Exhibit 2.3
CONFORMED COPY
Dated 7 June 2004
MACQUARIE EUROPEAN INFRASTRUCTURE PLC
(AS VENDOR)
and
MACQUARIE INFRASTRUCTURE ASSETS LLC
(AS PURCHASER)
SHARE PURCHASE AGREEMENT
relating to the sale and purchase of all the shares in Macquarie Yorkshire
Limited
Agreement for the purchase of Shares
THIS AGREEMENT is made on 7 June 2004
BETWEEN:
(1) MACQUARIE EUROPEAN INFRASTRUCTURE PLC whose registered office is at
Xxxxxx 00 xxx 00, Xxxx Xxxxx, 0 Xxxxxxxxx Xxxxxx, Xxxxxx XX0X 0XX (the
"VENDOR" or "MEIP"); and
(2) MACQUARIE INFRASTRUCTURE ASSETS LLC a Delaware limited liability
company whose principal executive office is at 000 Xxxxx Xxxxxx, 00xx
xxxxx, 00000, Xxx Xxxx, XXX (the "PURCHASER" or "MIAL").
WHEREAS:
(A) The Vendor wishes to sell the Shares and the Purchaser wishes to
purchase the Shares (as defined in this Agreement) in each case on the
terms and subject to the conditions of this Agreement.
(B) The Vendor wishes to transfer and the Purchaser wishes to assume
certain rights and obligations of the Vendor associated with the
ownership of the Shares pursuant to the Completion Documents (as
defined in this Agreement).
IT IS AGREED as follows:
1 INTERPRETATION
In this Agreement, unless the context otherwise requires, the
provisions in this Clause 1 apply:
1.1 DEFINITIONS
"ACCOUNTS" means the consolidated unaudited accounts of
Connect Holdings as at the Accounts Date;
"AUDITED ACCOUNTS" means the consolidated audited accounts of
Connect Holdings as at 31 March 2003;
"ACCOUNTS DATE" means 31 March 2004;
"AFFILIATE" means, in relation to any person, a subsidiary of
that person or a holding company of that person or any other
subsidiary of that holding company;
"AGREED TERMS" means, in relation to any document, such
document in the terms agreed between the Vendor and the
Purchaser and signed for the purposes of identification by the
Vendor's Solicitors and the Purchaser's Solicitors;
"ARIA" means the intercreditor agreement dated 26 March 1996
as amended and restated on 20 October 1997 and further amended
and restated on 4 September 2001 and now between Connect,
Connect Holdings, MYL, MIUK, ABN Amro Bank NV, European
Investment Bank, European Investment Fund, BB and certain
other financial institutions;
"AUDITED ACCOUNTS DATE" means 31 March 2003;
"BB" means Balfour Xxxxxx PLC whose registered office is at
000 Xxxxxx Xxxx, Xxxxxx XX0X 0XX;
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"BUSINESS DAY" means a day on which banks are open for
business in London and New York city (excluding Saturdays,
Sundays and public holidays);
"CBFA" means the commercial bank facility agreement dated 26
March 1996 as amended and restated on 20 October 1997 and
further amended and restated on 4 September 2001 and now
between Connect and ABN Amro Bank NV;
"COMMERCIAL SUBORDINATED LOAN AGREEMENT" means the commercial
subordinated loan agreement dated 26 March 1996 as amended and
restated on 20 October 1997 and further amended and restated
on 4 September 2001 and now between Connect, MYL and BB;
"COMPANY" or "MYL" means Macquarie Yorkshire Limited details
of which are contained in Schedule 1;
"COMPLETION" means the completion of the sale and purchase of
the Shares pursuant to Clause 7;
"COMPLETION DATE" means the date of Completion;
"COMPLETION DOCUMENTS" means the documents in the agreed terms
listed in Part C of Schedule 5;
"CONDITIONS PRECEDENT" means each of the matters listed in
Schedule 2;
"CONNECT" means Connect M1-A1 Limited (formerly Yorkshire Link
Limited) whose registered office is at 7th Floor Xxxxxxxx
Xxxxx, Xxxxxx Xxxx, Xxxxxx XX0X 0XX (registered number
2999303);
"CONNECT DOCUMENTS" means the Project Documents as defined in
the CBFA and the Finance Documents as defined in the ARIA.
"CONNECT HOLDINGS" means Connect M1-A1 Holdings Limited
(formerly Yorkshire Link (Holdings) Limited) whose registered
office is at 7th Floor Xxxxxxxx Xxxxx, Xxxxxx Xxxx, Xxxxxx
XX0X 0XX (registered number 3059235);
"CONNECT LOAN" has the meaning given to it in Clause 3.5.1(i);
"DBFO CONTRACT" means the contract dated 26 March 1996 between
the Secretary of State and Connect;
"DEBENTURE" means the debenture dated 26 March 1996 given by
Connect in favour of ABN Amro Bank NV (replacing Lloyds Bank
plc as Security Trustee pursuant to a Security Trustee
Accession Memorandum dated 4 September 2001);
"DEBT REPAYMENT" has the meaning given to it in Clause 4.1;
"DISCLOSED INFORMATION" means the documentation and
information relating to the MYL Group made available to the
Purchaser by the Vendor in the online data room, an index of
the contents of which is annexed to this Agreement at Schedule
7;
"EIB FACILITY AGREEMENT" means the EIB facility agreement
dated 26 March 1996 as amended and restated on 20 October 1997
and further amended and restated on 4 September 2001 between
Connect and the European Investment Bank;
"EIF FACILITY AGREEMENT" means the EIF Senior Guarantee
Facility Agreement between the European Investment Fund and
Yorkshire Link Limited dated 26 March 1996, and amended and
restated on 4 September 2001;
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"ENCUMBRANCE" means any claim, charge (fixed or floating),
mortgage, pledge, security, lien, option, right to acquire,
equity, power of sale, hypothecation, assignment by way of
security, trust arrangement for the purpose of providing
security or other third party rights, retention of title,
right of pre-emption, right of first refusal or security
interest of any kind and any agreement to create any of the
foregoing;
"FINANCE DOCUMENTS" means the Finance Documents (as defined in
the Intercreditor Agreement) and the Loan;
"GROUP RELIEF" means any Relief of the Vendor or any Affiliate
of the Vendor other than an MYL Group Company (a) that is (or
the benefit of which is) capable of being transferred,
assigned or surrendered by any means to (or for the benefit
of) the Company; or (b) that is capable of being utilised or
set-off against any liability for Tax or against income,
profits or gains of the Company and a "surrender" of Group
Relief shall mean a transfer, assignment or surrender of such
Relief and shall include any action taken to allow the Company
to utilise or set-off such relief against the Company's
liability for Tax or its income, profits or gains;
"INITIAL CONSIDERATION" means (pound)16,700,067;
"INTERCREDITOR AGREEMENT" means the intercreditor agreement
between Connect, Connect Holdings, ABN Amro Bank N.V. (as
intercreditor agent, security trustee, senior banks facility
agent and senior issuing bank) and others dated 26 March 1996
as amended and restated on 20 October 1997 and 4 September
2001;
"INTELLECTUAL PROPERTY RIGHTS" means all rights in, patents,
designs, trade and service marks, copyright, database rights,
domain names and all other similar or equivalent rights
anywhere in the world, whether registered or unregistered and
including applications for registration of the same;
"IPO" means an initial public offering of the Trust;
"LOAN" means the outstanding intra-group loan owed by the
Company to the Vendor, which currently stands at
(pound)26,599,933;
"MIUK" means Macquarie Infrastructure (UK) Limited whose
registered office is at Xxxxx 00 xxx 00, Xxxx Xxxxx, 0
Xxxxxxxxx Xxxxxx, Xxxxxx XX0X 0XX;
"MYL ACCOUNTS" means the unaudited accounts of MYL as at the
Accounts Date;
"MYL GROUP COMPANIES" or "MYL GROUP" means any of or all of
Connect, Connect Holdings and MYL, as the context requires and
"MYL GROUP COMPANY" shall be construed accordingly;
"NEW PARENT COMPANY GUARANTEE" means the parent company
guarantee from MIAL to BB in respect of, inter alia:
(a) the respective obligations of MYL and Macquarie
Yorkshire LLC under the Shareholders' Agreement; and
(b) the obligations of MYL under the Secondment
Agreement;
"PARENT COMPANY GUARANTEE" means the guarantee from MEIP to BB
dated 26 March 1996 as amended and restated on 30 April 2003
which is to be replaced by the New Parent Company Guarantee;
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"PROJECT" means the operation and maintenance of the X0/X0
Xxxx Xxxx;
"PROJECT DOCUMENTS" has the meaning given thereto in the DBFO
Contract;
"PROJECT FACILITIES" has the meaning given thereto in the DBFO
Contract;
"PURCHASER'S CONDITIONS PRECEDENT" means each Condition
Precedent set out in Part B of Schedule 2;
"PURCHASER'S GROUP" means the Purchaser, its subsidiaries and
subsidiary undertakings, any holding company of the Purchaser
and all other subsidiaries of any such holding company from
time to time;
"PURCHASER'S SOLICITORS" means Shearman & Sterling LLP of 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000-0000, XXX;
"PURCHASER'S WARRANTIES" means the warranties and
representations set out in Part B of Schedule 3;
"RELIEF" means any relief, loss, allowance, exemption,
set-off, deduction or credit in computing or against profits
or Taxation;
"RELATED PARTY" means any Affiliate, shareholder, partner or
joint venturer of MIAL;
"RELEVANT DATE" means 31 March 2005;
"RETAINED GROUP" means, in relation to the Vendor, the Vendor,
its subsidiaries and subsidiary undertakings from time to
time, any holding company of the Vendor and all other
subsidiaries or subsidiary undertakings of any such holding
company (but excluding in each case members of the MYL Group);
"SECONDMENT AGREEMENT" means the secondment agreement dated 26
March 1996 as amended and restated on 30 April 2003 and now
between Connect, MIUK and BB;
"SECONDMENT AGREEMENT NOVATION" means a novation of the
Secondment Agreement between BB, MIUK, Connect, MYL and MIAL
in the agreed terms;
"SECRETARY OF STATE" means the Secretary of State for
Transport;
"SEPTEMBER DISTRIBUTION AMOUNT " means:
(a) if a distribution is made by MYL to the Vendor on or
about 30 September 2004, (pound)1,753,000, being the
projected aggregate cash distribution (including
interest payment, dividend payment, director fees or
any other cash distribution) to be made on or about
30 September 2004 by Connect and Connect Holdings to
the Company; or
(b) if no distribution is made by MYL to the Vendor on or
about 30 September 2004,(pound)0;
"SHARE MORTGAGE" means the share mortgage dated 26 March 1996
between ABN Amro Bank NV and Connect Holdings;
"SHAREHOLDERS' AGREEMENT" means the shareholders' agreement
dated 26 March 1996 as amended and restated on 30 April 2003
and now between Connect, Connect Holdings, MYL, MEIP and BB;
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"SHAREHOLDERS' AGREEMENT NOVATION" means a novation of the
Shareholders' Agreement between inter alia the Purchaser, MYL,
Connect Holdings, Connect, MEIP and BB in the agreed terms;
"SHARES" means the 5,000,000 ordinary shares owned by the
Vendor in the Company;
"TCGA" means the UK Taxation of Chargeable Gains Xxx 0000;
"TAX" means 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
delay in paying any of the same) and "TAXATION" shall be
construed accordingly;
"TAX AUTHORITY" means any authority, body, agency or official
having or purporting to have power or authority in relation to
Tax;
"TAXES ACT" shall mean the UK Income and Corporation Taxes Xxx
0000;
"TAX DISCLOSURE LETTER" means the letter of even date with
this Agreement written by the Vendor to the Purchaser and
delivered to the Purchaser's Solicitors before the execution
of this Agreement disclosing information constituting
exceptions to the Tax Warranties;
"TAX RETURN" means any return, notice, computation or document
in relation to Tax;
"TAX WARRANTIES" means the warranties and representations set
out in paragraph 1.22 of Part A of Schedule 3 and "TAX
WARRANTY" shall be construed accordingly;
"TRANSACTION DOCUMENTS" means this Agreement, the
Shareholders' Agreement Novation, the Secondment Agreement
Novation, the New Parent Company Guarantee and the Tax
Disclosure Letter;
"TRUST" means the Macquarie Infrastructure Assets Trust, the
ultimate parent of the Purchaser;
"VATA" means the UK Value Added Tax Xxx 0000;
"VAT" means Tax chargeable under VATA;
"VENDOR CONDITIONS PRECEDENT" means each Condition Precedent
set out in Part A of Schedule 2;
"VENDOR'S ACCOUNT" means account number 00000000, sort code 20
00 00, SWIFT: BARC GB 22, at Barclays Bank PLC, 00 Xxxxxxx
Xxxxxx, Xxxxxx, XX0X 0XX in the name of the Vendor;
"VENDOR CONSENTS" means those consents listed in Part A of
Schedule 2;
"VENDOR'S SOLICITORS" means Linklaters of Xxx Xxxx Xxxxxx,
Xxxxxx XX0X 0XX;
"VENDOR'S WARRANTIES" means the warranties and representations
set out in Part A of Schedule 3; and
"WARRANTIES" means the Vendor's Warranties and the Purchaser's
Warranties and
"WARRANTY" shall be construed accordingly.
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1.2 SUBORDINATE LEGISLATION
References to a statutory provision include any subordinate
legislation made from time to time under that provision which
is in force at the date of this Agreement.
1.3 MODIFICATION ETC. OF STATUTES
References to a statute or statutory provision include that
statute or provision as from time to time modified, re-enacted
or consolidated whether before or after the date of this
Agreement so far as such modification, re-enactment or
consolidation applies or is capable of applying to any
transactions entered into in accordance with this Agreement
prior to Completion and (so far as liability thereunder may
exist or can arise) shall include also any past statute or
statutory provision (as from time to time modified, re-enacted
or consolidated) which such statute or provision has directly
or indirectly replaced except to the extent that any statute
or statutory provision made or enacted after the date of this
Agreement would create or increase a liability of the Vendor
or the Purchaser under this Agreement.
1.4 CLAUSES, SCHEDULES ETC.
References to this Agreement include any Recitals and
Schedules to it and references to Clauses and Schedules are to
Clauses of and Schedules to this Agreement. References to
paragraphs are to paragraphs of the Schedules.
1.5 AMENDMENTS TO DOCUMENTS
References to this Agreement or any other document include
this Agreement or such other document as varied, modified or
supplemented from time to time.
1.6 HEADINGS
Headings shall be ignored in construing this Agreement.
1.7 SUBSIDIARIES, HOLDING COMPANIES
The expressions "subsidiary" and "holding company" shall have
the same meanings in this Agreement as their respective
definitions in the Companies Xxx 0000.
1.8 WARRANTIES
Where any statement in the Transaction Documents is qualified
by the expression "so far as the Vendor is aware" or "to the
best of the Vendor's knowledge, information and belief" or any
similar expression, that expression or statement shall be
deemed to be made on the basis of all matters of which any
director of the Vendor has actual knowledge or ought
reasonably to have actual knowledge having made all reasonable
enquiries of each of the following Xxxxxxxxx Xxxxxx Helps,
Alexander Xxxxxxx Xxxxxxxx, Xxxxx Xxxxxxxx, Xxxx Xxxxxx
XxxXxxxxx, Xxxxx Xxxxxxx, Xxxxx Xxxxxxxx and Xxxxxx Xxxxxxx in
each case as at the date of this Agreement.
