Execution Version Tahorakuri
EXHIBIT 4.27
AGREEMENT FOR SALE AND PURCHASE OF TREES
BETWEEN
XXXXXXXX CHALLENGE FORESTS INDUSTRIES LIMITED
AND
TEAL 3 LIMITED
[XXXXXXX GRIERSON LOGO]
Execution Version Tahorakuri
TABLE OF CONTENTS
1. INTERPRETATION........................................ 1
2. CONDITIONS............................................ 6
3. NON-COMPLETION FEE.................................... 9
4. SALE AND PURCHASE..................................... 9
5. PURCHASE PRICE AND PAYMENT............................ 9
6. PENDING SETTLEMENT.................................... 10
7. SETTLEMENT............................................ 11
8. DUE DILIGENCE MATTERS................................. 12
9. RISK.................................................. 14
10. GOODS AND SERVICES TAX................................ 16
11. WARRANTIES............................................ 16
12. COSTS................................................. 22
13. DELAY................................................. 22
14. ASSIGNMENT............................................ 22
15. RESOLUTION OF DISPUTES................................ 23
16. CONFIDENTIALITY....................................... 24
17. SEVERABILITY.......................................... 25
18. LIMITED RECOURSE...................................... 25
19. NOTICES............................................... 26
20. ENTIRE AGREEMENT...................................... 28
21. MODIFICATION.......................................... 28
22. WAIVER................................................ 28
23. COUNTERPARTS.......................................... 28
24. FURTHER ASSURANCES.................................... 28
25. NO MERGER............................................. 28
26. APPLICABLE LAW........................................ 29
27. NO PARTNERSHIP........................................ 29
SCHEDULE ONE: WARRANTIES
ANNEXURE ONE: FORESTRY RIGHT
ANNEXURE TWO: INFRASTRUCTURE AGREEMENT
ANNEXURE THREE: MANAGEMENT AGREEMENT
ANNEXURE FOUR: WOOD SUPPLY AGREEMENT
ANNEXURE FIVE: DEED OF ASSIGNMENT
ANNEXURE SIX: DUE DILIGENCE INFORMATION REQUESTED BY TEAL
ANNEXURE SEVEN: UNDERTAKING FROM XXXXXXXX CHALLENGE INDUSTRIES LIMITED
THIS AGREEMENT is dated the day of 2003
BETWEEN XXXXXXXX CHALLENGE FORESTS INDUSTRIES LIMITED an incorporated company
having its registered office in Auckland ("FCF")
AND TEAL 3 LIMITED, an incorporated company having its registered office in
Auckland ("Teal")
BACKGROUND
A. FCF is a New Zealand registered company holding a leadership position
in New Zealand's forest industries.
X. Xxxx has been established as a special purpose vehicle to acquire the
Trees and the Forestry Right. Teal is exclusively advised and managed
by UBS Timber Investors, a division of UBS Global Asset Management (New
York), Inc., a portion of the asset management division of UBS AG.
C. FCF and Teal wish to undertake a transaction under which FCF will sell
the Trees to Teal, and create a Forestry Right over the Land in favour
of Teal, to be registered pursuant to the Forestry Rights Registration
Xxx 0000.
X. Xxxx will be granted certain rights to the Trees pursuant to the
Forestry Right.
E. On settlement of this agreement, FCF and Teal will be required to
execute and deliver an Infrastructure Agreement, a Management Agreement
and a Wood Supply Agreement which will set out arrangements between the
parties in relation to access to the Land and management of the Trees,
and in relation to the supply of certain Trees to FCF.
F. FCF agrees to sell and Teal agrees to purchase the Trees on the terms
of this agreement.
