluctuations solely for purposes of determining whether the transaction is permitted hereunder and (y) such baskets or ratios shall not be tested at the time of consummation of such transaction or related transactions.
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If the Issuer makes a Transaction Commitment Date Election, any such transactions (including any incurrence of Indebtedness and the use of proceeds therefrom) shall be deemed to have occurred on the date the definitive agreements are entered into for purposes of calculating any baskets or ratios under this Senior Notes Indenture after the date of such agreement and before the consummation of such transaction. To the extent the date of determination of a basket or ratio is tested prior to the date of consummation of a transaction, such basket or ratio shall be deemed utilized to the same extent until the earlier of the date of consummation of such transaction or the date such transaction is terminated or expires without consummation, except that, in the case of an acquisition, merger or consolidation, any calculation of Consolidated EBITDA for purposes other than incurrences of Indebtedness or Liens or the making of Restricted Payments (not related to such acquisition, merger or consolidation) shall not reflect such transaction until it has been consummated.
SUCCESSORS
Merger, Consolidation or Sale of Assets. Article 15 The Issuer will not (1) consolidate or merge with or into another Person (whether or not it is the surviving corporation) or (2) sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties and assets as an entirety or substantially as an entirety in one or more related transactions, to another Person, unless:
either: (a) the Issuer is the surviving Person; or (b) the Person formed by or surviving any such consolidation or merger (if other than the Issuer) or to which such sale, assignment, transfer, conveyance, lease or other disposition has been made is an entity organized or existing under the laws of an Approved Jurisdiction (other than the Federal Republic of Nigeria);
the Person formed by or surviving any such consolidation or merger with the Issuer (if other than the Issuer) or the Person to which such sale, assignment, transfer, conveyance, lease or other disposition has been made assumes all the obligations of the Issuer under the Senior Notes and this Senior Notes Indenture pursuant to a supplemental indenture;
immediately after such transaction, no Default or Event of Default exists;
the Issuer or the Person formed by or surviving any such consolidation or merger (if other than the Issuer), or to which such sale, assignment, transfer, conveyance, lease or other disposition has been made would, on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable period (A) be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Consolidated Net Leverage Ratio test set forth in Section 4.09 (a) hereof or (B) have a Consolidated Net Leverage Ratio not greater than it was immediately prior to giving effect to such transaction; and
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the Issuer delivers to the Trustee, in form and substance reasonably satisfactory to the Trustee, an Officer’s Certificate and Opinion of Counsel, in each case, stating that such consolidation, merger or transfer and such supplemental indenture comply with this covenant and that all conditions precedent in this Senior Notes Indenture relating to such transaction have been satisfied and that this Senior Notes Indenture and the Senior Notes constitute legal, valid and binding obligations of the Issuer, or the Person formed by or surviving any such consolidation or merger (as applicable) enforceable in accordance with their terms.
A Guarantor (other than a Guarantor whose Note Guarantee is to be released in accordance with the terms of the Note Guarantee and Section 10.05 hereof) will not, directly or indirectly: (1) consolidate or merge with or into another Person (whether or not such Guarantor is the surviving corporation) or (2) sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of the properties or assets of such Guarantor and its Subsidiaries that are Restricted Subsidiaries taken as a whole, in one or more related transactions, to another Person, unless:
either:
such Guarantor is the surviving Person; or
the Person formed by or surviving any such consolidation or merger (if other than such Guarantor) or the Person to which such sale, assignment, transfer, conveyance, lease or other disposition has been made assumes all the obligations of such Guarantor under its Note Guarantee and this Senior Notes Indenture pursuant to a supplemental indenture;
immediately after giving pro forma effect to such transaction or transactions (and treating any Indebtedness which becomes an obligation of the surviving corporation as a result of such transaction as having been incurred by the surviving corporation at the time of such transaction or transactions), no Default or Event of Default exists; and
the Issuer delivers to the Trustee an Officer’s Certificate and Opinion of Counsel, in each case, stating that such consolidation, merger or transfer and such supplemental indenture comply with this covenant and that all conditions precedent in this Senior Notes Indenture relating to such transaction have been satisfied and that this Senior Notes Indenture and the Note Guarantee constitute legal, valid and binding obligations of the Guarantor or the Person formed by or surviving any such consolidation and merger (as applicable) enforceable in accordance with their terms.
[Reserved].
This Section 5.01 will not apply to (i) any consolidation or merger of any Restricted Subsidiary that is not a Guarantor with and into the Issuer or a Guarantor; (ii) any consolidation or merger of any Guarantor with or into the Issuer or any other Guarantor; or (iii) any Permitted Reorganization effected in compliance with the definition thereof (iv) any Guarantor Redomiciliation; provided that, in the case of Sections 5.01(d)(i) and (ii) hereof, Sections 5.01(a)(ii) and 5.01(a)(v) hereof will be complied with.
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Sections 5.01(a)(iii), 5.01(a)(iv) and 5.01(b)(ii) hereof will not apply to any merger or consolidation of the Issuer or any Guarantor with or into an Affiliate solely for the purpose of reincorporating the Issuer or such Guarantor in another jurisdiction. This Section 5.01 will not apply to any transaction undertaken in accordance with Section 5.03 hereof.
Successor Corporation Substituted. Upon any consolidation or merger, or any sale, assignment, transfer, lease, conveyance or other disposition of all or substantially all of the properties or assets of the Issuer, any Guarantor or their respective Subsidiaries in a transaction that is subject to, and that complies with the provisions of, Section 5.01 hereof, the successor Person formed by such consolidation or into or with which the Issuer or such Guarantor is merged or to which such sale, assignment, transfer, lease, conveyance or other disposition is made shall succeed to, and be substituted for (so that from and after the date of such consolidation, merger, sale, assignment, transfer, lease, conveyance or other disposition, the provisions of this Senior Notes Indenture referring to the “Issuer” or the “Guarantor,” as applicable, shall refer instead to the successor Person and not to the Issuer or such Guarantor), and may exercise every right and power of the Issuer under this Senior Notes Indenture with the same effect as if such successor Person had been named as the Issuer or such Guarantor, as applicable, herein; provided, however, that the predecessor Issuer shall not be relieved from the obligation to pay the principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes except in the case of a sale of all of the Issuer’s assets in a transaction that is subject to, and that complies with the provisions of, Section 5.01 hereof.
Issuer Substitution. Article 16 Following a Qualifying IPO, the IPO Entity may be substituted in place of the Issuer (the “Substitution”) provided that the following conditions are met:
the IPO Entity is organized and existing under the laws of an Approved Issuer Substitution Jurisdiction;
the IPO Entity assumes all the obligations of the Issuer under the Senior Notes and this Senior Notes Indenture pursuant to a supplemental indenture;
immediately after such transaction, no Default or Event of Default exists;
the IPO Entity would, on the date of such Substitution after giving pro forma effect thereto (including giving pro forma effect to the Subsidiaries of the New Issuer (as defined in Section 5.03(b) hereof) that will become Restricted Subsidiaries from the date of the Substitution) and any related financing transactions as if the same had occurred at the beginning of the applicable period be permitted to incur at least U.S.$1.00 of additional Indebtedness pursuant to the Consolidated Net Leverage Ratio test set forth in Section 4.09(a);
effective at same time as the Substitution, the Issuer shall provide a guarantee of the Senior Notes pursuant to a supplemental indenture on a pari passu basis with the existing Note Guarantees; on or immediately prior to the date of the Substitution, the corporate family rating of the IPO Entity being equal to, or greater than, the then-prevailing rating for the Senior Notes, according to any two of Moody’s, S&P and Fitch; and
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the Issuer delivers to the Trustee, in form and substance reasonably satisfactory to the Trustee, an Officer’s Certificate and Opinion of Counsel, in each case, stating that such Substitution and such supplemental indenture comply with this covenant and that all conditions precedent in this Senior Notes Indenture relating to such transaction have been satisfied and that this Senior Notes Indenture, the Senior Notes and the Note Guarantees (including the Note Guarantee provided by the Issuer) constitute legal, valid and binding obligations of the IPO Entity and the Guarantors enforceable in accordance with their terms.
Notwithstanding any other provision or covenant in this Senior Notes Indenture, the Substitution shall be permitted by this Senior Notes Indenture, provided such Substitution complies with the terms of this covenant and following such Substitution, the Trustee will join the Issuer in a supplemental indenture to effect the Substitution in accordance with Section 9.01(a)(iii) hereof and in doing all such things that are required to be done to effect such Substitution in the clearing systems or pursuant to this Senior Notes Indenture without the consent of holders of the Senior Notes. Following such Substitution references to “Issuer” shall be to the IPO Entity substituting for the Issuer (the “New Issuer”) in this Senior Notes Indenture and the Senior Notes in all respects, and the New Issuer will succeed to, and be substituted for, and may exercise every right and power of, the Issuer as issuer under this Senior Notes Indenture and the Senior Notes, and upon such Substitution, the Issuer will be released from its obligations as issuer under this Senior Notes Indenture and the Senior Notes. The Subsidiaries of the New Issuer that are not Restricted Subsidiaries of the Issuer will be treated as having become Restricted Subsidiaries from the date of the Substitution for the purposes of this Senior Notes Indenture. A Substitution pursuant to this covenant may only occur once.
Parent Guarantor Substitution. Article 17 Any direct Parent Holdco of the Parent Guarantor (the “New Parent Guarantor”) may be substituted for the Parent Guarantor herein, (any such substitution pursuant to this Section 5.04, a “Parent Guarantor Substitution”) provided that the following conditions are met:
such New Parent Guarantor was formed for the purpose of holding shares in its Subsidiaries, and has no material business operations other than acting as a holding company;
immediately after such transaction, no Default or Event of Default exists;
effective at the same time as such substitution, such New Parent Guarantor shall provide a guarantee of the Senior Notes pursuant to a supplemental indenture in accordance with Section 9.01(a)(iii) hereof on a pari passu basis with the existing Note Guarantees; and
the Parent Guarantor delivers to the Trustee, in form and substance reasonably satisfactory to the Trustee, an Officer’s Certificate and an Opinion of Counsel, each stating that such substitution and such supplemental indenture comply with this covenant and that all conditions precedent in this Senior Notes Indenture relating to such transaction have been satisfied and that this Senior Notes Indenture, the Senior Notes and the Note Guarantees (including the Note Guarantee provided by the New Parent Guarantor) constitute legal, valid and binding obligations of such entity and the Guarantors, enforceable in accordance with their terms.
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Notwithstanding any other provision or covenant in this Senior Notes Indenture, the substitution shall be permitted by this Senior Notes Indenture, provided such substitution complies with the terms of this covenant and following such substitution, the Trustee will join the Parent Guarantor in doing all such things that are required to be done to effect such substitution in the clearing systems or pursuant to this Senior Notes Indenture without the consent of Holders of the Senior Notes. Following such substitution references to “Parent Guarantor” shall be to the New Parent Guarantor in this Senior Notes Indenture and the Senior Notes in all respects, and the New Parent Guarantor will succeed to, and be substituted for, the Parent Guarantor as Parent Guarantor under this Senior Notes Indenture and the Senior Notes.
DEFAULTS AND REMEDIES
Events of Default. Article 18 Each of the following is an “Event of Default”:
default for 30 days in the payment when due of interest or Additional Amounts, if any, with respect to the relevant series of Senior Notes;
default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the relevant series of Senior Notes;
failure by the Parent Guarantor, the Issuer or relevant Subsidiary Guarantor to comply with the provisions of Section 5.01 and 5.03 hereof;
failure by the Parent Guarantor, the Issuer or relevant Subsidiary Guarantor for 60 days after written notice (i) to the Issuer by the Trustee or (ii) to the Issuer and the Trustee by the Holders of at least 25% in aggregate principal amount of the Senior Notes then outstanding voting as a single class to comply with any of the agreements in this Senior Notes Indenture (other than a default in performance, or breach, or a covenant or agreement which is specifically dealt with in Sections 6.01(a)(i), 6.01(a)(ii) or 6.01(a)(iii) hereof);
default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries), whether such Indebtedness or guarantee now exists, or is created after the Issue Date, if that default:
is caused by a failure to pay principal of such Indebtedness following the expiration of the grace period provided in such Indebtedness and such failure to make any payment has not been waived or the maturity of such indebtedness has not been extended (a “Payment Default”); or
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and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $75.0 million or more;
results in the acceleration of such Indebtedness prior to its express maturity, failure by the Issuer, the Parent Guarantor or any Restricted Subsidiary of the Parent Guarantor that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary, to pay final judgments entered by a court or courts of competent jurisdiction aggregating in excess of $75.0 million (exclusive of any amounts that a solvent insurance company has acknowledged liability for), which judgments shall not have been discharged or waived and there shall have been a period of 60 consecutive days during which a stay of enforcement of such judgment or order, by reason of an appeal, waiver or otherwise, shall not have been in effect;
except as permitted by this Senior Notes Indenture (including with respect to any limitations), any Note Guarantee of the Parent Guarantor, or any Note Guarantee of any Subsidiary Guarantor that is a Significant Subsidiary or any group of Subsidiary Guarantors that, taken together, would constitute a Significant Subsidiary is held in any judicial proceeding to be unenforceable or invalid or ceases for any reason to be in full force and effect, or any Subsidiary Guarantor that is a Significant Subsidiary or any group of Guarantors that, taken together, would constitute a Significant Subsidiary, or the Parent Guarantor, or any Person acting on behalf of any such Guarantor or Guarantors, denies or disaffirms its obligations under its Note Guarantee;
the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary pursuant to or within the meaning of Bankruptcy Law:
commences a voluntary case under any applicable Bankruptcy Law or any other case to be adjudicated bankrupt or insolvency, or files for or has been granted a moratorium on payment of its debts, or files for bankruptcy or is declared bankrupt;
consents to the entry of an order for relief against it in an involuntary case or to the commencement of any bankruptcy or insolvency proceedings against it;
consents to the appointment of, or taking possession by, an administrator, custodian, receiver, liquidator, trustee, sequestrator or similar official of it or for all or substantially all of its property;
makes a general assignment for the benefit of its creditors;
admits in writing its inability to pay its debts generally as they become due;
files a petition or answer or consent seeking reorganization for relief (other than a solvent reorganization for purposes of transferring assets among the Parent Guarantor and its Restricted Subsidiaries); and a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
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is for relief against the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary in an involuntary case;
adjudging the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries bankrupt or insolvency, or seeking moratorium, reorganization, arrangement, adjustment or composition of or in respect of the Parent Guarantor or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries;
appoints a custodian or administrator of the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary or for all or substantially all of the property of the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary; or
orders the liquidation of the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive days.
Acceleration. In the case of an Event of Default specified in Sections 6.01(a)(viii) and 6.01(a)(ix) hereof, with respect to the Parent Guarantor, the Issuer or any Subsidiary Guarantor that is a Significant Subsidiary or any group of Subsidiary Guarantors that, taken together, would constitute a Significant Subsidiary, all outstanding Senior Notes will become due and payable immediately without further action or notice or other act on the part of the Trustee or any Holders. If any other Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the then outstanding Senior Notes by written notice to the Issuer (and to the Trustee if such notice is given by the Holders) may and the Trustee, upon the written request of such Holders, shall declare all amounts in respect of the Senior Notes to be due and payable immediately. Upon any such declaration, the Senior Notes shall become due and payable immediately. In the event of a declaration of acceleration of the Senior Notes because an Event of Default described in Section 6.01(a)(v) hereof has occurred and is continuing, the declaration of acceleration of the Senior Notes shall be automatically annulled if the event of default or payment default triggering such Senior Event of Default pursuant to Section 6.01(a)(v) hereof shall be remedied or cured, or waived by the holders of the Indebtedness, or the Indebtedness that gave rise to such Event of Default shall have been discharged in full, within 30 days after the declaration of acceleration with respect thereto and if (a) the annulment of the acceleration of the Senior Notes would not conflict with any judgment or decree of a court of competent jurisdiction and (b) all existing Events of Default, except non-payment of principal, premium or interest on the Senior Notes that became due solely because of the acceleration of the Senior Notes, have been cured or waived.
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Other Remedies. (a) If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal of, premium on, if any, interest or Additional Amounts, if any, on, the Senior Notes or to enforce the performance of any provision of the Senior Notes or this Senior Notes Indenture.
(b)The Trustee may maintain a proceeding even if it does not possess any of the Senior Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder of a Senior Note in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law.
Waiver of Past Defaults. The Holders of not less than a majority in aggregate principal amount of the then outstanding Senior Notes by written notice to the Trustee may, on behalf of the Holders of all of the Senior Notes waive any past Default and its consequences hereunder, except a continuing Default in the payment of principal of, premium on, if any, interest or Additional Amounts, if any, on, any Senior Note held by a non-consenting Holder (which may only be waived pursuant to Section 9.02 hereof); provided that the Holders of a majority in aggregate principal amount of the then outstanding Senior Notes may rescind an acceleration and its consequences, including any related payment default that resulted from such acceleration with respect to such Senior Notes and its consequences if rescission would not conflict with any judgment or decree of a court of competent jurisdiction. In connection with any such waiver or rescission, the Issuer shall pay all of the fees and expenses of the Trustee, including those of its agents and counsel. Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Senior Notes Indenture; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.
Control by Majority. Holders of a majority in aggregate principal amount of the then outstanding Senior Notes may direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee or exercising any trust or power conferred on the Trustee. The Trustee may withhold from Holders notice of any continuing Default or Event of Default if it determines that withholding notice is in their interest, except a Default or Event of Default relating to the payment of principal, interest or Additional Amounts or premium, if any. The Trustee may refuse to follow any direction that conflicts with law or this Senior Notes Indenture or the Senior Notes or would involve the Trustee in personal liability or could be unduly prejudicial to the rights of the other holders; provided, however, that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction.
Limitation on Suits. (a) Subject to the provisions of this Senior Notes Indenture relating to the duties of the Trustee, in case an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under this Senior Notes Indenture at the request or direction of any Holders of Senior Notes unless such Holders have made a written request and offered to the Trustee indemnity and/or security satisfactory to the Trustee against any loss, liability or expense. Except to enforce the right to receive payment of principal, premium, if any, or interest or Additional Amounts when due, no Holder may pursue any remedy with respect to this Senior Notes Indenture or the Senior Notes unless:
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such Holder has previously given the Trustee written notice that an Event of Default is continuing;
Holders of at least 25% in aggregate principal amount of the then outstanding Senior Notes have requested, in writing, that the Trustee pursue the remedy;
such Holders have offered the Trustee security and/or indemnity satisfactory to the Trustee against any loss, liability or expense;
the Trustee has not complied with such written request within 60 days after the receipt of the written request and the offer of security and/or indemnity; and
Holders of a majority in aggregate principal amount of the then outstanding Senior Notes have not given the Trustee a direction inconsistent with such request within such 60-day period.
A Holder of a Senior Note may not use this Senior Notes Indenture to prejudice the rights of another Holder of a Senior Note or to obtain a preference or priority over another Holder of a Senior Note. The Trustee shall have no obligation to ascertain whether the actions of a Holder of a Senior Note is unduly prejudicial to the interests of other Holders of the Senior Notes.
Rights of Holders of Senior Notes to Receive Payment. Notwithstanding any other provision of this Senior Notes Indenture, the right of any Holder of a Senior Note to receive payment of principal of, premium on, if any, interest or Additional Amounts, if any, on, the Senior Note, on or after the respective due dates expressed in the Senior Note (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder other than as provided in Section 9.02 hereof; provided that a Holder shall not have the right to institute any such suit for the enforcement of payment if and to the extent that the institution or prosecution thereof or the entry of judgment therein would, under applicable law, result in the surrender, impairment, waiver or loss of the Lien of this Senior Notes Indenture upon any property subject to such Lien.
For the avoidance of doubt, no amendment to, or deletion of any of the covenants under Article 4 or Article 5, or action taken in compliance with the covenants in effect at the time of such action, shall be deemed to impair or affect any rights of any Holders to receive payment of principal of or premium, if any, or interests on the Senior Notes or to institute suit for the enforcement of any payment on or with respect to such Holder’s Notes.
Collection Suit by Trustee. If an Event of Default specified in Sections 6.01(a)(i) or 6.01(a)(ii) hereof occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Issuer for the whole amount of principal of, premium on, if any, interest and Additional Amounts, if any, remaining unpaid on, the Senior Notes and interest on overdue principal and, to the extent lawful, Additional Amounts, interest and such further amount as shall be sufficient to cover the costs and expenses of collection, including the compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
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Trustee May File Proofs of Claim. The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders of the Senior Notes allowed in any judicial proceedings relative to the Issuer, a Guarantor or any other obligor upon the Senior Notes, their creditors or property and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.06 hereof. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.06 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Senior Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
Priorities. If the Trustee collects any money pursuant to this Article 6, it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under Section 7.06 hereof, including payment of all compensation, expenses and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection;
Second: to Holders of Senior Notes for amounts due and unpaid on the Senior Notes for principal, premium, if any, interest and Additional Amounts, if any, ratably, without preference or priority of any kind, according to the amounts due and payable on the Senior Notes for principal, premium, if any, interest and Additional Amounts, if any, respectively; and
Third: to the Issuer, any Guarantor or to such party as a court of competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to Holders of Senior Notes pursuant to this Section 6.10.
Undertaking for Costs. In any suit for the enforcement of any right or remedy under this Senior Notes Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defences made by the party litigant.
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This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder of a Senior Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in aggregate principal amount of the then outstanding Senior Notes.
Restoration of Rights and Remedies. If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Senior Notes Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined in a final judgment adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Issuer, any Guarantor, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.
Rights and Remedies Cumulative. Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes in Section 2.07 hereof, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.
Delay or Omission Not Waiver. No delay or omission of the Trustee or any Holder of any Senior Note to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article 6 or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.
TRUSTEE
Duties of Trustee. (c) If an Event of Default has occurred and is continuing, the Trustee will exercise such of the rights and powers vested in it by this Senior Notes Indenture, and use the same degree of care and skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.
Except during the continuance of an Event of Default:
the duties of the Trustee and the Agents will be determined solely by the express provisions of this Senior Notes Indenture and the Trustee and the Agents need perform only those duties that are specifically set forth in this Senior Notes Indenture and no others, and no implied covenants or obligations shall be read into this Senior Notes Indenture against the Trustee or the Agents; and in the absence of wilful misconduct, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or Opinions of Counsel furnished to the Trustee and conforming to the requirements of this Senior Notes Indenture.
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However, the Trustee will examine the certificates or Opinions of Counsel which by any provision hereof are specifically required to be furnished to the Trustee to determine whether or not such certificates or Opinions of Counsel conform to the requirements of this Senior Notes Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).
The Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act, or its own wilful misconduct, except that:
this Section 7.01(c) does not limit the effect of Section 7.01(b) hereof;
the Trustee will not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was grossly negligent in ascertaining the pertinent facts; and
the Trustee will not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Sections 6.02, 6.04 or 6.05 hereof.
Whether or not therein expressly so provided, every provision of this Senior Notes Indenture that in any way relates to the Trustee is subject to Section 7.01(a), (b) and (c) hereof.
No provision of this Senior Notes Indenture will require the Trustee to expend or risk its own funds or incur any liability. The Trustee will be under no obligation to exercise any of its rights and powers under this Senior Notes Indenture at the request of any Holders, unless such Holder has offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense.
The Trustee will not be liable for interest on any money received by it except as the Trustee may agree in writing with the Issuer. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law and funds held by the Trustee will not be subject to the United Kingdom FCA Client Money Rules.
The Trustee shall not be deemed to have notice or any knowledge of any matter (including without limitation Defaults or Events of Default) unless a Responsible Officer assigned to and working in the Trustee’s corporate trust and agency department has actual knowledge thereof or unless written notice thereof is received by the Trustee (attention: Agency & Trust) and such notice clearly references the Senior Notes, the Issuer or this Senior Notes Indenture.
Notwithstanding anything else herein contained, the Trustee and each Agent may refrain from doing anything that would or might in its opinion based upon legal advice in the relevant jurisdiction be contrary to any law of any state or jurisdiction (including but not limited to the United States of America or any jurisdiction forming a part of it and England & Wales) or any directive or regulation of any agency of any such state or jurisdiction and may do anything which is, in its opinion, necessary to comply with any such law, directive or regulation.
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Rights of Trustee. (d) The Trustee may conclusively rely upon any document (whether in its original, electronic or facsimile form) believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in such document. The Trustee may, if it sees fit, make such inquiry.
Before the Trustee acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel or both. The Trustee will not be liable for any action it takes or omits to take in good faith in reliance on such Officer’s Certificate or Opinion of Counsel, as the case may be. The Trustee may consult with counsel or other professional advisors and the written advice of such counsel, professional advisor or any Opinion of Counsel will be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.
The Trustee may act through its attorneys and agents and will not be responsible for the misconduct or negligence of any agent appointed with due care.
The Trustee will not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this Senior Notes Indenture.
Unless otherwise specifically provided in this Senior Notes Indenture, any demand, request, direction or notice from the Issuer or Parent Guarantor, as applicable, will be sufficient if signed by an Officer of the Issuer or Parent Guarantor, as applicable.
The Trustee will be under no obligation to exercise any of the rights or powers vested in it by this Senior Notes Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee indemnity and/or security satisfactory to it against the losses, liabilities and expenses that might be incurred by it in compliance with such request or direction.
The Trustee shall have no duty to inquire as to the performance of the covenants of the Parent Guarantor and/or its Restricted Subsidiaries. In addition, the Trustee shall not be deemed to have knowledge of any Default or Event of Default except: (i) any Event of Default occurring pursuant to Section 6.01(a)(i) or Section 6.01(a)(ii) hereof (provided it is acting as Paying Agent); and (ii) any Default or Event of Default of which a Responsible Officer shall have received written notification. Delivery of reports, information and documents to the Trustee under Section 4.03 hereof is for informational purposes only and the Trustee's receipt of the foregoing shall not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Parent Guarantor’s compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer's Certificates).
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The Trustee shall not have any obligation or duty to monitor, determine or inquire as to compliance, and shall not be responsible or liable for compliance with restrictions on transfer, exchange, redemption, purchase or repurchase, as applicable, of minimum denominations imposed under this Senior Notes Indenture or under applicable law or regulation with respect to any transfer, exchange, redemption, purchase or repurchase, as applicable, of any interest in any Senior Notes.
The rights, privileges, protections, immunities and benefits given to the Trustee, including its right to be indemnified and/or secured, are extended to, and shall be enforceable by the Trustee in each of its capacities hereunder and by each agent (including the Agents), custodian and other person employed to act hereunder. Absent wilful misconduct or negligence, each Paying Agent, Registrar and Transfer Agent shall not be liable for acting in good faith on instructions believed by it to be genuine and from the proper party.
In the event the Trustee receives inconsistent or conflicting requests and indemnity from two or more groups of Holders, each representing less than a majority in aggregate principal amount of the Senior Notes then outstanding, pursuant to the provisions of this Senior Notes Indenture, the Trustee, in its sole discretion, may determine what action, if any, will be taken and shall not incur any liability for its failure to act until such inconsistency or conflict is, in its reasonable opinion, resolved.
In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by acts of war or terrorism involving the United States, the United Kingdom or any member state of the European Monetary Union or any other national or international calamity or emergency (including natural disasters or acts of God), it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.
The Trustee is not required to give any bond or surety with respect to the performance or its duties or the exercise of its powers under this Senior Notes Indenture or the Senior Notes.
The permissive right of the Trustee to take the actions permitted by this Senior Notes Indenture shall not be construed as an obligation or duty to do so.
The Trustee will not be liable to any person if prevented or delayed in performing any of its obligations or discretionary functions under this Senior Notes Indenture by reason of any present or future law applicable to it, by any governmental or regulatory authority or by any circumstances beyond its control.
The Trustee shall not under any circumstances be liable for any special, indirect or consequential loss or damage whatsoever (being loss of business, goodwill, opportunity or profit of any kind) of the Parent Guarantor, any Restricted Subsidiary of the Parent Guarantor or any other Person (or, in each case, any successor thereto), even if advised of it in advance and even if foreseeable.
The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Issuer personally or by agent or attorney at the sole cost of the Issuer.
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The Trustee may request that the Issuer delivers an Officer’s Certificate setting forth the names of the individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Senior Notes Indenture, which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.
No provision of this Senior Notes Indenture shall require the Trustee to do anything which, in its opinion, may be illegal or contrary to applicable law or regulation.