1.9 References to a "PERSON" shall be construed so as to include
any individual, firm, company, government, state or agency of
a state or any joint venture, association or partnership
(whether or not having separate legal personality).
1.10 The singular includes the plural and vice versa and references
to one gender include all genders.
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2 AGREEMENT TO SELL THE SHARES
2.1 SALE OF SHARES
2.1.1 The Vendor agrees to sell with full title guarantee
and the Purchaser agrees to purchase the Shares
together with all rights and advantages now or in the
future attaching to the Shares.
2.1.2 The Vendor acknowledges that the Purchaser enters
into this Agreement in reliance on the
representations, warranties and undertakings on the
part of the Vendor set out in this Agreement.
2.1.3 The Vendor shall sell to the Purchaser the Shares
free from any Encumbrance.
2.1.4 The Vendor shall procure that on or prior to
Completion any and all rights of pre-emption over the
Shares are waived irrevocably by the persons entitled
thereto.
2.2 COMPLETION DOCUMENTS
The Vendor wishes to transfer and the Purchaser wishes to
assume certain rights and obligations of the Vendor associated
with its ownership of the Shares pursuant to the Completion
Documents. Each of the Purchaser and the Vendor agrees to
execute, or procure that any MYL Group Company executes, any
Completion Document to which it is expressed to be a party in
accordance with Part C of Schedule 5.
3 CONSIDERATION
3.1 The total consideration for the sale of the Shares shall be
the payment by the Purchaser of the Initial Consideration
which:
3.1.1 if Completion occurs after 30 September 2004, shall
be increased by (pound)9,553 for each day after 30
September 2004 Completion occurs; and
3.1.2 if Completion takes place before 30 September 2004,
shall be reduced by (pound)9,750 for each day before
30 September 2004 Completion occurs,
(the "COMPLETION AMOUNT").
3.2 Subject to Clause 3.3 below and paragraph 12 of Schedule 4,
the Vendor hereby agrees to pay to the Purchaser from time to
time by way of adjustment to the consideration an amount equal
to any Tax liability of the Company that arises in, or is
properly attributable to, a period or part period that ends on
or before the Completion Date other than any Tax liability of
the Company that arises in the ordinary course of business of
the Company between the Accounts Date and the Completion Date.
For the avoidance of doubt, deemed income, profits or gains
shall not be treated as arising in the ordinary course of
business.
3.3 If the Vendors become liable to make any payment under Clause
3.2 above, the Vendors may at their option and wholly or
partly instead of making a payment under Clause 3.2 surrender
any Group Relief to the Company in order to eliminate or
reduce the Taxation liability which would otherwise give rise
to an adjustment under Clause 3.2 above. The Purchaser shall
procure that the Company shall take without
7
delay (and in any event within any applicable statutory time
limit) all such steps as may reasonably be required by the
Vendors to effect the surrender of Group Relief.
3.4
3.4.1 Without prejudice to the provisions of Clause 3.2
above, but subject to Clauses 3.4.2 to 3.4.6 below,
the Vendor hereby agrees to pay to the Purchaser, as
soon as reasonably practicable following the
Settlement (as defined in Clause 3.4.2 below), by way
of adjustment to the consideration, an amount equal
to fifty per cent (50%) of:
(i) the Tax liability Connect has incurred in
all accounting periods or part periods
commencing on or after 5 September 2001; and
(ii) the net present value of the aggregate Tax
liability that Connect can reasonably be
expected to incur in all accounting periods
or part periods ending on or before March
31, 2028 save insofar as taken into account
in (i) above (such expected Tax liability to
be calculated using the financial model
referred to at paragraph 7.08 in the
Disclosed Information);
to the extent that such Tax liability is
attributable (or is reasonably expected to
be attributable based on the assumptions
used in the financial model referred to at
paragraph 7.08 in the Disclosed Information)
to a disallowance of a deduction for any
interest expense incurred on an amount of up
to (pound)50,768,000 of borrowings under the
CBFA that were used to fund loans and
distributions made to shareholders of
Connect or Connect Holdings between
September 2001 and Completion (the amount
payable under this Clause being the "AGREED
AMOUNT").
3.4.2 If and in the event Connect reaches a settlement with
the Inland Revenue (a "SETTLEMENT") as to the amount
of interest expense incurred by Connect in respect of
borrowings under the CBFA that is or will be
disallowed as a deduction in calculating Connect's
corporation tax liability, the amount of the interest
expense so disallowed shall be taken into account,
for the purposes of Clause 3.4.1 above, in
determining the aggregate Tax liability that Connect
can reasonably be expected to incur in all accounting
periods or part periods ending on or before March 31,
2028.
3.4.3 The Purchaser shall provide the Vendor with notice as
soon as reasonably practicable after the Purchaser
becomes aware of any challenge by the Inland Revenue
to the deductibility of any interest expense incurred
by Connect in respect of borrowings under the CBFA.
At all times prior to any Settlement the Purchaser
shall provide the Vendor with all copies of
correspondence with the Inland Revenue (including any
Tax Return filed or due to be filed) that the
Purchaser receives in relation to deductibility of
such interest expense and the Purchasers shall (at
the Vendor's expense) take all commercially
reasonable efforts to cause Connect to take such
steps as may be reasonably requested by the Vendor to
procure that Connect resist any such challenge to the
deductibility of interest in respect of borrowings
under the CBFA, provided that nothing in this clause
shall prevent Connect from entering into any
Settlement for prior and future periods if the
Purchaser and Balfour Xxxxxx plc, together with
Connect,
8
consider that the terms of the Settlement are
reasonable in the circumstances.
3.4.4 On or prior to the Settlement the Purchaser shall
take all such steps, and shall take reasonable
efforts to procure that Connect shall take all such
steps, as may be reasonably practicable (without
incurring any undue cost or burden) to minimise any
liability that the Vendor may have to the Purchaser
under Clause 3.4.1. The steps taken by the Purchaser
or Connect pursuant to this Clause 3.4.4 shall be
taken into account, for the purposes of Clause 3.4.1
above, in determining the aggregate Tax liability
that Connect can reasonably be expected to incur in
all accounting periods or part periods ending on or
before March 31, 2028 that is attributable to a
disallowance of a deduction for any interest expense
incurred in respect of borrowings under the CBFA;
3.4.5 The Vendor shall have no obligation to the Purchaser
under Clause 3.4.1 to the extent that the liability
arises or is materially increased as a result of an
event occurring after Completion other than for those
events that could reasonably be anticipated as being
the direct or indirect consequence of the Inland
Revenue seeking to disallow a deduction for the
interest expense incurred on those borrowings under
the CBFA that were used to fund loans and
distributions made to shareholders of Connect between
September 2001 and Completion.
3.4.6 If the Vendor has paid the Agreed Amount and receipt
of such sum, as the Agreed Amount, is acknowledged,
in writing, by the Purchaser then the Purchaser and
Vendor shall be released from any further obligations
under this Clause 3.4 and no further amounts will
become payable (or repayable) under this Clause 3.4.
3.5
3.5.1 Without prejudice to the provisions of Clause 3.2
above, but subject to Clause 3.5.2 to 3.5.6 below,
the Vendor hereby agrees to pay to the Purchaser, as
soon as reasonably practicable following the
Settlement (as defined in Clause 3.5.2 below), by way
of adjustment to the consideration, an amount equal
to
(i) any Tax liability the Company has incurred
in accounting periods or part periods
commencing on or after 5 September 2001 and
ending on or before Completion to the extent
such Tax liability is attributable to the
disallowance of a deduction for any imputed
interest expense incurred on loans or
advances made to the Company by Connect
between September 2001 and Completion (the
"CONNECT LOAN"); and
(ii) the net present value (calculated using the
discount rate equivalent to 8.66 per cent.)
of thirty per cent (30%) of any imputed or
actual interest expenses that the Company
can reasonably be expected to incur (based
on the assumptions used in the financial
model referred to at paragraph 7.08 of the
Disclosed Information) in all accounting
periods or part periods commencing on or
after Completion and ending on or before
March 31, 2028 on the
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Connect Loan to the extent that is
reasonably expected that a deduction for
such interest will be disallowed for Tax
purposes;
the amount payable under this Clause 3.5.1 being the
"AGREED AMOUNT".
3.5.2 If and in the event that the Company reaches a
settlement with the Inland Revenue (a "COMPANY
SETTLEMENT") as to the amount of imputed or actual
interest expense incurred on the Connect Loan that is
or will be disallowed as a deduction for Tax
purposes, the amount of the interest expense so
disallowed shall be taken into account, for the
purposes of Clause 3.5.1 above, in making the net
present value determination described in Clause 3.5.1
above.
3.5.3 The Purchaser shall provide the Vendor with notice as
soon as reasonably practicable after the Purchaser
becomes aware of any challenge by the Inland Revenue
to the deductibility of any actual or imputed
interest expense incurred by the Company in respect
of the Connect Loan. At all times prior to any
Company Settlement the Purchaser shall provide the
Vendor with all copies of correspondence with the
Inland Revenue (including any Tax Return filed or due
to be filed) that the Purchaser or the Company
receives in relation to deductibility of such
interest expense and the Purchaser shall (at the
Vendor's expense) cause the Company to take such
steps as may be reasonably requested by the Vendor to
procure that the Company resist any such challenge to
the deductibility of actual or imputed interest in
respect of the Connect Loan, provided that nothing in
this clause shall prevent the Company from entering
into any Company Settlement for prior and future
periods that is reasonable in the circumstances.
3.5.4 On or prior to the Company Settlement the Purchaser
shall procure that the Company shall take all such
steps, as may be reasonably practicable (without
incurring any undue cost or burden) to minimise any
liability that the Vendor may have to the Purchaser
under Clause 3.5.1. The steps taken by the Purchaser
or the Company pursuant to this Clause 3.5.4 shall be
taken into account, for the purposes of Clause 3.5.1
above, in making the net present value determination
described in Clause 3.5.1 above;
3.5.5 The Vendor shall have no obligation to the Purchaser
under Clause 3.5.1 to the extent that the liability
arises or is materially increased as a result of an
event occurring after Completion other than for those
events that could reasonably be anticipated as being
the direct or indirect consequence of the Inland
Revenue seeking to disallow a deduction for the
actual or imputed interest expense on the Connect
Loan.
3.5.6 If the Vendor has paid the Agreed Amount under Clause
3.5.1 and receipt of such sum, as the Agreed Amount,
is acknowledged, in writing, by the Purchaser then
the Purchaser and Vendor shall be released from any
further obligations under this Clause 3.5 and no
further amounts will become payable (or repayable)
under this Clause 3.5.
3.5.7 For the avoidance of doubt, the Vendor shall not be
liable under Clause 3.5.1 solely by virtue of the
application of the provisions of Schedule 28AA Taxes
Act to the Connect Loan (but without prejudice to the
application of
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Clause 3.5.1 if interest treated as being paid by the
Company under Schedule 28AA Taxes Act is disallowed
by reason of paragraph 13 of Schedule 9 Finance Xxx
0000 or for any other reason).
4 DEBT REPAYMENT
4.1 Notwithstanding anything contained in this Agreement, at
Completion the Purchaser will procure that the Company pays to
the Vendor the sum of (pound)26,599,933 less the September
Distribution Amount (the "DEBT REPAYMENT") in satisfaction of
all debts outstanding between the Company and the Vendor.
4.2 If the Debt Repayment is not received by the Vendor at
Completion the Purchaser shall pay the Vendor a sum equal to
the Debt Repayment and the parties agree that such payment
shall be treated as payment in full and final satisfaction of
all debts outstanding between the Company and the Vendor.
4.3 If, pursuant to Schedule 28AA of the Taxes Act (including any
amendment thereto as proposed by Chapter 2 of the Finance Xxxx
2004 (Version ordered, by the House of Commons, to be printed
23 March 2004)), the Vendor derives any taxable income in
respect of any imputed interest that arises in respect of the
Loan, the Purchaser shall procure that MYL shall, for no
consideration, and to the extent permitted by law, take
reasonable efforts to surrender to the Vendor, or any of the
Vendor's subsidiaries if so directed by the Vendor, any Group
Relief that arises out of a corresponding deduction in MYL in
respect of such imputed interest for the corresponding period
or periods, such Group Relief not to exceed the amount of
taxable income attributable to such imputed interest and
provided that MYL shall not be liable for the inability of the
Vendor or its subsidiaries to utilise any such Group Relief.
5 CONDITIONS
5.1 CONDITIONS PRECEDENT
The obligation to sell and purchase the Shares contained in
Clause 2.1 is conditional upon (and accordingly beneficial
ownership in the Shares will not pass until) satisfaction or
waiver (in accordance with Clause 5.4) of the Conditions
Precedent or their satisfaction subject only to Completion of
this Agreement.
5.2 RESPONSIBILITY FOR SATISFACTION
5.2.1 Each of the Vendor and Purchaser shall use reasonable
endeavours to ensure the satisfaction of the
Conditions Precedent as soon as practicable and in
any event by the Relevant Date.
5.2.2 Without prejudice to Clause 5.2.1, the Vendor and the
Purchaser agree that, prior to Completion, all
requests and enquiries from the Secretary of State or
any other governmental agency, court or body, any
lender, agent or security trustee under any relevant
financing or any party to the Shareholders' Agreement
shall be dealt with by the Vendor following due
consultation with the Purchaser and the Vendor shall
ensure that all such requests and enquiries are
promptly notified to the Purchaser.
5.2.3 The Vendor and the Purchaser shall promptly
co-operate with and provide all necessary information
and assistance reasonably required by such
11
governmental agency, court or body, any lender, agent
or security trustee under any relevant financing or
any party to the Shareholders' Agreement upon being
requested to do so by the other.
5.2.4 The Secretary of State shall not be requested to
provide its consent pursuant to paragraph 1 of Part A
of Schedule 2 until the Conditions Precedent which do
not require the consent of the Secretary of State
(listed in paragraphs 2 to 5 of Part A of Schedule 2)
have been satisfied, unless the parties determine
otherwise.
5.3 VENDOR NOTICE
5.3.1 The Vendor shall give a notice confirming receipt of
all Vendor Consents listed in Part A of Schedule 2
and attaching a copy of each such Vendor Consent to
the Purchaser (the "VENDOR CONSENT NOTICE") within
two Business Days of becoming aware of the same.
5.3.2 The Purchaser shall confirm by notice in writing to
the Vendor that it is satisfied with the form of the
Vendor Consents provided pursuant to Clause 5.3.1
above (the "PURCHASER NOTICE") within two Business
Days of receipt of the Vendor Consent Notice.
5.4 WAIVER
The Purchaser may at any time waive in whole or in part and
conditionally or unconditionally any Purchaser's Condition
Precedent by giving notice to the Vendor.