THE PARTIES AGREE:
1. INTERPRETATION
In this agreement unless the context indicates otherwise:
1.1 DEFINITIONS:
"ADDITIONAL DUE DILIGENCE INFORMATION" means
(a) the due diligence information within the scope of the
Due Diligence Information Request that is not
included in the Disclosure Letter and that FCF
supplies to Teal under clause 8.4
Agreement for Sale and Purchase of Trees Page 2
in the period following delivery of the Disclosure
Letter up to 19 February 2003 in response to the Due
Diligence Information Request; and
(b) any additional information reasonably requested by
Teal to clarify any of the due diligence information
previously supplied by FCF in response to the Due
Diligence Information Request;
but, unless otherwise agreed in writing by the parties,
excludes any information requested by Teal that is not within
the scope of the Due Diligence Information Request;
"AFFECTED TREES" means Trees destroyed or materially damaged
by fire, windthrow or any other cause howsoever for the
purposes of clause 9;
"AFFILIATES" of a person shall mean a person controlled by,
controlling or under common control with, such person and for
the purposes of this definition Forestry Corporation of New
Zealand Limited (In Receivership) is not an Affiliate of any
party;
"XXXX RATE" means the average of the bid rates for 90-day bank
accepted bills of exchange, expressed as a percentage per
annum as quoted on Reuters page BKBM (subject to manifest
error) as fixed at 10.45 am on each Business Day following the
due date;
"BUSINESS DAY" means a day on which registered banks are open
for banking business in Auckland, excluding Saturdays, Sundays
and public holidays;
"CONDITIONS" means the conditions set out in clause 2;
"CONFIDENTIAL INFORMATION" means any information:
(a) relating to the terms of this agreement and the
Related Agreements;
(b) disclosed by either party to the other party on the
express basis that such information is confidential
including any information disclosed by FCF to Teal
under clause 8;
provided that, where information relates exclusively to one
party, nothing in this agreement will require that party to
maintain confidentiality in respect of that information;
"DEED OF ASSIGNMENT" means the deed of assignment relating to
the assignment of GST input credits attached to this agreement
in Annexure Five;
"DEFAULT INTEREST RATE" means interest calculated daily at the
Xxxx Rate plus 4% per annum;
Agreement for Sale and Purchase of Trees Page 3
"DISCLOSURE LETTER" means the letter in the form agreed by the
parties written by FCF qualifying certain Warranties, which
will be delivered as a separate document, dated and signed, to
Teal prior to execution of this agreement;
"DUE DILIGENCE INFORMATION REQUEST" means the list of due
diligence information that Teal requires FCF to provide during
the course of the due diligence review contemplated in clause
2.1.3 and that is listed in Annexure Six;
"ENCUMBRANCE" means mortgage, lien, charge, pledge, title
retention, caveat, option, right of pre-emption, tenancy,
third party right, or security interest of any kind (including
but not limited to a security interest as defined in the
Personal Property Securities Act 1999) but excludes the
interests created under the Geothermal Development Deed, and
any document, caveat, transfer or encumbrance, whether
lawfully and properly registered against the Land or not,
which is intended to protect interests created under the terms
of the Geothermal Development Deed or the Geothermal Sale
Agreement;
"ENVIRONMENTAL LAW" means all applicable law relating to any
aspect of:
(a) the environment;
(b) the Trees and the Land;
(c) substances which may have an adverse effect on the
environment; and
(d) the carrying on or permitting of activities which may
have an adverse effect on the environment;
whether pursuant to the Resource Management Xxx 0000, any
other statutes, under the common law or otherwise;
"FCF'S SOLICITORS" means Xxxxxxxx Xxx, Barristers and
Solicitors, at Auckland;
"FORESTRY CONSULTANT" means a reputable forestry expert with
relevant experience;
"FORESTRY RIGHT" means the forestry right to be entered into
between Teal and FCF in accordance with the provisions of the
Forestry Rights Registration Act 1983 and in relation to
certain identified Stands and which is attached to this
agreement in Annexure One;
"GEOTHERMAL ARRANGEMENTS" has the meaning ascribed to it in
the Forestry Right;
Agreement for Sale and Purchase of Trees Page 4
"GEOTHERMAL DEVELOPMENT DEED" means the geothermal development
deed between Xxxxxxxx Challenge Energy Power Generation
Limited (now Shell Exploration NZ Limited) and Xxxxxxxx
Challenge Forests Limited (now Xxxxxxxx Challenge Forests
Industries Limited) dated 18 July 1997 to the extent that it
applies to the Land;
"GEOTHERMAL SALE AGREEMENT" means the agreement for sale and
purchase of geothermal exploitation rights dated 8 June 2000
between Xxxxxxxx Challenge Energy Power Generation Limited
(now Shell Exploration NZ Limited), Mighty River Power
Investments Limited and Tauhara Development Limited;
"GOODS AND SERVICES TAX" or "GST" means tax levied in
accordance with the GST Act and includes any tax levied in
substitution for such tax and excludes any penalties and
interest;
"GST ACT" means the Goods and Services Tax Xxx 0000;
"GST AMOUNT" is defined in clause 10.1 of this agreement;
"INFRASTRUCTURE AGREEMENT" means the infrastructure agreement
to be entered into between Teal and FCF for the provision of
certain services by FCF and attached to this agreement in
Annexure Two;
"LAND" means the land the subject of the Forestry Right and
more particularly comprised and described in the Forestry
Right;
"MANAGEMENT AGREEMENT" means the management agreement to be
entered into between Teal and FCF pursuant to which FCF will
manage the Tahorakuri forest and attached to this agreement in
Annexure Three;
"MANAGEMENT PLANS" means management plans as that term is
defined in the Management Agreement;
"PURCHASE PRICE" means US$45 million excluding GST;
"PURPOSE" means purpose as that term is defined in the
Forestry Right.