The Trustee may refrain from taking any action in any jurisdiction if the taking of such action in that jurisdiction would, in its opinion, based upon legal advice in the relevant jurisdiction, be contrary to any law of that jurisdiction or, to the extent applicable, the State of New York.
The Trustee may retain professional advisors to assist it in performing its duties under this Senior Notes Indenture. The Trustee may consult with such professional advisors or with counsel, and the advice or opinion of such professional advisors or counsel with respect to legal or other matters relating to this Senior Notes Indenture and the Senior Notes shall be full and complete authorization and protection from liability in respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.
The Trustee may assume without inquiry in the absence of actual knowledge that the Issuer or the Parent Guarantor is duly complying with its obligations contained in this Senior Notes Indenture required to be performed and observed by it, and that no Default or Event of Default or other event which would require repayment of the Senior Notes has occurred.
Individual Rights of Trustee. The Trustee in its individual or any other capacity may become the owner or pledgee of Senior Notes and may otherwise deal with the Issuer or any Affiliate of the Issuer with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days or resign. Any Agent may do the same with like rights and duties. The Trustee is also subject to Sections 7.09 and 7.10 hereof.
Trustee’s Disclaimer. The Trustee will not be responsible for and makes no representation as to the validity or adequacy of this Senior Notes Indenture, the Senior Notes, or any Note Guarantee, it shall not be accountable for the Issuer’s use of the proceeds from the Senior Notes or any money paid to the Issuer or upon the Issuer’s direction under any provision of this Senior Notes Indenture, it will not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it will not be responsible for any statement or recital herein or any statement in the Senior Notes or any other document in connection with the sale of the Senior Notes or pursuant to this Senior Notes Indenture other than its certificate of authentication.
Notice of Defaults. If a Default or Event of Default occurs and is continuing and if it is known to the Trustee, the Trustee will mail to Holders of Senior Notes a notice of the Default or Event of Default within 90 days after it occurs. The Trustee may withhold from the Holders notice of any continuing Default or Event of Default relating to the payment of principal, premium and interest or Additional Amounts, if it determines that withholding notice is in their interest.
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Compensation and Indemnity. (e) The Issuer or, upon the failure of the Issuer to pay, each Guarantor, jointly and severally, will pay to the Trustee from time to time compensation for its acceptance of this Senior Notes Indenture and services hereunder as shall be agreed from time to time between them. The Trustee’s compensation will not be limited by any law on compensation of a trustee of an express trust. The Issuer, and each Guarantor, jointly and severally, will reimburse the Trustee promptly upon request for all disbursements, advances and expenses properly incurred or made by it in addition to the compensation for its services. Such expenses will include the properly incurred compensation, disbursements and expenses of the Trustee’s agents and counsel. In the event of the occurrence of an Event of Default or potential Event of Default or being requested by the Issuer to undertake duties which the Trustee and the Issuer agree to be of an exceptional nature or otherwise outside the scope of the normal duties of the Trustee under this Senior Notes Indenture, the Issuer or, failing whom, the Guarantors shall pay to the Trustee such additional remuneration as shall be agreed between them.
The Issuer and the Guarantors, jointly and severally, will indemnify the Trustee against any and all losses, liabilities or expenses (including attorneys’ fees) incurred by it arising out of or in connection with the acceptance or administration of its duties under this Senior Notes Indenture, including the costs and expenses of enforcing this Senior Notes Indenture against the Issuer and the Guarantors (including this Section 7.06) and defending itself against any claim (whether asserted by the Issuer, the Guarantors, any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder, except to the extent any such loss, liability or expense may be attributable to the Trustee’s gross negligence, wilful misconduct or fraud. The Trustee shall notify the Issuer promptly of any third-party claim for which it may seek indemnity of which it has received written notice. Failure by the Trustee to so notify the Issuer shall not relieve the Issuer of its obligations hereunder. The Issuer shall defend the claim, with counsel satisfactory to the Trustee, and the Trustee shall provide reasonable cooperation at the Issuer’s expense in the defence; provided that if the defendants in any such claim include both the Issuer and the Trustee and the Trustee shall have concluded that there may be legal defences available to it which are different from or additional to those available to the Issuer, or the Trustee has concluded that there may be any other actual or potential conflicting interests between the Issuer and the Trustee, the Trustee shall have the right to select separate counsel and the Issuer shall be required to pay the fees and expenses of such separate counsel. Any settlement which affects the Trustee may not be entered into without the written consent of the Trustee, unless the Trustee is given a full and unconditional release from liability with respect to the claims covered thereby and such settlement does not include a statement or admission of fault, culpability or failure to act by or on behalf of the Trustee. Neither the Issuer nor any Guarantor need pay for any settlement made without its consent, which consent will not be unreasonably withheld.
The obligations of the Issuer and the Guarantors under this Section 7.06 will survive the satisfaction and discharge of this Senior Notes Indenture.
To secure the Issuer’s and the Guarantors’ payment obligations in this Section 7.06, the Trustee will have a Lien prior to the Senior Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal of, premium on, if any, interest or Additional Amounts, if any, on, particular Notes. Such Lien will survive the satisfaction and discharge of this Senior Notes Indenture.
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When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01 (a) (viii) hereof occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law.
The indemnity contained in this Section 7.06 shall survive the discharge or termination of this Senior Notes Indenture and shall continue for the benefit of the Trustee or an Agent notwithstanding its resignation or retirement.
Replacement of Trustee. (f) A resignation or removal of the Trustee and appointment of a successor Trustee will become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section 7.07.
The Trustee may resign in writing at any time and be discharged from the trust hereby created by so notifying the Issuer. The Holders of a majority in aggregate principal amount of the then outstanding Senior Notes may remove the Trustee by so notifying the Trustee and the Issuer in writing not less than 60 days prior to the effective date of such removal. The Issuer may remove the Trustee if:
the Trustee fails to comply with Section 7.09 hereof;
the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;
a custodian or public officer takes charge of the Trustee or its property; or
the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Issuer will promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in aggregate principal amount of the then outstanding Senior Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Issuer.
If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, (i) the retiring Trustee, the Issuer, or the Holders of at least 10% in aggregate principal amount of the then outstanding Senior Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee or (ii) the retiring Trustee may appoint a successor Trustee at any time prior to the date on which a successor Trustee takes office, provided that such appointment shall be reasonably satisfactory to the Issuer.
If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.09 hereof, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
A successor Trustee will deliver a written acceptance of its appointment to the retiring Trustee and to the Issuer. Thereupon, the resignation or removal of the retiring Trustee will become effective, and the successor Trustee will have all the rights, powers and duties of the Trustee under this Senior Notes Indenture.
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The successor Trustee will mail a notice of its succession to Holders. The retiring Trustee will promptly transfer all property held by it as Trustee to the successor Trustee; provided all sums owing to the Trustee hereunder have been paid and subject to the Lien provided for in Section 7.06 hereof. The retiring Trustee shall have no responsibility or liability for the action or inaction of the successor Trustee. Notwithstanding replacement of the Trustee pursuant to this Section 7.07, the Issuer's obligations under Section 7.06 hereof will continue for the benefit of the retiring Trustee.
Successor Trustee by Merger, etc. If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act will be the successor Trustee.
Eligibility; Disqualification. There will at all times be a Trustee hereunder that is a corporation organized and doing business under the laws of England and Wales, or the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power and that is subject to supervision or examination by federal or state authorities.
Agents. (g) Resignation of Agents. Any Agent may resign and be discharged from its duties under this Senior Notes Indenture at any time by giving thirty (30) days’ prior written notice of such resignation to the Trustee and Issuer. The Trustee or Issuer may remove any Agent at any time by giving thirty (30) days’ prior written notice to any Agent. Upon such notice, a successor Agent shall be appointed by the Issuer, who shall provide written notice of such to the Trustee. Such successor Agent shall become the Agent hereunder upon the resignation or removal date specified in such notice. If the Issuer is unable to replace the resigning Agent within thirty (30) days after such notice, the Agent may, in its sole discretion, deliver any funds then held hereunder in its possession to the Trustee, may appoint a successor agent on the Issuer’s behalf or may apply to a court of competent jurisdiction for the appointment of a successor Agent or for other appropriate relief. The costs and expenses (including its counsels’ fees and expenses) incurred by the Agent in connection with such proceeding shall be paid by the Issuer. Upon receipt of the identity of the successor Agent, the Agent shall deliver any funds then held hereunder to the successor Agent, less the Agent’s fees, costs and expenses or other obligations owed to the Agent. Upon its resignation and delivery any funds, the Agent shall be discharged of and from any and all further obligations arising in connection with this Senior Notes Indenture, but shall continue to enjoy the benefit of Section 7.06 hereof.
The Agents shall act solely as agents of the Issuer and need have not concern for the interests of, or be under any fiduciary duty or other obligation towards, or have any relationship of agency or trust to, the Holders, except as expressly stated elsewhere in this Senior Notes Indenture.
FATCA. (h) Mutual Undertaking Regarding Information Reporting and Collection Obligations. Each Party shall, within ten business days of a written request by another Party, supply to that other Party such forms, documentation and other information relating to it, its operations, or the Senior Notes as that other Party reasonably requests for the purposes of that other Party’s compliance with Applicable Law and shall notify the relevant other Party reasonably promptly in the event that it becomes aware that any of the forms, documentation or other information provided by such Party is (or becomes) inaccurate in any material respect; provided, however, that no Party shall be required to provide any forms, documentation or other information pursuant to this (a) to the extent that: (i) any such form, documentation or other information (or the information required to be provided on such form or documentation) is not reasonably available to such Party and cannot be obtained by such Party using reasonable efforts; or (ii) doing so would or might in the reasonable opinion of such Party constitute a breach of any: (a) Applicable Law; (b) fiduciary duty; or (c) duty of confidentiality.
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For purposes of this (a), “Applicable Law” shall be deemed to include (i) any rule or practice of any Authority by which any Party is bound or with which it is accustomed to comply; (ii) any agreement between any Authorities; and (iii) any agreement between any Authority and any Party that is customarily entered into by institutions of a similar nature.
Notice of Possible Withholding Under FATCA. The Issuer shall notify each Agent in the event that it determines that any payment to be made by an Agent under the Senior Notes is a payment which could be subject to FATCA Withholding if such payment were made to a recipient that is generally unable to receive payments free from FATCA Withholding, and the extent to which the relevant payment is so treated, provided, however, that the Issuer’s obligation under this (b) shall apply only to the extent that such payments are so treated by virtue of characteristics of the Issuer, the Senior Notes, or both.
Agent Right to Withhold. Notwithstanding any other provision of this Senior Notes Indenture, each Agent shall be entitled to make a deduction or withholding from any payment which it makes under the Senior Notes for or on account of any Tax, if and only to the extent so required by Applicable Law, in which event the Agent shall make such payment after such deduction or withholding has been made and shall account to the relevant Authority within the time allowed for the amount so deducted or withheld or, at its option, shall reasonably promptly after making such payment return to the Issuer the amount so deducted or withheld, in which case, the Issuer shall so account to the relevant Authority for such amount. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this (c). If such a withholding or deduction is so required, the Agent will not pay an additional amount in respect of that withholding or deduction.
Issuer Right to Redirect. In the event that the Issuer determines in its sole discretion that any deduction or withholding for or on account of any Tax will be required by Applicable Law in connection with any payment due to any of the Agents on any Senior Notes, then the Issuer will be entitled to redirect or reorganize any such payment in any way that it sees fit in order that the payment may be made without such deduction or withholding provided that, any such redirected or reorganized payment is made through a recognized institution of international standing and otherwise made in accordance with this Senior Notes Indenture. The Issuer will promptly notify the Agents and the Trustee of any such redirection or reorganization. For the avoidance of doubt, FATCA Withholding is a deduction or withholding which is deemed to be required by Applicable Law for the purposes of this Section 7.11 (d).
Instruction. The Trustee and each Agent is entitled to do nothing, without liability, if conflicting, unclear or equivocal instructions are received or in order to comply with any Applicable Law.
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For the purposes of Sections 7.11(a) through (e) above, the following definitions apply:
“Applicable Law” means any law or regulation including, but not limited to: (i) any statute or regulation; (ii) any rule or practice of any Authority by which any Party is bound or with which it is accustomed to comply; (iii) any agreement between any Authorities; and (iv) any customary agreement between any Authority and any Party.
“Authority” means any competent regulatory, prosecuting, Tax or governmental authority in any jurisdiction.
“FATCA Withholding” means any withholding or deduction required pursuant to an agreement described in Section 1471(b) of the Code, or any Taxes otherwise imposed pursuant to sections 1471 through 1474 of the Code, any regulations or agreements thereunder, any official interpretations thereof, any intergovernmental agreements implementing the foregoing or any treaty, regulation or law implementing such intergovernmental agreement.
“Party” means each party to this Senior Notes Indenture.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Option to Effect Legal Defeasance or Covenant Defeasance. The Issuer may at any time, at the option of its Board of Directors evidenced by a resolution set forth in an Officer's Certificate, elect to have either Section 8.02 or 8.03 hereof be applied to all outstanding Senior Notes upon compliance with the conditions set forth below in this Article 8.
Legal Defeasance and Discharge. (a) Upon the Issuer's exercise under Section 8.01 hereof of the option applicable to this Section 8.02, the Issuer and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to have been discharged from their obligations with respect to all outstanding Senior Notes (including the Note Guarantees) on the date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means that the Issuer and the Guarantors will be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Senior Notes (including the Note Guarantees), which will thereafter be deemed to be "outstanding" only for the purposes of Section 8.05 hereof and the other Sections of this Senior Notes Indenture referred to in Sections 8.05(a)(i) and (ii) below, and to have satisfied all their other obligations under such Senior Notes, the Note Guarantees and this Senior Notes Indenture (and the Trustee, on demand of and at the expense of the Issuer, shall execute proper instruments acknowledging the same), except for the following provisions which will survive until otherwise terminated or discharged hereunder:
the rights of Holders of outstanding Senior Notes to receive payments in respect of the principal of, or interest (including Additional Amounts) or premium, if any, on, such Senior Notes when such payments are due from the trust referred to in Section 8.04 hereof; the Issuer's and the Parent Guarantor’s, as applicable, obligations with respect to the Senior Notes under Article 2 and Section 4.02 hereof;
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the rights, powers, trusts, duties and immunities of the Trustee and the Issuer's and the Guarantors' obligations in connection therewith; and
this Article 8.
Subject to compliance with this Article 8, the Issuer may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03 hereof.
Covenant Defeasance. Upon the Issuer's exercise under Section 8.01 hereof of the option applicable to this Section 8.03, the Issuer and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be released from each of their obligations under the covenants contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.16, 4.20 and 4.21 hereof and Section 5.01(a)(iv) hereof with respect to the outstanding Senior Notes on and after the date the conditions set forth in Section 8.04 hereof are satisfied (hereinafter, “Covenant Defeasance”), and the Senior Notes will thereafter be deemed not "outstanding" for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but will continue to be deemed "outstanding" for all other purposes hereunder (it being understood that such Senior Notes will not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Senior Notes and Note Guarantees, the Issuer and the Guarantors may omit to comply with and will have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply will not constitute a Default or an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Senior Notes Indenture and such Senior Notes and Note Guarantees will be unaffected thereby. In addition, upon the Issuer's exercise under Section 8.01 hereof of the option applicable to this Section 8.03, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, Sections 6.01(a)(iii), 6.01(a)(iv), 6.01(a)(v), 6.01(a)(vi), 6.01(a)(vii) and 6.01(a)(viii) and (other than with respect to the Issuer) 6.01(a)(ix) hereof will not constitute Events of Default.
Conditions to Legal or Covenant Defeasance. (a) In order to exercise either Legal Defeasance or Covenant Defeasance under either Section 8.02 or 8.03 hereof:
the Issuer must irrevocably deposit with the Trustee (or such entity designated by the Trustee for this purpose), in trust for the benefit of the Holders, cash in U.S. dollars, non-callable U.S. dollar-denominated Government Securities or a combination of cash in U.S. dollars and non-callable U.S.
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dollar-denominated Government Securities in amounts as will be sufficient, to pay the principal of, or interest (including Additional Amounts and premium, if any) on the outstanding Senior Notes on the stated date for payment thereof or on the applicable redemption date, as the case may be, and the Issuer must specify whether the Senior Notes are being defeased to such stated date for payment or to a particular redemption date; in the case of an election under Section 8.02 hereof, the Issuer must deliver to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee of United States counsel confirming that (a) the Issuer has received from, or there has been published by, the U.S. Internal Revenue Service a ruling or (b) since the Issue Date, there has been a change in the applicable U.S. federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel will confirm that, the Holders of the outstanding Senior Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Legal Defeasance and will be subject to tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
in the case of an election under Section 8.03 hereof, the Issuer must deliver to the Trustee an opinion reasonably acceptable to the Trustee of United States counsel confirming that the Holders of the outstanding Senior Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
the Issuer must deliver to the Trustee an Officer’s Certificate stating that the deposit was not made by the Issuer with the intent of preferring the Holders over the other creditors of the Issuer or the Guarantors with the intent of defeating, hindering, delaying or defrauding any creditors of the Issuer, the Guarantors or others; and
the Issuer must deliver to the Trustee an Officer’s Certificate and an Opinion of Counsel, subject to customary assumptions and qualifications, each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.
In connection with either a Legal Defeasance or a Covenant Defeasance, Section 7.06 hereof shall survive.
Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions. (a) Subject to Section 8.06 hereof, all money and non-callable U.S. dollar-denominated Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.05, the “Trustee”) pursuant to Section 8.04 hereof in respect of the outstanding Senior Notes will be held in trust and applied by the Trustee, in accordance with the provisions of such Senior Notes and this Senior Notes Indenture, to the payment, either directly or through any Paying Agent (including the Issuer acting as Paying Agent) as the Trustee may determine, to the Holders of such Senior Notes of all sums due and to become due thereon in respect of principal, premium, if any, interest and Additional Amounts, if any, but such money need not be segregated from other funds except to the extent required by law and funds held by the Trustee will not be subject to the United Kingdom FCA Client Money Rules.
(b)The Issuer will pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash, the non-callable U.S. dollar-denominated Government Securities deposited pursuant to Section 8.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Senior Notes.
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(c)Notwithstanding anything in this Article 8 to the contrary, the Trustee will deliver or pay to the Issuer from time to time upon the request of the Issuer any money, non-callable U.S. dollar-denominated Government Securities held by it as provided in Section 8.04 hereof which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (which may be the opinion delivered under Section 8.04(i) hereof), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Repayment to Issuer. Any money deposited with the Trustee or any Paying Agent, or then held by the Issuer, in trust for the payment of the principal of, premium on, if any, interest or Additional Amounts, if any, on, any Senior Note and remaining unclaimed for two years after such principal, premium, if any, interest or Additional Amounts, if any, has become due and payable shall be paid to the Issuer on its request or (if then held by the Issuer) will be discharged from such trust; and the Holder of such Senior Note will thereafter be permitted to look only to the Issuer for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Issuer as trustee thereof, will thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Issuer give notice to the Holders in accordance with Section 12.01 hereof that such money remains unclaimed and that, after a date specified therein, which will not be less than 30 days from the date of such notification or publication, any unclaimed balance of such money then remaining will be repaid to the Issuer.
Reinstatement. If the Trustee or Paying Agent is unable to apply any U.S. dollars or non-callable U.S. dollar-denominated Government Securities in accordance with Section 8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Issuer's and the Guarantors' obligations under this Senior Notes Indenture and the Senior Notes and the Note Guarantees will be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.02 or 8.03 hereof, as the case may be; provided, however, that, if the Issuer makes any payment of principal of, premium on, if any, interest or Additional Amounts, if any, on, any Senior Note following the reinstatement of its obligations, the Issuer will be subrogated to the rights of the Holders of such Senior Notes to receive such payment from the money held by the Trustee or Paying Agent.
AMENDMENT, SUPPLEMENT AND WAIVER
Without Consent of Holders of Senior Notes. (a) Notwithstanding Section 9.02 hereof, without the consent of any Holder of Senior Notes, the Issuer, the Guarantors and the Trustee may amend or supplement this Senior Notes Indenture, the Senior Notes, and the Note Guarantees:
to cure any ambiguity, defect or inconsistency;
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to provide for uncertificated Senior Notes in addition to or in place of certificated Senior Notes; to provide for the assumption of the Issuer’s or a Guarantor’s obligations to Holders and Note Guarantees in the case of a merger or consolidation or sale of all or substantially all of the Issuer’s or such Guarantor’s assets, as applicable, or in the case of any Substitution or Parent Guarantor Substitution;
to make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect the legal rights under this Senior Notes Indenture of any such Holder in any material respect;
to conform the text of this Senior Notes Indenture, the Note Guarantees, or the Senior Notes to any provision of the “Description of the Notes” section of the Offering Memorandum to the extent that such provision in such “Description of the Notes” section of the Offering Memorandum was intended to be a verbatim recitation of a provision of this Senior Notes Indenture, the Note Guarantees and the Senior Notes;
to release any Note Guarantee in accordance with the terms of this Senior Notes Indenture;
to provide for the issuance of Additional Senior Notes in accordance with the limitations set forth in this Senior Notes Indenture as of the Issue Date;
to allow any Guarantor to execute a supplemental indenture and/or a Note Guarantee with respect to the Senior Notes;
to provide for uncertificated Senior Notes in addition to or in place of certificated Senior Notes (provided that the uncertificated Senior Notes are issued in registered form for purposes of Section 163(f) of the Code); or
to evidence and provide the acceptance of the appointment of a successor Trustee under this Senior Notes Indenture.
In formulating its opinion on such matters, the Trustee shall be entitled to rely absolutely on such evidence as it deems appropriate, including an Opinion of Counsel and an Officer’s Certificate.
For the avoidance of doubt, (i) no amendment to or deletion of, or actions taken in compliance with, the covenants contained in this Senior Notes Indenture shall be deemed to impair or affect any rights of Holders to receive payment of principal of, or premium, if any, or interest, on the Senior Notes; and (ii) it is understood and agreed that any amendment or waiver with respect to any matter described in Sections 9.02(e)(i) through (vi) and 9.02(e)(viii) that by its terms applies to only the 2025 Senior Notes or the 2027 Senior Notes shall require the consent of Holders holding not less than 90% of the then-outstanding principal amount of the 2025 Senior Notes or the 2027 Senior Notes, as applicable, in order for it to be binding on all Holders of the 2025 Senior Notes or the 2027 Senior Notes, as applicable.
It is not necessary for the consent of the Holders of Senior Notes under Section 9.02 hereof to approve the particular form of any proposed amendment, supplement or waiver, but it is sufficient if such consent approves the substance thereof.
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Upon the written request of the Issuer accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental indenture, and upon receipt by the Trustee of the documents described in Section 7.02 hereof, the Trustee will join with the Issuer and the Parent Guarantor in the execution of any amended or supplemental indenture authorized or permitted by the terms of this Senior Notes Indenture and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee will not be obligated to enter into such amended or supplemental indenture that affects its own rights, duties or immunities under this Senior Notes Indenture or otherwise.
With Consent of Holders of Senior Notes. (a) Except as provided below in this Section 9.02, this Senior Notes Indenture (including, without limitation, Section 3.10, Section 4.10 and Section 4.13 hereof), the Senior Notes and the Note Guarantees may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the Senior Notes then outstanding (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes), and, subject to Section 6.04 and Section 6.07 hereof, any existing Default or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium on, if any, interest or Additional Amounts, if any, on, the Senior Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of this Senior Notes Indenture, the Senior Notes and the Note Guarantees may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding Senior Notes (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes); provided that, if any amendment, supplement, waiver or other modification will only affect one series of the Senior Notes, only the consent of a majority in principal amount of the then outstanding Senior Notes of such series shall be required. Section 2.08 hereof shall determine which Senior Notes are considered to be "outstanding" for purposes of this Section 9.02.
(b)Upon the written request of the Issuer accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental indenture, and upon the filing with the Trustee of evidence satisfactory to the Trustee of the consent of the Holders of Senior Notes as aforesaid, and upon receipt by the Trustee of the documents described in Section 7.02 hereof, the Trustee will join with the Issuer and the Parent Guarantor in the execution of such amended or supplemental indenture unless such amended or supplemental indenture directly affects the Trustee’s own rights, duties, liabilities or immunities under this Senior Notes Indenture or otherwise, in which case the Trustee may in its discretion, but will not be obligated to, enter into such amended or supplemental Senior Notes Indenture. Any amended or supplemental indenture which amends Article 10 (Note Guarantees) or otherwise affects or alters any Guarantee given by such Subsidiary Guarantor in any manner shall be joined by such Subsidiary Guarantor.
(c)It is not necessary for the consent of the Holders of Senior Notes under this Section 9.02 to approve the particular form of any proposed amendment, supplement or waiver, but it is sufficient if such consent approves the substance thereof.
(d)After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Issuer will mail to the Holders of Senior Notes affected thereby a notice briefly describing the amendment, supplement or waiver.
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Any failure of the Issuer to mail such notice, or any defect therein, will not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver. Subject to Section 6.04 and Section 6.07 hereof, the Holders of a majority in aggregate principal amount of the Senior Notes then outstanding voting as a single class may waive compliance in a particular instance by the Issuer with any provision of this Senior Notes Indenture, the Senior Notes and the Note Guarantees.
(e)Unless consented to by the Holders of at least 90% of the aggregate principal amount of then outstanding Senior Notes (or if any amendment, supplement, waiver or other modification will only amend, supplement, waive or modify one series of the Senior Notes, only with the consent of Holders holding not less than 90% of the then outstanding aggregate principal amount of Senior Notes of such series) (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes), without the consent of each Holder affected, an amendment, supplement or waiver or other modification under this Section 9.02 may not (with respect to any Senior Notes held by a non-consenting Holder):
reduce the percentage of principal amount of Senior Notes whose Holders must consent to an amendment, supplement or waiver;
reduce the principal of or change the fixed maturity of any Senior Note or alter the provisions with respect to the redemption of the Senior Notes (except as provided above with respect to Sections 4.10 and 4.13 hereof);
reduce the rate of or change the time for payment of interest, including default interest, on any Senior Note;
impair the right of any Holder to institute suit for the enforcement of any payment of principal of and interest or Additional Amounts (if any) on such Holder’s Notes or the associated Note Guarantee on or after the due dates therefore;
waive a Default or Event of Default in the payment of principal of, or interest, Additional Amounts or premium, if any, on, the Senior Notes (except pursuant to a rescission of acceleration of the Senior Notes by the Holders of at least a majority in aggregate principal amount of the then outstanding Senior Notes and a waiver of the Payment Default that resulted from such acceleration);
make any Senior Note payable in money other than that stated in Senior Notes;
make any change in the provisions of this Senior Notes Indenture relating to waivers of past Defaults or the rights of Holders to receive payments of principal of, or interest, Additional Amounts or premium, if any, on, the Senior Notes;
waive a redemption payment with respect to any Senior Note (other than a payment required by Sections 4.10 and 4.13 hereof); release any Guarantor from any of its obligations under its Note Guarantee or this Senior Notes Indenture, except in accordance with the terms of this Senior Notes Indenture; or
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make any change in the preceding amendment and waiver provisions.
Any amendment, supplement, waiver or other modification consented to by at least 90% of the aggregate principal amount of the then outstanding Senior Notes (or if any amendment, supplement, waiver or other modification will only amend, supplement, waive or modify one series of the Senior Notes, only with the consent of Holders holding not less than 90% of the then outstanding aggregate principal amount of Senior Notes of such series) will be binding against any non-consenting Holders.
Revocation and Effect of Consents. Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a Senior Note is a continuing consent by the Holder of a Senior Note and every subsequent Holder of a Senior Note or portion of a Senior Note that evidences the same debt as the consenting Holder’s Note, even if notation of the consent is not made on any Senior Note. However, any such Holder of a Senior Note or subsequent Holder of a Senior Note may revoke the consent as to its Note if the Trustee receives written notice of revocation before the date the amendment, supplement or waiver becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder.
Notation on or Exchange of Senior Notes. (a) The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Senior Note thereafter authenticated. The Issuer in exchange for all Senior Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate or cause the Authenticating Agent to authenticate the new Notes that reflect the amendment, supplement or waiver.
(b)Failure to make the appropriate notation or issue a new Note will not affect the validity and effect of such amendment, supplement or waiver.
