Pinewood Shepperton plc Annual Report ... - Pinewood Studios

80 Pinewood Shepperton plc Annual Report & Accounts 2010Notes to the consolidated financial statements continued21. Interest-bearing loans and borrowings continuedThe banking facilities become repayable on demand following a change of control in the Group. If the Group and thesyndicate of banks’ agent are unable to agree alternative terms within thirty days of the Group’s notification of a changeof control.The overdraft, revolving credit facility and pre-let development facility are secured by a floating charge over the principleassets of the Group, other than those secured by a fixed charge by Shepperton Studios Property Partnership.CovenantsThe banking agreements contain a range of covenants appropriate for the revolving credit facility, pre-let developmentfacility and overdraft facility. The Group was covenant compliant at 31 December 2010.Cash flow hedgeAt 31 December 2010, the Group held interest rate swaps designated as hedges against drawn debt obligationsamounting to £22,500,000 (2009: £22,500,000). Further information can be found in Note 26.Asset financing facilityThe asset financing facility is a sterling chattel mortgage facility over a fixed term with fixed monthly payments and issecured over identifiable assets of an equal value. These assets are classified as ‘Fixtures, Fittings and Equipment’ within‘Property, Plant and Equipment’ in the statement of financial position.Share of joint venture loanThis relates to the Group’s 50% interest, £12,002,000 (2009: £12,002,000) of the joint venture’s £24,004,000 investorand development loan (2009: £24,004,000). These loans which have no financial covenants attached to them are securedby a fixed charge on the assets of Shepperton Studios Property Partnership, are non-recourse to the Group and arerepayable in full on 30 September 2026. Interest on the loans is at base rate plus 2% with an interest rate floor of 6.5%.The interest rate floor is an embedded derivative in the loan agreement; however the derivative has not been separatedfrom the loan agreement as it satisfies the criteria for non-separation in IAS 39.