5.5 NON-SATISFACTION
If any Condition Precedent is not satisfied or waived on or
before the Relevant Date or such later period of time as the
Purchaser and the Vendor may agree in writing, then, save as
otherwise expressly provided, this Agreement shall terminate
and no party shall have any claim against the other party
under it. The provisions of Clauses 1, 10.1, 10.3, 11.1, 11.2,
11.3, 11.4, 11.8, 11.9, 11.10 and 11.13 shall survive any
termination of this Agreement and the rights and liabilities
of the parties which have accrued before termination or in
relation to these Clauses shall survive termination.
6 ACTION PENDING COMPLETION
6.1 AMENDMENTS
Until the earlier of Completion and the termination of this
Agreement in accordance with Clause 5.5 or Clause 9.5, the
Vendor shall not agree to any amendment, modification or
waiver, or grant any consent in respect of, any Connect
Documents (except to the extent required to comply with its
obligations under this Agreement) without the consent of the
Purchaser, such consent not to be unreasonably withheld or
delayed.
6.2 ACCESS
Pending Completion, the Vendor (subject to being able to
obtain the consent of any relevant third party) shall:
6.2.1 procure that the Purchaser, its agents and
representatives are given reasonable access to the
properties and to the books and records of any member
of the MYL Group;
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6.2.2 provide to the Purchaser, its agents and
representatives information regarding the businesses
and affairs of any member of the MYL Group as the
Purchaser may reasonably request; and
6.2.3 cooperate with the Purchaser and shall use its
commercially reasonable endeavours to take, or cause
to be taken, all actions and to do, or cause to be
done, all things necessary or desirable under
applicable law and regulation as the Purchaser may
reasonably request the Vendor to take or do in
connection with the IPO.
6.3 CONDUCT OF BUSINESS
Pending Completion, save in so far as agreed in writing by the
Purchaser, the Vendor shall exercise its voting rights in MYL,
and procure (to the extent it is legally able to do so) that
the directors it has nominated to the board of MYL vote in a
manner consistent with the MYL Group Companies only carrying
on business in the ordinary course in compliance with their
obligations under the Project Documents and the Finance
Documents.
6.4 RESTRICTIONS ON THE VENDOR
Pending Completion, the Vendor:
(i) shall exercise its voting rights in MYL so that MYL
shall not, and
(ii) shall procure (to the extent it is legally able to do
so) that the directors it has nominated to the board
of MYL vote such that the MYL Group Companies shall
not,
(except as may be required to give effect to and comply with
this Agreement) without the prior written consent of the
Purchaser (such consent not to be unreasonably withheld or
delayed):
6.4.1 incur any additional borrowings or incur any other
indebtedness otherwise than in the ordinary course of
business; or
6.4.2 acquire or agree to acquire or dispose of or agree to
dispose of any material asset or material stocks or
any assets or stock, involving consideration,
expenditure or liabilities in excess of
(pound)500,000; or
6.4.3 enter into any guarantee, indemnity or other
agreement to secure any obligation of a third party
or create any Encumbrance over any of the assets or
undertaking of any MYL Group Company; or
6.4.4 create, allot, issue, sell, redeem or repurchase or
agree to create, allot, issue, sell, redeem or
repurchase any share or other securities of
whatsoever nature convertible into shares (or any
option to subscribe for the same) or make any
pre-payments or voluntary redemptions of any Connect
third party loans; or
6.4.5 acquire or agree to acquire any share, shares or
other interest in any company, partnership or other
venture; or
6.4.6 make any material change to the accounting practices
or policies of any MYL Group Company or amend the
constitutional documents (other than a
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change of name of Connect Holdings or Connect) of any
MYL Group Company other than pursuant to this
Agreement; or
6.4.7 make any loan; or
6.4.8 enter into or amend any contract with a value or
potential liability to any MYL Group Company of
greater than (pound)50,000; or
6.4.9 fail to file any Tax Returns or pay any Taxes on or
before the due date for filing or payment thereof; or
6.4.10 declare, make or pay any dividend or other
distribution from MYL to the Vendor other than:
(i) the payment of a distribution by MYL to the
Vendor on or around 30 September 2004;
(ii) the monthly payment of directors' fees; and
(iii) the payment of interest on the Loan,
for the avoidance of doubt, the Vendor shall only be
entitled to procure the making or payment of any
dividend or distribution or interest payment pursuant
to (i) or (iii) above, if Completion has not taken
place on or prior to 30 September 2004.
6.5 US ELECTION
Upon request by the Purchaser, the Vendor shall on or after
the Completion Date file an election under U.S. Treasury
Regulations Section 301.7701-3 with respect to the Company
(the "ELECTION") such Election to have an effective date prior
to the Completion Date (provided that the Vendor has received
the request from the Purchaser within 25 days of the
Completion Date) and, upon receipt of such request, the Vendor
shall sign such forms and do all such acts as are necessary or
appropriate to make such Election within a reasonable time.
7 COMPLETION
7.1 DATE AND PLACE
Subject to Clause 5 and receipt by the Vendor of the Purchaser
Notice pursuant to Clause 5.3.2, Completion shall take place
at the offices of the Vendor's Solicitors within two weeks of
the date of satisfaction of all the Conditions Precedent.
7.2 COMPLETION OBLIGATIONS
7.2.1 At Completion the Vendor shall provide to the
Purchaser copies of each Vendor Consent listed in
Part A of Schedule 2.
7.2.2 The Vendor shall procure that the obligations listed
in Part A and (to the extent within its power) Part C
of Schedule 5 are fulfilled.
7.2.3 The Purchaser shall procure that the obligations
listed in Part B and (to the extent within its power)
Part C of Schedule 5 are fulfilled.
7.2.4 Neither the Vendor nor the Purchaser shall be obliged
to complete the sale and purchase of the Shares
pursuant to this Agreement unless the Vendor
14
and the Purchaser comply fully with its obligations
under Clause 7.2.2 and Clause 7.2.3 respectively and
Schedule 5.
7.3 PAYMENTS AT COMPLETION
At Completion:
7.3.1 the Purchaser shall pay the Completion Amount to the
Vendor; and
7.3.2 the Purchaser shall procure that the Debt Repayment
shall be repaid in accordance with Clause 4,
free of any deduction or withholding for or on account of any
Tax, bank charges and commissions in immediately available
funds into the Vendor's Account or such account as the Vendor
may direct.
8 OBLIGATIONS AFTER COMPLETION
Without delay after Completion, the Purchaser shall procure that the
Company complies with the requirements of Schedule 6.
9 WARRANTIES
9.1 VENDOR'S WARRANTIES
The Vendor represents and warrants to the Purchaser that each
of the Vendor's Warranties is true and accurate in all
respects and not misleading in any respect at the date of this
Agreement in each case subject only to:
9.1.1 with respect to the Warranties contained in
paragraphs 1.1 to 1.21 of Part A of Schedule 3 any
matter which is fully and fairly disclosed in the
Disclosed Information;
9.1.2 with respect to the Tax Warranties any matter which
is fully and fairly disclosed in the Tax Disclosure
Letter; and
9.1.3 any matter expressly provided for under the terms of
this Agreement.
9.2 The Vendor accepts that the Purchaser is entering into this
Agreement in reliance upon each of the Warranties.
9.3 In accordance with Clause 11.3, the rights or benefits of or
under the Warranties may be assigned (together with any cause
of action arising in connection with any Warranty or covenant)
by the Purchaser to any of the Purchaser's Affiliates.
9.4 The provisions of Schedule 4 shall apply.
9.5 If prior to Completion:
9.5.1 it shall be found that any of the Vendor's Warranties
was, when given, or will be or would be at Completion
untrue or misleading in any material respect so as to
have a material adverse effect on the condition,
financial or otherwise, or on the earnings, business
affairs or business prospects of the MYL Group, taken
as a whole, whether or not arising in the ordinary
course of business, the Purchaser shall be entitled
(in addition to and without prejudice to all other
rights or remedies available to it including the
right to claim damages) by notice in writing to the
Vendor to terminate this
15
Agreement (other than Clauses 1, 10.1, 10.3, 11.1,
11.2, 11.3, 11.4, 11.8, 11.9, 11.10 and 11.13) but
failure to exercise this right shall not constitute a
waiver of any other rights of the Purchaser arising
out of any breach of Warranty; or
9.5.2 any event shall occur which has or is likely to have
a material adverse effect on the condition, financial
or otherwise, or on the earnings, business affairs or
business prospects of the MYL Group taken as a whole
(whether or not arising in the ordinary course of
business) not being an event affecting or likely to
affect generally all companies carrying on similar
business in the United Kingdom, the Purchaser shall
be entitled by notice in writing to the Vendor to
terminate this Agreement (other than Clauses 1, 10.1,
10.3, 11.1, 11.2, 11.3, 11.4, 11.8, 11.9, 11.10 and
11.13) but the occurrence of such event shall not
give rise to any right to damages or compensation; or
9.5.3 the Vendor is in material breach of any material
obligation on its part under this Agreement and,
where that breach is capable of remedy, it is not
remedied to the Purchaser's satisfaction, the
Purchaser shall be entitled (in addition to and
without prejudice to all other rights or remedies
available to it including the right to claim damages)
by notice in writing to the Vendor to terminate this
Agreement (other than Clauses 1, 10.1, 10.3, 11.1,
11.2, 11.3, 11.4, 11.8, 11.9, 11.10 and 11.13 but
failure to exercise this right shall not constitute a
waiver of any other rights of the Purchaser arising
out of any such material beach.
For the avoidance of doubt any breach by the Vendor
of any undertaking contained in Clause 5.2 shall be
deemed a material breach of material obligation under
this Agreement.
9.6 NOTIFICATION OF BREACH OF WARRANTY
The Vendor undertakes to disclose in writing to the Purchaser
anything which is or may constitute (i) a breach of or be
inconsistent with any of the Warranties or (ii) a material
breach of the undertakings or other obligations on the part of
the Vendor under this Agreement immediately it comes to the
notice of the Vendor both before, at the time of and after
Completion.
9.7 THE PURCHASER'S WARRANTIES
The Purchaser represents and warrants to the Vendor that each
of the warranties set out in Part B of Schedule 3 is true and
accurate in all respects and not misleading in any respect at
the date of this Agreement.
9.8 SEPARATION OF WARRANTIES, EFFECT OF COMPLETION
9.8.1 Each of the Vendor's Warranties and the Purchaser's
Warranties shall be construed as a separate and
independent warranty and (except where expressly
provided to the contrary) shall not be limited or
restricted as to its meaning by reference to or
inference from the terms of any other Warranty or any
other term of this Agreement.
9.8.2 The Vendor's Warranties and the Purchaser's
Warranties and all other provisions of this Agreement
insofar as the same shall not have been
16
performed at Completion shall not be extinguished or
affected by Completion, or by any other event or
matter whatsoever except by a specific and duly
authorised written waiver or release by the relevant
party.
10 ENTIRE AGREEMENT AND REMEDIES
10.1 ENTIRE AGREEMENT
This Agreement sets out the entire agreement between the
parties to this Agreement in respect of the transactions
contemplated by this Agreement to the exclusion of any terms
implied by law which may be excluded by contract and
supersedes any previous written or oral agreement between the
parties in relation to the matters dealt with in this
Agreement.
10.2 ACKNOWLEDGEMENT
The Purchaser acknowledges that it has not been induced to
enter into this Agreement by any representation, warranty or
undertaking not expressly incorporated into it.
10.3 REMEDIES
So far as permitted by law and except in the case of fraud,
each party agrees and acknowledges that its only right and
remedy in relation to any warranty, representation or
undertaking made or given in connection with this Agreement
shall be for breach of the terms of this Agreement to the
exclusion of all other rights and remedies (including those in
tort or arising under statute).
10.4 REASONABLENESS OF THIS CLAUSE
Each party to this Agreement confirms it has received
independent legal advice relating to all the matters provided
for in this Agreement, including the provisions of this Clause
10, and agrees, having considered the terms of this Clause 10
and the Agreement as a whole, that the provisions of this
Clause 10 are fair and reasonable.
11 OTHER PROVISIONS
11.1 ANNOUNCEMENTS
No announcement or circular in connection with the existence
or the subject matter of this Agreement shall be made or
issued by or on behalf of the Vendor or the Purchaser without
the prior written approval of, in the case of the Purchaser,
the Vendor or, in the case of the Vendor, the Purchaser. This
shall not affect any announcement or circular required by law
or any regulatory body or the rules of any recognised stock
exchange but the party with an obligation to make such an
announcement or issue such a circular shall consult with the
other insofar as is reasonably practicable before complying
with such an obligation and the other party shall act
reasonably during such any such consultation process.
11.2 CONFIDENTIALITY
11.2.1 Subject to Clause 11.1 and Clause 11.2.3, the Vendor
undertakes to the Purchaser to treat as confidential,
and to procure that its Affiliates treat as
confidential, and not to disclose or use, and to
procure that its Affiliates do not disclose or use,
any information which relates to:
17
(i) the provisions of this Agreement and any
agreement entered into pursuant to this
Agreement; or
(ii) the negotiations relating to this Agreement
(and such other agreements); or
(iii) the Purchaser's and the Purchaser's
Affiliates' business, financial or other
affairs and the MYL Group's business,
financial or other affairs (including future
plans and targets).
11.2.2 Subject to Clause 11.1 and Clause 11.2.3, the
Purchaser shall treat as confidential, and shall
procure that the Related Parties treat as
confidential and do not disclose or use, any
information which relates to:
(i) the provisions of this Agreement and any
agreement entered into pursuant to this
Agreement; or
(ii) the negotiations relating to this Agreement
(and such other agreements) including the
Disclosed Information; or
(iii) the Vendor's business, financial or other
affairs and the MYL Group's business,
financial or other affairs (including future
plans and targets).
11.2.3 Neither Clause 11.2.1 nor 11.2.2 shall prohibit
disclosure or use of any information if and to the
extent:
(i) the disclosure is made by or on behalf of
the Purchaser or its Affiliates and is
related to or in connection with the IPO;
(ii) the disclosure or use is required by law,
any regulatory body or the rules and
regulations of any recognised stock
exchange;
(iii) the disclosure or use is required to vest
the full benefit of this Agreement in the
Vendor or the Purchaser, as the case may be;
(iv) the disclosure or use is required for the
purpose of any judicial proceedings arising
out of this Agreement or any other agreement
entered into under or pursuant to this
Agreement or the disclosure is reasonably
required to be made to a Tax Authority in
connection with the Tax affairs of the
disclosing party (which for the avoidance of
doubt, shall include any information
required to be disclosed by the Vendor, or
which is deemed necessary in the Vendor's
reasonable opinion, pursuant to schedule 7AC
of the TCGA);
(v) the disclosure is made to a Related Party, a
representative or professional advisers of
the Vendor or the Purchaser provided that
such disclosure is made in terms that such
professional advisers, auditors or bankers
undertake to comply with the provisions of
Clauses 11.2.1 or 11.2.2 (as the case may
be) in respect of such information as if
they were a party to the Agreement;
(vi) the information is or becomes publicly
available (other than through the fault of
that party or the fault of any person to
whom such information is disclosed in
accordance with sub-paragraph (iv);
18
(vii) the Vendor, or as the case may be, the
Purchaser has given prior written approval
to the disclosure or use; or
(viii) the information is independently developed
after Completion,
provided that prior to disclosure or use of any
information pursuant to Clause 11.2.3(ii), (iii) or
(iv) (except in the case of disclosure to a Tax
authority), the party concerned shall, if permitted,
promptly notify the Vendor, or as the case may be,
the Purchaser, of such requirement with a view to
providing the other party with the opportunity to
contest such disclosure or use or otherwise to agree
the timing and content of such disclosure or use.