Trustee to Sign Amendments, etc. The Trustee will sign any amended or supplemental indenture authorized pursuant to this Article 9 if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. The Issuer may not sign an amended or supplemental indenture until the Board of Directors of the Issuer approves it. In executing any amended or supplemental indenture, the Trustee will be entitled to receive and (subject to Section 7.01 hereof) will be fully protected in relying upon, an Officer's Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Senior Notes Indenture and that such supplemental indenture constitutes the legal, valid and binding obligation of the Issuer, the Parent Guarantor and the Subsidiary Guarantors (as applicable), subject to customary exceptions.
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NOTE GUARANTEES
Guarantee. (c) Subject to this Article 10, each of the Issuer and the Guarantors hereby, jointly and severally, unconditionally guarantees to each Holder of a Senior Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of this Senior Notes Indenture, the Senior Notes or the obligations of the Issuer hereunder or thereunder, that:
the principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes will be promptly paid in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes, if lawful, and all other obligations of the Issuer to the Holders or the Trustee hereunder or thereunder will be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and
in case of any extension of time of payment or renewal of any Senior Notes or any of such other obligations, that same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise.
Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Guarantors will be jointly and severally obligated to pay the same immediately. Each Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.
The Guarantors hereby agree that their obligations hereunder are unconditional, irrespective of the validity, regularity or enforceability of the Senior Notes or this Senior Notes Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Senior Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Issuer, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defence of a guarantor. Each Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Issuer, any right to require a proceeding first against the Issuer, protest, notice and all demands whatsoever and covenant that this Note Guarantee will not be discharged except by complete performance of the obligations contained in the Senior Notes and this Senior Notes Indenture.
If any Holder or the Trustee is required by any court or otherwise to return to the Issuer, the Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to either the Issuer or the Guarantors, any amount paid by either to the Trustee or such Holder, this Note Guarantee, to the extent theretofore discharged, will be reinstated in full force and effect.
Each Guarantor agrees that it will not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby.
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Each Guarantor further agrees that, as between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand,
the maturity of the obligations guaranteed hereby may be accelerated as provided in Article 6 hereof for the purposes of this Note Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby; and
in the event of any declaration of acceleration of such obligations as provided in Article 6 hereof, such obligations (whether or not due and payable) will forthwith become due and payable by the Guarantors for the purpose of this Note Guarantee. The Guarantors will have the right to seek contribution from any non-paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Note Guarantee.
The Guarantors hereby agree that their obligations hereunder are unconditional, irrespective of the validity, regularity or enforceability of the Senior Notes or this Senior Notes Indenture, and agree to be bound by any and all amendments or supplemental indenture to the Senior Notes Indenture without the need to execute such amendment or supplemental indenture unless such amendment or supplemental indenture amends Article 10 (Note Guarantees) or otherwise affects or alters the Guarantee given by the additional Guarantors in any manner. The Issuer shall deliver copies of all amendments or supplemental indentures to all Guarantors not signatory thereto.
Limitation on Guarantor Liability. Each Guarantor, and by its acceptance of Senior Notes, each Holder, hereby confirms that it is the intention of all such parties that the Note Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance, for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar national, federal, local or state law or voidable preference, financial assistance or improper corporate benefit, or violate the corporate purpose of the relevant Guarantor or any applicable capital maintenance or similar laws or regulations affecting the rights of creditors generally under any applicable law or regulation to the extent applicable to any Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree that the obligations of such Guarantor will be limited to the maximum amount that will, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Guarantor that are relevant under such laws, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under this Article 10, result in the obligations of such Guarantor under its Note Guarantee not constituting either a fraudulent transfer or conveyance or voidable preference, financial assistance or improper corporate benefit, or violating the corporate purpose of the relevant Guarantor or any applicable capital maintenance or similar laws or regulations affecting the rights of creditors generally under any applicable law or regulation.
[Reserved]
[Reserved]
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Releases. (d) The Note Guarantee of a Guarantor will be automatically released and discharged without any further action by the Issuer, the relevant Guarantor or the Trustee and such Guarantor’s obligations under the Note Guarantee and this Senior Notes Indenture will automatically terminate and be of no further force and effect:
with respect to a Subsidiary Guarantor, in connection with any sale or other disposition of all or substantially all of the assets of that Subsidiary Guarantor (including by way of merger, consolidation, amalgamation or combination) to a Person that is not (either before or after giving effect to such transaction) the Parent Guarantor or a Restricted Subsidiary, provided, that the sale or other disposition does not violate Section 4.10 hereof;
with respect to a Subsidiary Guarantor, in connection with any sale or other disposition of Capital Stock of that Subsidiary Guarantor (or Capital Stock of any Parent Holdco of such Subsidiary Guarantor) to a Person that is not (either before or after giving effect to such transaction) the Parent Guarantor or a Restricted Subsidiary, provided, that the sale or other disposition does not violate Section 4.10 hereof and the Subsidiary Guarantor ceases to be a Restricted Subsidiary as a result of the sale or other disposition;
if the Parent Guarantor designates any Restricted Subsidiary that is a Subsidiary Guarantor to be an Unrestricted Subsidiary in accordance with Section 4.16 hereof;
upon a Legal Defeasance or Covenant Defeasance as provided for in Article 8 hereof or satisfaction and discharge of this Senior Notes Indenture as provided for in Article 11 hereof ;
upon the full and final payment of the Senior Notes and performance of all Obligations of the Issuer and the Guarantors under this Senior Notes Indenture and the Senior Notes;
as described under Section 9.02 hereof;
with respect to an additional Note Guarantee given under Section 4.14 hereof, upon release of the guarantee that gave rise to the requirement to issue such additional guarantee so long as no Default or Event of Default would arise as a result thereof and no other Indebtedness that would give rise to an obligation to give an additional Note Guarantee is at that time guaranteed by the relevant Guarantor;
as a result of a transaction permitted or not prohibited by Section 5.01 hereof;
as part of a Permitted Reorganization; or
pursuant to Section 5.04 (with respect to the Parent Guarantor), provided that the New Parent Guarantor has provided a full and unconditional pari passu Guarantee of the Notes and otherwise fulfilled all other requirements of such provision.
Upon any occurrence giving rise to a release of a Note Guarantee, as specified above, the Trustee, subject to receipt of an Officer’s Certificate and an Opinion of Counsel from the Issuer and/or Guarantor will execute any documents reasonably required in order to evidence or effect such release, discharge and termination in respect of such Note Guarantee.
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Neither the Issuer, the Trustee nor any Guarantor will be required to make a notation on the Senior Notes to reflect any such release, discharge or termination.
Any Guarantor not released from its obligations under its Note Guarantee as provided in this Section 10.05 will remain liable for the full amount of principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes and for the other obligations of any Guarantor under this Senior Notes Indenture as provided in this Article 10.
SATISFACTION AND DISCHARGE
Satisfaction and Discharge. (e) This Senior Notes Indenture will be discharged and will cease to be of further effect as to all Senior Notes of the applicable series issued hereunder, when:
either:
all Senior Notes of the applicable series that have been authenticated and delivered, except lost, stolen or destroyed Senior Notes that have been replaced or paid and Senior Notes for whose payment money has been deposited in trust and thereafter repaid to the Issuer or discharged from such trust as provided for in this Senior Notes Indenture, have been delivered to the Trustee for cancellation; or
all Senior Notes of the applicable series that have not been delivered to the Principal Paying Agent for cancellation have become due and payable by reason of the publication of a notice of redemption by the Principal Paying Agent in the name, and at the expense, of the Issuer or otherwise or will become due and payable within one year and the Issuer or any Guarantor has irrevocably deposited or caused to be deposited with the Trustee (or such other entity designated by the Trustee for this purpose) as trust funds in trust solely for the benefit of the holders, cash in euro, non-callable U.S. dollar-denominated Government Securities or a combination of cash in U.S. dollar and non-callable euro-denominated Government Securities, in amounts as will be sufficient, without consideration of any reinvestment of interest, to pay and discharge the entire Indebtedness on the Senior Notes of the applicable series not delivered to the Principal Paying Agent for cancellation for principal, premium and Additional Amounts, if any, and accrued interest to the date of maturity or redemption;
the Issuer or any Guarantor has paid or caused to be paid all sums payable by the Issuer and the Guarantors under this Senior Notes Indenture; and
the Issuer has delivered irrevocable instructions to the Trustee under this Senior Notes Indenture to apply the deposited money toward the payment of the Senior Notes at maturity or on the redemption date, as the case may be.
In addition, the Issuer must deliver an Officer’s Certificate and an opinion of independent counsel to the Trustee stating that all conditions precedent in this Senior Notes Indenture relating to satisfaction and discharge of this Senior Notes Indenture have been satisfied such satisfaction and discharge will not result in a breach or violation of, or constitute a default under, this Senior Notes Indenture; provided that any such counsel may rely on any Officer’s Certificate as to matters of fact (including as to compliance with the Sections 11.01(a)(i) through 11.01(a)(iii) hereof).
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Notwithstanding the satisfaction and discharge of this Senior Notes Indenture, if money has been deposited with the Trustee pursuant to Section 11.01(a)(i)(B) hereof, the provisions of Sections 11.02 and 8.06 hereof will survive. In addition, nothing in this Section 11.01 will be deemed to discharge those provisions of Section 7.06 hereof, that, by their terms, survive the satisfaction and discharge of this Senior Notes Indenture.
If requested in writing by the Issuer in the Officer’s Certificate that accompanies any Satisfaction and Discharge deposit, the Trustee or Paying Agent may distribute any amounts deposited in trust to Holders of the Senior Notes prior to maturity or the redemption date, as the case may be.
Application of Trust Money. Subject to the provisions of Section 8.06 hereof, all money deposited with the Trustee pursuant to Section 11.01 hereof shall be held in trust and applied by it, in accordance with the provisions of the Senior Notes and this Senior Notes Indenture, to the payment, either directly or through any Paying Agent (including the Issuer acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal of, premium on, if any, interest and Additional Amounts, if any, for whose payment such money has been deposited with the Trustee; but such money need not be segregated from other funds except to the extent required by law and funds held by the Trustee will not be subject to the United Kingdom FCA Client Money Rules.
If the Trustee or Paying Agent is unable to apply any money or Government Securities in accordance with Section 11.01 hereof by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Issuer's and any Guarantor's obligations under this Senior Notes Indenture and the Senior Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 11.01 hereof; provided that if the Issuer has made any payment of principal of, premium on, if any, interest and Additional Amounts, if any, on, the Senior Notes because of the reinstatement of its obligations, the Issuer shall be subrogated to the rights of the Holders of such Senior Notes to receive such payment from the money or Government Securities held by the Trustee or Paying Agent.
MISCELLANEOUS
Notices. (a) Any notice or communication by the Issuer, any Guarantor or the Trustee to the others is duly given if in writing and delivered in Person or mailed by first class mail (registered or certified, return receipt requested), facsimile transmission or overnight air courier guaranteeing next day delivery, to the others’ address:
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If to the Issuer and/or any Guarantor:
IHS Netherlands Holdco B.V.
Haagsche Hof
Parkstraat 83, 2514 JG
The Hague, The Netherlands
Attention: Chief Executive Officer
If to the Trustee:
Citibank N.A., London Branch
Citigroup Centre
25 Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Facsimile No.: +44 20 7500 5877
Attention: The Trustee Directors, Agency & Trust
(b)The Issuer, any Guarantor or the Trustee, by notice to the others, may designate additional or different addresses for subsequent notices or communications.
(c)All notices and communications (other than those sent to Holders) will be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if transmitted by facsimile; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery.
(d)All notices to the Holders (while any Senior Notes are represented by one or more Global Notes) shall be delivered to DTC, Euroclear and Clearstream, as applicable for communication to entitled account Holders. If publication as provided above is not practicable, notice will be given in such other manner, and shall be deemed to have been given on such date, as the Trustee may approve. In the case of Definitive Registered Notes, notices will be mailed to Holders by first-class mail at their respective addresses as they appear on the records of the Registrar, unless stated otherwise in the register kept by, and at the registered office of the Issuer.
(e)Notices given by publication will be deemed given on the first date on which publication is made. Notices delivered to DTC, Euroclear and Clearstream will be deemed given on the date when delivered. Notices given by first class mail, postage paid, will be deemed given five calendar days after mailing whether or not the addressee receives it.
(f)If a notice or communication is mailed or published in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it.
(g)If the Issuer or any Guarantor mails a notice or communication to Holders or delivers a notice or communication to holders of Book-Entry Interests, it will mail a copy to the Trustee and each Agent at the same time.
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All notices will be given in the English language.
Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Issuer to the Trustee to take any action under this Senior Notes Indenture, the Issuer shall furnish to the Trustee:
an Officer's Certificate in form and substance reasonably satisfactory to the Trustee (which must include the statements set forth in Section 12.03 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Senior Notes Indenture relating to the proposed action have been satisfied; and
an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee (which must include the statements set forth in Section 12.03 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been satisfied.
Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Senior Notes Indenture shall include:
a statement that the Person making such certificate or opinion has read such covenant or condition;
a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been satisfied; and
a statement as to whether or not, in the opinion of such Person, such condition or covenant has been satisfied.
Rules by Trustee and Agents. The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions.
No Personal Liability of Directors, Officers, Employees and Stockholders. No director, officer, employee, incorporator or stockholder of the Issuer or any Guarantor, as such, will have any liability for any obligations of the Issuer or the Guarantors under the Senior Notes, this Senior Notes Indenture, and the Note Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Senior Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Senior Notes. The waiver may not be effective to waive liabilities under applicable securities laws.
Agent for Service; Submission to Jurisdiction; Waiver of Immunities.
- 129 -
Each of the parties hereto irrevocably agrees that any suit, action or proceeding arising out of, related to, or in connection with this Senior Notes Indenture, the Senior Notes and the Note Guarantees or the transactions contemplated hereby, and any action arising under U.S. federal or state securities laws, may be instituted in any U.S. federal or state court located in the State and City of New York, Borough of Manhattan; irrevocably waives, to the fullest extent it may effectively do so, any objection which it may now or hereafter have to the laying of venue of any such proceeding; and irrevocably submits to the jurisdiction of such courts in any such suit, action or proceeding. The Issuer and each of the Guarantors hereby appoints CT Corporation System, 111 Eighth Avenue, New York, New York 10011, United States of America as its authorized agent upon whom process may be served in any such suit, action or proceeding which may be instituted in any federal or state court located in the State of New York, Borough of Manhattan arising out of or based upon this Senior Notes Indenture, the Senior Notes, the purchase agreement dated September 10, 2019 with respect to the Initial Senior Notes or the transactions contemplated hereby or thereby, and any action brought under U.S. federal or state securities laws (the “Authorized Agent”). The Issuer and each of the Guarantors expressly consents to the exclusive jurisdiction of any such court in respect of any such action and waives any other requirements of or objections to personal jurisdiction with respect thereto and waives any right to trial by jury. Such appointment shall be irrevocable unless and until replaced by an agent reasonably acceptable to the Trustee. The Issuer and each of the Guarantors represents and warrants that the Authorized Agent has agreed to act as said agent for service of process, and the Issuer agrees to take any and all action, including the filing of any and all documents and instruments, that may be necessary to continue such appointment in full force and effect as aforesaid. Service of process upon the Authorized Agent and written notice of such service to the Issuer shall be deemed, in every respect, effective service of process upon the Issuer and any Guarantor.
Governing Law. THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THIS SENIOR NOTES INDENTURE, THE SENIOR NOTES AND THE NOTE GUARANTEES.
No Adverse Interpretation of Other Agreements. This Senior Notes Indenture may not be used to interpret any other indenture, loan or debt agreement of the Issuer, any Guarantor or any of their respective Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Senior Notes Indenture.
Successors. All agreements of the Issuer in this Senior Notes Indenture and the Senior Notes will bind its successors. All agreements of the Trustee in this Senior Notes Indenture will bind its successors. All agreements of each Guarantor in this Senior Notes Indenture will bind its successors, except as otherwise provided in Section 10.05 hereof.
Severability. In case any provision in this Senior Notes Indenture or in the Senior Notes is invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby.
Counterpart Originals. The parties may sign any number of copies of this Senior Notes Indenture. Each signed copy will be an original, but all of them together represent the same agreement.
Table of Contents, Headings, etc. The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Senior Notes Indenture have been inserted for convenience of reference only, are not to be considered a part of this Senior Notes Indenture and will in no way modify or restrict any of the terms or provisions hereof.
- 130 -
Judgment Currency. Any payment on account of an amount that is payable in euro which is made to or for the account of any Holder or the Trustee in lawful currency of any other jurisdiction (the “Judgment Currency”), whether as a result of any judgment or order or the enforcement thereof or the liquidation of the Issuer or any Guarantor, shall constitute a discharge of the Issuer or the Guarantor’s obligation under this Senior Notes Indenture and the Senior Notes or Note Guarantee, as the case may be, only to the extent of the amount of U.S. dollars that such Holder or the Trustee, as the case may be, could purchase in the London foreign exchange markets with the amount of the Judgment Currency in accordance with normal banking procedures at the rate of exchange prevailing on the first Business Day following receipt of the payment in the Judgment Currency. If the amount of U.S. dollars that could be so purchased is less than the amount of U.S. dollars that is originally due to such Holder or the Trustee, as the case may be, the Issuer and the Guarantors shall indemnify and hold harmless the Holder or the Trustee, as the case may be, from and against all loss or damage arising out of, or as a result of, such deficiency. This indemnity shall constitute an obligation separate and independent from the other obligations contained in this Senior Notes Indenture or the Senior Notes, shall give rise to a separate and independent cause of action, shall apply irrespective of any indulgence granted by any Holder or the Trustee from time to time and shall continue in full force and effect notwithstanding any judgment or order for a liquidated sum in respect of an amount due hereunder or under any judgment or order.
Prescription. Claims against the Issuer or any Guarantor for the payment of principal or Additional Amounts, if any, on the Senior Notes will be prescribed ten years after the applicable due date for payment thereof. Claims against the Issuer or any Guarantor for the payment of interest on the Senior Notes will be prescribed six years after the applicable due date for payment of interest.
Additional Information. Upon written request by any Holder or holder of a Book-Entry Interest to the Issuer at the address set out in Section 12.01 hereof, the Issuer will mail or cause to be mailed, by first class mail, to such Holder or holder (at the expense of the Issuer) a copy of this Senior Notes Indenture, and the form of Senior Note.
[Signatures on following pages]
- 131 -
IN WITNESS HEREOF, the parties have caused this Senior Notes Indenture to be duly executed as of the date first written above.
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IHS Netherlands Holdco B.V. |
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IHS Netherlands NG1 B.V. |
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IHS Netherlands NG2 B.V. |
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IHS Nigeria Limited |
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IHS Towers NG Limited |
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Nigeria Tower Interco B.V. |
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INT Towers Limited |
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INT Towers NG Finco 1 Plc |
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CITIBANK, N.A., LONDON BRANCH, as |
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Trustee |
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CITIBANK, N.A., LONDON BRANCH, as |
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Principal Paying Agent and Transfer Agent |
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CITIBANK, N.A., LONDON BRANCH, as |
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Registrar |
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FORM OF GLOBAL NOTES
[Face of Note]
ISIN: [US44963LAB27] 1[US44963LAC00]2[XS2051105778] 3[XS2051106073]4
CUSIP: [44963L AB2] 5[44963L AC0]6
COMMON CODE: [205110577] 7[205110607]8
[7.125% Senior Notes due 2025]9[8.000% Senior Notes due 2027]10
No. |
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$ |
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IHS NETHERLANDS HOLDCO B.V.
promises to pay to _____________ or registered assigns,
the principal sum of ______________________________________U.S. DOLLARS or such greater or lesser amount as indicated in the schedule of Exchanges of Interests in the Global Note on September 18, [2025]11[2027.]12
Interest Payment Dates: March 18 and September 18
Record Dates: March 3 and September 3
1 Include for Rule 144A 2025 Senior Notes
2 Include for Rule 144A 2027 Senior Notes
3 Include for Regulation S 2025 Senior Notes
4 Include for Regulation S 2027 Senior Notes
5 Include for Rule 144A 2025 Senior Notes
6 Include for Rule 144A 2027 Senior Notes
7 Include for Regulation S 2025 Senior Notes
8 Include for Regulation S 2027 Senior Notes
9 Include for 2025 Senior Notes
10 Include for 2027 Senior Notes
11 Include for 2025 Senior Notes
12 Include for 2027 Senior Notes
Exh A-1
IN WITNESS WHEREOF, the Issuer has caused this Senior Note to be signed manually or by facsimile by the duly authorized officer referred to below.
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IHS NETHERLANDS HOLDCO B.V. |
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Exh A-2
This is one of the Senior Notes referred to |
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in the within-mentioned Senior Notes Indenture: |
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CITIBANK, N.A., LONDON BRANCH |
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not in its personal capacity but in its capacity as |
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Senior Notes Trustee, |
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Authorized Signatory |
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Exh A-3
[Back of Note]
[7.125% Senior Notes due 2025]13 [8.000% Senior Notes due 2027]14
[Insert the Global Note Legend, if applicable pursuant to the provisions of the Senior Notes Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions of the Senior Notes Indenture]
Capitalized terms used herein have the meanings assigned to them in the Senior Notes Indenture referred to below unless otherwise indicated.
(1)[INTEREST. IHS Netherlands Holdco B.V., a private limited liability company incorporated under the laws of the Netherlands, having its registered office at Herikerbergweg 88, 1101CM Amsterdam, , The Netherlands, registered with the Dutch trade register under number 66017912 (the “Issuer”), promises to pay or cause to be paid interest on the principal amount of this 2025 Senior Note at 7.125% per annum from [ ] until maturity. The Issuer will pay interest semi-annually in arrears on March 18 and September 18 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each, an “Interest Payment Date”). Interest on the 2025 Senior Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided that if there is no existing Default in the payment of interest, and if this 2025 Senior Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided further that the first Interest Payment Date shall be [ ]. The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at a rate that is 1% per annum higher than the then applicable interest rate on the 2025 Senior Notes to the extent lawful. The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue instalments of interest and Additional Amounts, if any (without regard to any applicable grace periods), at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.]15
[INTEREST. IHS Netherlands Holdco B.V., a private limited liability company incorporated under the laws of the Netherlands, having its registered office at Herikerbergweg 88, 1101CM Amsterdam, The Netherlands, registered with the Dutch trade register under number 66017912 (the “Issuer”), promises to pay or cause to be paid interest on the principal amount of this 2027 Senior Note at 8.000% per annum from [ ] until maturity. The Issuer will pay interest semi-annually in arrears on March 18 and September 18 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each, an “Interest Payment Date”). Interest on the 2027 Senior Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided that if there is no existing Default
13 Include for 2025 Senior Notes
14 Include for 2027 Senior Notes
15 Include for 2025 Senior Notes
Exh A-4
in the payment of interest, and if this 2027 Senior Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided further that the first Interest Payment Date shall be [ ]. The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at a rate that is 1% per annum higher than the then applicable interest rate on the 2027 Senior Notes to the extent lawful. The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue instalments of interest and Additional Amounts, if any (without regard to any applicable grace periods), at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.]16
(2)METHOD OF PAYMENT. The Issuer will pay interest on the [2025]17[2027]18 Senior Notes (except defaulted interest) to the Persons who are registered Holders of [2025]19[2027]20 Senior Notes at the close of business on March 3 and September 3 preceding the next Interest Payment Date, even if such [2025]21[2027]22 Senior Notes are cancelled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Senior Notes Indenture with respect to defaulted interest. The [2025]23[2027]24 Senior Notes will be payable as to principal, premium, if any, interest and Additional Amounts, if any, through the Paying Agent as provided in the Senior Notes Indenture or, at the option of the Issuer, payment of interest and Additional Amounts, if any, may be made by check mailed to the Holders at their addresses set forth in the register of Holders; provided that payment by wire transfer of immediately available funds will be required with respect to principal of and interest, premium and Additional Amounts, if any, on, all Global Notes and all other Notes the Holders of which will have provided wire transfer instructions to the Issuer or the Paying Agent. Such payment shall be made in U.S. dollars.
(3)PAYING AGENT, REGISTRAR AND TRANSFER AGENT. Initially, Citibank N.A., London Branch will act as Principal Paying Agent and Transfer Agent. Citibank N.A., London Branch will act as Registrar. The Issuer may change the Paying Agent, the Registrar or the Transfer Agent without prior written notice to the holders. For so long as the [2025]25[2027]26 Senior Notes are listed on the Official List of the Exchange and the rules of The International Stock Exchange
16 Include for 2027 Senior Notes
17 Include for 2025 Senior Notes
18 Include for 2027 Senior Notes
19 Include for 2025 Senior Notes
20 Include for 2027 Senior Notes
21 Include for 2025 Senior Notes
22 Include for 2027 Senior Notes
23 Include for 2025 Senior Notes
24 Include for 2027 Senior Notes
25 Include for 2025 Senior Notes
26 Include for 2027 Senior Notes (4)SENIOR NOTES INDENTURE.
Exh A-5
Authority Limited so require, the Issuer will notify The International Stock Exchange Authority Limited of any change of the Paying Agent, Registrar or Transfer Agent.
The Issuer issued the [2025]27[2027]28 Senior Notes under a Senior Notes Indenture dated as of September 18, 2019 (the “Senior Notes Indenture”) between the Issuer, the Guarantors, Citibank N.A., London Branch as Trustee, Citibank N.A., London Branch as Principal Paying Agent and Transfer Agent and Citibank N.A., London Branch as Registrar. The [2025]29[2027]30 Senior Notes are subject to all such terms, and Holders are referred to the Senior Notes Indenture for a statement of such terms. To the extent any provision of this [2025]31[2027]32 Senior Note conflicts with the express provisions of the Senior Notes Indenture, the provisions of the Senior Notes Indenture shall govern and be controlling.
(5)OPTIONAL REDEMPTION.
(a)At any time prior to September 18, [2021]33[2022]34, the Issuer may on any one or more occasions redeem up to 40% of the aggregate principal amount of the [2025]35[2027]36 Senior Notes issued under the Senior Notes Indenture, upon not less than 10 nor more than 60 days’ prior written notice to the Holders, at a redemption price equal to [107.125%,]37[108.000%]38 of the principal amount thereof, plus accrued and unpaid interest and Additional Amounts, if any, to the date of redemption (subject to the rights of Holders of the [2025]39[2027]40 Senior Notes on the relevant record date to receive interest on the relevant interest payment date), with the net cash proceeds of any Public Equity Offering of the Parent Guarantor or any Equity Offering of the Parent Guarantor or any Parent Holdco of the Parent Guarantor (any of them, an “IPO Entity”) to the extent the proceeds from such Equity Offering are contributed to the Parent Guarantor’s common equity capital or are paid to the Parent Guarantor as consideration for the issuance of
27 Include for 2025 Senior Notes
28 Include for 2027 Senior Notes
29 Include for 2025 Senior Notes
30 Include for 2027 Senior Notes
31 Include for 2025 Senior Notes
32 Include for 2027 Senior Notes
33 Include for 2025 Senior Notes
34 Include for 2027 Senior Notes
35 Include for 2025 Senior Notes
36 Include for 2027 Senior Notes
37 Include for 2025 Senior Notes
38 Include for 2027 Senior Notes
39 Include for 2025 Senior Notes
40 Include for 2027 Senior Notes ordinary shares of the Parent Guarantor or as Subordinated Shareholder Debt (in each case, excluding proceeds from any Parent Debt Contribution); provided that:
Exh A-6
(1) |
at least 50% of the aggregate principal amount of the [2025]41[2027]42 Senior Notes being redeemed originally issued under the Senior Notes Indenture (excluding [2025]43[2027]44 Senior Notes held by the Parent Guarantor and its Subsidiaries and their respective Affiliates) remain outstanding immediately after the occurrence of such redemption; and |
(2) |
the redemption occurs within 180 days of the date of the closing of such Equity Offering or Public Equity Offering. |
(b)At any time prior to September 18, [2021]45[2022]46, the Issuer may on any one or more occasions redeem all or a part of the [2025]47[2027]48 Senior Notes upon not less than 10 nor more than 60 days’ prior written notice to the Holders, at a redemption price equal to 100.000% of the principal amount of the [2025]49[2027]50 Senior Notes redeemed, plus the Applicable Premium as of, and accrued and unpaid interest and Additional Amounts, if any, to the date of redemption, subject to the rights of Holders of the [2025]51[2027]52 Senior Notes on the relevant record date to receive interest due on the relevant interest payment date.
