ICBC contributes to a €3.025 billion EUR syndicated loan to PPF Arena 1 to finance the acquisition of Telenor CEE Group and refinance existing loan facilities related to the acquisition of O2 Czech Republic

March 2018 €3.025 billion EUR syndicated loan to PPF Arena 1 to finance the acquisition of Telenor CEE Group and refinance existing loan facilities related to the acquisition of O2 Czech Republic On March 21, 2018, a syndicate of 15 banks — including the Bank of China (BOC) and the Industrial and Commercial Bank of China (ICBC) — entered into a €3.025 billion EUR syndicated term and revolving facilities agreement with PPF Arena 1 B.V. — a Netherlands-incorporated telecommunications company, providing fixed-line and mobile telecommunications company and infrastructure, data services, and internet television wholly-owned by Netherlands-incorporated PPF TMT Holdco 2 B.V., wholly-owned by Netherlands-incorporated PPF TMT Holdco 1 B.V. wholly-owned by PPF Group N.V., a Netherlands-incorporated privately-held international diversified investment group headquartered in Prague and owned Czech businessmen, almost entirely by Czech billionaire Petr Kellner (the wealthiest man in the Czech Republic) — to finance the acquisition of Telenor CEE Group and refinance existing loan facilities related to the acquisition of O2 Czech Republic.

The facilities consisted of a €2.825 billion EUR term loan tranche and a €200 million EUR revolving credit facility (RCF) tranche.

One portion carried a maturity period of five years and a final maturity date of July 31, 2023 and another portion a maturity period of six years and a final maturity date of July 31, 2024. The facilities were available for drawdown in euros, Czech koruna, Bulgarian lev, Hungarian forint, and Serbian dinar.

The facilities carried an interest rate based on a reference rate (either 3-month EURIBOR, PRIBOR, SOFIBOR, BUBOR, or BELIBOR, depending on the currency) plus a margin that was subject to adjustments based on the group's proportionate leverage; for the five-year maturity, the initial margin was 2.00% for the euro-debt and 1.50% for the koruna-debt, and for the seven-year debt, the initial margin was 2.75% for the euro-debt and 2.00% for the koruna-debt.

The facilities had incremental tranches that could be incurred as long as the pro forma proportionate leverage of PPF Arena 1's group on such incurrence does not exceed 3.50:1 or, where such incremental indebtedness were made available to fund certain permitted acquisitions of the Group, 3.99:1.

The loan was secured by (i.e. collateralized against) Bulgarian law governed financial collateral with the creation of a pledge over all the shares in Telenor Bulgaria EAD; Czech law governed pledges of receivables from bank accounts of the PPF Arena 1 B.V., PPF Infrastructure B.V., PPF Telco B.V. and PPF TMT Bidco 1 B.V.; Dutch law governed share pledges over all the shares in PPF Arena 1 B.V., PPF Infrastructure B.V., PPF Telco B.V., and PPF TMT Bidco 1 B.V.; Dutch law governed share pledge over 75% shares in TMT Hungary B.V.; Dutch law governed pledges over bank account receivables of PPF Arena 1 B.V., PPF Infrastructure B.V., PPF Telco B.V. and PPF TMT Bidco 1 B.V.; Dutch law governed pledges over intercompany loans provided by PPF Arena 1 B.V., PPF TMT Holdco 2 B.V., PPF Infrastructure B.V., PPF Telco B.V. and PPF TMT Bidco 1 B.V.; English law governed security over hedging receivables from PPF Arena 1 B.V., acquisition agreements and intercompany loans provided or received by PPF Arena 1 B.V., PPF TMt Holdco 2 B.V., PPF Infrastructure B.V., PPF Telco B.V. and PPF TMT Bidco 1 B.V.; Hungarian law governed pledge over all shares in Telenor Common Operation Zrt.; Montenegrin law governed pledge on quota (shares) in respect of Telenor d.o.o.

Podgorica; and Serbian law governed pledge of quota (shares) in respect of Telenor d.o.o. Beograd.

The facilities were to be released if the proportionate leverage of the group, subject to certain exceptions, was equal to or below 2.00:1 and, among other things, no default or blocking event is continuing and PPF Arena 1 delivers a notice to the agent; if, however, the leverage increases to or exceeds 2:50.1, the security subject to the release must be again created and perfected.

PPF Arena 1 and PPF Telco B.V., PPF Infrastructure B.V., and PPF TMT Bidco 1 B.V. — Netherlands-incorporated wholly-owned subsidiaries of PPF Arena 1 — served as collateral providers.

The facilities included financial covenants testing the borrower's proportionate leverage calculated as proportionate net debt to proportionate earnings before interest, taxes, depreciation and amortization (EBITDA) of the relevant part of the group, which for any relevant period ending on or after December 31, 2018 could not exceed: (i) 4.50:1 for the group consisting of all material group entities, (ii) 2.50:1, subject to adjustments from time to time, for the group consisting primarily of the O2 Czech Republic and its subsidiaries in Slovakia and Česká telekomunikační infrastruktura (CETIN) (iii) 1.00:1 for the group consisting of the Telenor CEE Group and future target entities; the interest cover calculated as cash upstreamed to the PPF Arena 1 B.V. by its subsidiaries to net finance charges of PPF Arena 1 B.V., which could not be less than 2.50:1 in respect of the financial years ending on December 31, 2018 and 2019 and less than 3.00:1 thereafter.

Record ID#110247 captures BOC's contribution. Record ID#110248 captures ICBC's contribution.

In addition to BOC and ICBC, the following lenders contributed to the loan syndicate: BNP Paribas Fortis S.A./N.V., Crédit Agricole Corporate and Investment Bank (CACIB), Česká spořitelna, a.s., HSBC Bank plc, Société Générale S.A. (SocGen), UniCredit Bank Czech Republic and Slovakia a.s., Citigroup, Commerzbank Aktiengesellschaft, Credit Suisse AG, ING Group N.V., PKO Bank Polski S.A. (PKOBP), Raiffeisen Bank International AG, and Sberbank.

BNP Paribas Fortis, CACIB, Česká spořitelna, HSBC Bank, SocGen, and UniCredit Bank Czech Republic and Slovakia served as global coordinators and bookrunners. SocGen served as agent. Komerční banka, a.s. served as security agent.

In July 2018, PPF Arena 1 drew down four secured term loan facilities worth €2.792 billion EUR (€882 million EUR; €1.514 billion EUR; Kč3.745 billion CZK; and Kč6.427 billion CZK), with €400 million EUR used to fully refinance the existing loan facilities related to the acquisition of Czech telecommunications company O2 Czech Republic a.s. and euro-denominated €2.4 billion EUR were used to finance the €2.8 billion EUR acquisition of Telenor CEE Group, the Central and Eastern Europe business (including Hungary, Bulgaria, Serbia, and Montenegro, which had over nine million customers) of Norwegian majority state-owned multinational telecommunications company Telenor ASA, as well as Hungary-based technology service provider Telenor Common Operation.

The acquisition was expected to close in June 2018. The acquisition was completed in July 2018. As of December 31, 2018, the Kč200 million RCF had not been drawn. The facilities agreement was amended and restated on March 22, 2019.

On March 21, 2019, banks, including BOC, arranged a €550 million EUR seven-year bond to partly refinance the term loan for the Telenor acquisition. The facilities agreement was amended and restated on March 22, 2019. As of December 31, 2019, €1.591 billion EUR was outstanding under the €2.825 billion EUR term loan portion