11.2.4 Any reference to "information" in this Clause 11.2
includes oral communication, visual presentation,
books, records or other information in any form
including paper, electronically stored data, magnetic
media, film, computer disk and compact disk.
11.2.5 If Completion does not take place, the Purchaser
shall:
(i) return all written information of or
relating to the Vendor and the MYL Group
provided to the Purchaser and the Related
Parties;
(ii) destroy all information, analyses,
compilations, notes, studies, memoranda or
other documents derived from information
received or provided by the Vendor;
(iii) as far as practicable, remove any
information received or provided by the
Vendor from any computer, word processor or
other device; and
(iv) be permitted, to the extent that it is
required by applicable law or its record
keeping policies to retain any routinely
prepared memoranda, correspondence or
internal analysis based on the information,
provided those materials remain subject to
the obligations of confidentiality set out
in this Agreement.
11.2.6 If Completion does not take place, the Vendor shall:
(i) return all written information of or
relating to the Purchaser provided to the
Vendor and its Affiliates;
(ii) destroy all information, analyses,
compilations, notes, studies, memoranda or
other documents derived from information
received or provided by the Purchaser;
(iii) as far as practicable, remove any
information received or provided by the
Purchaser from any computer, word processor
or other device; and
(iv) be permitted, to the extent that it is
required by applicable law or its record
keeping policies to retain any routinely
prepared memoranda, correspondence or
internal analysis based on the information,
provided those materials remain subject to
the obligations of confidentiality set out
in this Agreement.
19
11.2.7 Subject to Clause 11.2.8, this Clause 11.2 contains
the whole agreement between the parties and their
Affiliates, or in the case of the Purchaser, Related
Parties, relating to confidentiality and disclosure
and supersedes any previous written or oral agreement
between the parties and their Affiliates, or in the
case of the Purchaser, Related Parties, in relation
to such matters.
11.2.8 Subject to the giving of effect to all waivers
granted pursuant thereto, the Purchaser agrees to
comply fully with the confidentiality requirements
set out in the DBFO Contract as if MIAL was a party
to the DBFO Contract.
11.3 SUCCESSORS AND ASSIGNS
11.3.1 This Agreement is personal to the parties to it and
subject to Clause 11.3.2, neither the Purchaser nor
the Vendor may, without the prior written consent of
the other, assign, hold on trust or otherwise
transfer the benefit of all or any of the other's
obligations under this Agreement.
11.3.2 The Purchaser may, without the consent of the Vendor,
assign to an Affiliate the benefit of all or any of
the other's obligations under this Agreement
(including for the avoidance of doubt the full
benefit of the Vendor's Warranties) provided that:
(i) if the assignee ceases to be an Affiliate of
the Purchaser, the benefit of those
obligations shall be reassigned to the
Purchaser or an Affiliate of the Purchaser;
(ii) the assignee shall not be entitled to
receive under this Clause any greater amount
than that to which the Purchaser would have
been entitled; and
(iii) the Purchaser shall remain bound to perform
its obligations under this Agreement.
11.4 THIRD PARTY RIGHTS
A person who is not a party to this Agreement shall have no
right under the Contracts (Rights of Third Parties) Xxx 0000
to enforce any of its terms.
11.5 VARIATION
No variation of this Agreement shall be effective unless in
writing and signed by or on behalf of both parties to this
Agreement.
11.6 EFFECTS OF COMPLETION
The terms of this Agreement (insofar as not performed at
Completion and except as specifically otherwise provided in
this Agreement) shall remain in full force and effect after
and notwithstanding Completion for a period of two years.
11.7 TIME OF THE ESSENCE
Time shall be of the essence in this Agreement.
11.8 FURTHER ASSURANCE
The Vendor shall at its own expense use reasonable endeavours
to do or procure to be done all such further acts and things,
and execute or procure the execution of all
20
such other deeds or documents, as the Purchaser may from time
to time reasonably require, whether before, on or after
Completion, for the purpose of giving to the parties to this
Agreement the full benefit of all of the provisions of this
Agreement, and in particular to vest any of the Shares in the
Purchaser.
The Vendor shall use reasonable endeavours to procure the
convening of all meetings, the giving of all waivers and
consents and the passing of all resolutions as are necessary
under statute, its constitution or any agreement or obligation
affecting it or the Company to give effect to this Agreement.
11.9 COSTS
Except as otherwise stated in this Agreement, each party shall
pay its own costs and expenses in relation to the preparation,
negotiation and entry into this Agreement and the sale of the
Shares. For the avoidance of any doubt, stamp duty arising on
the acquisition of MYL shall be paid by the Purchaser.
11.10 NOTICES
11.10.1 Any notice or other communication in connection with
this Agreement shall be in writing (a "NOTICE") and
shall be sufficiently given or served if delivered or
sent:
(i) in the case of the Vendor to:
Macquarie European Infrastructure PLC
Xxxxx 00 xxx 00, Xxxx Xxxxx
0 Xxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Company Secretary
(ii) in the case of the Purchaser to:
Macquarie Infrastructure Assets LLC
00xx Xxxxx
000 Xxxxx Xxxxxx
00000 Xxx Xxxx
XXX
Fax: 000 000 0000
Attention: Xxxxx Xxxxxx
with a copy (which shall not constitute
notice) to:
Shearman & Sterling LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
21
Fax: 000-000-0000
Attention: Xxxxxxx Xxxxxxx, Esq.
or to such other address or fax number as the
relevant party may have notified to the other in
accordance with this Clause.
11.10.2 Any Notice may be delivered by hand, or sent by fax
or prepaid first class post. Without prejudice to the
foregoing, any Notice shall conclusively be deemed to
have been received on the next Business Day in the
place to which it is sent, if sent by fax, or three
Business Days if sent by post, or at the time of
delivery, if delivered by hand.
11.11 INVALIDITY
If any term in this Agreement shall be held to be illegal,
invalid or unenforceable, in whole or in part, under any
enactment or rule of law, such term or part shall to that
extent be deemed not to form part of this Agreement but the
legality, validity or enforceability of the remainder of this
Agreement shall not be affected.
11.12 COUNTERPARTS
This Agreement may be entered into in any number of
counterparts, all of which taken together shall constitute one
and the same instrument. Either party may enter into this
Agreement by executing any such counterpart.
11.13 GOVERNING LAW AND SUBMISSION TO JURISDICTION
11.13.1 This Agreement shall be governed by and construed in
accordance with English law.
11.13.2 The parties irrevocably agree that the courts of
England are to have exclusive jurisdiction to settle
any dispute which may arise out of or in connection
with this Agreement. The parties irrevocably submit
to the jurisdiction of such courts and waive any
objection to proceedings in any such court on the
ground of venue or on the ground that proceedings
have been brought in an inconvenient forum.
11.14 PRE-COMPLETION TAX COMPUTATIONS
11.14.1 In relation to MYL, the Vendor shall, in relation to
all Tax periods ending on or before Completion, and
at its own expense, prepare, submit, negotiate and
otherwise deal with all computations and returns
relating to Taxation and correspondence relating
thereto, and prepare submit and deal with (or procure
the preparation and submission of) all claims,
elections, surrenders, disclaimers, notice and
consents for Taxation purposes.
11.14.2 The Vendor or its duly authorised agents shall
deliver all Tax Returns prepared by the Vendor to the
Purchaser for authorisation and signing prior to
submission. The Purchaser shall procure that the Tax
Returns are so authorised and signed as soon as
reasonably practicable by or on behalf of the Company
provided nothing in this clause shall require the
Company to file any Tax Return the Company considers
to be false or misleading in any respect. If a time
limit applies in relation to any Tax Return, the
Vendor
22
shall ensure that the Company receives the Tax Return
at least 10 days prior to the expiry of the time
limit.
11.14.3 In relation to the Company, the Vendor agrees, at its
own cost, to devote reasonable resources to dealing
with pre-Completion Tax affairs and shall use
reasonable endeavours to procure that they are
finalised as soon as reasonably practicable.
11.14.4 The Purchaser shall procure that the Vendor and its
duly authorised agents are (on reasonable notice in
writing to the Purchaser) afforded such reasonable
access to the books, accounts, personnel,
correspondence and documentation of the Company and
such other reasonable assistance as may be reasonably
required to enable the Vendor to discharge its
obligations under this clause.
11.14.5 The Purchaser shall procure that no amendment or
revocations are made to any Tax Return prepared by
the Vendor in accordance with this clause provided
nothing in this clause shall prevent the Company or
the Purchaser from amending any Tax Return the
Company considers to be false or misleading in any
respect.
11.14.6 The Purchaser shall be responsible for the
outstanding Tax affairs of the Company in respect of
periods ending after Completion and shall prepare and
submit such Tax Returns to the appropriate Taxation
Authorities and deal with negotiations,
correspondence and agreements with respect thereto.
The agreement of the Vendor (not to be unreasonably
withheld) shall be requested for the submission or
amendment of any Tax Return covering or including a
period before Completion.
11.14.7 The Purchaser shall ensure that all communications
with any Taxation Authority in relation to
post-Completion accounting periods which relate to an
event prior to Completion and which the Purchaser is
aware will affect the liability of the Vendor shall
first be sent in draft to the Vendor and the
Purchaser will incorporate any reasonable comments of
the Vendor.
11.14.8 The Vendor shall procure that the Purchaser receives
copies of all material written correspondence with
any Tax Authority (or extract therefrom) insofar as
it is relevant to the preparation and submission of
any Tax Return of the Company prepared in accordance
with 11.14.1.
11.14.9 The Purchaser shall procure that the Company (at the
cost of the Vendor) shall take without delay (and in
any event within any applicable statutory time limit)
all such steps as may reasonably be required by the
Vendor to effect the making of any claim or election
in respect of any period ending on or before the
Completion Date, or in respect of any election
pursuant to section 171A or 179A of the TCGA, or in
respect of any claim relating to Schedule 7AC of the
TCGA.
11.15 CONNECT HOLDINGS AND CONNECT TAXES
11.15.1 In relation to Connect Holdings and Connect, the
Purchaser shall use all reasonable endeavours to
ensure that all communications with any Tax Authority
which the Purchaser is aware will affect the Tax
position of the Vendor shall be first sent in draft
to the Vendor and the Purchaser shall use
23
reasonable endeavours to procure that Connect
Holdings and Connect incorporate any reasonable
comments of the Vendor.
IN WITNESS whereof this Agreement has been duly executed.
24
SIGNED by
Name: /s/ Xxxxx Xxxxxxx
Title: Attorney
Name: /s/ Annabelle Helps
Title: Attorney
on behalf of MACQUARIE EUROPEAN INFRASTRUCTURE PLC
SIGNED by
Name: /s/ Xxxxx Xxxxxx
Title: Chief Executive Officer
on behalf of MACQUARIE INFRASTRUCTURE ASSETS LLC
25
SCHEDULE 1
COMPANY DETAILS
PART A
PARTICULARS OF OFFICERS OF THE COMPANY
FULL NAMES USUAL ADDRESS
Xxxxxxxxx Xxxxxx Helps 139 Xxxxxx Xxxx, Barbican
Company Secretary Xxxxxx
Xxxxxxx Xxxxxx
XX0X 0XX
Alexander Xxxxxxx Xxxxxxxx 00 Xxxxxxx Xxxxx
Company Secretary 00 Xxxxxxx Xxxx
Xxxxxxxxxx
Xxxxxxxxx
XX00 0XX
Xxxxx Xxxxxxx Xxxxxxxx 00 Xxxxxxx Xxxxx
Xxxxxxxx Xxxxxxxxx
Xxxxxx XX00 0XX
Xxxx Xxxxxx XxxXxxxxx Creag Dhu
Director Xxxxxxx Xxxx
Xxxxx X'Xxxxxxx
Xxxxxx
Xxxxxx
XX00 0XX
Xxxxx Xxxxxx Xxxxxxx 00X Xxxxxxxxx Xxxx
Xxxxxxxx Xxxxxx Xxx
Xxxxxx X0 0XX
26
PART B
PARTICULARS OF THE COMPANY
REGISTERED NUMBER: 04712996
REGISTERED OFFICE: Xxxxx 00, XxxxXxxxx, 0 Xxxxxxxxx Xxxxxx,
Xxxxxx XX0X 0XX
DATE AND PLACE OF INCORPORATION: 00 Xxxxx 0000, Xxxxxx Xxxxxxx
SECRETARY: Xxxxxxxxx Xxxxxx Helps
Alexander Xxxxxxx Xxxxxxxx
DIRECTORS: Xxxxx Xxxxxxx Xxxxxxxx
Xxxx Xxxxxx XxxXxxxxx
Xxxxx Xxxxxx Xxxxxxx
ACCOUNTING REFERENCE DATE: 30 June
AUTHORISED SHARE CAPITAL: Ordinary shares 5,000,000 of(pound)1 each
ISSUED AND FULLY PAID-UP SHARE Allotted, called-up, fully paid:
CAPITAL: Ordinary shares 5,000,000 of (pound)1 each
MEMBER: Full name: Macquarie European Infrastructure
plc
Registered address: Xxxxx 00, Xxxx Xxxxx, 0
Xxxxxxxxx Xxxxxx, Xxxxxx XX0X 0XX
Number of Shares held: 5,000,000
27
SCHEDULE 2
CONDITIONS PRECEDENT
PART A
VENDOR CONDITIONS PRECEDENT
1 SECRETARY OF STATE
Consent from the Secretary of State pursuant to Clauses 2.3.2, 41.2 and
41.3 of the DBFO Contract.
2 BALFOUR XXXXXX PLC
Side letter confirming no Material Adverse Effect (as defined in the
Commercial Subordinated Loan Agreement) on the interests of BB and that
the form, terms and parties of any substitute for any Project Document
or any new Project Documents are satisfactory and approved by BB
pursuant to Clauses 16.7, 16.8 and 16.9 of the Commercial Subordinated
Loan Agreement.
3 EUROPEAN INVESTMENT BANK
Side letter confirming no Material Adverse Effect (as defined in the
CBFA) on the interests of EIB and that the form, terms and parties of
any substitute for any Project Document or any new Project Documents
are satisfactory and approved by EIB pursuant to Clause 8.5 of the EIB
Facility Agreement.
4 EUROPEAN INVESTMENT FUND
Side letter confirming no Material Adverse Effect (as defined in the
CBFA) on the interests of EIF and that the form, terms and parties of
any substitute for any Project Document or any new Project Documents
are satisfactory and approved by EIF pursuant to Clause 8.2 of the EIF
Facility Agreement.
5 BANKS (AS DEFINED IN THE CBFA) AND MAJORITY BANKS (AS DEFINED IN THE
CBFA)
Side letter by the Banks confirming no Material Adverse Effect (as
defined in the CBFA) and that the form, terms and parties of any
substitute for any Project Document or any new Project Documents are
satisfactory, and approved by, the Majority Banks pursuant to Clauses
21.7, 21.8 and 21.9 of the CBFA.