(c)Except pursuant to the preceding clause (5)(a) and (5)(b) and except pursuant to clause (6) and clause (8), the [2025]53[2027]54 Senior Notes will not be redeemable at the Issuer’s option prior to September 18, [2021]55[2022]56.
41 Include for 2025 Senior Notes
42 Include for 2027 Senior Notes
43 Include for 2025 Senior Notes
44 Include for 2027 Senior Notes
45 Include for 2025 Senior Notes
46 Include for 2027 Senior Notes
47 Include for 2025 Senior Notes
48 Include for 2027 Senior Notes
49 Include for 2025 Senior Notes
50 Include for 2027 Senior Notes
51 Include for 2025 Senior Notes
52 Include for 2027 Senior Notes
53 Include for 2025 Senior Notes
54 Include for 2027 Senior Notes
55 Include for 2025 Senior Notes
Exh A-7
56 Include for 2027 Senior Notes (d)On or after September 18, [2021]57[2022]58, the Issuer may on any one or more occasions redeem all or a part of the [2025]59[2027]60 Senior Notes upon not less than 10 nor more than 60 days’ prior written notice to the Holders, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest and Additional Amounts, if any, on the [2025]61[2027]62 Senior Notes redeemed, to the applicable date of redemption, if redeemed on or after the dates indicated below, subject to the rights of Holders of the [2025]63[2027]64 Senior Notes on the relevant record date to receive interest on the relevant interest payment date:
[2025 Senior Notes
Date |
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Redemption Price |
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September 18, 2021 |
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103.563 |
% |
September 18, 2022 |
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101.781 |
% |
September 18, 2023 and thereafter |
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100.000 |
% |
] 65
[2027 Senior Notes
Date |
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Redemption |
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September 18, 2022 |
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104.000 |
% |
September 18, 2023 |
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102.000 |
% |
September 18, 2024 and thereafter |
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100.000 |
% |
] 66
57 Include for 2025 Senior Notes
58 Include for 2027 Senior Notes
59 Include for 2025 Senior Notes
60 Include for 2027 Senior Notes
61 Include for 2025 Senior Notes
62 Include for 2027 Senior Notes
63 Include for 2025 Senior Notes
64 Include for 2027 Senior Notes
65 Include for 2025 Senior Notes
66 Include for 2027 Senior Notes (e)Unless the Issuer defaults in the payment of the redemption price, interest will cease to accrue on the [2025]67[2027]68 Senior Notes or portions thereof called for redemption on the applicable redemption date.
Exh A-8
(f)Any redemption pursuant to Section 3.07 of the Senior Notes Indenture shall be made pursuant to the provisions of Sections 3.01 through 3.06 of the Senior Notes Indenture.
(6)REDEMPTION FOR CHANGES IN TAXES.
The Issuer may redeem the Senior Notes, in whole but not in part, at its discretion at any time upon giving not less than 10 nor more than 60 days’ prior written notice to the Holders (which notice will be irrevocable and given in accordance with the procedures described in Section 3.03 and Section 12.01 of the Senior Notes Indenture), at a redemption price equal to 100% of the aggregate principal amount thereof, together with accrued and unpaid interest, if any, to (but excluding) the date fixed by the Issuer for redemption (a “Tax Redemption Date”) and all Additional Amounts (if any) then due and which will become due on the Tax Redemption Date as a result of the redemption or otherwise (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date and Additional Amounts (if any) in respect thereof), if on the next date on which any amount would be payable in respect of the Senior Notes, (x) the Issuer or a Guarantor is or would be required to pay Additional Amounts or (y) any payments on the Proceeds Bonds would become subject to withholding or deduction for, or on account of, any Taxes imposed or levied by or on behalf of Nigeria or any political subdivision or any authority thereof or therein having power to tax at a rate in excess of 7.5% (calculated after giving effect to any reduction of such rate under the applicable tax treaty between the Netherlands and Nigeria) (“Proceeds Bond Withholding”), and in each case the Issuer or Guarantor cannot avoid any such payment obligation by taking reasonable measures available, and the requirement arises as a result of:
(1)any amendment to, or change in, the laws or treaties (or any regulations or rulings promulgated thereunder of a relevant Tax Jurisdiction which change or amendment becomes effective on or after the Issue Date (or, if the applicable Tax Jurisdiction became a Tax Jurisdiction with respect to the Issuer or such Guarantor, as applicable, on a date after the Issue Date, such later date); or
(2)any amendment to, or change in, an official position, or the introduction of an official position, regarding the interpretation, administration or application of such laws, regulations, treaties or rulings (including by virtue of a holding, judgment, or order by a court of competent jurisdiction or a change in published administrative practice) which amendment, change or introduction becomes effective on or after the Issue Date (or, if the applicable Tax Jurisdiction became a Tax Jurisdiction with respect to the Issuer or such Guarantor, as applicable on a date after the Issue Date, such later date) (each of the foregoing clauses (1) and (2), a “Change in Tax Law”).
67 Include for 2025 Senior Notes
Exh A-9
The Issuer will not give any such notice of redemption earlier than 60 days prior to the earliest date on which the Issuer would be obligated to make such payment or withholding if a payment in respect of the Senior Notes was then due, and the obligation to pay Additional Amounts or Proceeds Bond Withholding must be in effect at the time such notice is given. Prior to the publication or, where relevant, mailing of any notice of redemption of the Senior Notes pursuant to this Senior Notes Indenture, the Issuer will deliver to the Trustee (i) an Officer’s Certificate stating that obligation to pay such Additional Amounts or Proceeds Bond Withholding cannot be avoided by the Issuer (or the relevant Guarantor, as applicable) taking reasonable measures available to it; and (ii) a written opinion of independent tax counsel to the Issuer of recognized standing qualified under the laws of the relevant Tax Jurisdiction and reasonably satisfactory to the Trustee (such approval not to be unreasonably withheld) to the effect that the Issuer (or the relevant Guarantor, as applicable) has or will become obligated to pay such Additional Amounts or Proceeds Bond Withholding as a result of a Change in Tax Law.
The Trustee will accept and shall be entitled to rely on such Officer’s Certificate and Opinion of Counsel as sufficient evidence of the existence and satisfaction of the conditions precedent as described above, in which event it will be conclusive and binding on the Holders.
(7)REPURCHASE AT THE OPTION OF HOLDER.
68 Include for 2027 Senior Notes (a)Upon the occurrence of a Change of Control, the Issuer will make an offer (a “Change of Control Offer”) to each Holder to repurchase all or any part (in integral multiples of $1,000; provided that Senior Notes of $200,000 or less may only be redeemed in whole and not in part) of that Holder’s Senior Notes pursuant to a Change of Control Offer on the terms set forth in the Senior Notes Indenture. In the Change of Control Offer, the Issuer will offer a payment in cash equal to 101% of the aggregate principal amount of Senior Notes repurchased, plus accrued and unpaid interest and Additional Amounts, if any, on the Senior Notes repurchased to the date of purchase (the “Change of Control Payment”), subject to the rights of Holders on the relevant record date to receive interest due on the relevant Interest Payment Date. Within 30 days following any Change of Control, the Issuer will mail a notice to each Holder, with a copy to the Trustee, setting forth the procedures governing the Change of Control Offer as required by the Senior Notes Indenture.
(b)If the Parent Guarantor or a Restricted Subsidiary of the Parent Guarantor consummates any Asset Sales, within 10 Business Days of each date on which the aggregate amount of Excess Proceeds exceeds $100.0 million, the Issuer will make an Asset Sale Offer to all Holders of Senior Notes and may, to the extent the Issuer so elects, make an offer to holders of Pari Passu Indebtedness to purchase, prepay or redeem with the proceeds of sales of assets in accordance with Section 3.10 of the Senior Notes Indenture the maximum principal amount of Senior Notes and such other Pari Passu Indebtedness (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith) that may be purchased, prepaid or redeemed out of the Excess Proceeds. The offer price for the Senior Notes in any Asset Sale Offer will be equal to (i) solely in the case of the Senior Notes, 100% of the principal amount of the applicable series which shall be repurchased in integral multiples of $1,000; provided that $200,000 or less may only be redeemed in whole and not in part; and (ii) solely in the case of any other Pari Passu Indebtedness, no greater than 100% of the principal amount, plus, in the case of (i) and (ii), accrued and unpaid interest and Additional Amounts, if any, to the date of purchase, prepayment or redemption, subject to the rights of Holders on the relevant record date to receive interest due on the relevant Interest Payment Date, and will be payable in cash.
Exh A-10
If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Parent Guarantor and its Restricted Subsidiaries may use those Excess Proceeds for any purpose not otherwise prohibited by the Senior Notes Indenture. If the aggregate principal amount of Senior Notes and other Pari Passu Indebtedness tendered into (or to be prepaid or redeemed in connection with) such Asset Sale Offer exceeds the amount of Excess Proceeds or if the aggregate principal amount of Senior Notes tendered pursuant to a Notes Offer or an Asset Sale Offer that is an application of Net Proceeds pursuant to Section 4.10(b)(i) of the Senior Notes Indenture exceeds the amount of the Net Proceeds so applied, the Trustee or Registrar, as applicable, will select the Senior Notes and such other Pari Passu Indebtedness, if applicable, to be purchased on a pro rata basis (or in the manner described in Section 3.02 of the Senior Notes Indenture), based on the amounts tendered or required to be prepaid or redeemed in integral multiples of $1,000; provided that $200,000 or less may only be redeemed in whole and not in part. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. Holders of Senior Notes that are the subject of an offer to purchase will receive an Asset Sale Offer from the Issuer prior to any related purchase date and may elect to have such Senior Notes purchased by completing the form entitled “Option of Holder to Elect Purchase” attached to the Senior Notes.
(8)NOTICE OF REDEMPTION. At least 10 days but not more than 60 days before a redemption date, the Issuer will mail or cause to be mailed, pursuant to Section 12.01 of the Senior Notes Indenture, a notice of redemption to each Holder whose Senior Notes are to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Senior Notes or the satisfaction and discharge pursuant to the Senior Notes Indenture.
(9)DENOMINATIONS, TRANSFER, EXCHANGE. The Global Notes are in registered form without coupons attached in denominations of $200,000 and integral multiples of $1,000 in excess thereof. The transfer of Senior Notes may be registered and Senior Notes may be exchanged as provided in the Senior Notes Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Issuer may require a Holder to pay any taxes and fees required by law or permitted by the Senior Notes Indenture. The Issuer shall not be required to register the transfer of any Definitive Registered Notes: (A) for a period of 15 days prior to any date fixed for the redemption of such Definitive Registered Notes under Section 3.03 of the Senior Notes Indenture; (B) for a period of 15 days immediately prior to the date fixed for selection of such Definitive Registered Notes to be redeemed in part; (C) for a period of 15 days prior to the record date with respect to any Interest Payment Date applicable to such Definitive Registered Notes; or (D) which the Holder has tendered (and not withdrawn) for repurchase in connection with a Change of Control Offer or an Asset Sale Offer.
(10)PERSONS DEEMED OWNERS. The registered Holder of a Senior Note may be treated as the owner of it for all purposes.
(11)AMENDMENT, SUPPLEMENT AND WAIVER.
Exh A-11
Subject to certain exceptions, the Senior Notes Indenture, the Senior Notes, and the Note Guarantees may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the Senior Notes then outstanding (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes); provided that, if any amendment, supplement, waiver or other modification will only affect one series of the Senior Notes, only the consent of a majority in principal amount of the then outstanding Senior Notes of such series shall be required, and, subject to Section 6.04 and Section 6.07 of the Senior Notes Indenture, any existing Default or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium on, if any, interest or Additional Amounts, if any, on, the Senior Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of the Senior Notes Indenture, the Senior Notes, and the Note Guarantees may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding Senior Notes (including, without limitation, Additional Senior Notes, if any) voting as a single class (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Senior Notes); provided that, if any amendment, supplement, waiver or other modification will only affect one series of the Senior Notes, only the consent of a majority in principal amount of the then outstanding Senior Notes of such series shall be required. Without the consent of any Holder of Senior Notes, the Senior Notes Indenture, the Senior Notes, and the Note Guarantees may be amended or supplemented to cure any ambiguity, defect or inconsistency, to provide for uncertificated Senior Notes in addition to or in place of certificated Senior Notes, to provide for the assumption of the Issuer’s or a Guarantor’s obligations to Holders and Note Guarantees in the case of a merger or consolidation or sale of all or substantially all of the Issuer’s or such Guarantor’s assets, as applicable, or in the case of any Substitution or Parent Guarantor Substitution, to make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect the legal rights under the Senior Notes Indenture of any such Holder in any material respect, to conform the text of the Senior Notes Indenture, the Note Guarantees or the Senior Notes to any provision of the “Description of the Notes” section of the Offering Memorandum to the extent that such provision in such “Description of the Notes” section of the Offering Memorandum was intended to be a verbatim recitation of a provision of the Senior Notes Indenture, the Note Guarantees and the Senior Notes, to release any Note Guarantee in accordance with the terms of the Senior Notes Indenture, to provide for the issuance of Additional Senior Notes in accordance with the limitations set forth in the Senior Notes Indenture as of the Issue Date, to allow any Guarantor to execute a supplemental indenture and/or a Note Guarantee with respect to the Senior Notes, to provide for uncertificated Senior Notes in addition to or in place of certificated Senior Notes (provided that the uncertificated Senior Notes are deemed issued in registered form for purposes of Section 163(f) of the Code), or to evidence and provide the acceptance of the appointment of a successor Trustee under the Senior Notes Indenture.
(12)DEFAULTS AND REMEDIES.
Exh A-12
Events of Default include: (1) default for 30 days in the payment when due of interest or Additional Amounts, if any, with respect to the relevant series of Senior Notes; (2) default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the relevant series of Senior Notes; (3) failure by the Parent Guarantor, Issuer or relevant Subsidiary Guarantor to comply with the provisions of Sections 5.01 or 5.03 of the Senior Notes Indenture; (4) failure by the Parent Guarantor, Issuer or relevant Subsidiary Guarantor for 60 days after written notice (i) to the Issuer by the Trustee or (ii) to the Issuer and the Trustee by the Holders of at least 25% in aggregate principal amount of the Senior Notes then outstanding voting as a single class to comply with any of the agreements in the Senior Notes Indenture (other than a default in performance, or breach, or a covenant or agreement which is specifically dealt with in Sections 6.01(a)(i), 6.01(a)(ii) or 6.01(a)(iii) of the Senior Notes Indenture); (5) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Issuer, Parent Guarantor or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries), whether such Indebtedness or guarantee now exists, or is created after the Issue Date, if that default: (i) is caused by a Payment Default, or (ii) results in the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $75.0 million or more; (6) failure by the Issuer, the Parent Guarantor or any Restricted Subsidiary of the Parent Guarantor that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary, to pay final judgments entered by a court or courts of competent jurisdiction aggregating in excess of $75.0 million (exclusive of any amounts that a solvent insurance company has acknowledged liability for), which judgments shall not have been discharged or waived and there shall have been a period of 60 consecutive days during which a stay of enforcement of such judgment or order, by reason of an appeal, waiver or otherwise, shall not have been in effect; (7) except as permitted by the Senior Notes Indenture (including with respect to any limitations), any Note Guarantee of the Parent Guarantor, or any Note Guarantee of any Subsidiary Guarantor that is a Significant Subsidiary or any group of Subsidiary Guarantors that, taken together, would constitute a Significant Subsidiary is held in any judicial proceeding to be unenforceable or invalid or ceases for any reason to be in full force and effect, or any Subsidiary Guarantor that is a Significant Subsidiary or any group of Guarantors that, taken together, would constitute a Significant Subsidiary, or the Parent Guarantor, or any Person acting on behalf of any such Guarantor or Guarantors, denies or disaffirms its obligations under its Note Guarantee; and (8) certain events of bankruptcy or insolvency described in the Senior Notes Indenture with respect to the Issuer, the Parent Guarantor or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of its Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary. The Holders of a majority in aggregate principal amount of the then outstanding Senior Notes by written notice to the Trustee may, on behalf of all of the Holders of all the Senior Notes, rescind an acceleration and its consequences hereunder, if the rescission would not conflict with any judgment or decree and if all existing Events of Default (except non-payment of principal of, premium on, if any, interest or Additional Amounts, if any, on the Senior Notes that has become due solely because of the acceleration) have been cured or waived. The Issuer is required to deliver to the Trustee annually a statement regarding compliance with the Senior Notes Indenture substantially in the form attached to the Senior Notes Indenture, and the Issuer is required, upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default.
(13)AUTHENTICATION. This Senior Note will not be valid until authenticated by the manual or facsimile signature of the authorized signatory of the Trustee or an authenticating agent.
(14)ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
Exh A-13
(15)CUSIP, ISIN AND COMMON CODE NUMBERS. The Issuer has caused CUSIP, Common Code and ISIN numbers, as applicable, to be printed on the Senior Notes and the Trustee may use such CUSIP, Common Code and ISIN numbers, as applicable, in notices of redemption as a convenience to Holders. No representation is made as to the accuracy of any such numbers either as printed on the Senior Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon, and any such redemption or exchange shall not be affected by any defect in or omission of such numbers.
(16)GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THE SENIOR NOTES INDENTURE, THIS SENIOR NOTE AND THE NOTE GUARANTEES.
The Issuer will furnish to any Holder upon written request and a copy of the Senior Notes Indenture and the form of Senior Note. Requests may be made to:
IHS NETHERLANDS HOLDCO B.V.
Herikerbergweg 88
1101CM Amsterdam
The Netherlands Attention: Chief Executive Officer
Exh A-14
ASSIGNMENT FORM
To assign this Senior Note, fill in the form below:
(I) or (we) assign and transfer this Senior Note to: |
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(Print or type assignee’s name, address and zip code) | ||
and irrevocably appoint |
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to transfer this Senior Note on the books of the Issuer. The agent may substitute another to act for him. | ||
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Your Signature: |
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(Sign exactly as your name appears on the face of this Senior Note) |
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Signature Guarantee*:_______________
*Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).
Exh A-15
OPTION OF HOLDER TO ELECT PURCHASE*
If you want to elect to have this Senior Note purchased by the Issuer pursuant to Section 4.10 or 4.13 of the Senior Notes Indenture, check the appropriate box below
☐ Section 4.10☐ Section 4.13
If you want to elect to have only part of the Senior Note purchased by the Issuer pursuant to Section 4.10 or Section 4.13 of the Senior Notes Indenture, state the amount you elect to have purchased (in denominations of $200,000 and integral multiples of $1,000 in excess thereof):
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Signature Guarantee*:
*Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).
Exh A-16
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Registered Note, or exchanges of a part of another Global Note or Definitive Registered Note for an interest in this Global Note, have been made:
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*This schedule should be included only if the Senior Note is issued in global form.
Exh A-17
FORM OF CERTIFICATE OF TRANSFER
IHS NETHERLANDS HOLDCO B.V.
Herikerbergweg 88
1101CM Amsterdam
The Netherlands
Attention: Chief Executive Officer
[Trustee/Registrar address block]
Re:[7.125% Senior Notes due 2025]69 [8.000% Senior Notes due 2027]70 of IHS Netherlands Holdco B.V.
Reference is hereby made to the Senior Notes Indenture, dated as of September 18, 2019 (the “Senior Notes Indenture”), between, among others, IHS Netherlands Holdco B.V., a private limited liability company incorporated under the laws of the Netherlands, having its registered office at Herikerbergweg 88, 1101CM Amsterdam, The Netherlands, registered with the Dutch trade register under number 66017912 (the “Issuer”), the Guarantors party thereto, Citibank, N.A., London Branch as Trustee, Citibank, N.A., London Branch as Principal Paying Agent and Transfer Agent, and Citibank, N.A., London Branch as Registrar. Capitalized terms used but not defined herein shall have the meanings given to them in the Senior Notes Indenture.
________________, (the “Transferor”) owns and proposes to transfer the Senior Note[s] or interest in such Senior Note[s] specified in Annex A hereto, in the principal amount of $____ in such Senior Note[s] or interests (the “Transfer”), to ________________ (the “Transferee”), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1.☐ Check if Transferee will take delivery of a Book-Entry Interest in a 144A Global Note or a Definitive Registered Note pursuant to Rule 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), and, accordingly, the Transferor hereby further certifies that the beneficial interest or the Book-Entry Interest or Definitive Registered Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or the Book-Entry Interest or Definitive Registered Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a “qualified institutional buyer” within the meaning of
69 Include for 2025 Senior Notes
Exh B-1
70 Include for 2027 Senior Notes Rule 144A under the U.S. Securities Act in a transaction meeting the requirements of Rule 144A under the U.S. Securities Act and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Senior Notes Indenture, the transferred beneficial interest or the Book-Entry Interest or Definitive Registered Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant 144A Global Note and/or the Definitive Registered Note and in the Senior Notes Indenture and the U.S. Securities Act.
2.☐ Check if Transferee will take delivery of a Book-Entry Interest in a Regulation S Global Note or a Definitive Registered Note pursuant to Regulation S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the U.S. Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market, (ii) such Transferor does not know that the transaction was prearranged with a buyer in the United States, (iii) no directed selling efforts have been made in connection with the Transfer in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the U.S. Securities Act, (iv) the transaction is not part of a plan or scheme to evade the registration requirements of the U.S. Securities Act and (v) if the proposed transfer is being effected prior to the expiration of a Restricted Period, the transferee is not a U.S. Person, as such term is defined pursuant to Regulation S of the Securities Act, and will take delivery only as a Book-Entry Interest so transferred through Euroclear or Clearstream. Upon consummation of the proposed transfer in accordance with the terms of the Senior Notes Indenture, the transferred Book-Entry Interest or Definitive Registered Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the relevant Regulation S Global Note and/or the Definitive Registered Note and in the Senior Notes Indenture and the U.S. Securities Act.
3.☐ Check and complete if Transferee will take delivery of a Book-Entry Interest in a Global Note or a Definitive Registered Note pursuant to any provision of the U.S. Securities Act other than Rule 144A or Regulation S. The Transfer is being effected in compliance with the transfer restrictions applicable to Book-Entry Interests in Global Notes and Definitive Registered Notes and pursuant to and in accordance with the U.S. Securities Act and any applicable blue sky securities laws of any state of the United States.
Exh B-2
This certificate and the statements contained herein are made for your benefit and the benefit of the Issuer.
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Exh B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1.The Transferor owns and proposes to transfer the following:
[CHECK ONE]
(a)☐ a Book-Entry Interest held through Euroclear Account No. _______ or Clearstream Account No. _______, in the Regulation S Global Note (ISIN _______ or Common Code _______); or
(b)☐ a Book-Entry Interest held through DTC Account No. _______ in the 144A Global Note (ISIN _______ or CUSIP _______); or
(c)☐ a 144A Definitive Registered Note; or
(d)☐ a Regulation S Definitive Registered Note.
2.After the Transfer the Transferee will hold:
[CHECK ONE]
(a)☐ a Book-Entry Interest held through Euroclear Account No. _______ or Clearstream Account No. _______, in the Regulation S Global Note (ISIN _______ or Common Code __________); or
(b)☐ a Book-Entry Interest held through DTC Account No. _______ in the 144A Global Note (ISIN _______ or CUSIP _______); or
(c)☐ a 144A Definitive Registered Note; or
(d)☐ a Regulation S Definitive Registered Note.
Exh B-4
FORM OF CERTIFICATE OF EXCHANGE
IHS NETHERLANDS HOLDCO B.V.
Haagsche Hof
Herikerbergweg 88
1101CM Amsterdam
The Netherlands
Attention: Chief Executive Officer
Re:[7.125% Senior Notes due 2025]71 [8.000% Senior Notes due 2027]72 of IHS Netherlands Holdco B.V.
(ISIN _______; [CUSIP / Common Code] _______)
Reference is hereby made to the Senior Notes Indenture, dated as of September 18, 2019 (the “Senior Notes Indenture”), between, among others, IHS Netherlands Holdco B.V., a private limited liability company incorporated under the laws of the Netherlands, having its registered office at Herikerbergweg 88, 1101CM Amsterdam, The Netherlands, registered with the Dutch trade register under number 66017912 (the “Issuer”), the Guarantors party thereto, Citibank, N.A., London Branch as Trustee, Citibank, N.A., London Branch as Principal Paying Agent and Transfer Agent, and Citibank, N.A., London Branch as Registrar. Capitalized terms used but not defined herein shall have the meanings given to them in the Senior Notes Indenture.
__________________, (the “Owner”) owns and proposes to exchange the Senior Note[s] or interest in such Senior Note[s] specified herein, in the principal amount of $_______________ in such Senior Note[s] or interests (the “Exchange”). In connection with the Exchange, the Owner hereby certifies that:
1.☐ Check if Exchange is from Book-Entry Interest in a Global Note for Definitive Registered Notes. In connection with the Exchange of the Owner’s Book-Entry Interest in a Global Note for Definitive Registered Notes in an equal amount, the Owner hereby certifies that such Definitive Registered Notes are being acquired for the Owner’s own account without transfer. The Definitive Registered Notes issued pursuant to the Exchange will bear the Private Placement Legend and will be subject to restrictions on transfer enumerated in the Senior Notes Indenture and the U.S. Securities Act.
2.☐ Check if Exchange is from Definitive Registered Notes for Book-Entry Interest in a Global Note. In connection with the Exchange of the Owner’s Definitive Registered Notes for Book-Entry Interest in a Global Note in an equal amount, the Owner hereby certifies that such Book-Entry Interest in a Global Note are being acquired for the Owner’s own account
71 Include for 2025 Senior Notes
72 Include for 2027 Senior Notes
Exh C-1
without transfer. The Book-Entry Interests transferred in exchange will be subject to restrictions on transfer enumerated in the Senior Notes Indenture and the U.S. Securities Act.
This certificate and the statements contained herein are made for your benefit and the benefit of the Issuer.
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Exh C-2
ANNEX A TO CERTIFICATE OF EXCHANGE
1.The Owner owns and proposes to exchange the following:
[CHECK ONE]
(a)☐ a Book-Entry Interest held through Euroclear Account No.____________ or Clearstream Account No. ____________, in the Regulation S Global Note (ISIN ____________ or Common Code ____________); or
(b)☐ a Book-Entry Interest held through DTC Account No. ____________ in the 144A Global Note (ISIN ____________ or CUSIP ____________); or
(c)☐ a 144A Definitive Registered Note; or
(d)☐ a Regulation S Definitive Registered Note.
2.After the Transfer the Transferee will hold:
[CHECK ONE]
(e)☐ a Book-Entry Interest held through Euroclear Account No. ____________ or Clearstream Account No. ____________, in the Regulation S Global Note (ISIN ____________ or Common Code ____________); or
(f)☐ a Book-Entry Interest held through DTC Account No. ____________ in the 144A Global Note (ISIN ____________ or CUSIP ____________); or
(g)☐ a 144A Definitive Registered Note; or
(h)☐ a Regulation S Definitive Registered Note;
Exh C-3
FORM OF SUPPLEMENTAL SENIOR NOTES INDENTURE TO BE DELIVERED BY SUBSEQUENT GUARANTORS
SUPPLEMENTAL SENIOR NOTES INDENTURE (this “Supplemental Senior Notes Indenture”), dated as of _____________, among _____________, a company organized and existing under the laws of _____________ (the “Subsequent Guarantor”), a subsidiary of IHS Netherlands Holdco B.V. (or its permitted successor), a private limited liability company incorporated under the laws of the Netherlands, having its registered office at Herikerbergweg 88, 1101CM Amsterdam, The Netherlands (the “Issuer”), the Guarantors party thereto, Citibank, N.A., London Branch as Trustee and Citibank, N.A., London Branch as Principal Paying Agent and Transfer Agent.
W I T N E S S E T H
WHEREAS, the Issuer has heretofore executed and delivered to the Trustee an indenture (the “Senior Notes Indenture”), dated as of September 18, 2019, providing for the issuance of 7.125% Senior Notes due 2025 (the “2025 Senior Notes”) and the 8.000% Senior Notes due 2027 (the “2027 Senior Notes,” and together with the 2025 Senior Notes, the “Senior Notes”);
WHEREAS, the Senior Notes Indenture provides that under certain circumstances the Subsequent Guarantor shall execute and deliver to the Trustee a supplemental indenture and notation of guarantee pursuant to which the Subsequent Guarantor shall unconditionally guarantee all of the Issuer’s Obligations under the Senior Notes and the Senior Notes Indenture on the terms and conditions set forth herein (including but not limited to Article 10 thereof) (the “Note Guarantee”); and
WHEREAS, pursuant to Section 9.01 of the Senior Notes Indenture, the Issuer, the Guarantors, and the Trustee are authorized to execute and deliver this Supplemental Senior Notes Indenture.
NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Subsequent Guarantor and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Senior Notes as follows:
1.CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Senior Notes Indenture.
2.AGREEMENT TO GUARANTEE. The Subsequent Guarantor hereby agrees to provide an unconditional Note Guarantee on the terms and subject to the conditions set forth in the Senior Notes Indenture including but not limited to Article 10 thereof.
3.EXECUTION AND DELIVERY.
(a)The execution of this Supplemental Senior Notes Indenture shall constitute due delivery of the Note Guarantee set forth in this Supplemental Senior Notes Indenture on behalf of the Subsequent Guarantor.
(b)If an Officer whose signature is on this Supplemental Indenture no longer holds that office at the time the Trustee authenticates the Supplemental Indenture in which the Note Guarantee is contained, the Note Guarantee shall be valid nevertheless
4.NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator, stockholder or agent of any Subsequent Guarantor, as such, shall have any liability for any obligations of the Issuer or any Subsequent Guarantor under the Senior Notes, the Senior Notes Indenture, the Note Guarantees or this Supplemental Senior Notes Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Senior Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Senior Notes.
5.INCORPORATION BY REFERENCE. Section 12.06 of the Senior Notes Indenture is incorporated by reference to this Supplemental Senior Notes Indenture as if more fully set out herein.
6.NEW YORK LAW TO GOVERN. THIS SUPPLEMENTAL SENIOR NOTES INDENTURE AND THE SENIOR NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
7.COUNTERPARTS. The parties may sign any number of copies of this Supplemental Senior Notes Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.
8.EFFECT OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof.
9.THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Senior Notes Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Subsequent Guarantor and the Issuer.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Senior Notes Indenture to be duly executed and attested, all as of the date first above written.
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IHS NETHERLANDS HOLDCO B.V. |
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CITIBANK, N.A., LONDON BRANCH, as |
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Authorized Signatory |
Exhibit 2.9
DESCRIPTION OF SECURITIES
The following is a description of the material terms of our second amended and restated memorandum and articles of association (the “Articles”) which were adopted by way of special resolution at our annual general meeting on June 28, 2024. The following description is a summary and should be read in conjunction with our Articles, which have been publicly filed with the U.S. Securities and Exchange Commission (“SEC”).
General
We are a Cayman Islands exempted company with limited liability. Our affairs are governed by our Articles and the Companies Act.
Our register of shareholders is maintained by Computershare Trust Company, N.A.
Our authorized share capital is $510,000,000 divided into 1,700,000,000 ordinary shares, par value $0.30 per share.
Ordinary Shares
General
All of our issued and outstanding ordinary shares are fully paid and non-assessable.
Certificates representing our issued and outstanding ordinary shares are generally not issued and legal title to our issued shares is recorded in registered form in the register of members. Holders of our ordinary shares have no preemptive, subscription, redemption or conversion rights.
Our board of directors may provide for other classes of shares, including series of preferred shares, out of our authorized but unissued share capital, which could be utilized for a variety of corporate purposes, including future offerings to raise capital for corporate purposes or for use in employee benefit plans. Such additional classes of shares shall have such rights, restrictions, preferences, privileges and payment obligations as determined by our board of directors. If we issue any preferred shares, the rights, preferences and privileges of holders of our ordinary shares will be subject to, and may be adversely affected by, the rights of the holders of such preferred shares. See “- Variation of rights.”
Dividends
The holders of our ordinary shares are entitled to such dividends as may be declared by our board of directors subject to the Companies Act and our Articles. Dividends and other distributions on issued and outstanding ordinary shares may be paid out of the funds of the Company lawfully available for such purpose, subject to any preference of any outstanding preferred shares. Dividends and other distributions will be distributed among the holders of our ordinary shares on a pro rata basis.
Voting rights
Voting at any shareholders’ meeting is by way of poll. On a poll every shareholder present in person or by proxy shall have one vote for each ordinary share on all matters upon which the ordinary shares are entitled to vote except that, for so long as the number of ordinary shares held by Mobile Telephone Networks (Netherlands) B.V. or an affiliate of it or MTN Group is greater than twenty percent (20%) of the total number of ordinary shares in issue, each ordinary share held by MTN Group shall entitle MTN Group to the number of votes per ordinary share calculated by dividing 20% of the total number of ordinary shares in issue by the number of Shares held by MTN Group. “MTN Group” refers to MTN Group Limited and its subsidiaries, one of which is one of our shareholders as well as a related party of certain MTN operating entities that are our customers in the countries in which we currently operate.
A quorum required for a meeting of shareholders consists of shareholders holding at least one third of the votes eligible to be cast at any such general meeting of the Company. A special resolution will be required for matters such as merger or consolidation transactions, change of name or making changes to our Articles, or the voluntary winding up of the Company.
An ordinary resolution to be passed by the shareholders requires the affirmative vote of a simple majority of the votes cast by persons present (in person or by proxy) and voting in a general meeting at which a quorum is present (in person or by proxy), while a special resolution requires the affirmative vote of not less than two-thirds of the votes cast by persons present and voting at any such meeting, or, in each case, a unanimous resolution in writing.
Variation of rights
The rights attached to any class or sub-class of shares (unless otherwise provided by the terms of issue of that class or sub-class), such as voting, dividends and the like, may only be materially adversely varied or abrogated with the sanction of a resolution passed by not less than two-thirds of the votes attaching to the shares of the relevant class or sub-class cast in a meeting of the holders of the shares of that class or sub-class, or by the written consent of the holders of not less than two-thirds of the shares of that class or sub-class. The rights conferred upon the holders of the shares of any class or sub-class shall not (unless otherwise provided by the terms of issue of that class or sub-class) be deemed to be varied by the creation, allotment or issue of further shares ranking pari passu with or subsequent to them or the redemption or purchase of any shares by the Company.
Transfer of ordinary shares
Any of our shareholders may transfer all or any of his or her ordinary shares by an instrument of transfer in the usual or common form or any other form approved by our board of directors, subject to the applicable restrictions of our Articles, such as the suspension of transfers for a period immediately preceding a general meeting, or the determination that a proposed transfer is not eligible.
Liquidation
On a return of capital on winding up or otherwise (other than on conversion, redemption or purchase of ordinary shares), assets available for distribution among the holders of ordinary shares shall be distributed among the holders of the ordinary shares on a pro rata basis.
Directors
The management of our Company is vested in a board of directors. Our Articles provide that our board of directors may from time to time fix the number of directors to be appointed, provided that the minimum number of directors shall be eight and the maximum number of directors shall be twelve.
Our Articles provide that directors are divided into three classes designated as Class I, Class II and Class III, respectively. At the annual general meeting of shareholders to be held for the fiscal year ended December 31, 2025 (“the 2025 AGM”), the term of the Class I Directors, the Class II Directors and the Class III Directors shall expire and the Class I Directors, Class II Directors and the Class III Directors appointed at the 2025 AGM shall be elected for a term that shall expire at the next succeeding annual general meeting, following which, the board of directors shall no longer be classified and following the 2025 AGM our directors shall thereafter be elected annually.. A Director whose term has expired may be reappointed in accordance with the terms of the Articles. At any general meeting where a resolution for the election of directors is proposed a plurality of the votes cast shall be sufficient to elect a director. In addition, our directors may appoint any person to be a director and assign such director to a class either as a result of a casual vacancy or as an additional director.
Our Articles provide that a director may be removed by ordinary resolution of the shareholders (provided that no more than four directors in aggregate may be removed pursuant to that provision in any given period between annual general meetings as described in the Articles) or for “cause” (as defined therein) by notice from not less than 75% of the directors then in office.
The quorum necessary for any meeting of our board of directors shall consist of at least a majority of the members of our board of directors. In case of an equality of votes, the chairman shall have a second or casting vote if the chairman is an independent director and if the chairman is not an independent director then the lead independent director appointed by the board of directors shall have a second or casting vote.
Indemnity of directors and officers
Our Articles provide that our board of directors and officers shall be indemnified from and against all liability which they incur in execution of their duty in their respective offices, except liability incurred by reason of such director’s or officer’s dishonesty, willful default or fraud. However, we have entered into indemnification agreements with our executive officers and directors.
Exclusive Forum
Our Articles provide that, unless we consent in writing to the selection of an alternative forum (a) the federal courts of the United States shall have exclusive jurisdiction to hear, settle and/or determine any dispute, controversy or claim arising under the provisions of the Securities Act or the Exchange Act, which are referred to as the U.S. Actions; and (b) save for such U.S. Actions, the courts of the Cayman Islands shall have exclusive jurisdiction over any claim or dispute arising out of or in connection with the Articles or otherwise related in any way to each member's shareholding in us, including but not limited to (i) any derivative action or proceeding brought on behalf of us; (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us; (iii) any action asserting a claim arising pursuant to any provision of the Companies Act of the Cayman Islands or the Articles; or (iv) any action asserting a claim against us concerning our internal affairs.
This choice of forum provision may increase a shareholder's cost and limit such shareholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage lawsuits against us and our directors, officers and other employees. Any person or entity purchasing or otherwise acquiring any of our shares or other securities, whether by transfer, sale, operation of law or otherwise, shall be deemed to have notice of and have irrevocably agreed and consented to these provisions. The enforceability of similar choice of forum provisions in other companies' charter documents has been challenged in legal proceedings.
Differences in Corporate Law
Cayman Islands companies are governed by the Companies Act (as amended) of the Cayman Islands (the “Companies Act”). The Companies Act is modeled on English law but does not follow recent English Law statutory enactments, and differs from laws applicable to United States corporations and their shareholders. Set forth below is a summary of some significant differences between the provisions of the Companies Act applicable to us and, for comparison purposes, the laws applicable to companies incorporated in the State of Delaware and their shareholders.
Mergers and similar arrangements
The Companies Act allows for the merger of two or more companies into either one consolidated company or one or more company(ies) merged into another so as to form a single surviving company. The merger or consolidation of two or more companies under Cayman Islands law requires the directors of the companies to enter into and to approve a written plan of merger or consolidation, which must also be authorized by a special resolution of each constituent company, in which regard see “- Ordinary Shares - Voting Rights” above, and such other authorization, if any, as may be specified in such companies’ articles of association. In relation to any merger or consolidation under the Companies Act, dissenting shareholders have certain limited appraisal rights in circumstances which are similar to those available to dissenting shareholders of a Delaware corporation, providing rights to receive payment in cash for the judicially determined fair value of the shares. Appraisal rights for the holders of shares listed on a public exchange are ordinarily only available where the consideration offered under the merger is payable in cash or, in some instances, the unlisted securities of a third party.
The Companies Act also includes statutory provisions that facilitate the reconstruction and amalgamation of companies, provided that such a scheme of arrangement is approved by (i) in respect of shareholders, 75% in value of the shareholders, or each class of shareholder, who attend and vote, either in person or by proxy, at a meeting or meetings convened for that purpose; or (ii) in respect of creditors, a majority in number representing 75% in value of creditors, or each class of creditor, who attend and vote, either in person or by proxy, at a meeting or meetings convened for that purpose. The convening of meetings to consider any such scheme of arrangement, and the implementation of the scheme, must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder has the right to express to the court the view that the transaction ought not to be approved, the court can be expected to approve the arrangement if it determines that:
| ● | The company is not proposing to act illegally or beyond the scope of its corporate authority and the statutory provisions as to the dual majority vote have been met; |
| ● | the shareholders have been fairly represented at the meeting in question and the classes properly delineated; |
| ● | the arrangement is such that a businessman would reasonably approve; and |
| ● | the arrangement is not one that would more properly be sanctioned under some other provision of the Companies Act or that would amount to a “fraud on the minority”. |
If a scheme of arrangement is thus approved, the dissenting shareholders would have no rights comparable to appraisal rights, which would otherwise ordinarily be available to dissenting shareholders of a Delaware corporation.
When a tender offer to acquire shares is made and accepted (within four months) by holders of not less than 90% of the shares subject to such offer, the offeror may, within a two-month period following the expiration of the initial four month period, require the holders of the remaining shares to transfer such shares on the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands but this is unlikely to succeed unless there is evidence of fraud, bad faith, collusion or inequitable treatment of shareholders.
Our Articles contain a prohibition on business combinations with any “interested” shareholder for a period of three years after such person becomes an interested shareholder unless (1) there is advance approval of the Board, (2) the interested shareholder owns at least 85% of our voting shares at the time the business combination commences or (3) the combination is approved by shareholders holding at least two-thirds of the votes attaching to the ordinary shares that are not held by the interested shareholder. A person becomes “interested” where it and persons acting in concert with it or its affiliates acquire 15% of the issued ordinary shares. A “business combination” in this context includes, among other things, a merger, asset or stock sale or other transaction resulting in a financial benefit to the interested shareholder.
Shareholders’ suits
We are not aware of any reported class action having been brought in a Cayman Islands court. Derivative actions have been brought in the Cayman Islands courts, and the Cayman Islands courts have confirmed the availability for such actions. In principle, the Company will normally be the proper plaintiff and a derivative action may not be brought by a shareholder.
However, based on English authorities, which would in all likelihood be of persuasive authority in the Cayman Islands, there are exceptions to the foregoing principle, including when:
| ● | a company acts or proposes to act illegally or ultra vires (beyond the scope of its authority); |
| ● | the act complained of, although not ultra vires, could be effected if duly authorized by a special resolution that has not been obtained; and |
| ● | those who control the company are perpetrating a fraud on the minority. |
A shareholder may have a direct right of action against the company where the individual rights of that shareholder have been infringed or are about to be infringed.
Fiduciary duties of directors
Under Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and its shareholders. This duty has two components, the duty of care and the duty of loyalty. The duty of care requires that a director act in good faith, with the care that an ordinarily prudent person would exercise under similar circumstances. Under this duty, a director must inform himself of, and disclose to shareholders, all material information reasonably available regarding a significant transaction. The duty of loyalty requires that a director must act in a manner he or she reasonably believes to be in the best interests of the corporation. A director must not use his or her corporate position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that the best interests of the corporation and its shareholders take precedence over any interest possessed by a director, officer or controlling shareholder and not shared by the shareholders generally. In general, actions of a director are presumed to have been made on an informed basis, in good faith and in the honest belief that the action taken was in the best interests of the corporation. However, this presumption may be rebutted by evidence of a breach of one of the fiduciary duties. Should such evidence be presented concerning a transaction by a director, the director must prove the procedural fairness of the transaction and that the transaction was of fair value to the corporation.
As a matter of Cayman Islands law, a director of a Cayman Islands company is in the position of a fiduciary with respect to the company and therefore it is considered that he owes the following duties to the company: a duty to act in good faith and in what he considers to be in the best interests of the company; a duty not to make a profit out of his position as director (unless the company permits him to do so); a duty to exercise his powers for the purposes for which they are conferred; and a duty not to put himself in a position where the interests of the company conflict with his personal interest or his duty to a third party. A director of a Cayman Islands company owes to the company a duty to act with skill and care. In the performance of their duties, directors must act as a reasonably diligent person having both: (i) the general knowledge, skill and experience that may reasonably be expected of a director in relation to the Company (an objective test); and (ii) the general knowledge skill and experience of that director (a subjective test).
Under our Articles, directors who are in any way, whether directly or indirectly, interested in a contract or proposed contract with our company must declare the nature of their interest at a meeting of the board of directors. Following such declaration, a director may vote in respect of any contract or proposed contract notwithstanding his interest; provided that, in exercising any such vote, such director’s duties remain as described above.
Written consent of shareholders
Under Delaware corporate law, unless otherwise provided in the certificate of incorporation, any action to be taken at any annual or special meeting of shareholders of a corporation may be taken by written consent of the holders of outstanding stock having not less than the minimum number of votes that would be necessary to take that action at a meeting at which all shareholders entitled to vote were present and voted. In addition, a corporation may eliminate the right of shareholders to act by written consent through amendment to its certificate of incorporation.
Cayman Islands law and our Articles also provide that shareholders may approve certain other corporate matters that would require an ordinary resolution or a special resolution by way of unanimous written resolution signed by or on behalf of each shareholder who would have been entitled to vote on such matter at a general meeting without a meeting being held.
Shareholder proposals
Under Delaware corporate law, a shareholder has the right to put any proposal before the shareholders at the annual meeting, provided that such shareholder complies with the notice provisions in the governing documents. A special meeting may be called by the board of directors or any other person authorized to do so in the governing documents, but shareholders may be precluded from calling special meetings.
Under the laws of the Cayman Islands our Articles determine the ability of shareholders to requisition a general meeting and to put a proposal before shareholders at any general meeting. Our Articles provide for general meetings to be convened by the directors. In addition, general meetings shall also be convened by the Directors whenever any single shareholder or group of shareholders holding collectively at least 25% in the aggregate of the issued ordinary shares (the “Meeting Threshold”) so requisition in writing and the notice to convene such requisitioned general meeting shall be sent by the directors within 45 days of the deemed receipt of such requisition in writing for a requisitioned general meeting to be held within 70 days of the deemed receipt of such requisition in writing; provided that if MTN either requisition a meeting or are part of a group requisitioning a meeting, the aforementioned Meeting Threshold shall be at least fifty percent (50%) in the aggregate of the issued ordinary shares. For any shareholder or group of shareholders seeking to requisition a general meeting, such shareholder or group of shareholders must be a member of record on both (i) the date of making the requisition and (ii) the record date for the determination of members entitled to vote at such requisitioned general meeting, and on each such date beneficially own issued ordinary shares at least equal to the Meeting Threshold. A requisition by a shareholder or group of shareholders shall require the board of directors (or any duly authorised committee thereof) to convene a general meeting in accordance with the Articles and to include the matters proposed to be determined by resolution of the shareholders as set out in such requisition.
If the directors fail to send a notice convening a general meeting within 45 days of receiving a requisition in accordance with the Articles, the shareholder or shareholders requisitioning such general meeting may convene a general meeting in the same manner as nearly as possible as that in which general meetings may be convened by the directors.
After (i) the annual general meeting of the Company held on June 28, 2024 and prior to the 2025 AGM, any shareholder holding more than 10% of the issued ordinary shares and (ii) the 2025 AGM, any shareholder or group of shareholders holding in aggregate more than 10% of the issued ordinary shares, in each case, may propose business in accordance with the terms of the Articles at a general meeting, where such shareholder or group of shareholders (as applicable) is (A) a member of record on both (x) the date of the giving of the notice by that shareholder provided for under the Articles and (y) the record date for the determination of shareholders entitled to vote at such general meeting, and on each such date beneficially owns more than 10% of the Company’s issued ordinary shares and (B) have given timely notice of the proposed resolution to the Company in accordance with the Articles. Under the Articles, MTN (either acting alone or as part of a group of shareholders, except for any group that also includes shareholders who would otherwise hold a sufficient number of issued ordinary shares and be entitled to provide notice of any business to be transacted at any general meeting in accordance with the terms of the Articles without MTN) shall not be eligible to provide notice of any business to be transacted at any general meeting.
Under the Companies Act, an exempted Cayman Islands company is not obliged by law to call a shareholders’ annual general meeting; however, under our Articles, the Company must hold an annual general meeting at least once every 15 months, unless the meeting is not held within that time frame due to its adjournment.
Under Delaware corporate law, a corporation is required to set a minimum quorum of one-third of the issued and outstanding shares for a shareholders meeting. Cayman Islands law permits a company’s articles to have any quorum. See “- Ordinary Shares - Voting Rights.”
Cumulative voting
Under Delaware corporate law, cumulative voting for elections of directors is not permitted unless the corporation’s certificate of incorporation specifically provides for it. Cumulative voting potentially facilitates the representation of minority shareholders on a board of directors since it permits a minority shareholder to cast all the votes to which such shareholder is entitled on a single director, which increases such shareholder’s voting power with respect to electing such director.
There are no prohibitions in relation to cumulative voting under the laws of the Cayman Islands, but our Articles do not provide for cumulative voting. As a result, our shareholders are not afforded any less protection or fewer rights on this issue than shareholders of a Delaware corporation.
Election and removal of directors
Under Delaware corporate law, unless otherwise specified in the certificate of incorporation or bylaws of a corporation, directors are elected by a plurality of the votes of the shares entitled to vote on the election of directors and may be removed with or without cause (or, with respect to a classified board, only with cause unless the certificate of incorporation provides otherwise) by the approval of a majority of the outstanding shares entitled to vote.
Similarly, as permitted by the Companies Act and pursuant to our Articles, directors may be appointed by a plurality of votes of the shares entitled to vote on the appointment of directors and may be removed by ordinary resolution of the shareholders (provided that no more than four directors in aggregate may be removed pursuant to that provision in any given period between annual general meetings as described in the Articles) or for “cause” (as defined therein) by notice from not less than 75% of the directors then in office.
Our Articles also permit (i) prior to the 2025 AGM, any shareholder holding more than 10% of the issued ordinary shares and (ii) after the conclusion of the 2025 AGM, any shareholder or group of shareholders holding in aggregate more than 10% of the issued ordinary shares, the right to nominate a director for election at an annual general meeting or general meeting of the Company in accordance with the terms of the Articles. Notwithstanding the above, under the Articles, MTN shall in no event be eligible to nominate a director for election, whether acting alone or as part of a group of shareholders (other than as part of a group of shareholders that would otherwise hold a sufficient number of issued ordinary shares and be entitled to nominate a director for election in accordance with the terms of the Articles without MTN); MTN may, however, suggest candidates to the company for nomination by the board of directors, which the board of directors may, at its discretion, consider for nomination in accordance with the terms of the Articles. Under the Articles, any such nomination by a shareholder or group of shareholders (as applicable) must be notified to the Company as follows (i) where a director is to be elected at an annual general meeting, not less than 90 nor more than 120 days prior to the anniversary of the last annual general meeting or, in the event the annual general meeting is called for a date that is greater than 30 days before or after such anniversary, the notice must be so given not later than 14 days following the earlier of the day on which such notice of the date of the annual general meeting was mailed or public disclosure of such annual general meeting was made and (ii) where a director is to be elected at a general meeting that is not an annual general meeting, not later than 7 days following the earlier of the day on which such notice of the date of the general meeting was mailed or public disclosure of such general meeting was made.
Written consent of directors
Under Delaware corporate law, a written consent of the directors must be unanimous to take effect. The position under our Articles is the same in this regard.
Indemnification of directors and executive officers and limitation of liability
Cayman Islands law does not limit the extent to which a company’s Articles may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. Our Articles provide that our board of directors and officers shall be indemnified from and against all liability which they incur in execution of their duty in their respective offices, except liability incurred by reason of such directors’ or officers’ dishonesty, wilful default or fraud.
This standard of conduct is generally the same as permitted under Delaware corporate law.
Enforcement of civil liabilities
The Cayman Islands has a less developed body of securities laws as compared to the United States and provides less protection to investors. Additionally, Cayman Islands companies may not have standing to sue before the Federal courts of the United States. Although there is no statutory enforcement in the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize a foreign judgment as the basis for a claim at common law in the Cayman Islands provided such judgment:
| ● | is one in respect of which the foreign court had jurisdiction over the defendant according to Cayman Islands conflict of law rules; |
| ● | is final and conclusive; |
| ● | is either for a liquidated sum not in respect of penalties or taxes or a fine or similar fiscal or revenue obligations or, in certain circumstances, for in personam non-money relief; and |
| ● | was neither obtained in a manner, nor is of a kind enforcement of which is contrary to natural justice or the public policy of the Cayman Islands. |
As a result of English case law, which will likely be highly persuasive in the Cayman Islands, the Cayman Islands Courts may also have discretion to enforce judgments obtained in foreign bankruptcy proceedings in other circumstances. A Cayman Islands court may stay enforcement proceedings if concurrent proceedings are brought elsewhere.
Variation of rights of shares
Under Delaware corporate law, a corporation may vary the rights of a class of shares with the approval of a majority of the outstanding shares of such class, unless the certificate of incorporation provides otherwise.
Under Cayman Islands law and our Articles, if our share capital is divided into more than one class or sub-class of shares, we may only materially and adversely vary or abrogate the rights attached to any class or sub-class with either the written consent of the holders of two-thirds of the shares of such class or sub-class or with the sanction of a resolution passed by not less than two-thirds of the votes attaching to the shares of the relevant class or sub-class cast in a meeting of the holders of the shares of that class or sub-class.
Sale of assets
Under Delaware corporate law, a vote of the shareholders is required to approve a sale of assets only when all or substantially all assets are being sold to a person other than a subsidiary of the company.
The Companies Act contains no specific restrictions on the powers of directors to dispose of assets of a company. As a matter of general law, in the exercise of those powers, the directors must discharge their duties of care and to act in good faith, for a proper purpose and in the interests of the company.
Transactions with interested shareholders
The Delaware General Corporation Law contains a business combination statute applicable to Delaware corporations whereby, unless the corporation has specifically elected not to be governed by such statute by amendment to its certificate of incorporation, it is prohibited from engaging in certain business combinations with an “interested shareholder” for three years following the date that such person becomes an interested shareholder. An interested shareholder generally is a person or a group who or which owns or owned 15% or more of the target’s outstanding voting stock within the past three years.
This has the effect of limiting the ability of a potential acquirer to make a two-tiered bid for the target in which all shareholders would not be treated equally. The statute does not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder, the board of directors approves either the business combination or the transaction which resulted in the person becoming an interested shareholder. This encourages any potential acquirer of a Delaware corporation to negotiate the terms of any acquisition transaction with the target’s board of directors.
Cayman Islands law has no comparable statute. As a result, we cannot avail ourselves of the types of protections afforded by the Delaware business combination statute. However, although Cayman Islands law does not regulate transactions between a company and its significant shareholders, it does provide that such transactions must be entered into bona fide in the best interests of the company and not with the effect of constituting a fraud on the minority shareholders. In addition, our Articles contain a prohibition on business combinations with any “interested” shareholder for a period of three years after such person becomes an interested shareholder unless (i) there is advance approval of the board of directors, (ii) the interested shareholder owns at least 85% of our voting shares at the time the business combination commences or (iii) the combination is approved by shareholders holding at least two-thirds of the votes attaching to the ordinary shares that are not held by the interested shareholder. A person becomes “interested” where it and persons acting in concert with it or its affiliates acquire 15% of the issued ordinary shares. A “business combination” in this context includes, among other things, a merger, asset or stock sale or other transaction resulting in a financial benefit to the interested shareholder.
Rights of non-resident or foreign shareholders
There are no limitations imposed by our Articles on the rights of non-resident or foreign shareholders to hold or exercise voting rights on our shares. As similarly provided under Delaware corporate law, there are no restrictions on foreign or non-resident ownership or management of a Cayman Islands company under Cayman Islands law. In addition, there are no provisions in our Articles governing the ownership threshold above which shareholder ownership must be disclosed.
Dissolution and winding up
Under the Delaware General Corporation Law, unless the board of directors approves the proposal to dissolve, dissolution must be approved by shareholders holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the board of directors may it be approved by a simple majority of the corporation’s outstanding shares. Delaware law allows a Delaware corporation to include in its certificate of incorporation a supermajority voting requirement in connection with a dissolution initiated by the board of directors. Under the Companies Act of the Cayman Islands and our Articles, our company may be voluntarily wound up only by a special resolution of our shareholders, in which regard see “- Ordinary Shares - Voting Rights” above. In addition, a company may be wound up by the Grand Court of the Cayman Islands if the company is unable to pay its debts or if the court is of the opinion that it is just and equitable that our company is wound up.
Inspection of books and records
Under Delaware corporate law, any shareholder of a corporation may for any proper purpose inspect or make copies of the corporation’s stock ledger, list of shareholders and other books and records.
Our shareholders have no general right under Cayman Islands law to inspect or obtain copies of our list of shareholders or corporate records except our Articles.
Amendment of governing documents
Under Delaware corporate law, a corporation’s certificate of incorporation may be amended only if adopted and declared advisable by the board of directors and approved by a majority of the outstanding shares entitled to vote, and the bylaws may be amended with the approval of a majority of the outstanding shares entitled to vote and may, if so provided in the certificate of incorporation, also be amended by the board of directors. As permitted by Cayman Islands law, our Articles may be amended with the sanction of a special resolution of shareholders.