"RECORDS" means all documents, photographs, maps and any other
records, including but not limited to stand records, (stored
or documented in whatever form) held by FCF in relation to
FCF's ownership and management of the Trees but excludes any
records that FCF is required by any law to retain but includes
copies of them;
"RELATED AGREEMENTS" means the Forestry Right, Infrastructure
Agreement, Management Agreement, Wood Supply Agreement and
Deed of Assignment as amended by agreement between the parties
prior to the Settlement Date;
"SCHEDULE" means a schedule to this agreement, unless this
agreement expressly provides otherwise;
Agreement for Sale and Purchase of Trees Page 5
"SETTLEMENT" means the performance by FCF of FCF's obligations
under clause 7 and the performance by Teal of Teal's
obligations under clause 7;
"SETTLEMENT DATE" means the date 10 Business Days immediately
following the date on which the Conditions are satisfied or
waived pursuant to clause 2 or if such date does not meet the
requirements of the last sentence of clause 5.2, the first
Business Day following which does or, as the parties may
agree, any other date on which Settlement is to take place;
"SPECIFIED PERSONS" for the purposes of clause 1.5.3 of
Warranty means Xxxxx Xxxxxx, Xxxx XxXxxxxx, Xxx Xxxxxx, Xxxx
Xxxxxxxx, Xxx Piebenger, Xxxxx Xxxxxxxxxx, Xxxx Xxxxxxx, Xxxx
XxXxx, Xxxxxxx Xxxx, Xxxxx XxXxxxxx, Xxx Xxxx, Xxxx Xxxx, Xxxx
Xxxxxxx, Xxxxxxx Xxxxxx, Xxxxxxx Xxxx and Xxxxx Xxxxxxx;
"STAND" means those parts of the Land comprising specific
plantation areas of the age class, area and silvicultural
condition described in Schedule Two of the Forestry Right;
"SUM" has the meaning ascribed to it in clause 2.6;
"TREES" means those Pinus radiata trees growing, standing or
lying on the Stands as at the date of this agreement and any
logs or forest produce arising from such trees and, unless the
context otherwise requires, includes the Records;
"TEAL'S SOLICITORS" means Xxxxxxx Grierson, Barristers and
Solicitors, at Auckland;
"WARRANTIES" means the warranties contained in Schedule One;
"WOOD SUPPLY AGREEMENT" means the wood supply agreement to be
entered into between Teal and FCF pursuant to which Teal will
supply wood to FCF and attached to this agreement in Annexure
Four;
1.2 PARTIES: references to parties are references to parties to
this agreement;
1.3 PERSONS: references to persons shall be deemed to include
references to individuals, companies, corporations, firms,
partnerships, joint ventures, associations, organisations,
trusts, states or agencies of state, government departments
and municipal authorities or other regulatory bodies or
regulatory authorities in each case whether or not having
separate legal personality;
1.4 DEFINED EXPRESSIONS: expressions defined in the main body of
this agreement bear the defined meaning in the whole of this
agreement including the recitals;
Agreement for Sale and Purchase of Trees Page 6
1.5 DOLLARS: references to dollars or $ are references to NZ
dollars except in relation to the Purchase Price and the Sum
payable under clause 2.6, which are references to US dollars;
1.6 CLAUSES, SCHEDULES AND BACKGROUND: references to clauses,
schedules and background are references to clauses, schedules
and background to this agreement unless otherwise indicated;
1.7 HEADINGS: section, clause and other headings are for ease of
reference only and shall not be deemed to form any part of the
context or to affect the interpretation of this agreement;
1.8 SINGULAR AND PLURAL: words importing the singular number shall
include the plural and vice versa;
1.9 SCHEDULES AND ANNEXURES: the schedules and annexures to this
agreement and the provisions and conditions contained in such
schedules and annexures shall have the same effect as if set
out in the body of this agreement;
1.10 NEGATIVE OBLIGATIONS: any obligation not to do anything shall
be deemed to include an obligation not to suffer, permit or
cause that thing to be done;
1.11 GENDER: words importing one gender shall include the other
genders;
1.12 STATUTES AND REGULATIONS: references to a statute include
references to regulations, orders or notices made under or
pursuant to such statute or regulations made under the statute
and references to a statute or regulation include references
to all amendments to that statute or regulation whether by
subsequent statute or otherwise and a statute or regulation
passed in substitution for the statute or regulation referred
to as incorporating any of the provisions; and
1.13 DISPOSAL: references to disposal include sale, exchange,
transfer, assignment, lease or parting with possession or
control of, and the word "dispose" means to make a disposal.