28
PART B
PURCHASER'S CONDITIONS PRECEDENT
1 Completion of the IPO conducted by the Trust, which shall be such time
as payment for the shares is made to the Trust in federal or other
funds immediately available in New York City against delivery of such
shares for the respective accounts of the several underwriters on the
Delivery Date (as such term is defined in the underwriting agreement to
be entered into among the Trust, MIAL and the underwriters for the
IPO).
29
SCHEDULE 3
WARRANTIES
PART A - VENDOR'S WARRANTIES
1 WARRANTIES GIVEN BY THE VENDOR
Each of the warranties and representations contained in this Schedule 3
Part A (other than those given in respect of the Vendor or MYL and
those given in paragraphs 1.3, 1.4, 1.5, 1.6.1, 1.6.4, 1.8.2, 1.8.5,
1.9.3(i), 1.12.1, 1.12.5, 1.14.4, 1.15.1) are given to the best of the
Vendor's knowledge, information and belief.
1.1 INCORPORATION
The Vendor is duly incorporated and validly existing under the
laws of England and Wales.
1.2 AUTHORITY
The Vendor has the legal right and full power and authority to
enter into and perform the Transaction Documents which when
executed will constitute valid and binding obligations for the
Vendor in accordance with their terms, subject to general
principles of English law.
The Vendor has taken or will have taken by Completion all
corporate action required by it to authorise it to enter into
and to perform the Transaction Documents.
1.3 NO BREACH
1.3.1 Neither the execution of this Agreement nor the
consummation of the transactions as contemplated by
this Agreement will violate, conflict with or result
in the breach of any term, limitation in or provision
of, or constitute a default under, the terms,
provisions or conditions of the constitutional
documents of the Vendor or any MYL Group Company or
violate any order, judgment, decree, award, lien,
lease, ordinance, governmental consent, licence or
authorisation or regulation applicable to the Vendor
or MYL or, to the best of the Vendor's knowledge,
Connect Holdings or Connect.
1.3.2 Compliance with the terms of this Agreement does not
and will not (i) place the Vendor or MYL or, to the
best of the Vendor's knowledge, Connect Holdings or
Connect in breach of a contract to which it is a
party or (ii) relieve any other party to a contract
with the Vendor or MYL or, to the best of the
Vendor's knowledge, Connect Holdings or Connect of
its obligations under such contract or (iii) enable
any party to a contract with the Vendor or MYL or, to
the best of the Vendor's knowledge, Connect Holdings
or Connect to vary or terminate its rights or
obligations under such contract.
1.3.3 Other than as set out in this Agreement, no consent
or approval is required from any person pursuant to a
contract to which the Vendor or MYL or, to the best
of the Vendor's knowledge, Connect Holdings or
Connect is a party in connection with the execution
or performance of the Transaction Documents.
30
1.4 CONSENTS AND APPROVALS FROM GOVERNMENTAL AUTHORITIES
Save as listed in Schedule 2 to this Agreement, no consent or
approval by, notice to or registration with any governmental
or other authority or third party is required in connection
with the execution or performance by the Vendor or MYL or, to
the best of the Vendor's knowledge, by Connect Holdings or
Connect of the Transaction Documents.
1.5 SHARE CAPITAL
1.5.1 The Vendor is entitled to sell and transfer to the
Purchaser the full legal and beneficial ownership of
the Shares on the terms of this Agreement.
1.5.2 The Shares constitute the whole of the issued and
allotted share capital of MYL and have been properly
and validly issued and allotted and are each fully
paid.
1.5.3 There are no Encumbrances on the Shares.
1.5.4 The Vendor is the sole legal and beneficial owner of
the Shares and has the right to exercise all voting
and other rights over the Shares, free from
Encumbrances.
1.5.5 MYL is the sole legal and beneficial owner of
1,500,000 shares of (pound)1.00 each in the share
capital of Connect Holdings and has the right to
exercise all voting and other rights over the Shares,
free from Encumbrances.
1.5.6 Connect Holdings is the sole legal and beneficial
owner of 3,000,000 shares of (pound)1.00 each in the
share capital of Connect and has the right to
exercise all voting and other rights over the Shares,
free from Encumbrances other than the Share Mortgage.
1.5.7 No person is entitled or has claimed to be entitled
to require any member of the MYL Group to issue any
share or loan capital either now or at any future
date whether contingently or not.
1.5.8 There is no option, right of pre-emption, right to
acquire, charge, pledge, lien or other form of
security or encumbrance on, over or affecting any of
the shares of MYL nor is there any commitment to give
or create any of the foregoing, and no person has
claimed to be entitled to any of the foregoing.
1.5.9 Since incorporation, MYL has not carried on any
business other than in connection with the holding of
its shares in Connect Holdings, the making of loans
to Connect and borrowing from Connect and the Vendor.
1.5.10 Since incorporation, Connect Holdings has not carried
on any business other than in connection with the
holding of its shares in Connect.
1.5.11 The particulars contained in Schedule 1 are true and
accurate.
1.6 CONTRACTS; INFORMATION
1.6.1 True and accurate copies of all contracts involving
consideration, expenditure or liabilities in excess
of (pound)50,000 in the possession of the Vendor
relating to each member of the MYL Group
("CONTRACTS") have been disclosed in the Disclosed
Information.
31
1.6.2 All the Contracts to which any of the MYL Group
Companies is a party constitute valid and binding
contracts of the parties thereto and the terms
thereof have been complied with in all material
respects by the relevant MYL Group Company and by any
other party to such contracts.
1.6.3 No notice of termination or of intention to terminate
or notice of material breach has been received in
respect of any Contract (other than the termination
by agreement on 10 March 2004 of the technical
support agreement between Connect, Trafalgar House
Corporate Development Limited and BICC plc dated 26
March 1996 (the "TECHNICAL SUPPORT AGREEMENT")).
1.6.4 If the Vendor Conditions Precedent are satisfied and
the Completion Obligations set out in Schedule 5 are
performed, the transactions contemplated by this
Agreement will not trigger a change of control event
in relation to any Contract.
1.6.5 All documents contained in the Disclosed Information
provided by the Vendor to the Purchaser prior to
entering into this Agreement are true and accurate in
all respects and are not misleading and have not been
amended in any material respects.
1.6.6 The Vendor is not aware of any fact or matter or
circumstance not disclosed in writing to the
Purchaser which renders any of the Disclosed
Information untrue, inaccurate or misleading in any
material respect or the disclosure of which might
reasonably affect the willingness of the Purchaser to
purchase the Shares or the price at or the terms upon
which the Purchaser would be willing to purchase
them.
1.7 ACCOUNTS
1.7.1 The Audited Accounts have been prepared:
(i) in accordance with applicable law and with
the accounting principles, standards and
practices generally accepted at the Audited
Accounts Date in the United Kingdom; and
(ii) subject to (i) above, on a basis consistent
with that adopted in preparing the audited
consolidated accounts of Connect Holdings
for the previous two financial years (other
than in respect of depreciation policy),
so as to give a true and fair view of the state of
affairs of Connect Holdings and its subsidiaries at
the Audited Accounts Date and of the profits or
losses for the period concerned.
1.7.2 The Accounts:
(i) have been prepared on a basis consistent
with the accounting principles employed in
preparing the Audited Accounts; and
(ii) fairly present in all material respects the
state of affairs of Connect Holdings and its
subsidiaries as at the Accounts Date for the
financial year ended on that date.
32
1.7.3 The MYL Accounts have been prepared on the basis of
generally accepted accounting principles, standards
and practices in the United Kingdom, which fairly
present in all material respects the stated affairs
of MYL as at the Accounts Date for the financial
period ended on that date.
1.7.4 There is no material inaccuracy contained in the
unaudited management accounts of Connect for the
period ended 31 March 2004 which have been prepared
on a basis consistent with the accounting principles
employed in preparing the Audited Accounts.
1.7.5 All accounts, books, ledgers, and other financial
records of each member of the MYL Group have been
properly maintained and contain accurate records of
all matters required to be entered in them by the
applicable laws.
1.7.6 The Vendor has no reason to believe that any trade
debts owing to any member of the MYL Group at the
date of this Agreement will not in the ordinary
course of collection realise its nominal amount plus
any accrued interest.
1.8 SINCE THE ACCOUNTS DATE
Since the Accounts Date:
1.8.1 the MYL Group Companies have conducted their
respective business in a manner consistent with the
way such business was carried out in the twelve
months prior to the Accounts Date;
1.8.2 no member of the MYL Group has acquired or disposed
of, or agreed to acquire or dispose of, any business
or any material asset of a value in excess of
(pound)1,000,000 other than (i) in the ordinary
course of business (which includes the acquisition
and replacement of spare parts) or (ii) where such
assets are obsolete, no longer used or useful in the
operation of the business of the MYL Group and are
replaced by other equipment of equal value or
utility;
1.8.3 there has been no material adverse change in the
financial or trading position or prospects of the MYL
Group (other than a change affecting or likely to
affect all companies carrying on business in the
United Kingdom) and no event, fact or matter has
occurred or is likely to occur which will or is
likely to give rise to any such change;
1.8.4 no MYL Group Company has entered into any material
transaction or assumed or incurred any material
liabilities (including contingent liabilities) or
made any material payment not provided for in the
Accounts otherwise than in the ordinary course of
carrying on its business;
1.8.5 no MYL Group Company has declared, made or paid any
dividend or other distribution to its members;
1.8.6 the MYL Group Companies have not made any change in
any method of accounting or accounting practice or
policy used by the Company or any member of the MYL
Group; and
1.8.7 no payments have been made under the Technical
Support Agreement.
33
1.9 BORROWINGS
1.9.1 Full details of all financial facilities (other than
the Loan) available to the MYL Group Companies and
the amounts outstanding under them are set out in the
Disclosed Information and the Vendors have supplied
true and correct copies of each of the Finance
Documents and there are no circumstances whereby the
continuation of any such facilities might be
prejudiced or affected as a result of any transaction
contemplated by this Agreement or any of the
Transaction Documents.
1.9.2 Save in relation to the arrangements and matters
disclosed in the Disclosed Information, the Finance
Documents and the Loan:
(i) the MYL Group Companies have no outstanding
obligation for the payment or repayment of
money in respect of loan capital or any
money borrowed or raised (including any
guarantee, indemnity or other obligation
created pursuant to a written instrument);
(ii) other than debts accrued to it in the
ordinary course of its business, the MYL
Group Companies have not lent any money
which has not been repaid to it nor does it
own the benefit of any debt (whether present
or future); and
(iii) there are no outstanding indebtedness or
guarantee arrangements between the Retained
Group and the MYL Group Companies, and no
member of the Retained Group has any right
to receive or require any loans or
guarantees from the MYL Group Companies.
1.9.3 In relation to each Finance Document:
(i) full details are disclosed in the Disclosed
Information and true and correct copies of
it have been provided in the Disclosed
Information;
(ii) there has not been any material
contravention (that has been subsequently
waived) of, or non-compliance with, any of
its terms;
(iii) no steps for the enforcement of any
Encumbrance have been taken or threatened;
(iv) it is not dependent on the guarantee of, or
on any security provided by, a third party;
and
(v) it is not terminable by reason of the sale
of the Shares (subject to the consents
referred to in this Agreement).
1.10 LOANS, SWAPS
Save in relation to the arrangements and matters disclosed in
the Finance Documents, no member of the MYL Group has
outstanding any obligations in respect of any interest rate or
foreign exchange currency swap transaction.
1.11 LITIGATION
1.11.1 No member of the MYL Group is engaged in any
litigation or arbitration proceedings (other than as
claimant for collection of debts not exceeding an
aggregate of (pound)100,000 in the case of all sums
being collected by all the
34
MYL Group) and there are no such proceedings pending
or threatened by or against any member of the MYL
Group.
1.11.2 There are no material threatened litigation or
arbitration proceedings by or against any member of
the MYL Group.
1.11.3 There are no undisputed or outstanding judgments
affecting the MYL Group Companies.
1.11.4 None of the MYL Group Companies have given written
notice to any third party, to whom it has entered
into a material contract with, that such party is in
material or persistent default under such contract.
1.12 CORPORATE ORGANISATION
1.12.1 The copies of the constitutional documents of each
MYL Group Company which have been given to the
Purchaser (and which comprise part of the Disclosed
Information) are accurate and complete and have
annexed or incorporated copies to them all
resolutions or agreements required by any applicable
laws to be so annexed or incorporated.
1.12.2 There have not been and are not any breaches by any
MYL Group Company of its constitutional documents.
1.12.3 The register of members and other statutory books and
registers of each MYL Group Company have been
properly kept and contain complete and accurate
records of all matters required to be dealt with in
such books and records. No notice or allegation that
any such books and records are incorrect or should be
rectified has been received by an MYL Group Company.
1.12.4 All returns and particulars, resolutions and other
documents which any MYL Group Company is required by
law to file with, or deliver to, the registrar of
companies or his equivalent have been correctly made
up and duly filed or delivered.
1.12.5 All the directors and secretaries of each MYL Group
Company have been duly appointed in accordance with
the Companies Xxx 0000.
1.13 SUBSIDIARIES, ASSOCIATIONS AND BRANCHES
1.13.1 No MYL Group Company:
(i) holds or beneficially owns or has agreed to
acquire any securities of any other
corporation other than shares of another MYL
Group Company; or
(ii) is or has agreed to become a member of any
partnership (whether incorporated or
unincorporated) or other unincorporated
association, joint venture or consortium
(other than recognised trade associations);
or
(iii) has outside the United Kingdom any branch or
any permanent establishment (as that
expression is defined in the respective
Double Taxation Relief Orders current at the
date of this agreement).
35
1.13.2 No MYL Group Company has any subsidiaries or any
shareholdings in any legal entity other than, in the
case of MYL, Connect Holdings and, in the case of
Connect Holdings, Connect, and does not have any
existing or continuing obligations or liabilities in
relation to any business save in relation to the
Project.
1.14 OWNERSHIP OF ASSETS
1.14.1 All the assets included in the Accounts or acquired
by any of the MYL Group Companies since the Accounts
Date are owned by the relevant member of the MYL
Group.
1.14.2 Except for current assets offered for sale or sold in
the ordinary course of trading, no member of the MYL
Group has since the Accounts Date disposed of (i) any
of the assets included in the Accounts or (ii) any
assets acquired or agreed to be acquired since
Accounts Date.
1.14.3 Save in relation to the matters and arrangements
disclosed in the Finance Documents, none of the
property, assets, undertaking, goodwill or uncalled
capital of any MYL Group Company is subject to any
Encumbrance.
1.14.4 The assets of each MYL Group Company comprise all the
assets necessary for the continuation of its business
as carried on at the date of this Agreement.
1.15 INSOLVENCY
1.15.1 In respect of the Vendor and the MYL Group Companies
(or any part of their respective assets or
undertakings):
(i) no receiver or administrative receiver has
been appointed;
(ii) no administration order has been made;
(iii) no order has been made and no resolution has
been passed for the winding up of, or the
appointment of a provisional liquidator;
(iv) such company is not insolvent or unable to
pay its debts within the meaning of Section
123 of the Insolvency Xxx 0000;
(v) no distress or execution or other process
has been levied;
(vi) no arrangement with creditors has been made;
and
(vii) no event analogous to any of the foregoing
has occurred in any jurisdiction outside
England.
1.15.2 No MYL Group Company has been held in default by
lenders under any debt financing.