Exhibit 4.6
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IHS Netherlands Holdco B.V. |
Herikerbergweg 88 |
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1101 CM |
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Amsterdam |
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www.ihstowers.com |
To:Ecobank Nigeria Limited (the “Agent”)
14 November 2024
Dear Sir or Madam
Amendment letter 3 relating to the Facility Agreement (as defined below)
1. |
Introduction |
1.1 |
We refer to the up to NGN 165,000,000,000 term facility dated 3 January 2023 between, amongst others, IHS Netherlands Holdco B.V. (“Holdco”), IHS Holding Limited (the “Company”), each of IHS (Nigeria) Limited, IHS Towers NG Limited and INT Towers Limited as borrowers, the Agent and each of the financial institutions named therein as original lenders (the “Facility Agreement”). |
1.2 |
Capitalised terms defined in the Facility Agreement shall have the same meaning when used herein unless expressly defined in this letter (the “Letter”). |
1.3 |
The provisions of clause 1.2 (Construction) and clause 1.7 (Third party rights) of the Facility Agreement apply to this Letter as though they were set out in full in this Letter with all necessary consequential changes; and with references in that clause to “this Agreement” being construed as references to this Letter. |
2. |
Background |
2.1 |
The Group has a number of intermediary Dutch holding companies within its group structure, including each of the Original Guarantors. |
2.2 |
The Company has decided, as part of an ongoing review of its Group corporate structure, to redomicile each of the Relevant Obligors (as defined in paragraph 2.3 below) to Mauritius, where some of its other intermediary group companies are also registered. Due to applicable Dutch law procedures, the redomiciliation will be effected in a two-step process, whereby the relevant entities (noted in paragraph 2.3 below) will each redomicile into Luxembourg and shortly thereafter into Mauritius (together, the “Transaction”). The intention is for the redomiciled companies to then become UK tax resident, similar to the Company. |
2.3 |
For the purposes of the Facility Agreement, the Transaction will be implemented for each of IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V. and Nigeria Tower Interco B.V., (each of which are Guarantors under the Facility Agreement) (the “Relevant Obligors”). |
2.4 |
Corporate re-domiciliation or migration by way of continuation is the process by which a company moves its domicile from one jurisdiction to another by changing the country under whose laws it is registered or incorporated, while maintaining the same legal identity. Upon the Transaction becoming effective for a Relevant Obligor, that Relevant Obligor will continue to exist (initially in Luxembourg for the interim period, and ultimately in Mauritius) with the same legal identity, shareholding structure, assets and liabilities. In particular, under Luxembourg and Mauritian law, the Transaction does not operate to: |
2.4.1 |
create a new legal entity; |
2.4.2 |
prejudice or affect the identity or continuity of that Relevant Obligor as previously constituted; |
2.4.3affect the property of that Relevant Obligor;
2.4.4 |
affect any appointment made, resolution passed or any other act or thing done in relation to that Relevant Obligor pursuant to a power conferred by any of the constitutional or other corporate documents of that Relevant Obligor or by the laws of The Netherlands under which that Relevant Obligor was previously incorporated and registered; |
2.4.5 |
affect the shareholding structure of that Relevant Obligor; or |
2.4.6 |
affect the rights, powers, authorities, functions, assets, liabilities or obligations of the Relevant Obligor. |
2.5 |
As the terms of the Facility Agreement provide for restrictions in relation to the change of jurisdiction of incorporation of the Company, Holdco and the Guarantors, the purpose of this Letter is to seek the consent of the Lenders to authorise the Transaction. |
2.6 |
In this Letter, “Effective Date” means the date upon which the Agent has countersigned this Letter. |
3. |
Consents |
3.1 |
The Agent confirms that the consent of the Majority Lenders has been obtained to the Company implementing the Transaction in the form described in this letter (provided strictly that each such redomiciliation is carried out in a manner that would constitute a Permitted Redomiciliation under the Facility Agreement as amended by this letter) and the amendments of the Facility Agreement referred to below and accordingly, on behalf of itself and each of the Lenders, agrees with effect on and from the Effective Date that the amendments to the Facility Agreement set out in Schedule 1 (Amendments) of this letter shall be deemed made. |
4. |
Guarantee Confirmation |
4.1 |
The Obligors’ Agent confirms that: |
4.1.1 |
the guarantee and indemnity contained in clause 19.1 (Guarantee and Indemnity) of the Facility Agreement shall, after giving effect to the amendments effected by this Letter, on and after the Effective Date continue in full force and effect and extend to the liabilities and obligations of each of the Obligors under the Facility Agreement and the other Finance Documents each as amended pursuant to the terms of this letter; and |
4.1.2 |
subject to the Legal Reservations, constitute legal, valid and binding obligations of the relevant Obligors enforceable in accordance with their terms. |
5. |
Representations and Warranties |
5.1 |
The Obligor’s Agent represents and warrants to the Agent and to the Lenders that it has been, and remains, appointed and authorised to act as the Obligors’ Agent in accordance with clause 2.5 (Obligors’ Agent) of the Facility Agreement. |
5.2 |
Each of the Repeating Representations shall be made on the Effective Date as if references to “this Agreement” in those Repeating Representations were references to this Letter. |
6. |
Miscellaneous |
6.1 |
This Letter is a Finance Document. |
6.2 |
From the Effective Date, the Facility Agreement and this Letter shall be read and construed as one document. |
6.3 |
Except as otherwise provided in this Letter, the Financing Documents remain in full force and effect. |
6.4 |
Except to the extent expressly waived in this Letter, no amendment or waiver of any provision of any Finance Document is given by the terms of this Letter and the Finance Parties expressly reserve all their rights and remedies in respect of any breach of, or other default under, the Finance Documents. |
2
6.5 |
This Letter may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of this Letter. |
7. |
Governing law |
7.1 |
This Letter and any non-contractual obligations arising out of or in connection with it are governed by English law. |
7.2 |
Clause 33 (Notices), clause 38 (Confidentiality) and clause 43 (Enforcement) of the Facility Agreement shall apply to this Letter, mutatis mutandis, as if references in those provisions of the Facility Agreement to the Facility Agreement and Finance Document shall be construed as references to this Letter. |
3
Please sign and return a copy of this Letter to confirm your acceptance and agreement to its terms and conditions.
Yours faithfully
/s/ Mohamad Darwish |
|
Name: Mohamad Darwish |
|
|
|
Title: Authorised Signatory |
|
|
|
For and on behalf of |
|
|
|
IHS Netherlands Holdco B.V. |
|
/s/ Laurens Klein |
|
Name: Laurens Klein |
|
|
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Title: Authorised Signatory |
|
|
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For and on behalf of |
|
|
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IHS Netherlands Holdco B.V. |
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/s/ Segun Anjorin |
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Name: Segun Anjorin |
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Title: AG head, Corporate Bank |
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For and on behalf of |
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Ecobank Nigeria Limited |
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as Agent |
|
4
SCHEDULE 1
AMENDMENTS
The Facility Agreement shall be amended as follows:
1. |
A definition of “Approved Jurisdiction” shall be added to clause 1.1 (Definitions) of the Facility Agreement, with the remaining definitions reordered alphabetically accordingly: |
““Approved Jurisdiction” means any state which is a member state of the European Union, the United Kingdom, the Federal Republic of Nigeria, the Cayman Islands or Mauritius.”
2. |
A definition of “Permitted Redomiciliation” shall be added to clause 1.1 (Definitions) of the Facility Agreement, with the remaining definitions reordered alphabetically accordingly: |
““Permitted Redomiciliation” means any redomiciliation of any Obligor (other than the Borrowers or any Original Guarantor incorporated in Nigeria) or of any member of the Nigeria Group (other than any member of the Nigeria Group incorporated in Nigeria) from its jurisdiction of incorporation, provided that, where such Redomiciliation or other redomiciliation relates to an Obligor:
(a) |
the relevant Obligor redomiciles within an Approved Jurisdiction; |
(b) |
no later than 15 Business Days prior to the proposed date for completion of the redomiciliation of the relevant Obligor taking effect, Holdco notifies the Agent of the proposed redomiciliation; |
(c) |
there is no change to the legal identity or assets or liabilities of the relevant Obligor (other than as permitted under paragraph (d) of the definition of Permitted Reorganisation), prejudice or effect on the identity or continuity or its properties as a result of such redomiciliation; |
(d) |
no Event of Default is continuing as at the date notice is provided under paragraph (b) above and no Default or mandatory prepayment event under Clause 8.1 (Change of Control) or Clause 8.2 (Sanctions) would occur as a result of such redomiciliation; |
(e) |
all assets of, and shares in, the relevant Obligor are not subject to Security under a Security Document at the date of completion of the redomiciliation; |
(f) |
the constitutional documents of the relevant Obligor and a legal opinion in form and substance satisfactory to the Agent (acting on the instruction of the Majority Lenders, acting reasonably) from legal advisers in the relevant jurisdiction of the redomiciliation are delivered to the Agent as soon as reasonably practicable (and in any event, within 30 days) following the date on which the relevant Obligor receives evidence of the completion of the final redomiciliation of the relevant Obligor; and |
(g) |
if the Agent (acting on the instructions of the Majority Lenders, acting reasonably and taking into account advice of the legal counsel to the Finance Parties in the relevant jurisdiction) requests any amendment to the Finance Documents that is necessary under the laws of the jurisdiction in which the final redomiciliation occurs in order to ensure that the rights, powers and remedies of the Finance Parties under the Finance Documents are not materially affected by such redomiciliation, the Agent and the Obligor shall enter into negotiations on a good faith basis (for a period of not more than 30 days) with a view to agreeing such amendments, |
and, after such redomiciliation has occurred in accordance with this definition, the jurisdiction of incorporation of the relevant Obligor shall be deemed to be the Approved Jurisdiction where such redomiciliation is completed for the purposes of this Agreement.”
3. |
A definition of “Relevant Jurisdiction” shall be added to clause 1.1 (Definitions) of the Facility Agreement, with the remaining definitions reordered alphabetically accordingly: |
5
““Relevant Jurisdiction” means in relation to an Obligor or member of the Nigeria Group:
(a) |
its jurisdiction of incorporation and, following a Permitted Redomiciliation, its jurisdiction of domicile following that Permitted Redomiciliation; and |
(b) |
any jurisdiction where any asset subject to any Security created or expressed to be created by it under a Security Document is situated.” |
4. |
The definition of “Permitted Disposal” in clause 1.1 (Definitions) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“Permitted Disposal” means any sale, lease, licence, transfer or other disposal:
(a) |
of assets by the Company or a member of the Nigeria Group in the ordinary course of trading or business activities; |
(b) |
by the Company to a member of the IHS Group, or between any members of the Nigeria Group; |
(c) |
of assets in exchange for other assets comparable or superior as to type, value or quality; |
(d) |
the decommissioning of any towers, including but not limited to in connection with tower consolidation purposes; |
(e) |
of obsolete or redundant assets no longer required for the relevant person’s business; |
(f) |
of Cash Equivalent Investments for a comparable amount of cash or in exchange for a comparable amount of other Cash Equivalent Investments; |
(g) |
arising as a result of the creation of any Permitted Security, a Permitted Payment, a Permitted Reorganisation or a Permitted Transaction; |
(h) |
of cash to the extent not otherwise prohibited by the terms of this Agreement (including by way of a Permitted Loan); |
(i) |
constituted by a licence of intellectual property rights; |
(j) |
constituted by a licence or sub-licence in the ordinary course of trading or business activities; |
(k) |
constituted by a lease or licence of real property arising in the ordinary course of trading or business activities of the disposing entity; |
(l) |
any share sale or issuance by the Company or share sale or issuance by any member of the Nigeria Group or arising as a result of any such share sale or issuance; |
(m) |
arising as a result of the sale of towers, provided that such towers are replaced by towers with an aggregate fair market value that is equal to or greater than the aggregate fair market value of the towers sold; |
(n) |
of trade receivables earned during a previous accounting period on a non-recourse basis (which may include recourse in respect of warranties and indemnities as to title and validity that are customarily provided in such non-recourse arrangements) and provided that such transaction does not have the commercial effect of a borrowing; |
(o) |
arising as a result of the disposition of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of trading or business activities or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements; |
(p) |
arising as a result of the foreclosure, condemnation or any similar action with respect to any property or other assets or a surrender or waiver of contract rights or the settlement, release or surrender of contract, tort or other claims of any kind; |
6
(q) |
arising as a result of a seizure, expropriation, nationalisation, intervention, restriction or other action by or on behalf of any governmental, regulatory or other authority which in each case does not constitute an Event of Default pursuant to Clause 24.9 (Creditors’ Process) or Clause 24.12 (Expropriation); |
(r) |
of treasury shares by the Company or any member of the Nigeria Group that are held following the exercise, in each case on a “cashless” or “net exercise” basis, of any option to purchase corporate stock, shares or membership interests granted to any future, present or former employee, director, officer, contractor or consultant of any member of the IHS Group pursuant to any employee benefit plans or arrangements, including for the purpose of satisfying any taxes (including estimated taxes) due as a result of the exercise of any such option; |
(s) |
to a Joint Venture, to the extent permitted by Clause 23.6 (Joint Ventures); |
(t) |
by the IHS Group (other than an Obligor) to the extent not otherwise restricted by the terms of this Agreement; and |
(u) |
arising under any single transaction or series of related transactions that involves assets having a fair market value of less than the greater of USD 25,000,000 (or its equivalent in other currencies) and an amount equal to zero point eight per cent. (0.8%) of Total Assets.” |
5. |
The definition of “Permitted Reorganisation” in clause 1.1 (Definitions) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“Permitted Reorganisation” means:
(a) |
a reorganisation on a solvent basis involving the business or assets of, or shares of the Company or any member of the Nigeria Group: |
(i) |
where the Company or a member of the Nigeria Group (as applicable) remains the surviving entity and the Relevant Jurisdiction of the Company or such member of the Nigeria Group remains the same; and |
(ii) |
if such reorganisation has the effect of disposal of any business, assets or shares, where such disposal would be a Permitted Disposal; or |
(iii) |
if such reorganisation has the effect of an acquisition of any business, assets or shares, where such acquisition would be a Permitted Acquisition; |
(b) |
any transaction contemplated under paragraph (c) of the definition of “Permitted Transaction”; |
(c) |
a transfer of all of the issued share capital of the Company to a newly incorporated holding company, subject to the conditions in paragraph (d) of the definition of Change of Control; |
(d) |
any merger or reorganisation of two or more members of the Nigeria Group (either as part of or separate to a Permitted Redomiciliation) where either: |
(i) |
one of such members of the Nigeria Group is the surviving entity; or |
(ii) |
the issued share capital of all such entities is transferred to another existing member of the Nigeria Group or a newly incorporated entity, |
in each case, provided that:
(A) |
where a member of the Nigeria Group is the surviving entity, the jurisdiction of incorporation of such member of the Nigeria Group remains the same or is an Approved Jurisdiction; |
(B) |
where a newly incorporated entity is the surviving entity, its jurisdiction of incorporation is the same as that of any member of the Nigeria Group |
7
undergoing such merger or reorganisation or is an Approved Jurisdiction; and
(C) |
where any such member of the Nigeria Group subject to such merger or reorganisation is an Obligor: |
(1) |
the surviving entity is an Obligor; or |
(2) |
if, as a result of the laws applicable in the jurisdiction of the entities subject to such merger or reorganisation, it is not possible for the surviving entity to effectively accede to this Agreement as a Guarantor prior to the date of such merger or reorganisation, the Company shall provide written notice to the Agent on or around the date of completion of the relevant merger or reorganisation of such merger or reorganisation occurring (the “Effective Reorganisation Date”) and procure that the surviving entity shall accede to this Agreement promptly and in any event within no more than 10 Business Days of the Effective Reorganisation Date; |
(e) |
a Permitted Redomiciliation; and |
(f) |
any other reorganisation approved by the Agent (acting on the instruction of the Majority Lenders).” |
6. |
The definition of “Permitted Transaction” in clause 1.1 (Definitions) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
““Permitted Transaction” means:
(a) |
any Financial Indebtedness incurred, guarantee or indemnity given, payment made, or other transaction arising, under the Finance Documents; |
(b) |
transactions (other than (i) any sale, lease, license, transfer or other disposal and (ii) the granting or creation of Security or the incurring or permitting to subsist of Financial Indebtedness) conducted in the ordinary course of trading or business of the Company or any member of the Nigeria Group on arm’s length terms; |
(c) |
the solvent liquidation or sale, lease, license, transfer or other disposal of Nigeria Tower Interco B.V.; and |
(d) |
a Permitted Redomiciliation.” |
7. |
Paragraphs (a) to (d) of clause 20.1 (Status) of the Facility Agreement shall be deleted in their entirety and replaced with the following: |
“(a) |
Other than in relation to the Company, it is a limited liability company, duly incorporated and validly existing under the law of its jurisdiction of incorporation (or, in the case of an Obligor (other than the Company) that has completed a Permitted Redomiciliation or a Permitted Reorganisation into an Approved Jurisdiction, a limited liability company duly incorporated or registered under the law of an Approved Jurisdiction). |
(b) |
In the case of the Company, it is an exempted company registered by way of continuation with limited liability, validly existing and in good standing under the laws of the Cayman Islands (or, in the case of the Company if it has completed a Permitted Redomiciliation or a Permitted Reorganisation into an Approved Jurisdiction, a limited liability company duly incorporated or registered under the law of an Approved Jurisdiction). |
(c) |
Each member of the Nigeria Group (other than an Obligor) is a limited liability company, duly incorporated and validly existing under the law of its jurisdiction of incorporation |
8
(or, in the case of a member of the Nigeria Group (other than an Obligor) that has completed a Permitted Redomiciliation or a Permitted Reorganisation into an Approved Jurisdiction, a limited liability company duly incorporated or registered under the law of an Approved Jurisdiction).
(d) |
It and each of its Subsidiaries has the power to own its own assets and carry on its business as it is being conducted.” |
8. |
Paragraph (a) (ii) of clause 20.5 (Validity and Admissibility in Evidence) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“(ii) |
to make the Finance Documents to which it is a party, subject to the Legal Reservations and the requirement to stamp the Finance Documents in Nigeria, admissible in evidence in its Relevant Jurisdiction,” |
9. |
Clause 20.6 (Governing Law and Enforcement) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“(a) |
Subject to the Legal Reservations, the choice of governing law of the Finance Documents as expressed in such Finance Document will be recognised in its Relevant Jurisdiction. |
(b) |
Subject to the Legal Reservations, any arbitral award or judgment obtained in relation to a Finance Document in the jurisdiction of the governing law of that Finance Document will be recognised and enforced in its Relevant Jurisdiction.” |
10. |
Paragraph (a)(ii) of clause 21.8 (“Know Your Customer” Checks) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“(ii) |
a Permitted Redomiciliation or any change in the status of an Obligor or the composition of the direct or indirect shareholders of an Obligor after the date of this Agreement; or” |
11. |
Clause 23.1 (Authorisations and Consents) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“Each Obligor shall promptly obtain, comply with and do all that is necessary to maintain in full force and effect any Authorisations required under any law or regulation of its Relevant Jurisdiction to:
(a) |
enable it to perform its obligations under the Finance Documents; |
(b) |
subject to the Legal Reservations, ensure the legality, validity, enforceability or admissibility in evidence of any Finance Documents; and |
(c) |
carry on its business save to the extent failure to do so would not reasonably be expected to have a Material Adverse Effect.” |
12. |
Clause 23.8 (Taxes) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“23.8Taxes
(a) |
Each Obligor shall (and shall ensure that each member of the Nigeria Group will) pay and discharge all Taxes imposed upon it or its assets within the time period allowed without incurring penalties unless and only to the extent that: |
(i) |
such payment is being contested in good faith; |
(ii) |
adequate reserves are being maintained for those Taxes; and |
(iii) |
such payment can be lawfully withheld and failure to pay those Taxes would not be reasonably likely to have a Material Adverse Effect. |
9
(b) |
The Company will remain resident for Tax purposes only in: |
(i) |
the UK and (as a result of its registration by way of continuation in the Cayman Islands) the Cayman Islands; or |
(ii) |
the UK. |
(c) |
Each member of the Nigeria Group will remain resident for Tax purposes in its jurisdiction of incorporation or establishment or, following a Permitted Redomiciliation or Permitted Reorganisation by it in an Approved Jurisdiction, an Approved Jurisdiction.” |
13. |
Paragraph (a)(i) of clause 24.8 (Insolvency Proceedings) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“(i) |
the suspension of payments, a moratorium of any indebtedness, winding-up, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) of the Company or any member of the Nigeria Group other than a solvent liquidation or reorganisation (including, for the avoidance of doubt, a Permitted Redomiciliation);” |
10
Exhibit 4.7
|
IHS Netherlands Holdco B.V. |
Herikerbergweg 88 |
|
1101 CM |
|
Amsterdam |
To: |
Ecobank Nigeria Limited (the “Facility Agent”) |
Attention : |
Olakunle Lowo |
28 January 2025
Unsecured NGN Term Facility Agreement – Amendment 4
Dear Sirs
1. |
Introduction |
1.1 |
We refer to the up to NGN 165,000,000,000 term credit facility dated 3 January 2023 between, amongst others, IHS Netherlands Holdco B.V. (“Holdco”), each of IHS (Nigeria) Limited, IHS Towers NG Limited and INT Towers Limited as the borrower, the Facility Agent and each of the financial institutions named therein as original lenders (the “Facility Agreement”). |
1.2 |
Capitalised terms defined in the Facility Agreement shall have the same meaning when used herein unless expressly defined in this letter (the “Letter”). |
1.3 |
The provisions of clause 1.2 (Construction) of the Facility Agreement apply to this Letter as though they were set out in full in this Letter with all necessary consequential changes; and with references in that clause to “this Agreement” being construed as references to this Letter. |
2. |
Request for Amendment |
2.1 |
In accordance with Clause 37.1 (Required Consents) of the Facility Agreement, Holdco hereby requests the consent of the Majority Lenders to the following amendment to the Facility Agreement: |
2.2 |
On and from the date falling 3 January 2025, Clause 10.1(b)(Calculation of Interest) shall be deleted in its entirety and the numbering of Clause 10.1 shall be adjusted accordingly. |
2.3 |
Clause 22.2(b) (Interest Cover Ratio) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“Interest Coverage Ratio: On each Quarter Date the Interest Cover Ratio shall not be less than :
(i) in respect of any Relevant Period beginning with and subsequent to the Relevant Period ending on 31 December 2024, 2.00:1 and up to and including the Relevant Period ending on 31 December 2026, 2.00:1; and
(ii) in respect of any Relevant Period beginning with the Relevant Period ending on 31 March 2027 and up to and including the Relevant Period ending on 31 December 2027, 2.25:1.”
3. |
Amendment |
With effect from the date of this Letter, the Facility Agent (on behalf of the Lenders) confirms that any Default or Event of Default that would be continuing, were it not for the amendments set out in this Letter, are irrevocably waived.
4. |
Miscellaneous |
4.1 |
This Letter is a Finance Document. |
4.2 |
From the date of this Letter, the Facility Agreement and this Letter shall be read and construed as one document. |
4.3 |
Except as otherwise provided in this Letter, the Finance Documents remain in full force and effect. |
4.4 |
Except to the extent amended or waived in this Letter, no amendment or waiver of any provision of any Finance Document is given by the terms of this Letter and the Finance Parties expressly reserve all their rights and remedies in respect of any breach of, or other default under, the Finance Documents. |
4.5 |
A person who is not a party to this Letter has no right under the Contracts (Right of Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Letter. |
4.6 |
This Letter may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of this Letter. |
5. |
Governing law |
5.1 |
This Letter and any non-contractual obligations arising out of or in connection with it are governed by English law. |
5.2 |
Clause 33 (Notices), Clause 38 (Confidential Information) and 43 (Enforcement) of the Facility Agreement shall apply to this Letter, mutatis mutandis, as if references in those provisions of the Facility Agreement to the Facility Agreement and Finance Document shall be construed as references to this Letter. |
2
Please sign and return a copy of this Letter to confirm your agreement to the above.
Yours faithfully
/s/ Mohamad Darwish |
|
|
|
Name: Mohamad Darwish |
|
|
|
Title: Authorised Signatory |
|
|
|
For and on behalf of |
|
|
|
IHS Netherlands Holdco B.V. |
|
/s/ Laurens Klein |
|
|
|
Name: Laurens Klein |
|
|
|
Title: Authorised Signatory |
|
|
|
For and on behalf of |
|
|
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IHS Netherlands Holdco B.V. |
|
3
/s/ Segun Anjorin |
|
|
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Name: Segun Anjorin |
|
|
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Title: Ag Head, Corporate Bank |
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|
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For and on behalf of |
|
|
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Ecobank Nigeria Limited as Facility Agent (acting on the instructions of the Majority Lenders) | |
4
Exhibit 4.11
|
IHS Netherlands Holdco B.V. |
Herikerbergweg 88 |
|
1101 CM |
|
Amsterdam |
|
www.ihstowers.com |
To:Ecobank Nigeria Limited (the “Agent”)
14 November 2024
Dear Sir or Madam
Amendment letter 3 relating to the Facility Agreement (as defined below)
1. |
Introduction |
1.1 |
We refer to the up to NGN 55,000,000,000 revolving credit facility dated 3 January 2023 between, amongst others, IHS Netherlands Holdco B.V. (“Holdco”), IHS Holding Limited (the “Company”), each of IHS (Nigeria) Limited, IHS Towers NG Limited and INT Towers Limited as borrowers, the Agent and each of the financial institutions named therein as original lenders (the “Facility Agreement”). |
1.2 |
Capitalised terms defined in the Facility Agreement shall have the same meaning when used herein unless expressly defined in this letter (the “Letter”). |
1.3 |
The provisions of clause 1.2 (Construction) and clause 1.7 (Third party rights) of the Facility Agreement apply to this Letter as though they were set out in full in this Letter with all necessary consequential changes; and with references in that clause to “this Agreement” being construed as references to this Letter. |
2. |
Background |
2.1 |
The Group has a number of intermediary Dutch holding companies within its group structure, including each of the Original Guarantors. |
2.2 |
The Company has decided, as part of an ongoing review of its Group corporate structure, to redomicile each of the Relevant Obligors (as defined in paragraph 2.3 below) to Mauritius, where some of its other intermediary group companies are also registered. Due to applicable Dutch law procedures, the redomiciliation will be effected in a two-step process, whereby the relevant entities (noted in paragraph 2.3 below) will each redomicile into Luxembourg and shortly thereafter into Mauritius (together, the “Transaction”). The intention is for the redomiciled companies to then become UK tax resident, similar to the Company. |
2.3 |
For the purposes of the Facility Agreement, the Transaction will be implemented for each of IHS Netherlands Holdco B.V., IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V. and Nigeria Tower Interco B.V., (each of which are Guarantors under the Facility Agreement) (the “Relevant Obligors”). |
2.4 |
Corporate re-domiciliation or migration by way of continuation is the process by which a company moves its domicile from one jurisdiction to another by changing the country under whose laws it is registered or incorporated, while maintaining the same legal identity. Upon the Transaction becoming effective for a Relevant Obligor, that Relevant Obligor will continue to exist (initially in Luxembourg for the interim period, and ultimately in Mauritius) with the same legal identity, shareholding structure, assets and liabilities. In particular, under Luxembourg and Mauritian law, the Transaction does not operate to: |
2.4.1 |
create a new legal entity; |
2.4.2 |
prejudice or affect the identity or continuity of that Relevant Obligor as previously constituted; |
2.4.3 |
affect the property of that Relevant Obligor; |
2.4.4 |
affect any appointment made, resolution passed or any other act or thing done in relation to that Relevant Obligor pursuant to a power conferred by any of the constitutional or other corporate documents of that Relevant Obligor or by the laws of The Netherlands under which that Relevant Obligor was previously incorporated and registered; |
2.4.5 |
affect the shareholding structure of that Relevant Obligor; or |
2.4.6 |
affect the rights, powers, authorities, functions, assets, liabilities or obligations of the Relevant Obligor. |
2.5 |
As the terms of the Facility Agreement provide for restrictions in relation to the change of jurisdiction of incorporation of the Company, Holdco and the Guarantors, the purpose of this Letter is to seek the consent of the Lenders to authorise the Transaction. |
2.6 |
In this Letter, “Effective Date” means the date upon which the Agent has countersigned this Letter. |
3. |
Consents |
3.1 |
The Agent confirms that the consent of the Majority Lenders has been obtained to the Company implementing the Transaction in the form described in this letter (provided strictly that each such redomiciliation is carried out in a manner that would constitute a Permitted Redomiciliation under the Facility Agreement as amended by this letter) and the amendments of the Facility Agreement referred to below and accordingly, on behalf of itself and each of the Lenders, agrees with effect on and from the Effective Date that the amendments to the Facility Agreement set out in Schedule 1 (Amendments) of this letter shall be deemed made. |
4. |
Guarantee Confirmation |
4.1 |
The Obligors’ Agent confirms that: |
4.1.1 |
the guarantee and indemnity contained in clause 19.1 (Guarantee and Indemnity) of the Facility Agreement shall, after giving effect to the amendments effected by this Letter, on and after the Effective Date continue in full force and effect and extend to the liabilities and obligations of each of the Obligors under the Facility Agreement and the other Finance Documents each as amended pursuant to the terms of this letter; and |
4.1.2 |
subject to the Legal Reservations, constitute legal, valid and binding obligations of the relevant Obligors enforceable in accordance with their terms. |
5. |
Representations and Warranties |
5.1 |
The Obligor’s Agent represents and warrants to the Agent and to the Lenders that it has been, and remains, appointed and authorised to act as the Obligors’ Agent in accordance with clause 2.5 (Obligors’ Agent) of the Facility Agreement. |
5.2 |
Each of the Repeating Representations shall be made on the Effective Date as if references to “this Agreement” in those Repeating Representations were references to this Letter. |
6. |
Miscellaneous |
6.1 |
This Letter is a Finance Document. |
6.2 |
From the Effective Date, the Facility Agreement and this Letter shall be read and construed as one document. |
6.3 |
Except as otherwise provided in this Letter, the Financing Documents remain in full force and effect. |
6.4 |
Except to the extent expressly waived in this Letter, no amendment or waiver of any provision of any Finance Document is given by the terms of this Letter and the Finance Parties expressly reserve |
2
all their rights and remedies in respect of any breach of, or other default under, the Finance Documents.
