TNAG-2414-FCO40-3516-Hong-Kong-Port-and-Airport-Development-Strategy-(PADS)-fina-1992 — Page 181

3.

4.

(B)

(C)

(D)

(E)

(F)

(iii)

if the aggregate of the real estate revenues raised before the Target Date plus the aggregate of any drawings under this sub-paragraph (iii) are less than the cumulative total amounts set out in Annex A.

For project cost increase, the standby facility may be drawn by the Authority by the amount of cost increase minus the aggregate of any drawings under sub- paragraph 2(A)(i) at such time. Cost increase is defined as:-

Estimated accrued project cost to date + remaining original budgeted cost - original budgeted cost.

The original budgeted project cost is set out in Annex B.

If there is a project delay, the standby facility may be drawn after the Target Date to meet (i) the total of scheduled debt service payments on all debt incurred by the Authority to fund the airport project and which has been agreed or arranged before the Completion Date ("Project Debt"); and (ii) all other costs of the Authority in respect of which a drawing may not be made under sub- paragraph 2(A)(i).

For real estate revenue shortfall, the standby facility may be drawn if the aggregate real estate revenue from core demand activities (i.e. cargo village, hotels and offices) raised before the Target Date together with any previous drawings against the standby facility in respect thereof is less than expected. The amount which may be drawn by the Authority will be the shortfall in revenue. A schedule of expected revenues from real estate activities is set out in Annex A.

Before drawing on the standby facility under sub-paragraphs 2(A)(i) or (ii), the Authority will take into account any liquidated damages, insurance proceeds in respect of delay or project cost increases or other receipts arising out of delay, and after the Target Date the Authority will take into account any net revenue (including any Passenger Terminal Charge but after deducting operating expenses) from Kai Tak operations (the "Kai Tak Surplus") available to it.

Amounts drawn under the standby facility shall be non-interest bearing and (subject to paragraph 4(A)) shall be subordinated as to principal and interest to all Project Debt.

Procedure for Drawing

On each occasion that the Authority makes use of the standby facility it shall:-

(i)

(ii)

report to Government, with full supporting information, the circumstances which have led to the event; and

confirm to Government that all reasonable measures have been and will continue to be taken to reduce to a minimum the amount of the facility actually drawn down.

Adjustment and Conversion into Equity of Standby Facility

(A)

Amounts drawn under the standby facility shall be repaid on or as soon as practicable after the Completion Date by the Authority to Government to the extent that:-

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