1.15.3 No steps have been taken to enforce any security over
any assets of any MYL Group Company and no event has
occurred to give the rights to enforce such security.
1.16 COMPLIANCE WITH LAWS
1.16.1 The MYL Group Companies have complied in all material
respects with all statutes, orders, laws and
regulations or the like a breach of which may
36
give rise to any fine, penalty or other liability or
sanction on the part of that member of the MYL Group.
1.16.2 The MYL Group has obtained all material licences,
consents, permits and authorities (public or private,
statutory or otherwise) necessary to own and operate
its assets and to permit the MYL Group Companies to
carry on their business in material compliance with
all applicable laws and regulations as of the date
hereof and the Vendor is not aware of anything that
might result in the revocation, suspension or
modification of any such licences or consents or that
might prejudice their renewal.
1.16.3 No MYL Group Company has at any relevant time been
party to a transaction pursuant to or as a result of
which a material asset owned, purportedly owned or
otherwise held by any MYL Group Company is liable to
be transferred or re-transferred to another person or
which gives or may give rise to a material right of
compensation or other payment in favour of another
person under the law of any relevant jurisdiction or
country.
1.17 EMPLOYEES
Neither MYL nor any MYL Group Company has any employees, nor
is there any liability relating to or in respect of any
persons who may have been previously employed by MYL or any
MYL Group Company.
1.18 CORRUPT GIFTS
No corrupt gift which would, or might, give rise to any
remedies or other adverse circumstances under any Project
Document has been given or received.
1.19 INTELLECTUAL PROPERTY
1.19.1 No activities of any MYL Group Company (or of any
licensee under any licence granted by an MYL Group
Company) infringe or are likely to infringe any
Intellectual Property Rights of any third party and
no claim has been made against any MYL Group Company
or any such licensee in respect of such infringement.
1.19.2 Each MYL Group Company owns or has licensed to it all
Intellectual Property Rights it requires to carry on
its business as such business has been carried on
during the year prior to the date of this Agreement
and such rights and that MYL Group Company's ability
to use such rights will not be affected by the
acquisition of the Shares by the Purchaser.
1.20 ENVIRONMENT
1.20.1 For the purposes of this paragraph 1.20:
"ENVIRONMENT" means all or any of the following media
(alone or in combination): air (including the air
within buildings and the air within other natural or
man-made structures whether above or below ground);
water (including water under or within land or in
drains or sewers); soil and land and any ecological
systems and living organisms supported by these
media;
37
"ENVIRONMENTAL AUTHORITY" means any legal person or
body of persons (including any government department
or government agency or court or tribunal) having
jurisdiction to determine any matter arising under
Environmental Law and/or relating to the Environment;
"ENVIRONMENTAL LAW" means all applicable laws
(including, for the avoidance of doubt, common law),
statutes, regulations, statutory guidance notes and
binding court and other tribunal decisions in force
in England and Wales at the date of this Agreement
whose purpose is to protect, or prevent pollution of,
the Environment or natural resources, or to
emissions, discharges, or releases of Hazardous
Substances into the Environment, or to the use,
treatment, storage, burial, disposal, transport or
handling of Hazardous Substances, and all by-laws,
codes, regulations, decrees or orders issued or
promulgated or approved thereunder or in connection
therewith to the extent that the same are in force
under the laws of England and Wales at the date of
this Agreement;
"ENVIRONMENTAL PERMIT" means any licence, approval,
authorisation, permission, notification, waiver,
order or exemption which is issued, granted or
required under Environmental Law which is material to
the operation of the business of any member of the
MYL Group on or before the date of this Agreement;
"HAZARDOUS SUBSTANCES" means any wastes, pollutants,
contaminants and any other natural or artificial
substance (whether in the form of a solid, liquid,
gas or vapour) regulated by any Environmental Law;
and
"RELEVANT PERIOD" means the period commencing three
years before the execution of this Agreement and
ending at the date of this Agreement.
1.20.2 Each member of the MYL's Group is conducting and
during the Relevant Period has conducted, the
business of the MYL Group in material compliance with
Environmental Law.
1.20.3 All Environmental Permits:
(i) have been obtained;
(ii) are in force; and
(iii) have been complied with in all material
respects during the Relevant Period.
1.20.4 No member of the MYL Group has received any written
notice during the Relevant Period (or earlier than
the Relevant Period, if not fully resolved) of any
civil, criminal, regulatory or administrative action,
claim, investigation or other proceeding or suit
relating to Environmental Law or Environmental
Permits and, to the Vendor's knowledge, there are no
circumstances that can reasonably be expected to form
the basis of any such action, claim, investigation,
proceeding or suit.
1.20.5 No MYL Group Company has received written notice
during the Relevant Period that either (i) an
Environmental Authority is intending to revoke,
suspend, vary or limit any Environmental Permits or
(ii) any amendment to
38
any Environmental Permit is required to enable the
continued operation of the business of the MYL Group
Companies.
1.21 INSURANCE
1.21.1 All insurance policies required to be in effect by
Connect pursuant to the terms of Schedule 8 to the
CBFA have been obtained by Connect and are currently
in full force and effect and nothing has been done or
omitted to be done which could make any such policy
of insurance void, unenforceable for illegality or
otherwise and all premiums have been duly paid to
date. Any outstanding claims have been notified to
and are being dealt with by the relevant insurers
under the policies and full details of all such
claims have been disclosed in the Disclosed
Information.
1.21.2 The parties to the Finance Documents have not waived
or otherwise released Connect from any of its
obligations under Schedule 8 to the CBFA, with the
exception of the contractors professional indemnity
policy which is maintained by each of the
construction joint venture partner companies.
1.21.3 No MYL Group Company has procured insurance cover
required under Schedule 8 of the CBFA from any other
member of the MYL Group, the Vendor or any of their
Affiliates.
1.22 TAX
The Vendor warrants that:-
1.22.1 Each of the MYL Group Companies has filed all Tax
Returns required by law.
All such Tax Returns are and remain complete, correct
and accurate in all respects.
Such Tax Returns are not the subject of any enquiry
or dispute with any Tax Authority and there are no
facts or circumstances likely to give rise to or be
the subject of any such dispute.
1.22.2 All records which an MYL Group Company is required to
keep for Tax purposes or which are required by law to
substantiate any material claim made or position
taken in relation to Tax have been duly kept and are
available for inspection upon reasonable request.
1.22.3 None of the MYL Group Companies have been subject to
any investigation or audit by any Tax Authority nor
are there any facts or circumstances likely to give
rise to or be the subject of any such investigation
or audit by any Tax Authority.
1.22.4 Each of the MYL Group Companies has duly and
punctually paid all Taxes which they have become
liable to pay and have not incurred any liability to
pay any penalty, surcharge or fine or interest in
connection with any Tax.
1.22.5 All payments by the MYL Group Companies to any person
which ought to have been made under deduction or
withholding of Tax (including, without limitation,
under section 42A Taxes Act) have been so made and
each MYL Group Company has, if required by law to do
so, accounted to the relevant
39
Tax Authority for the Tax so deducted and has
otherwise complied with all legal obligations in
respect of such deductions or withholdings.
1.22.6 None of the MYL Group Companies have disposed of any
capital asset after the Accounts Date (including a
disposal under section 29 of the TCGA), over
(pound)100,000.
1.22.7 All payments of a revenue nature which the MYL Group
Companies have made have been deductible and will be
deductible for UK corporate income tax purposes.
1.22.8 The MYL Group Companies are not and have not been a
party to or otherwise involved in any transaction,
agreement or arrangement the terms or provisions of
which differ from the terms or provisions which would
have been made as between independent enterprises
such that the provisions of sections 770 to 773 or
Schedule 28AA to the Taxes Act may apply in respect
of that transaction, agreement or arrangement.
1.22.9 None of the MYL Group Companies have been released
from a loan relationship (as defined by section 81 of
the Finance Act 1996) or derivative contract (as
defined by Schedule 26 to the Finance Act 2002) in
circumstances that gave rise to a Tax liability.
1.22.10 The MYL Group Companies have not acquired any asset
from any other company belonging at the time of
acquisition to the same group of companies as the
Company within the meaning of section 170 of the
TCGA.
1.22.11 The MYL Group Companies have always been resident in
the country in which they were incorporated and have
never been resident in any other country or treated
as so resident for the purposes of any double Tax
agreement. None of the MYL Group Companies has a
branch, agency or permanent establishment in a
country other than the country of its incorporation.
1.22.12 The MYL Group Companies are not nor have never been
close companies as defined in section 414 of the
Taxes Act.
1.22.13 Except as otherwise noted in the Shareholders'
Agreement, the MYL Group Companies have not entered
into any indemnity, guarantee or covenant under which
any of the MYL Group Companies have agreed to pay or
discharge any amount equivalent to or by reference to
any other person's liability to Tax.
1.22.14 The MYL Group Companies are not members of any
combined, consolidated or unitary group for Tax
purposes other than a group of which the MYL Group
Companies are the only members.
1.22.15 All claims by the MYL Group Companies for relief
under sections 402-413 of the Taxes Act (for the
purposes of this paragraph, "Group Relief") were,
when made, and are now valid and have been or will be
allowed by way of relief from UK corporation tax. The
MYL Group Companies have not made nor are liable to
make any payment for Group Relief otherwise than in
consideration for the surrender of Group Relief
allowable to the MYL Group
40
Companies by way of relief from UK corporation tax.
The MYL Group Companies have received all payments
due to them under any arrangement or agreement for
surrender of Group Relief by them for periods prior
to Completion and no payments are outstanding that
are not due. No such payment exceeds or could exceed
the amount permitted by section 402(6) of the Taxes
Act. The payments received by the MYL Group Companies
in respect of any Group Relief surrendered are at
least equal to the amount of UK corporation tax the
payer would have paid had such Group Relief not been
made available. No arrangement exists or existed for
any period of account in respect of which a surrender
has been made or purports to have been made such as
are specified in section 410(1)-(6) of the Taxes Act.
1.22.16 The MYL Group Companies have not been a party to:
(i) a loan relationship which has or had an
unallowable purpose for the purposes of
paragraph 13 of Schedule 9 to the Finance
Xxx 0000;
(ii) a derivative contract which has or had an
unallowable purpose for the purposes of
paragraph 23 of Schedule 26 to the Finance
Xxx 0000.
1.22.17 The MYL Group Companies have not entered into nor
been a party to any Tax avoidance scheme or
arrangement (including any arrangement in relation to
which the MYL Group Companies may be liable to Tax
under the principles set out in X.X. Xxxxxx Limited v
IRC (1981 STC 174) or Xxxxxxx v Xxxxxx (1984 STC 153)
as developed in subsequent cases).
1.22.18 The MYL Group Companies are registered persons for
the purpose of the VATA and all regulations and
orders made thereunder (the "VAT Legislation"), and
have not at any time been treated as members of a
group of companies for VAT purposes and have not made
any application to be so treated. No circumstances
exist whereby the MYL Group Companies would or might
become liable for VAT as an agent or otherwise by
virtue of section 47 of the VATA. The MYL Group
Companies have complied in all respects with the
requirements and provisions of the VAT Legislation
and have made and maintained, and will pending
Completion, make and maintain accurate and up-to-date
records, invoices, accounts and other documents
required by or necessary for the purposes of the VATA
and the MYL Group Companies have at all times
punctually paid and made all payments and returns
required thereunder. The MYL Group Companies have not
made any supplies in the previous two years in
consequence of which they are or will be unable to
obtain credit for all input tax paid by them.
1.22.19 No action has been taken by any or the MYL Group
Companies in respect of which any notice was required
to be given to any Tax Authority or any dispensation,
consent or clearance from any Tax Authority was
required, save in circumstances where such notice was
given or such dispensation, consent or clearance was
validly obtained, and where any conditions attaching
thereto were, and will immediately following
Completion, continue to be met.
41
PART B
PURCHASER'S WARRANTIES
1 Warranties given by the Purchaser
1.1 AUTHORITY AND CAPACITY
1.1.1 INCORPORATION
The Purchaser is a limited liability company duly
organised and validly existing under the law of the
State of Delaware.
1.1.2 AUTHORITY
The Purchaser has the legal right and full power and
authority to enter into and perform the Transaction
Documents which constitute valid and binding
obligations on the Purchaser in accordance with their
terms.
The Purchaser has taken or will have taken by
Completion all corporate action required by it to
authorise it to enter into and to perform the
Transaction Documents.
1.1.3 NO BREACH
The execution and delivery of, and the performance by
the Purchaser of its obligations under this Agreement
will not result in a breach of any provision of or
any obligations under the Purchaser's constitutional
documents.
42
SCHEDULE 4
LIMITATION OF LIABILITY
1 LIMITATION OF LIABILITY
Notwithstanding the provisions of Clause 9.1, the Vendor shall not be
liable under this Agreement:
1.1 TIME LIMITS
(a) in respect of any claim unless notice of such claim
is given in writing by the Purchaser to the Vendor
setting out reasonable details of the specific matter
in respect of which the claim is made including (if
practicable) an estimate as to the amount of such
claim within 2 years following Completion (other than
Tax Warranties or any claim under Clause 3.2, 3.4 or
3.5) and in the case of a claim under the Tax
Warranties or any claim under Clause 3.2, 3.4 or 3.5
within 7 years following Completion;
(b) any such claim shall (if it has not been previously
satisfied, settled or withdrawn) be deemed to be
withdrawn six months after the relevant time limit
set out above unless legal proceedings in respect of
it (i) have been commenced by being both issued and
served and (ii) are being pursued with reasonable
diligence;
1.2 MINIMUM CLAIMS
In respect of any claim arising from any single circumstance
if and to the extent the amount of the claim does not exceed
(pound)250,000 save that claims relating to a series of
connected matters shall be aggregated for this purpose and
provided that any claim in relation to Tax shall be treated as
arising out of a single circumstance;
1.3 MAXIMUM CLAIMS
In respect of any claim to the extent that the aggregate
amount of the liability of the Vendor for that claim together
with all other claims made under this Agreement would exceed
an amount equal to the aggregate of the Completion Amount and
the amount re-paid to the Vendor in accordance with Clause 4;
1.4 CONTINGENT LIABILITIES
in respect of any liability which is contingent other than a
claim under Clause 3.4 or Clause 3.5 unless and until such
contingent liability becomes an actual liability and is due
and payable (and in relation to any such claim the six month
time limit referred to in paragraph 1.1(b) of this Schedule
shall be deemed to run from the date on which the relevant
liability shall become an actual liability and be due and
payable); and
1.5 PURCHASER'S KNOWLEDGE
in respect of any claim other than a claim under Clause 3.2,
3.4 or 3.5 to the extent that the relevant facts, matters or
circumstances giving rise to the claim were known by the
Purchaser or by any of its directors prior to the execution of
this Agreement.
43
The Purchaser shall be deemed to have full knowledge of:
(a) any matter fully and fairly disclosed in the
Disclosed Information;
(b) any information which would be revealed upon an
inspection (whether or not made) of the publicly
available records in England and Wales relating to
the Company, Connect Holdings and Connect as at the
date of this Agreement;
(c) any matter referred to in the Transaction Documents;
(d) matters which the Purchaser knew or ought reasonably
to have known and which are of public record and in
the public domain relating to the prevailing social,
economic and climatic factors governing the running
of companies in the business of providing for the
design, construction, financing, operation and
maintenance of roads in England and Wales; and
(e) all matters provided for or noted in the Accounts.