6.5 |
This Letter may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of this Letter. |
7. |
Governing law |
7.1 |
This Letter and any non-contractual obligations arising out of or in connection with it are governed by English law. |
7.2 |
Clause 33 (Notices), clause 38 (Confidentiality) and clause 43 (Enforcement) of the Facility Agreement shall apply to this Letter, mutatis mutandis, as if references in those provisions of the Facility Agreement to the Facility Agreement and Finance Document shall be construed as references to this Letter. |
3
Please sign and return a copy of this Letter to confirm your acceptance and agreement to its terms and conditions.
Yours faithfully
/s/ Mohamad Darwish |
|
Name: Mohamad Darwish |
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Title: Authorised Signatory |
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For and on behalf of |
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IHS Netherlands Holdco B.V. |
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/s/ Laurens Klein |
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Name: Laurens Klein |
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Title: Authorised Signatory |
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For and on behalf of |
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IHS Netherlands Holdco B.V. |
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/s/ Segun Anjorin |
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Name: Seugn Anjorin |
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Title: Ag Head, Corporate Bank |
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For and on behalf of |
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Ecobank Nigeria Limited |
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as Agent |
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4
SCHEDULE 1
AMENDMENTS
The Facility Agreement shall be amended as follows:
1. |
A definition of “Approved Jurisdiction” shall be added to clause 1.1 (Definitions) of the Facility Agreement, with the remaining definitions reordered alphabetically accordingly: |
““Approved Jurisdiction” means any state which is a member state of the European Union, the United Kingdom, the Federal Republic of Nigeria, the Cayman Islands or Mauritius.”
2. |
A definition of “Permitted Redomiciliation” shall be added to clause 1.1 (Definitions) of the Facility Agreement, with the remaining definitions reordered alphabetically accordingly: |
““Permitted Redomiciliation” means any redomiciliation of any Obligor (other than the Borrowers or any Original Guarantor incorporated in Nigeria) or of any member of the Nigeria Group (other than any member of the Nigeria Group incorporated in Nigeria) from its jurisdiction of incorporation, provided that, where such Redomiciliation or other redomiciliation relates to an Obligor:
(a) |
the relevant Obligor redomiciles within an Approved Jurisdiction; |
(b) |
no later than 15 Business Days prior to the proposed date for completion of the redomiciliation of the relevant Obligor taking effect, Holdco notifies the Agent of the proposed redomiciliation; |
(c) |
there is no change to the legal identity or assets or liabilities of the relevant Obligor (other than as permitted under paragraph (d) of the definition of Permitted Reorganisation), prejudice or effect on the identity or continuity or its properties as a result of such redomiciliation; |
(d) |
no Event of Default is continuing as at the date notice is provided under paragraph (b) above and no Default or mandatory prepayment event under Clause 8.1 (Change of Control) or Clause 8.2 (Sanctions) would occur as a result of such redomiciliation; |
(e) |
all assets of, and shares in, the relevant Obligor are not subject to Security under a Security Document at the date of completion of the redomiciliation; |
(f) |
the constitutional documents of the relevant Obligor and a legal opinion in form and substance satisfactory to the Agent (acting on the instruction of the Majority Lenders, acting reasonably) from legal advisers in the relevant jurisdiction of the redomiciliation are delivered to the Agent as soon as reasonably practicable (and in any event, within 30 days) following the date on which the relevant Obligor receives evidence of the completion of the final redomiciliation of the relevant Obligor; and |
(g) |
if the Agent (acting on the instructions of the Majority Lenders, acting reasonably and taking into account advice of the legal counsel to the Finance Parties in the relevant jurisdiction) requests any amendment to the Finance Documents that is necessary under the laws of the jurisdiction in which the final redomiciliation occurs in order to ensure that the rights, powers and remedies of the Finance Parties under the Finance Documents are not materially affected by such redomiciliation, the Agent and the Obligor shall enter into negotiations on a good faith basis (for a period of not more than 30 days) with a view to agreeing such amendments, |
and, after such redomiciliation has occurred in accordance with this definition, the jurisdiction of incorporation of the relevant Obligor shall be deemed to be the Approved Jurisdiction where such redomiciliation is completed for the purposes of this Agreement.”
3. |
A definition of “Relevant Jurisdiction” shall be added to clause 1.1 (Definitions) of the Facility Agreement, with the remaining definitions reordered alphabetically accordingly: |
5
““Relevant Jurisdiction” means in relation to an Obligor or member of the Nigeria Group:
(a) |
its jurisdiction of incorporation and, following a Permitted Redomiciliation, its jurisdiction of domicile following that Permitted Redomiciliation; and |
(b) |
any jurisdiction where any asset subject to any Security created or expressed to be created by it under a Security Document is situated.” |
4. |
The definition of “Permitted Disposal” in clause 1.1 (Definitions) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“Permitted Disposal” means any sale, lease, licence, transfer or other disposal:
(a) |
of assets by the Company or a member of the Nigeria Group in the ordinary course of trading or business activities; |
(b) |
by the Company to a member of the IHS Group, or between any members of the Nigeria Group; |
(c) |
of assets in exchange for other assets comparable or superior as to type, value or quality; |
(d) |
the decommissioning of any towers, including but not limited to in connection with tower consolidation purposes; |
(e) |
of obsolete or redundant assets no longer required for the relevant person’s business; |
(f) |
of Cash Equivalent Investments for a comparable amount of cash or in exchange for a comparable amount of other Cash Equivalent Investments; |
(g) |
arising as a result of the creation of any Permitted Security, a Permitted Payment, a Permitted Reorganisation or a Permitted Transaction; |
(h) |
of cash to the extent not otherwise prohibited by the terms of this Agreement (including by way of a Permitted Loan); |
(i) |
constituted by a licence of intellectual property rights; |
(j) |
constituted by a licence or sub-licence in the ordinary course of trading or business activities; |
(k) |
constituted by a lease or licence of real property arising in the ordinary course of trading or business activities of the disposing entity; |
(l) |
any share sale or issuance by the Company or share sale or issuance by any member of the Nigeria Group or arising as a result of any such share sale or issuance; |
(m) |
arising as a result of the sale of towers, provided that such towers are replaced by towers with an aggregate fair market value that is equal to or greater than the aggregate fair market value of the towers sold; |
(n) |
of trade receivables earned during a previous accounting period on a non-recourse basis (which may include recourse in respect of warranties and indemnities as to title and validity that are customarily provided in such non-recourse arrangements) and provided that such transaction does not have the commercial effect of a borrowing; |
(o) |
arising as a result of the disposition of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of trading or business activities or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements; |
(p) |
arising as a result of the foreclosure, condemnation or any similar action with respect to any property or other assets or a surrender or waiver of contract rights or the settlement, release or surrender of contract, tort or other claims of any kind; |
6
(q) |
arising as a result of a seizure, expropriation, nationalisation, intervention, restriction or other action by or on behalf of any governmental, regulatory or other authority which in each case does not constitute an Event of Default pursuant to Clause 24.9 (Creditors’ Process) or Clause 24.12 (Expropriation); |
(r) |
of treasury shares by the Company or any member of the Nigeria Group that are held following the exercise, in each case on a “cashless” or “net exercise” basis, of any option to purchase corporate stock, shares or membership interests granted to any future, present or former employee, director, officer, contractor or consultant of any member of the IHS Group pursuant to any employee benefit plans or arrangements, including for the purpose of satisfying any taxes (including estimated taxes) due as a result of the exercise of any such option; |
(s) |
to a Joint Venture, to the extent permitted by Clause 23.6 (Joint Ventures); |
(t) |
by the IHS Group (other than an Obligor) to the extent not otherwise restricted by the terms of this Agreement; and |
(u) |
arising under any single transaction or series of related transactions that involves assets having a fair market value of less than the greater of USD 25,000,000 (or its equivalent in other currencies) and an amount equal to zero point eight per cent. (0.8%) of Total Assets.” |
5. |
The definition of “Permitted Reorganisation” in clause 1.1 (Definitions) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“Permitted Reorganisation” means:
(a) |
a reorganisation on a solvent basis involving the business or assets of, or shares of the Company or any member of the Nigeria Group: |
(i) |
where the Company or a member of the Nigeria Group (as applicable) remains the surviving entity and the Relevant Jurisdiction of the Company or such member of the Nigeria Group remains the same; and |
(ii) |
if such reorganisation has the effect of disposal of any business, assets or shares, where such disposal would be a Permitted Disposal; or |
(iii) |
if such reorganisation has the effect of an acquisition of any business, assets or shares, where such acquisition would be a Permitted Acquisition; |
(b) |
any transaction contemplated under paragraph (c) of the definition of “Permitted Transaction”; |
(c) |
a transfer of all of the issued share capital of the Company to a newly incorporated holding company, subject to the conditions in paragraph (d) of the definition of Change of Control; |
(d) |
any merger or reorganisation of two or more members of the Nigeria Group (either as part of or separate to a Permitted Redomiciliation) where either: |
(i) |
one of such members of the Nigeria Group is the surviving entity; or |
(ii) |
the issued share capital of all such entities is transferred to another existing member of the Nigeria Group or a newly incorporated entity, |
in each case, provided that:
(A) |
where a member of the Nigeria Group is the surviving entity, the jurisdiction of incorporation of such member of the Nigeria Group remains the same or is an Approved Jurisdiction; |
(B) |
where a newly incorporated entity is the surviving entity, its jurisdiction of incorporation is the same as that of any member of the Nigeria Group |
7
undergoing such merger or reorganisation or is an Approved Jurisdiction; and
(C) |
where any such member of the Nigeria Group subject to such merger or reorganisation is an Obligor: |
(1) |
the surviving entity is an Obligor; or |
(2) |
if, as a result of the laws applicable in the jurisdiction of the entities subject to such merger or reorganisation, it is not possible for the surviving entity to effectively accede to this Agreement as a Guarantor prior to the date of such merger or reorganisation, the Company shall provide written notice to the Agent on or around the date of completion of the relevant merger or reorganisation of such merger or reorganisation occurring (the “Effective Reorganisation Date”) and procure that the surviving entity shall accede to this Agreement promptly and in any event within no more than 10 Business Days of the Effective Reorganisation Date; |
(e) |
a Permitted Redomiciliation; and |
(f) |
any other reorganisation approved by the Agent (acting on the instruction of the Majority Lenders).” |
6. |
The definition of “Permitted Transaction” in clause 1.1 (Definitions) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
““Permitted Transaction” means:
(a) |
any Financial Indebtedness incurred, guarantee or indemnity given, payment made, or other transaction arising, under the Finance Documents; |
(b) |
transactions (other than (i) any sale, lease, license, transfer or other disposal and (ii) the granting or creation of Security or the incurring or permitting to subsist of Financial Indebtedness) conducted in the ordinary course of trading or business of the Company or any member of the Nigeria Group on arm’s length terms; |
(c) |
the solvent liquidation or sale, lease, license, transfer or other disposal of Nigeria Tower Interco B.V.; and |
(d) |
a Permitted Redomiciliation.” |
7. |
Paragraphs (a) to (d) of clause 20.1 (Status) of the Facility Agreement shall be deleted in their entirety and replaced with the following: |
“(a) |
Other than in relation to the Company, it is a limited liability company, duly incorporated and validly existing under the law of its jurisdiction of incorporation (or, in the case of an Obligor (other than the Company) that has completed a Permitted Redomiciliation or a Permitted Reorganisation into an Approved Jurisdiction, a limited liability company duly incorporated or registered under the law of an Approved Jurisdiction). |
(b) |
In the case of the Company, it is an exempted company registered by way of continuation with limited liability, validly existing and in good standing under the laws of the Cayman Islands (or, in the case of the Company if it has completed a Permitted Redomiciliation or a Permitted Reorganisation into an Approved Jurisdiction, a limited liability company duly incorporated or registered under the law of an Approved Jurisdiction). |
(c) |
Each member of the Nigeria Group (other than an Obligor) is a limited liability company, duly incorporated and validly existing under the law of its jurisdiction of incorporation (or, in the case of a member of the Nigeria Group (other than an Obligor) that has |
8
completed a Permitted Redomiciliation or a Permitted Reorganisation into an Approved Jurisdiction, a limited liability company duly incorporated or registered under the law of an Approved Jurisdiction).
(d) |
It and each of its Subsidiaries has the power to own its own assets and carry on its business as it is being conducted.” |
8. |
Paragraph (a) (ii) of clause 20.5 (Validity and Admissibility in Evidence) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“(ii) |
to make the Finance Documents to which it is a party, subject to the Legal Reservations and the requirement to stamp the Finance Documents in Nigeria, admissible in evidence in its Relevant Jurisdiction,” |
9. |
Clause 20.6 (Governing Law and Enforcement) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“(a) |
Subject to the Legal Reservations, the choice of governing law of the Finance Documents as expressed in such Finance Document will be recognised in its Relevant Jurisdiction. |
(b) |
Subject to the Legal Reservations, any arbitral award or judgment obtained in relation to a Finance Document in the jurisdiction of the governing law of that Finance Document will be recognised and enforced in its Relevant Jurisdiction.” |
10. |
Paragraph (a)(ii) of clause 21.8 (“Know Your Customer” Checks) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“(ii) |
a Permitted Redomiciliation or any change in the status of an Obligor or the composition of the direct or indirect shareholders of an Obligor after the date of this Agreement; or” |
11. |
Clause 23.1 (Authorisations and Consents) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“Each Obligor shall promptly obtain, comply with and do all that is necessary to maintain in full force and effect any Authorisations required under any law or regulation of its Relevant Jurisdiction to:
(a) |
enable it to perform its obligations under the Finance Documents; |
(b) |
subject to the Legal Reservations, ensure the legality, validity, enforceability or admissibility in evidence of any Finance Documents; and |
(c) |
carry on its business save to the extent failure to do so would not reasonably be expected to have a Material Adverse Effect.” |
12. |
Clause 23.8 (Taxes) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“23.8Taxes
(a) |
Each Obligor shall (and shall ensure that each member of the Nigeria Group will) pay and discharge all Taxes imposed upon it or its assets within the time period allowed without incurring penalties unless and only to the extent that: |
(i) |
such payment is being contested in good faith; |
(ii) |
adequate reserves are being maintained for those Taxes; and |
(iii) |
such payment can be lawfully withheld and failure to pay those Taxes would not be reasonably likely to have a Material Adverse Effect. |
9
(b) |
The Company will remain resident for Tax purposes only in: |
(i) |
the UK and (as a result of its registration by way of continuation in the Cayman Islands) the Cayman Islands; or |
(ii) |
the UK. |
(c) |
Each member of the Nigeria Group will remain resident for Tax purposes in its jurisdiction of incorporation or establishment or, following a Permitted Redomiciliation or Permitted Reorganisation by it in an Approved Jurisdiction, an Approved Jurisdiction.” |
13. |
Paragraph (a)(i) of clause 24.8 (Insolvency Proceedings) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“(i) |
the suspension of payments, a moratorium of any indebtedness, winding-up, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) of the Company or any member of the Nigeria Group other than a solvent liquidation or reorganisation (including, for the avoidance of doubt, a Permitted Redomiciliation);” |
10
Exhibit 4.12
|
IHS Netherlands Holdco B.V. Herikerbergweg 88 1101 CM Amsterdam |
To: |
Ecobank Nigeria Limited (the “Facility Agent”) |
Attention : |
Olakunle Lowo |
28 January 2025
Unsecured NGN RCF Agreement – Amendment 4
Dear Sirs
| 1. | Introduction |
| 1.1 | We refer to the up to NGN 55,000,000,000 revolving credit facility dated 3 January 2023 between, amongst others, IHS Netherlands Holdco B.V. (“Holdco”), each of IHS (Nigeria) Limited, IHS Towers NG Limited and INT Towers Limited as the borrower, the Facility Agent and each of the financial institutions named therein as original lenders (the “Facility Agreement”). |
| 1.2 | Capitalised terms defined in the Facility Agreement shall have the same meaning when used herein unless expressly defined in this letter (the “Letter”). |
| 1.3 | The provisions of clause 1.2 (Construction) of the Facility Agreement apply to this Letter as though they were set out in full in this Letter with all necessary consequential changes; and with references in that clause to “this Agreement” being construed as references to this Letter. |
| 2. | Request for Amendment |
| 2.1 | In accordance with Clause 37.1 (Required Consents) of the Facility Agreement, Holdco hereby requests the consent of the Majority Lenders to the following amendment to the Facility Agreement: |
| 2.2 | On and from the date falling 1 January 2025, Clause 10.1(b)(Calculation of Interest) shall be deleted in its entirety and the numbering of Clause 10.1 shall be adjusted accordingly. |
| 2.3 | Clause 22.2(b) (Interest Cover Ratio) of the Facility Agreement shall be deleted in its entirety and replaced with the following: |
“Interest Coverage Ratio: On each Quarter Date, the Interest Cover Ratio shall not be less than: in respect of any Relevant Period beginning with the Relevant Period ending on 31 December 2024 and up to and including the Relevant Period ending on 31 December 2026, 2.00:1.”
| 3. | Amendment |
With effect from the date of this Letter, the Facility Agent (on behalf of the Lenders) confirms that any Default or Event of Default that would be continuing, were it not for the amendments set out in this Letter, are irrevocably waived.
| 4. | Miscellaneous |
| 4.1 | This Letter is a Finance Document. |
| 4.2 | From the date of this Letter, the Facility Agreement and this Letter shall be read and construed as one document. |
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| 4.3 | Except as otherwise provided in this Letter, the Finance Documents remain in full force and effect. |
| 4.4 | Except to the extent amended or waived in this Letter, no amendment or waiver of any provision of any Finance Document is given by the terms of this Letter and the Finance Parties expressly reserve all their rights and remedies in respect of any breach of, or other default under, the Finance Documents. |
| 4.5 | A person who is not a party to this Letter has no right under the Contracts (Right of Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Letter. |
| 4.6 | This Letter may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of this Letter. |
| 5. | Governing law |
| 5.1 | This Letter and any non-contractual obligations arising out of or in connection with it are governed by English law. |
| 5.2 | Clause 33 (Notices), Clause 38 (Confidential Information) and 43 (Enforcement) of the Facility Agreement shall apply to this Letter, mutatis mutandis, as if references in those provisions of the Facility Agreement to the Facility Agreement and Finance Document shall be construed as references to this Letter. |
2
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Please sign and return a copy of this Letter to confirm your agreement to the above.
Yours faithfully
/s/ Mohamad Darwish |
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Name: Mohamad Darwish |
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Title: Authorised Signatory |
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For and on behalf of |
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IHS Netherlands Holdco B.V. |
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/s/ Laurens Klein |
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Name: Laurens Klein |
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Title: Authorised Signatory |
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For and on behalf of |
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IHS Netherlands Holdco B.V. |
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3
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/s/ Segun Anjorin |
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Name: Segun Anjorin |
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Title: Ag Head, Corporate Bank |
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For and on behalf of |
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Ecobank Nigeria Limited as Facility Agent (acting on the instructions of the Majority Lenders) | ||
4
Exhibit 8.1
Entity name |
Country of incorporation |
IHS Holding Limited (ultimate parent) |
Cayman Islands |
IHS Mauritius Cameroon Limited |
Mauritius |
IHS Mauritius Côte d’Ivoire Limited |
Mauritius |
IHS Mauritius Netherlands Limited |
Mauritius |
IHS Mauritius Zambia Limited |
Mauritius |
IHS Mauritius Rwanda Limited |
Mauritius |
IHS Africa (UK) Limited |
United Kingdom |
IHS Netherlands (Interco) Coöperatief U.A. |
Netherlands |
IHS Netherlands Holdco B.V. |
Netherlands |
IHS Netherlands NG1 B.V. |
Netherlands |
IHS Netherlands NG2 B.V. |
Netherlands |
IHS Nigeria Limited |
Nigeria |
INT Towers Limited |
Nigeria |
INT Towers NG Finco 1 PLC |
Nigeria |
IHS Towers NG Limited |
Nigeria |
IHS Côte d’Ivoire S.A. |
Côte d’Ivoire |
IHS Cameroon S.A. |
Cameroon |
IHS Zambia Limited |
Zambia |
IHS Rwanda Limited |
Rwanda |
Rwanda Towers Limited |
Rwanda |
IHS Brasil - Cessão de Infraestruturas S.A. |
Brazil |
IHS Towers Colombia S.A.S |
Colombia |
San Gimignano Imoveis e Adminsitracao Ltda. |
Brazil |
Nigeria Tower Interco B.V. |
Netherlands |
IHS GCC Limited |
United Arab Emirates |
IHS Netherlands Connect B.V. |
Netherlands |
IHS FinCo Management Limited |
United Arab Emirates |
IHS GCC MAR Holding Limited |
United Arab Emirates |
Global Independent Connect Limited |
Nigeria |
IHS SSC FZE |
United Arab Emirates |
IHS Netherlands RSA B.V. |
Netherlands |
IHS Netherlands BR B.V. |
Netherlands |
IHS South Africa Holding Proprietary Limited |
South Africa |
IHS Towers South Africa Proprietary Limited |
South Africa |
IHS Netherlands PHP B.V. |
Netherlands |
IHS Towers Inc. |
United States of America |
IHS Netherlands EGY B.V. |
Netherlands |
IHS Telecom Towers Egypt S.A.E. |
Egypt |
IHS Brasil Serviços de Infraestrutura Ltda. |
Brazil |
IHS Fiber Brasil - Cessão de Infraestruturas Ltda. |
Brazil |
I-Systems Soluções de Infraestrutura S.A. |
Brazil |
Centennial Towers Colombia S.A.S. |
Colombia |
Polar Breeze Colombia S.A.S |
Colombia |
Centennial Towers Brasil Cooperatief U.A. |
Netherlands |
Centennial Towers of Brasil B.V. |
Netherlands |
Centennial Towers of Colombia Ltd. |
British Virgin Islands |
IHS E-Services (NG) Limited |
Nigeria |
Exhibit 11.1
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IHS HOLDING LIMITED |
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INSIDER TRADING COMPLIANCE POLICY |
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November 2023 |
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INDEX
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I. |
INTRODUCTION |
3 |
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II. |
STATEMENT OF POLICIES PROHIBITING INSIDER TRADING |
3 |
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III. |
EXPLANATION OF INSIDER TRADING |
4 |
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IV. |
STATEMENT OF PROCEDURES PREVENTING INSIDER TRADING |
9 |
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V. |
ADDITIONAL PROHIBITED TRANSACTIONS |
12 |
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VI. |
RULE 10B5‐1 TRADING PLANS |
14 |
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VII. |
INTERPRETATION, AMENDMENT AND IMPLEMENTATION OF THIS POLICY |
18 |
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VIII. |
CERTIFICATION OF COMPLIANCE |
18 |
2
I. |
INTRODUCTION |
Preventing insider trading is necessary to comply with securities laws and to preserve the reputation and integrity of IHS Holding Limited (the “Company”) and all persons affiliated with the Company. This updated Insider Trading Compliance Policy (this “Policy”) was adopted by the Board of Directors of the Company and came into effect on 8 November 2023.
“Insider trading” occurs when any person purchases or sells a security while in possession of inside information relating to the security. As explained below, “inside information” is information that is both “material” and “non- public.” Insider trading is a crime. The penalties for violating insider trading laws include imprisonment, disgorgement of profits, civil fines, and significant criminal fines. Insider trading is also prohibited by this Policy, and violation of this Policy may result in Company-imposed sanctions, including termination of employment for cause.
This Policy applies to all officers, directors and employees of the Company and, at the Company’s discretion, to any consultants and contractors of the Company. Individuals subject to this Policy are responsible for ensuring that members of their households also comply with this Policy. This Policy also applies to any entities controlled by individuals subject to the Policy, including any corporations, partnerships or trusts (such entities, together with all officers, directors and employees of the Company, are referred to as the “Covered Persons”), and transactions by these entities should be treated for the purposes of this Policy and applicable securities laws as if they were for the individual’s own account. This Policy extends to all activities within and outside an individual’s Company duties. Every officer, director and employee must review this Policy. Questions regarding the Policy should be directed to the Group Legal function.
It should be noted that this Policy primarily addresses compliance with United States law. Many other laws, including without limitation the laws of the Cayman Islands, may also be implicated by trading in the securities of the Company.
II. |
STATEMENT OF POLICIES PROHIBITING INSIDER TRADING |
No Covered Person shall purchase or sell any type of security while in possession of material, non-public information relating to the security, whether the issuer of such security is the Company or any other company, including another company in the Company’s industry.
These prohibitions do not apply to the following “permitted transactions”:
3
| ◾ | purchases of the Company’s securities by a Covered Person from the Company or sales of the Company’s securities by a Covered Person to the Company; |
| ◾ | exercises of stock options or other equity awards or the surrender of shares to the Company in payment of the exercise price or in satisfaction of any tax obligations in a manner permitted by the applicable equity award agreement, or vesting of equity-based awards, that in each case do not involve a market sale of the Company’s securities (the “cashless exercise” of Company stock options through a broker does involve a market sale of the Company’s securities, and therefore would not qualify under this exception); |
| ◾ | bona fide gifts of the Company’s securities, unless the person making the gift has reason to believe that the recipient intends to sell the securities while the donor is in possession of material, non-public information about the Company; or |
| ◾ | purchases or sales of the Company’s securities made pursuant to any binding contract, specific instruction or written plan entered into outside of a black-out period and while the purchaser or seller, as applicable, was unaware of any material, non-public information and which contract, instruction or plan (i) meets all of the requirements of the affirmative defense provided by Rule 10b5-1 (“Rule 10b5-1”) promulgated under the Securities Exchange Act of 1934, as amended (the “1934 Act”), (ii) was pre-cleared in advance pursuant to this Policy and (iii) has not been amended or modified in any respect after such initial pre- clearance without such amendment or modification being pre-cleared in advance pursuant to this Policy. |
In addition, no Covered Person shall directly or indirectly communicate (or “tip”) material, non-public information to anyone within the Company, other than on a need-to-know basis, or to anyone outside of the Company, except in accordance with the Company’s policies regarding the protection or authorized external disclosure of Company information, including the Company’s Policy Statement Guidelines for Corporate Disclosure.
The General Counsel of the Company has the final determination for interpreting this Policy.
III. |
EXPLANATION OF INSIDER TRADING |
“Insider trading” refers to the purchase or sale of a security while in possession of material, non-public information relating to the security or its issuer.