2 MATTERS WHERE VENDOR NOT LIABLE
The Vendor shall not be liable for any claim in respect of any matter
to the extent that:
2.1 allowance, provision or reserve has been made for such matter
in the Accounts or to the extent that payment or discharge of
the relevant matter has been taken into account therein;
2.2 such claim arises or, such claim otherwise having arisen, is
increased as a result of any change made after Completion in
any accounting policies or practice of any MYL Group Company,
the Purchaser or any other company in the same group of
companies as the Purchaser (other than any change in
accounting policies or practice arising as a result of the
application of the provisions of Schedule 28AA Taxes Act to
the Connect Loan);
2.3 such claim other than a claim under Clause 3.2, 3.4 or 3.5
relates to any loss of profits or to any loss to the Purchaser
other than an actual loss directly caused by a breach by the
Vendor of this Agreement; and
2.4 such claim other than a claim under Clause 3.4 or 3.5 relates
to any forecasts, models or information provided to the
Purchaser regarding the anticipated future performance of the
Project. Such statements and estimates regarding the future
performance of the Project reflect various assumptions
concerning anticipated results, which assumptions may or may
not prove to be correct and no representations are made as to
the accuracy of such statements and estimates.
3 MITIGATION OF LOSS
The Purchaser shall take or procure that any MYL Group Company takes
all reasonable steps to avoid or mitigate any losses which in the
absence of mitigation might give rise to a liability in respect of any
claim under this Agreement other than a claim under Clause 3.2, 3.4 or
3.5.
3.1 Without prejudice to the Purchaser's obligation to mitigate
the claim:
(a) the Vendor shall be entitled to require the Purchaser
or any MYL Group Company to take all such reasonable
steps or proceedings as the Vendor may consider
necessary and not detrimental to the Purchaser's
44
interest in order to mitigate any claim and the
Purchaser shall procure that any MYL Group Company
shall act in accordance with any such requirements;
and
(b) for the purpose of enabling the Vendor to remedy a
breach or to mitigate or otherwise determine the
amount of any claim or to decide what steps or
proceedings should be taken in order to mitigate any
claim, the Purchaser shall:
(i) promptly and in any event within thirty (30)
days of any breach or circumstances giving
rise to a breach of any of the Vendor's
Warranties or other terms of the Agreement
coming to its notice or to the notice of the
Company give notice of the same to the
Vendor; and
(ii) make or procure to be made available to the
Vendor or its duly authorised
representatives all relevant books of
account, records and correspondence of the
relevant company and permit the Vendor to
ascertain or extract any relevant
information therefrom.
4 FACTORS WHICH REDUCE LIABILITY CALCULATION
In calculating the liability of the Vendor in respect of any claim,
where such claim arises from any depletion in the assets of any MYL
Group Company or any increase in its liabilities, then the liability of
the Vendor in respect of such claim shall be reduced by:
4.1 the amount by which any asset of any MYL Group Company shall
have been under-stated in the Accounts;
4.2 the amount by which any liability of any MYL Group Company
shall have been over-stated in the Accounts;
4.3 any amount recovered in respect of any debt written off in the
Accounts; or
4.4 the value (applying the accounting policies adopted therein)
of any asset which asset has, at the date of the claim been
established to have been omitted from the Accounts or which is
subsequently established to have been so omitted.
5 INSURANCE
The Vendor shall not be liable in respect of any claim to the extent
that the losses arising from such claim are covered by a policy of
insurance in force at the date of this Agreement and payment is made by
the relevant insurer or would have been covered if such policy of
insurance had been maintained beyond the date of this Agreement on no
less favourable terms as those existing at the date hereof.
6 CONTINGENT LIABILITY
If any claim other than a claim under Clause 3.4 or Clause 3.5 shall
arise by reason of some liability which at the time that the claim is
notified to the Vendor is contingent only, the Vendor shall not be
under any obligation to make any payment to the Purchaser thereunder
until such time as such liability becomes an actual liability and is
due and payable (and in relation to such claim the six months time
limit referred to in paragraph 1.1 of this Schedule shall be deemed to
run from the date on which the relevant liability shall become an
actual liability and be due and payable).
45
7 VOLUNTARY ACT, OMISSION OR TRANSACTION
The Vendor shall not be liable in respect of any claim other than a
claim under Clause 3.2, 3.4 or 3.5 to the extent that the claim arises
directly as a result of any voluntary act, omission or transaction
carried out after the Completion Date by any member of the Purchaser's
Group otherwise than in the ordinary course of business as carried on
up to Completion.
8 VENDOR'S WARRANTIES
The Vendor's Warranties shall be actionable only by the Purchaser or
its permitted assignee or transferee under Clause 11.3 and no other
party shall be entitled to make any claim or take any action whatsoever
against the Vendor under or arising out of or in connection with this
Agreement.
9 NOTICE PERIOD FOR VENDOR'S WARRANTIES
A breach of the Vendor's Warranties which is capable of remedy shall
not entitle the Purchaser to compensation unless the Vendor is given
written notice of such breach and such breach is not remedied to the
reasonable satisfaction of the Purchaser within 30 days after the date
on which such notice is served on the Vendor.
10 CHANGE IN LAW
The Vendor shall not be liable for any claim in respect of a breach of
any of the Vendor's Warranties to the extent that the claim:
10.1 results from or is increased by any change in any law, rule,
regulation, legislation or administrative practice, first
announced or enacted after the date of this Agreement
including (without prejudice to the generality of the
foregoing) any increase in the rates of Tax or any imposition
of Tax or any withdrawal of relief from Tax not actually (or
prospectively) in effect at the date of this Agreement; or
10.2 would not have arisen but for any change after the date of
this Agreement of any generally accepted interpretation or
application of any legislation or accounting policy.
11 For the avoidance of doubt, the Vendor shall not be liable in respect
of any claim arising from any depletion in the assets of any MYL Group
Company or any increase in its liabilities to the extent that the
Purchaser does not own directly or indirectly the whole of the relevant
MYL Group Company immediately after Completion.
12 TAX
The Vendor shall not be liable under Clause 3.2 of the Agreement or in
respect of any breach of the Tax Warranties:
12.1 in respect of any Taxation liability to the extent that a
provision or reserve for such liability (other than provision
for deferred Taxation) was made or taken into account as a
provision in the Accounts or the MYL Accounts;
12.2 in respect of any Taxation liability to the extent that such
liability was discharged or paid prior to Completion and such
payment or discharge was reflected in the Accounts or the MYL
Accounts;
46
12.3 to the extent that such Taxation liability would not have
arisen but for a voluntary act or transaction carried out by
the Purchaser or the Company after Completion outside the
ordinary course of business and other than pursuant to a
legally binding obligation entered into prior to Completion
and which the Purchaser or Company ought reasonably to have
known would give rise to such liability;
12.4 to the extent that the Taxation liability would not have
arisen, but for an act carried out by the Vendor prior to
Completion at the written request or with the written approval
of the Purchaser outside the ordinary course of their
respective normal businesses;
12.5 to the extent that an allowance, credit, exemption, deduction
or relief that arose in a period or part period ending on or
before the Completion Date is available (other than any
allowance, credit, exemption, deduction or relief of Connect
Holdings or Connect, or any allowance, credit, exemption,
deduction or relief taken into account in determining any
asset or provision in the Accounts or MYL Accounts, or any
allowance, credit, exemption, deduction or relief arising in
the ordinary course of business between the Accounts Date and
the Completion Date), at no cost to the Company, to reduce,
offset or extinguish such Taxation liability, or would be
available on the making of an appropriate election;
12.6 to the extent that such Taxation liability arises or is
increased as a consequence of any change in accounting policy,
any Tax reporting practice or the length of any accounting
period for Tax purposes by the Company or an MYL Group Company
after Completion, except where such change was necessary in
order to comply with any applicable legal, regulatory,
financial reporting or other requirement;
12.7 to the extent that such Taxation liability arises or is
increased as a consequence of any retrospective change in any
law (including subordinated legislation), regulation or
direction or generally published practice of any Taxation
Authority enacted after Completion or to the extent that such
Taxation liability arises or is increased by a change in any
rate of Taxation enacted after Completion but with retroactive
effect;
12.8 to the extent that the Taxation liability arises or is
increased as a result of the Purchaser's failure to comply
with its obligations under Clause 11.14 (Pre-completion Tax
Computations) or 11.15 (Connect Holdings and Connect Taxes);
12.9 in respect of any Taxation liability which arises by reason of
a voluntary disclaimer by the Company after Completion of the
whole or part of any allowance to which it is entitled under
Part 2 of the Capital Allowances Act 2001 or by reason of the
revocation by the Company after Completion of any claim for
Relief made (whether provisionally or otherwise) by it prior
to Completion, in each case where such allowance or Relief was
taken into account in, or in computing a provision for
Taxation in, the MYL Accounts;
12.10 to the extent that such Taxation liability arises or is
increased as a result of the making or amendment of a claim,
election, surrender or disclaimer, the giving of a notice or
consent, or the doing of any other thing by the Purchaser, the
Company or any of the Project Companies under the provisions
of any enactment or regulation relating to Taxation after
Completion (other than one the making, giving or doing of
which was taken into account in computing any provision for
Tax in the Accounts or the MYL Accounts);
47
12.11 to the extent that such Taxation liability would not have
arisen but for, or has been increased by, the failure or
omission on the part of the Company or any MYL Group Company
to make any such valid claim, election, surrender or
disclaimer, or to give any such notice or consent or to do any
such thing, or to submit any Tax Return required to be
submitted by them, that was (a) taken into account in
determining any provision or liability for Tax in the Accounts
or MYL Accounts and (b) notified to the Purchaser by the
Vendor within a reasonable time that would allow the Purchaser
to correct such omission or failure;
12.12 to the extent that any income, profits or gains, not being
deemed income, profits or gains, (and for these purposes
deemed income shall include income that is paid before the
Accounts Date but accrues, for Tax purposes, after the
Accounts Date) to which that Taxation liability is
attributable were actually earned or received by or actually
accrue to the Company but were not reflected in the MYL
Accounts;
12.13 to the extent that recovery has been made in respect of the
same subject matter elsewhere in this Agreement; or
12.14 to the extent that such Taxation liability arises in respect
of the receipt or payment by MYL of the aggregate cash
distribution (including interest payment, dividend payment,
director fees or any other cash distribution) to be made on or
around 30 September 2004 by Connect and Connect Holdings to
the Company.
48
SCHEDULE 5
COMPLETION OBLIGATIONS
PART A - VENDOR'S OBLIGATIONS
At Completion the Vendors shall:
1 deliver to the Purchaser, transfers in respect of the Shares duly
executed by the registered holders in favour of the Purchaser (or such
person as the Purchaser may nominate in writing not less than five
Business Days prior to Completion) and share certificates for the
Shares in the name of the relevant transferors (or an express indemnity
in a form reasonably satisfactory to the Purchaser in the case of any
certificate found to be missing) and any power of attorney under which
any transfer is executed on behalf of the Vendor or nominee;
2 deliver to the Purchaser such waivers or consents as the Purchaser may
require to enable the Purchaser or its nominee to be registered as
holder of the Shares, including the waiver of BB's pre-emption rights
under Clause 11A of the Shareholders' Agreement;
3 procure that the following documents in the agreed terms are executed
and delivered to the Purchaser's Solicitors:-
(i) Shareholders' Agreement Novation duly executed by the Vendor;
(ii) Secondment Agreement Novation duly executed by the Vendor; and
(iii) Release of the Parent Company Guarantee in the agreed terms.
4 deliver to the Purchaser (or to any person whom the Purchaser may
nominate) (or otherwise make available in a manner reasonably
acceptable to the Purchaser) such of the following as the Purchaser may
require:
(i) the statutory books (which shall be written up to but not
including the Completion Date), the certificate of
incorporation (and any certificate of incorporation on change
of name) and common seal (if any) of the Company and share
certificates or other documents of title in respect of all the
issued share capital of each subsidiary which is owned
directly or indirectly by the Company;
(ii) the written resignations of each of the directors and company
secretary of the Company and the nominee directors of the
Vendor and its Affiliates of Connect Holdings and Connect from
their office as a director or secretary in the agreed terms to
take effect on the date of Completion in each case
acknowledging that he or she has no claim against any MYL
Group Company whether for loss of office or otherwise.
(iii) a copy of the minutes of a duly held meeting of the directors
of the Vendor authorising the execution by the Vendor of the
Transaction Documents to which the Vendor is party;
5 procure board meetings of each MYL Group Company to be held at which:-
(i) in the case of the Company, it shall be resolved that the
transfer relating to the Shares shall be approved for
registration and (subject only to the transfer being duly
49
stamped) the Purchaser to be registered as the holder of the
Shares concerned in the register of members;
(ii) each of the persons nominated by the Purchaser (such persons
to be nominated in writing not less than five Business Days
prior to Completion) shall be appointed directors and/or
secretary, as the case may be, such appointments to take
effect on the Completion Date;
(iii) the resignations of the directors and secretaries referred to
in paragraph 3(ii) above shall be tendered and accepted;
and the Vendor shall procure that minutes of each duly held board
meeting referred to above are delivered to the Purchaser.
PART B - PURCHASER'S OBLIGATIONS
At Completion the Purchaser shall deliver to the Vendor's Solicitors:
1 The Shareholders' Agreement Novation and the Secondment Agreement
Novation in the agreed terms, duly executed by the Purchaser;
2 A copy of the New Parent Guarantee to BB in the agreed terms;
3 BF Letter of Credit (as such term is defined in the EIB Facility
Agreement) in favour of the European Investment Bank in the form of
Annex 5 to the EIB Facility Agreement in the agreed terms;
4 Release of the letter of credit provided by MEIP in an amount
of(pound)1,000,000 in respect of break costs under the EIB Facility
Agreement in the agreed terms; and
5 A copy of the minutes of a duly held meeting of the directors of the
Purchaser authorising the execution by the Purchaser of the Transaction
Documents to which the Purchaser is a party.
PART C - COMPLETION DOCUMENTS
1 The Vendor and the Purchaser shall use their respective best endeavours
to procure that any required third party executes the Completion
Documents at or prior to Completion.
DOCUMENT PARTIES
-------- -------
Shareholders' Agreement Novation Connect, Connect Holdings, MYL, MEIP, BB,
MIAL and others
Release of Parent Company Guarantee BB and the Vendor
New Parent Company Guarantee MIAL and BB
50
DOCUMENT PARTIES
-------- -------
Secondment Agreement Novation Connect, MIUK, MYL, BB and XXXX
XX Letter of Credit (as such term is defined in the EIB MIAL
Facility Agreement) in favour of the European Investment
Bank in the form of Annex 5 to the EIB Facility Agreement
Release of the Letter of Credit (as such term is defined EIB and Vendor
in the EIB Facility Agreement) provided by MEIP in an
amount of(pound)1m in respect of break costs under the EIB
Facility Agreement
Waiver of pre-emption rights from BB BB and Vendor
51
SCHEDULE 6
POST COMPLETION OBLIGATIONS
1 VENDOR'S OBLIGATIONS
1.1 Secretary of State
1.1.1 Certified conformed copies of each amendment,
release, waiver or agreement being entered into to be
delivered to the Secretary of State within 15 days of
being entered into pursuant to Clause 2.3.4 of the
DBFO Contract.
1.2 The Agent (pursuant to the CBFA)
1.2.1 Certified conformed copies of each amendment,
release, waiver or agreement being entered into that
are delivered to the Secretary of State (pursuant to
Clause 2.3.4 of the DBFO) together with certified
copies of any further Connect Documents entered into
pursuant to Clauses 19.18 and 19.23 of the CBFA.
1.3 European Investment Bank
1.3.1 European Investment Bank to be provided with
information relating to the appointment of any
consultant or information relating to the financial
outcome of the Project pursuant to Clause 8.2(e) of
the EIB Facility Agreement.
1.4 European Investment Fund
1.4.1 European Investment Fund to be provided with
information relating to the financial outcome of the
Project pursuant to Clause 8.2(f) of the EIF Facility
Agreement.
52
TABLE OF CONTENTS
1 Interpretation................................ 1
2 Agreement to Sell the Shares.................. 7
3 Consideration................................. 7
4 Debt Repayment................................ 11
5 Conditions.................................... 11
6 Action Pending Completion..................... 12
7 Completion.................................... 14
8 Obligations after Completion.................. 15
9 Warranties.................................... 15
10 Entire Agreement and Remedies................. 17
11 Other Provisions.............................. 17
Schedule 1 Company Details............................. 26
Schedule 2 Conditions Precedent........................ 28
Schedule 3 Warranties.................................. 30
Schedule 4 Limitation of Liability..................... 43
Schedule 5 Completion Obligations...................... 49
Schedule 6 Post Completion Obligations................. 52
Schedule 7 Disclosed Information....................... 53
53
Exhibit 2.3
MACQUARIE INFRASTRUCTURE COMPANY LLC
PRINCIPAL EXECUTIVE OFFICES: 000 Xxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx, 00000, XXX
REGISTERED OFFICE IN THE STATE OF DELAWARE: Corporation Trust Center,
0000 Xxxxxx Xxxxxx, Xxxx xx Xxxxxxxxxx, Xxxxxx of New Castle.
REGISTERED AGENT: The Corporation Trust Company
To: Macquarie European Infrastructure PLC
Levels 29 and 00,
Xxxx Xxxxx,
0 Xxxxxxxxx Xxxxxx,
Xxxxxx, XX0X 0XX
14, October 2004
Dear Sirs,
YORKSHIRE LINK
We refer to the sale and purchase agreement between Macquarie Infrastructure
Company LLC (formerly Macquarie Infrastructure Assets LLC) and Macquarie
European Infrastructure PLC relating to the sale and purchase of all the shares
in Macquarie Yorkshire Limited, dated 7 June 2004 (the "AGREEMENT"). Pursuant
to Clause 11.5 of the Agreement and in consideration of each party agreeing to
be bound by the terms set out herein, the Agreement shall be amended as
follows, such amendments to be effective as of the date hereof:
1. in the description of the parties thereto, the reference to "MACQUARIE
INFRASTRUCTURE ASSETS LLC a Delaware limited liability company whose
principal executive office is at 000 Xxxxx Xxxxxx, 00xx xxxxx, 00000,
Xxx Xxxx, XXX (the "PURCHASER" or "MIAL")" shall be deleted and
replaced by reference to "MACQUARIE INFRASTRUCTURE COMPANY LLC a
Delaware limited liability company whose principal executive office is
at 000 Xxxxx Xxxxxx, 00xx xxxxx, 00000, Xxx Xxxx, XXX (the "PURCHASER"
or "MICL")".
2. each reference to "MIAL" shall be replaced by reference to "MICL".
3. the deletion of the definition of "September Distribution Amount".
4. the following changes being made to Clause 3 (Consideration):
(i) Clause 3.1 being deleted in its entirety and replaced with
the following words "3.1 The total consideration for the
sale of the Shares shall be the payment by the Purchaser of
the Initial Consideration which shall be increased by L9,750
for each day after 30 September 2004 Completion occurs (the
"COMPLETION AMOUNT")."
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(ii) on the third line of Clause 3.5.1, the insertion of the word
"Company" before the words "Settlement (as defined in Clause 3.5.2
below)".
5. the following change being made to Clause 4 (Debt Repayment):
(i) the deletion of the words "less the September Distribution
Amount" in Clause 4.1.
6. the following change being made to Clause 6.4 (Restrictions on the Vendor):
(i) Clause 6.4.10 being deleted in its entirety and replaced with the
following words "6.4.10 declare, make or pay any dividend
or other distribution from MYL to the Vendor."
7. the addition of the following as a new Clause 12 in the Agreement:
"12. INDEMNITY RELATING TO ROAD ACCIDENT
12.1 For the purposes of this Clause 12, the following terms shall have
the following meanings:
"COSTS" has the meaning given to it in Clause 12.2;
"FINAL AMOUNT" has the meaning given to it in Clause 12.5;
"INCIDENT" means the road accident occurring on MI-A1 motorway on
20 March 2004;
"NOTIFICATION" has the meaning given to it in Clause 12.4(ii);
"PURCHASER ESTIMATE" has the meaning given to it in Clause 12.5;
"PURCHASER NOTICE" has the meaning given to it in Clause 12.5; and
"REVENUE REDUCTION" means a reduction in the revenues of Connect
which is attributable to the suspension or reduction by the
Secretary of State of the DBFO Payment (as such term is defined in
the DBFO Contract) or the termination by the Secretary of State of
the DBFO Contract, in each case as a result of an Event of Default
occurring under Clause 36 of the DBFO Contract which is caused by
or directly related to the Incident.
12.2 Subject to Clause 12.3, 12.6 and 12.9 below, the Vendor agrees to
pay to the Purchaser, from time to time by way of adjustment to
the consideration, an amount equal to any and all losses, costs,
expenses and liabilities including those arising out of any
claims, actions and proceedings (which shall include, but not be
limited to, all legal and other costs and expenses incurred in
connection with the investigation,
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preparation, defence or settlement of any actual or potential claim, action
or proceeding) (hereinafter collectively referred to as the "COSTS") that
are suffered, incurred or made against:
(i) the Purchaser; or
(ii) any MYL Group Company
in connection with or arising out of the commencement of criminal
proceedings against any member of the MYL Group or any officer or director
thereof, in relation to the Incident, provided always that the Vendor's
liability under paragraph (ii) above shall, save in respect of MYL, be
limited to an amount equal to fifty per cent. (50%) of the total aggregate
Costs suffered, incurred or made against such MYL Group Company.
12.3 For the avoidance of doubt the Purchaser shall not be entitled to recover
under Clause 12.2 in respect of any reduction in the revenues of Connect
and any claim by the Purchaser with respect to a Revenue Reduction shall
only be made in accordance with the provision of Clause 12.4 below.
12.4 Without prejudice to the provisions of Clause 12.2 above, but subject to
Clauses 12.5, 12.6 and 12.9 below, the Vendor hereby agrees to pay to the
Purchaser, by way of adjustment to the consideration, as soon as reasonably
practicable (but in any event not more than 10 Business Days) following
receipt of the Purchaser Notice below), an amount equal to fifty per cent.
(50%) of the difference between (a) the net present value of the total
aggregate amount of the Original Cash Flows and (b) the net present value
of the total aggregate amount of the Revised Cash Flows, calculated as
follows:
(i) Original Cash Flows shall be the original aggregate distributions
(comprising all actual dividend distributions and actual payments on
the subordinated debt (whether payments of interest or principal)) to
be made by Connect (directly or indirectly) to shareholders of Connect
or Connect Holdings in connection with the Project from the date of
the Notification up to and including 31 March 2028, as set out in the
financial model referred to at paragraph 7.08 in the Disclosed
Information;
(ii) The Revised Cash Flows shall be the Original Cash Flows derived by
adjusting only the future revenues of the Project to reflect the
effect of any Revenue Reduction notified to Connect by the Secretary
of State in accordance with the provisions of the DBFO Contract (the
"NOTIFICATION") and recalculating these adjusted revenues on the basis
of the assumptions used in the financial model referred to at
paragraph 7.08 in the Disclosed Information.
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(iii) The net present value of the Original Cash Flows and the Revised
Cash Flows shall be calculated using a discount rate of 8.66%
(based on the assumptions used in the financial model referred to
at paragraph 7.08 in the Disclosed Information), such values to be
calculated as of the date of the Notification.
12.5 Upon becoming aware that a Notification has been received by Connect, the
Purchaser must notify the Vendor in writing that the provisions of Clause
12.4 apply (the "PURCHASER NOTICE"). The Purchaser Notice must set out
the Purchaser's calculation of the amount payable by the Vendor to the
Purchaser under Clause 12.4 (The "PURCHASER ESTIMATE"). The Purchaser
Estimate will be deemed to be the agreed amount payable by the Vender to
the Purchaser under Clause 12.4 in respect of a Revenue Reduction unless
the Vendor notifies the Purchaser in writing that it disputes the
Purchaser Estimate within 10 Business Days of receipt of the Purchaser
Estimate. If the Vendor provides timely notice to the Purchaser that it
disputes the Purchaser Estimate the parties shall refer the dispute to an
independent accountant with recognized expertise in financial modelling
selected by the Purchaser (such referral to be made within 10 Business
Days of the Purchaser's selection) to determine the amount payable by the
Vendor pursuant to Clause 12.4 and the following shall apply:
(i) the costs and expenses of the independent accountant shall be
borne equally between the Vendor and the Purchaser;
(ii) both the Purchaser and the Vendor shall have a reasonable
opportunity to make submissions in respect of the amount payable
under Clause 12.4 and the parties shall procure that the
independent accountant gives due consideration to such
submissions; and
(iii) the independent accountant shall make its determination as soon
as practicable and, in any event, within 30 Business Days of the
referral being made.
In making any determination referred to in this Clause 12.5 the independent
accountant shall act as expert not as arbitrator. The determination made by the
independent accountant under this Clause 12.5 shall, in the absence of manifest
error, be final and binding on the Vendor and the Purchaser. The amount the
independent accountant determines to be payable under Clause 12.4 (the "FINAL
AMOUNT") shall be payable to the Purchaser by the Vendor in full discharge of
the Vendor's obligations arising under Clause 12.4 in respect of the Revenue
Reduction. The Final Amount must be paid within 3 Business Days of the
determination being made.
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12.6 If, before the Vendor pays an amount in discharge of any claim under this
Clause 12, the Purchaser or any other MYL Group Company recovers or is
entitled to recover (whether by payment, discount, credit, relief or
otherwise) from a third party a sum which relates to the subject matter
of such claim, the Purchaser shall procure that before steps are taken
against the Vendor pursuant to this Clause 12 all reasonable steps are
taken to enforce such recovery and the Vendor shall not be liable in
respect of any such claim (and any amount determined to be payable under
Clause 12.4 shall be adjusted) to the extent that actual recovery has
been made by the Purchaser or any other MYL Group Company from any other
source, including, without limitation, where:
(i) the losses arising from such claim are covered by a policy of
insurance and payment is made by the relevant insurer; or
(ii) recovery has been made in respect of the same losses arising from
such claim from a third party.
12.7 Where a claim is brought by the Purchaser in respect of losses under this
Clause 12 and an amount is determined to be payable by the Vendor, the
Vendor shall take the benefit by way of subrogation of all rights or
claims of the Purchaser against any third party in respect of the same
losses.
12.8 Following Completion the Purchaser shall promptly supply to the Vendor
details of all claims, actions, proceedings and investigations begun in
relation to any MYL Group Company in respect of the Incident but any
failure to provide such details shall not affect the rights of the
Purchaser save to the extent that the Vendor is prejudiced by such
failure. The Vendor shall be entitled, at its own expense, to direct the
Purchaser, and the Purchaser shall comply with all reasonable directions
of the Vendor, in the conduct of any defence or response to such claims,
actions, proceedings and investigations in connection with the Incident.
The Purchaser shall not and shall procure that no MYL Group Company shall
make any admission of liability in relation to the Incident without the
prior consent of the Vendor.
12.9 The Vendor's liability in respect of the aggregate amount of all claims
brought by the Purchaser pursuant to this Clause 12 shall not exceed
Pound Sterling 2,750,000.
12.10 For the avoidance of doubt, the provisions of Schedule 4 hereto shall not
apply to this Clause 12."
For the avoidance of doubt, all other provisions of the Agreement remain
unchanged and as stated.
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Unless otherwise stated, all capitalised terms in this letter shall have the
same meaning as in the Agreement.
This letter shall be governed by and construed in accordance with English law
and the parties hereto submit to the exclusive jurisdiction of the courts of
England to settle all disputes arising in connection therewith.
Please confirm your agreement to the above by counter-signing this letter in the
space provided below.
Yours faithfully,
/s/ Xxxxx Xxxxxx
-------------------------------
Name: Xxxxx Xxxxxx
Title: Chief Executive Officer
For and on behalf of
MACQUARIE INFRASTRUCTURE COMPANY LLC
We agree to the terms and conditions of this letter as set out above.
/s/ Xxxxx Xxxxx /s/ Xxxxxxxxx Xxxx
------------------------------- -------------------------------
Name: Xxxxx Xxxxx Xxxxxxxxx Xxxx
Title: Director Secretary
For and on behalf of
MACQUARIE EUROPEAN INFRASTRUCTURE PLC
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Exhibit 2.3
MACQUARIE INFRASTRUCTURE COMPANY LLC
PRINCIPAL EXECUTIVE OFFICES: 000 Xxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx, 00000, XXX
REGISTERED OFFICE IN THE STATE OF DELAWARE: Corporation Trust Center,
0000 Xxxxxx Xxxxxx, Xxxx xx Xxxxxxxxxx,
Xxxxxx of New Castle. REGISTERED AGENT: The Corporation Trust Company
To: Macquarie European Infrastructure PLC
Levels 29 and 00,
Xxxx Xxxxx,
0 Xxxxxxxxx Xxxxxx,
Xxxxxx XX0X 0XX
1, November 2004
Dear Sirs,
YORKSHIRE LINK
We refer to the sale and purchase agreement between Macquarie Infrastructure
Company LLC (formerly Macquarie Infrastructure Assets LLC) (the "PURCHASER") and
Macquarie European Infrastructure PLC (the "VENDOR") relating to the sale and
purchase of all the shares in Macquarie Yorkshire Limited, dated 7 June 2004
(the "AGREEMENT"). Pursuant to paragraph 1 of Schedule 5 (Completion
Obligations) of the Agreement the Purchaser wishes to nominate Macquarie
Yorkshire LLC (of 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000, XXX)
to be the transferee of the Shares and hereby requests that at Completion the
Vendor deliver to the Purchaser transfers in respect of the Shares duly executed
by the registered holder in favour of Macquarie Yorkshire LLC.
Unless otherwise stated, all capitalised terms in this letter shall have the
same meaning as in the Agreement.
Yours faithfully,
/s/ Xxxxx Xxxxxx
------------------------------------------
Name: Xxxxx Xxxxxx
Title: Chief Executive Officer
For and on behalf of
MACQUARIE INFRASTRUCTURE COMPANY LLC
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