“Securities” includes stocks, bonds, notes, debentures, options, warrants and other convertible securities, as well as derivative instruments.
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“Purchase” and “sale” are defined broadly under the federal securities law. “Purchase” includes not only the actual purchase of a security, but any contract to purchase or otherwise acquire a security. “Sale” includes not only the actual sale of a security, but any contract to sell or otherwise dispose of a security. These definitions extend to a broad range of transactions, including conventional cash-for-stock transactions, conversions, the exercise of stock options, transfers, gifts, and acquisitions and exercises of warrants or puts, calls or other derivative securities.
It is generally understood that insider trading includes the following:
| ◾ | trading by insiders while in possession of material, non-public information; |
| ◾ | trading by persons other than insiders while in possession of material, non-public information, if the information either was given in breach of an insider’s fiduciary duty to keep it confidential or was misappropriated; and |
| ◾ | communicating or tipping material, non-public information to others, including recommending the purchase or sale of a security while in possession of such information. |
A.WHAT FACTS ARE MATERIAL?
The materiality of a fact depends upon the circumstances. A fact is considered “material” if there is a substantial likelihood that a reasonable investor would consider it important in making a decision to buy, sell or hold a security, or if the fact is likely to have a significant effect on the market price of the security. Material information can be positive or negative and can relate to virtually any aspect of a company’s business or to any type of security, debt or equity.
Examples of material information include (but are not limited to) information about:
| ◾ | corporate earnings or earnings forecasts; |
| ◾ | possible mergers, acquisitions, tender offers or dispositions; |
| ◾ | major new products or product developments; |
| ◾ | important business developments such as developments regarding strategic collaborations; |
| ◾ | management or control changes; |
| ◾ | significant financing developments including pending public sales or offerings of debt or equity securities; |
| ◾ | defaults on borrowings; |
| ◾ | bankruptcies; |
| ◾ | cybersecurity or data security incidents; and |
| ◾ | significant litigation or regulatory actions. |
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Moreover, material information does not have to be related to a company’s business. For example, the contents of a forthcoming newspaper column that is expected to affect the market price of a security can be material. A good general rule of thumb: When in doubt, do not trade.
B.WHAT IS NON-PUBLIC?
Information is “non-public” if it is not available to the general public. In order for information to be considered public, it must be widely disseminated in a manner making it generally available to investors through media such as Dow Jones, Business Wire, Reuters, The Wall Street Journal, Associated Press, United Press International, or Bloomberg, a broadcast on widely available radio or television programs, publication in a widely available newspaper, magazine or news web site, a Regulation FD-compliant conference call or webcast, or public disclosure documents filed with the Securities and Exchange Commission (“SEC”) that are available on the SEC’s web site.
The circulation of rumors, even if accurate and reported in the media, does not constitute effective public dissemination. In addition, even after a public announcement, a reasonable period of time must lapse in order for the market to react to the information. Generally, one should allow two full trading days following publication as a reasonable waiting period before such information is deemed to be public. For the purposes of this Policy, a “trading day” is a day on which U.S. national stock exchanges are open for trading. If, for example, the Company were to make an announcement on a Monday prior to 9:30 a.m. Eastern time, the information would be deemed public after the close of trading on Tuesday. If an announcement were made on a Monday after 9:30 a.m. Eastern time, the information would be deemed public after the close of trading on Wednesday. If you have any question as to whether information is publicly available, please err on the side of caution and direct an inquiry to the Group Legal function.
C.WHO IS AN INSIDER?
“Insiders” include officers, directors and employees of a company and anyone else who has material non- public information about a company. Insiders have independent fiduciary duties to their company and its stockholders not to trade on material, non-public information relating to the company’s securities. Individuals subject to this Policy are responsible for ensuring that members of their households also comply with this Policy. This Policy also applies to any entities controlled by individuals subject to the Policy, including any corporations, partnerships or trusts, and transactions by these entities should be treated for the purposes of this Policy and applicable securities laws as if they were for the individual’s own account.
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D.TRADING BY PERSONS OTHER THAN INSIDERS
Insiders may be liable for communicating or tipping material, non-public information to a third party (“tippee”), and insider trading violations are not limited to trading or tipping by insiders. Persons other than insiders also can be liable for insider trading, including tippees who trade on material, non-public information tipped to them or individuals who trade on material, non-public information that has been misappropriated.
Tippees inherit an insider’s duties and are liable for trading on material, non-public information illegally tipped to them by an insider. Similarly, just as insiders are liable for the insider trading of their tippees, so are tippees who pass the information along to others who trade. In other words, a tippee’s liability for insider trading is no different from that of an insider. Tippees can obtain material, non-public information by receiving overt tips from others or through, among other things, conversations at social, business, or other gatherings.
E.PENALTIES FOR ENGAGING IN INSIDER TRADING
Penalties for trading on or tipping material, non-public information can extend significantly beyond any profits made or losses avoided, both for individuals engaging in such unlawful conduct and their employers. The SEC and Department of Justice have made the civil and criminal prosecution of insider trading violations a top priority. Enforcement remedies available to the government or private plaintiffs under the federal securities laws include:
| ◾ | SEC administrative sanctions; |
| ◾ | securities industry self-regulatory organization sanctions; |
| ◾ | civil injunctions; |
| ◾ | damage awards to private plaintiffs; |
| ◾ | disgorgement of all profits; |
| ◾ | significant civil and criminal fines for the violator; |
| ◾ | significant civil fines for the employer or other controlling person of a violator (i.e., where the violator is an employee or other controlled person); and |
| ◾ | jail sentences of up to 20 years. |
In addition, insider trading could result in serious sanctions by the Company, including dismissal. Insider trading violations are not limited to violations of the federal securities laws. Other federal and state civil or criminal laws (including of non-US jurisdictions), such as the laws prohibiting mail and wire fraud and the Racketeer Influenced and Corrupt Organizations Act (RICO), also may be violated in connection with insider trading.
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F.SIZE OF TRANSACTION AND REASON FOR TRANSACTION DO NOT MATTER
The size of the transaction or the amount of profit received does not have to be significant to result in prosecution. The SEC has the ability to monitor even the smallest trades, and the SEC performs routine market surveillance. Brokers and dealers are required by law to inform the SEC of any possible violations by people who may have material, non-public information. The SEC and other similar regulatory authorities (including in other jurisdictions) aggressively investigate even small insider trading violations.
G.EXAMPLES OF INSIDER TRADING
Examples of insider trading cases include:
| ◾ | actions brought against corporate officers, directors, and employees who traded in a company’s securities after learning of significant confidential corporate developments; |
| ◾ | friends, business associates, family members and other tippees of such officers, directors, and employees who traded in the securities after receiving such information; |
| ◾ | government employees who learned of such information in the course of their employment; and |
| ◾ | other persons who misappropriated, and took advantage of, confidential information from their employers. |
The following are illustrations of insider trading violations. These illustrations are hypothetical and, consequently, not intended to reflect on the actual activities or business of the Company or any other entity.
Trading by Insider
An officer of X Corporation learns that earnings to be reported by X Corporation will increase dramatically. Prior to the public announcement of such earnings, the officer purchases X Corporation’s stock. The officer, an insider, is liable for all profits as well as penalties of up to three times the amount of all profits. The officer also is subject to, among other things, criminal prosecution, including up to $5,000,000 in additional fines and 20 years in jail. Depending upon the circumstances, X Corporation and the individual to whom the officer reports also could be liable as controlling persons.
Trading by Tippee
An officer of X Corporation tells a friend that X Corporation is about to publicly announce that it has signed an agreement for a major acquisition. This tip causes the friend to purchase X Corporation’s stock in advance of the announcement. The officer is jointly liable with his friend for all of the friend’s profits, and each is liable for all civil penalties of up to three times the amount of the friend’s profits. The officer and his friend are also subject to criminal prosecution and other remedies and sanctions, as described above.
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H.PROHIBITION OF RECORDS FALSIFICATION AND FALSE STATEMENTS
Section 13(b)(2) of the 1934 Act requires companies subject to the Act to maintain proper internal books and records and to devise and maintain an adequate system of internal accounting controls. The SEC has supplemented the statutory requirements by adopting rules that prohibit (1) any person from falsifying records or accounts subject to the above requirements and (2) officers or directors from making any materially false, misleading, or incomplete statement to any accountant in connection with any audit or filing with the SEC. These provisions reflect the SEC’s intent to discourage officers, directors and other persons with access to the Company’s books and records from taking action that might result in the communication of materially misleading financial information to the investing public.
IV. |
STATEMENT OF PROCEDURES PREVENTING INSIDER TRADING |
The following procedures have been established, and will be maintained and enforced, by the Company to prevent insider trading. Every officer, director and designated employee is required to follow these procedures.
A.PRE-CLEARANCE OF ALL TRADES BY ALL OFFICERS, DIRECTORS AND EMPLOYEES
To provide assistance in preventing inadvertent violations of applicable securities laws and to avoid the appearance of impropriety in connection with the purchase and sale of the Company’s securities, all transactions in the Company’s securities (including without limitation, acquisitions and dispositions of Company stock, debt securities, the exercise of stock options and the sale of Company stock issued upon exercise of stock options) by officers, directors and such other employees as are designated from time to time by the General Counsel or Chief Financial Officer as being subject to this pre-clearance process (each, a “Pre-Clearance Person”) must be pre- cleared by the Group Legal and Compliance Team (or such other person(s) designated by the General Counsel). Pre-clearance does not relieve anyone of his or her responsibility under SEC or other applicable rules. For the avoidance of doubt, the employees who are subject to pre-clearance may be updated from time to time by the General Counsel or Chief Financial Officer.
A request for pre-clearance shall be in writing (including without limitation by e-mail), and should be made in accordance with the process set out by the Group Legal and Compliance Team at least two business days in advance of the proposed transaction. The request for pre-clearance should include the identity of the Pre-Clearance Person, the type of proposed transaction (for example, an open market purchase, a privately negotiated sale, an option exercise, etc.), the proposed date of the transaction and the number of shares, options or other securities to be involved.
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In addition, the Pre-Clearance Person must certify in the manner required by the Group Legal and Compliance Team that the Pre-Clearance Person is not aware of material, non-public information about the Company. The General Counsel shall have sole discretion to decide whether to clear any contemplated transaction, provided that the Chief Financial Officer shall have sole discretion to decide whether to clear transactions by the General Counsel or Covered Persons subject to this Policy as a result of their relationship with the General Counsel. All trades that are pre-cleared must be effected within five business days of receipt of the pre-clearance unless a specific exception has been granted by the General Counsel (or the Chief Financial Officer, in the case of the General Counsel or persons or entities subject to this policy as a result of their relationship with the General Counsel). A pre- cleared trade (or any portion of a pre-cleared trade) that has not been effected during the five business day period must be pre-cleared again prior to execution. Notwithstanding receipt of pre-clearance, if the Pre-Clearance Person becomes aware of material, non-public information or becomes subject to a black-out period before the transaction is effected, the transaction may not be completed.
B.BLACK-OUT PERIODS
No officer, director or other employee designated from time to time by the General Counsel or the Chief Financial Officer as being subject to quarterly black-out periods shall purchase or sell any security of the Company during the period beginning at 11:59 p.m., Eastern time, on the 14th calendar day before the end of any fiscal quarter of the Company and ending upon the completion of the second full trading day after the public release of earnings data for such fiscal quarter or during any other trading suspension period declared by the Company, except for purchases and sales made pursuant to the permitted transactions described above. For example, if the Company’s fourth fiscal quarter ends at 11:59 p.m., Eastern time, on December 31, the corresponding black-out period would begin at 11:59 p.m., Eastern time, on December 17. For the avoidance of doubt, any designation of the employees who are subject to quarterly black-out periods may be updated from time to time by the Chief Financial Officer or General Counsel.
Exceptions to the black-out period policy may be approved only by the General Counsel (or such other person designated by the General Counsel) or, in the case of an exception for the General Counsel or Covered Persons subject to this policy as a result of their relationship with the General Counsel, the Chief Financial Officer.
From time to time, the Company, through the Board of Directors, the Company’s Disclosure Committee, the Chief Financial Officer or the General Counsel, may recommend or require that officers, directors, employees or others suspend trading in the Company’s securities because of developments that have not yet been disclosed to the public. Subject to the exceptions noted above, all of those affected should not trade in the Company’s securities while the suspension is in effect, and should not disclose to others that the Company has suspended trading.
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C.POST-TERMINATION TRANSACTIONS
If an individual is in possession of material, non-public information when his or her service terminates, that individual may not trade in the Company’s securities until that information has become public or is no longer material.
D.LIMITATIONS ON ACCESS TO COMPANY INFORMATION
Access to material, non-public information about the Company, including the Company’s business, earnings or prospects, should be limited to directors, officers and employees of the Company on a need-to-know basis. In addition, such information should not be communicated to anyone within the Company other than on a need-to-know basis or to anyone outside the Company under any circumstances, except in accordance with the Company’s policies regarding the protection or authorized external disclosure of Company information, including the Policy Statement Guidelines for Corporate Disclosure, as administered by the Company’s Disclosure Committee.
In communicating material, non-public information to employees of the Company, all directors, officers and employees must take care to emphasize the need for confidential treatment of such information and adherence to the Company’s policies with regard to confidential information.
The following procedures are designed to maintain confidentiality with respect to the Company’s business operations and activities.
All officers, directors and employees should take all steps and precautions necessary to restrict access to, and secure, material, non-public information by, among other things:
| ◾ | maintaining the confidentiality of Company-related transactions; |
| ◾ | conducting their business and social activities so as not to risk inadvertent disclosure of confidential information. Review of confidential documents in public places should be conducted so as to prevent access by unauthorized persons; |
| ◾ | restricting access to documents and files (including computer files) containing material, non-public information to individuals on a need-to-know basis (including maintaining control over the distribution of documents and drafts of documents); |
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| ◾ | promptly removing and cleaning up all confidential documents and other materials from conference rooms following the conclusion of any meetings; |
| ◾ | disposing of all confidential documents and other papers, after there is no longer any business or other legally required need, through shredders when appropriate; |
| ◾ | restricting access to areas likely to contain confidential documents or material, non-public information; |
| ◾ | safeguarding laptop computers, mobile devices, tablets, memory sticks, CDs and other items that contain confidential information; and |
| ◾ | avoiding the discussion of material, non-public information in places where the information could be overheard by others such as in elevators, restrooms, hallways, restaurants, airplanes or taxicabs. |
Personnel involved with material, non-public information, to the extent feasible, should conduct their business and activities in areas separate from other Company activities.
Inquiries from third parties, such as industry analysts or members of the media, about the Company should be directed to the Chief Financial Officer, the Disclosure Committee and the Group Investor Relations team.
V. |
ADDITIONAL PROHIBITED TRANSACTIONS |
The Company has determined that there is a heightened legal risk and/or the appearance of improper or inappropriate conduct if the persons subject to this Policy engage in certain types of transactions. Therefore, officers, directors and employees shall comply with the following policies with respect to certain transactions in the Company securities:
A.SHORT SALES
Short sales of the Company’s securities are prohibited by this Policy. Short sales of the Company’s securities evidence an expectation on the part of the seller that the securities will decline in value, and therefore signal to the market that the seller has no confidence in the Company or its short-term prospects. In addition, short sales may reduce the seller’s incentive to improve the Company’s performance.
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B.OPTIONS
Transactions in puts, calls or other derivative securities involving the Company’s equity securities, on an exchange, on any other organized market or on an over-the-counter market, are prohibited by this Policy. A transaction in options is, in effect, a bet on the short-term movement of the Company’s stock and therefore creates the appearance that an officer, director or employee is trading based on inside information.
Transactions in options, whether traded on an exchange, on any other organized market or on an over- the- counter market, also may focus an officer’s, director’s or employee’s attention on short-term performance at the expense of the Company’s long-term objectives.
This prohibition does not apply to the exercise of employee stock options issued as part of the Company’s equity incentive plans, which may be exercised. Employee stock options cannot be traded publicly or transferred unless they have been first exercised. If you have been awarded employee stock options in the course of your employment, you may at any time exercise vested employee stock options and receive the underlying shares by paying cash or having the Company withhold shares for the exercise price of the employee stock option and to satisfy related tax-withholding requirements, as applicable. Shares that are acquired upon exercise of an employee stock option will be treated like any other shares subject to this Policy.
C.HEDGING TRANSACTIONS
Purchasing financial instruments, such as prepaid variable forward contracts, equity swaps, collars, and exchange funds, or otherwise engaging in transactions that hedge or offset, or are designed to hedge or offset, any decrease in the market value of the Company’s equity securities, may cause an officer, director, or employee to no longer have the same objectives as the Company’s other stockholders. Therefore, all such transactions involving the Company’s securities, whether such securities were granted as compensation or are otherwise held, directly or indirectly, are prohibited by this Policy.
D.PURCHASES OF THE COMPANY’S SECURITIES ON MARGIN; PLEDGING THE COMPANY’S SECURITIES TO SECURE MARGIN OR OTHER LOANS
Purchasing on margin means borrowing from a brokerage firm, bank or other entity in order to purchase the Company’s securities (other than in connection with a cashless exercise of stock options through a broker under the Company’s equity plans).
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Margin purchases of the Company’s securities are prohibited by this Policy. Pledging the Company’s securities as collateral to secure loans is prohibited. This prohibition means, among other things, that you cannot hold the Company’s securities in a “margin account” (which would allow you to borrow against your holdings to buy securities).
E.PARTNERSHIP DISTRIBUTIONS
Nothing in this Policy is intended to limit the ability of a venture capital partnership or other similar entity with which a director is affiliated to distribute Company securities to its partners, members or other similar persons. It is the responsibility of each affected director and the affiliated entity, in consultation with their own counsel (as appropriate), to determine the timing of any distributions, based on all relevant facts and circumstances and applicable securities laws.
VI. |
RULE 10B5‐1 TRADING PLANS |
A.OVERVIEW
Rule 10b5-1 presents an opportunity for insiders to establish arrangements to sell (or purchase) Company stock without the restrictions of trading windows and black-out periods, even when there is undisclosed material information. Rule 10b5-1 will protect directors, officers and employees from insider trading liability under Rule 10b5- 1 for transactions under a previously established contract, plan or instruction to trade in the Company’s stock (a “Trading Plan”) entered into in good faith and in accordance with the terms of Rule 10b5-1 and all applicable state laws and will be exempt from the trading restrictions set forth in this Policy. Trading Plans only provide an “affirmative defense” in the event there is an insider trading lawsuit. A Trading Plan may also help reduce negative publicity that may result when key executives sell the Company’s stock. It does not prevent someone from bringing a lawsuit.
The initiation of, and any modification to, any such Trading Plan will be deemed to be a transaction in the Company’s securities, and such initiation or modification is subject to all limitations and prohibitions relating to transactions in the Company’s securities. Each such Trading Plan, and any modification thereof, must be submitted to and pre-approved by the Group Legal function, or such other person as the General Counsel may designate from time to time (the “Authorizing Officer”), who may impose such conditions and requirements on the implementation and operation of the Trading Plan as the Authorizing Officer deems necessary or advisable in order to comply with the rules and regulations of regarding such plans set forth by the SEC. The Authorizing Officer will communicate the conditions and requirements on implementation and operation of the Trading Plan that have been established from time to time to the person initiating the Trading Plan, but for all Trading Plans:
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| ● | there must be included a “cooling-off period” for (x) officers and directors that extends to the later of 90 days after the adoption or modification of a Trading Plan or two business days after the disclosure of the Company’s financial results in a Form 6-K or Form 20-F by the Company covering the fiscal quarter in which the Trading Plan was adopted or modified, up to a maximum of 120 days or (y) any employees or other persons (other than the Company itself) that extends 30 days after adoption or modification of the Trading Plan; |
| ● | for executive officers and directors, there is included in the Trading Plan a representation that such person is (1) not aware of any material non-public information about the Company or its securities and (2) adopting the Trading Plan in good faith and not as part of a plan or scheme to evade Rule 10b-5; |
| ● | the Trading Plan has been entered into in good faith at a time when the individual was not in possession of material non-public information about the Company and not otherwise in a black-out period, and the person who entered into the Trading Plan has acted in good faith with respect to the Trading Plan; |
| ● | the Trading Plan either (x) specifies the amounts, prices, and dates of all transactions under the Trading Plan; or (y) provides a written formula, algorithm, or computer program for determining the amount, price, and date of the transactions, and also prohibits the individual from exercising any subsequent influence over the transactions; and |
| ● | complies with all other applicable requirements of Rule 10b5-1. |
The Authorizing Officer may impose such other conditions on the implementation and operation of the Trading Plan as the Authorizing Officer deems necessary or advisable. Individuals may not adopt more than one Trading Plan at a time except under the limited circumstances permitted by Rule 10b5-1 and subject to pre-approval by the Authorizing Officer.
A director, officer or employee may enter into a Trading Plan only when he or she is not in possession of material, non-public information, and only during a trading window period outside of the trading black-out period. The Company reserves the right from time to time to suspend, discontinue or otherwise prohibit any transaction in the Company’s securities, even pursuant to a previously approved Trading Plan, if the Authorizing Officer, in their discretion, determines that such suspension, discontinuation or other prohibition is in the best interests of the Company. Failure to discontinue purchases and sales as directed shall constitute a violation of the terms of this Policy.
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An individual may only modify a Trading Plan outside of a black-out period and, in any event, when the individual does not possess material non-public information. Modifications to and terminations of a Trading Plan are subject to pre-approval by the Authorizing Officer and modifications of a Trading Plan that change the amount, price, or timing of the purchase or sale of the securities underlying a Trading Plan will trigger a new cooling-off period.
The transactions prohibited under this Policy, including but not limited to short sales and hedging transactions, may not be carried out through a Trading Plan or other arrangement or trading instruction involving potential sales or purchases of the Company’s securities.
The Company reserves the right to publicly disclose, announce, or respond to inquiries from the media regarding the adoption, modification, or termination of a Trading Plan and non-Rule 10b5-1 trading arrangements, or the execution of transactions made under a Trading Plan. The Company also reserves the right from time to time to suspend, discontinue, or otherwise prohibit transactions under a Trading Plan if the Authorizing Officer or the Board of Directors, in their discretion, determines that such suspension, discontinuation, or other prohibition is in the best interests of the Company.
Compliance of a Trading Plan with the terms of Rule 10b5-1 and the execution of transactions pursuant to the Trading Plan are the sole responsibility of the person initiating the Trading Plan, and none of the Company, the Group Legal and Compliance Team, the General Counsel, the Authorizing Officer, or the Company’s other employees assumes any liability for any delay in reviewing and/or refusing to approve a Trading Plan submitted for approval, nor the legality or consequences relating to a person entering into, informing the Company of, or trading under, a Trading Plan.
B.DISCRETIONARY PLANS
Although non-discretionary Trading Plans are preferred, discretionary Trading Plans, where the discretion or control over trading is transferred to a broker, are permitted if pre-approved by the Authorizing Officer.
The Authorizing Officer of the Company must pre-approve any discretionary Trading Plan, arrangement or trading instructions, etc., involving potential sales or purchases of the Company’s stock or option exercises, including but not limited to, blind trusts, discretionary accounts with banks or brokers, or limit orders. The actual transactions effected pursuant to a pre-approved Trading Plan will not be subject to further pre-clearance for transactions in the Company’s stock once the Trading Plan or other arrangement has been pre-approved.
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C.REPORTING (IF REQUIRED)
If required, an SEC Form 144 will be filled out and filed by the individual/brokerage firm in accordance with the existing rules regarding Form 144 filings.
D.TRADES OUTSIDE OF A TRADING PLAN
During an open trading window, trades differing from Trading Plan instructions that are already in place are allowed as long as the Trading Plan continues to be followed in accordance with the requirements of Rule 10b5-1 and such trades receive the necessary pre-clearance.
E.PUBLIC ANNOUNCEMENTS
The Company may make a public announcement that Trading Plans are being implemented in accordance with Rule 10b5-1. It will consider in each case whether a public announcement of a particular Trading Plan should be made. It may also make public announcements or respond to inquiries from the media as transactions are made under a Trading Plan, including in accordance with the Company’s Policy Statement Guidelines for Corporate Disclosure, as administered by the Company’s Disclosure Committee.
F.PROHIBITED TRANSACTIONS
The transactions prohibited under Section V of this Policy, including among others short sales and hedging transactions, may not be carried out through a Trading Plan or other arrangement or trading instruction involving potential sales or purchases of the Company’s securities.
G.LIMITATION ON LIABILITY
None of the Company, the General Counsel, Chief Financial Officer, the Authorizing Officer, the Company’s other employees or any other person will have any liability for any delay in reviewing, or refusal of, a Trading Plan or a request for pre-clearance submitted for approval pursuant to this Policy. Notwithstanding any review of a Trading Plan or pre-clearance of a transaction pursuant this Policy, none of the Company, the General Counsel, the Authorizing Officer, the Company’s other employees or any other person assumes any liability for the legality or consequences of such Trading Plan or transaction to the person engaging in or adopting such Trading Plan or transaction.
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VII. |
INTERPRETATION, AMENDMENT AND IMPLEMENTATION OF THIS POLICY |
The General Counsel shall have the authority to interpret and update this Policy and all related policies and procedures. In particular, such interpretations and updates of this Policy, as authorized by the General Counsel, may include amendments to or departures from the terms of this Policy, to the extent consistent with the general purpose of this Policy and applicable securities laws.
Actions taken by the Company, the General Counsel, the Group Legal and Compliance Team, or any other Company personnel pursuant to this policy or its interpretation and application do not constitute legal advice, nor do they insulate you from the consequences of non-compliance with this Policy or with securities laws.
VIII. |
CERTIFICATION OF COMPLIANCE |
After reading this Policy and on an annual basis, all officers, directors and employees should complete the certification Process related to this Policy established by the Group Legal and Compliance Team.
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Exhibit 12.1 |
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IHS Holding Limited 1 Cathedral Piazza 123 Victoria Street London, SW1E 5BP United Kingdom www.ihstowers.com |
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Sam Darwish, Chief Executive Officer, certify that:
1. |
I have reviewed this annual report on Form 20-F of IHS Holding Limited (the “Company”); |
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report; |
4. |
The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have: |
(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) |
Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) |
Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and |
5. |
The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions): |
|
Exhibit 12.1 |
|
IHS Holding Limited 1 Cathedral Piazza 123 Victoria Street London, SW1E 5BP United Kingdom www.ihstowers.com |
(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and |
(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting. |
Date: March 18, 2025 |
By: |
/s/ Sam Darwish |
|
|
Name: Sam Darwish |
|
|
Title: Chief Executive Officer |
|
Exhibit 12.2 |
|
IHS Holding Limited 1 Cathedral Piazza 123 Victoria Street London, SW1E 5BP United Kingdom www.ihstowers.com |
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Steve Howden, Chief Financial Officer, certify that:
1. |
I have reviewed this annual report on Form 20-F of IHS Holding Limited (the “Company”); |
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report; |
4. |
The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have: |
(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) |
Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) |
Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and |
5. |
The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions): |
(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and |
(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting. |
Date: March 18, 2025 |
By: |
/s/ Steve Howden |
|
|
Name: Steve Howden |
|
|
Title: Chief Financial Officer |
|
Exhibit 13.1 |
|
IHS Holding Limited 1 Cathedral Piazza 123 Victoria Street London, SW1E 5BP United Kingdom www.ihstowers.com |
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 906 OF
THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 20-F of IHS Holding Limited (the “Company”) for the year ended December 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Sam Darwish, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: March 18, 2025 |
By: |
/s/ Sam Darwish |
|
|
Name: Sam Darwish |
|
|
Title: Chief Executive Officer |
|
Exhibit 13.2 |
|
IHS Holding Limited 1 Cathedral Piazza 123 Victoria Street London, SW1E 5BP United Kingdom www.ihstowers.com |
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 906 OF
THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 20-F of IHS Holding Limited (the “Company”) for the year ended December 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Steve Howden, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: March 18, 2025 |
By: |
/s/ Steve Howden |
|
|
Name: Steve Howden |
|
|
Title: Chief Financial Officer |
Exhibit 15.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-260317) of IHS Holding Limited of our report dated March 18, 2025 relating to the financial statements, financial statement schedule and the effectiveness of internal control over financial reporting, which appears in this Form 20-F.
/s/ PricewaterhouseCoopers LLP
London, United Kingdom
March 18, 2025