2 CONDITIONS
2.1 CONDITIONS: This agreement is subject to the following
conditions:
2.1.1 STATUTORY CONSENTS: receipt by Teal, on terms
acceptable to Teal, of all requisite statutory
consents, clearances and authorisations (if any)
necessary or desirable for Teal's acquisition of the
Trees, including the consent of the Overseas
Investment Commission to the transaction contemplated
by this agreement;
Agreement for Sale and Purchase of Trees Page 7
2.1.2 BANKS CONSENTS: receipt by FCF, on terms acceptable
to FCF, of all consents required from FCF's bankers
to the transaction contemplated by this agreement;
2.1.3 DUE DILIGENCE: Teal, in Teal's sole discretion and
judgment, being satisfied with Teal's due diligence
review of the Trees, the Land and any matter which in
Teal's discretion is relevant to its decision whether
or not to purchase the Trees.
2.2 FULFILMENT OF CONDITIONS: The parties will each make all
appropriate applications, diligently pursue those
applications, do all other acts, matters and things within
their power and control and supply all such information
reasonably required to satisfy the Conditions. For the
avoidance of doubt, FCF shall provide all assistance,
information and documents reasonably required by Teal to
enable Teal to satisfy the condition in clause 2.1.1.
2.3 BENEFIT OF CONDITIONS: Conditions 2.1.1 and 2.1.3 are inserted
solely for the benefit of Teal who may waive them at Teal's
discretion. Condition 2.1.2 is inserted solely for the benefit
of FCF who may waive it at FCF's discretion.
2.4 NON-FULFILMENT OF CONDITIONS: If all the Conditions in:
2.4.1 CLAUSES 2.1.1 AND 2.1.2: Clauses 2.1.1 and 2.1.2 have
not been fulfilled or waived in accordance with this
agreement by 5.00pm on 28 February 2003 or such later
date as may be agreed in writing by the parties;
2.4.2 CLAUSE 2.1.3: Clause 2.1.3 has not been fulfilled or
waived in accordance with this agreement by the later
of 5.00pm on 12 March 2003, the date 10 Business Days
after FCF receives bank consent pursuant to clause
2.1.2 or the date 8 Business Days after FCF receives
bank confirmation pursuant to clause 2.5, or such
later date as may be agreed in writing by the
parties;
then either party may terminate this agreement by notice to
the other of them in which case this agreement (other than
clauses 3 (but only if this agreement is terminated by FCF due
to the Condition in clause 2.1.2 not being satisfied) and 16,
which will survive termination) will end and no party will
have any claim against any other party arising under or in
connection with termination.
2.5 BANK CONFIRMATION: Within 2 Business Days of the Condition in
clause 2.1.2 being satisfied or waived in accordance with this
agreement, FCF will procure that any lender holding an
Encumbrance over the Land and the Trees provides confirmation
of its consent, on usual terms for such consents, to provide
at Settlement the unconditional release of each Encumbrance
over the Trees and the unconditional consent to the creation
and registration of the Forestry Right. If FCF is unable to
Agreement for Sale and Purchase of Trees Page 8
provide such confirmation by 4 March 2003, FCF shall before
4.30_pm on that day pay to Teal's Solicitors in immediately
available cleared funds a bond of NZ$692,307.69 to be held on
the following terms:
2.5.1 BOND HELD ON TRUST: Teal's Solicitors must hold the
bond as stakeholder on trust in an interest bearing
account in the names of both parties until Settlement
or termination of this agreement;
2.5.2 RISK OF LOSS OF BOND: The risk of loss of the bond
rests with the party who has the right to payment of
the bond on Settlement or termination of this
agreement;
2.5.3 ENTITLEMENT TO BOND: The bond is to be paid by Teal's
Solicitors as follows:
(a) If Settlement takes place, or this agreement
is terminated other than due to the default
of FCF, it is to be refunded forthwith to
FCF;
(b) If this agreement is terminated due to the
default of FCF, it becomes the property of
Teal, and shall be paid forthwith to it
accordingly, provided that Teal cannot
receive payment under this clause and under
clause 3.
2.5.4 ENTITLEMENT TO INTEREST ON BOND: The interest earned
on the bond must be paid by Teal's Solicitors to the
party entitled to be paid the bond under clause
2.5.3.
2.5.5 SOLICITORS' LETTER ABOUT BOND: Teal will procure
Teal's Solicitors to provide a letter addressed to
both parties confirming the terms on which the bond
will be held pursuant to this clause 2.5.
2.6 PAYMENT OF SUM: One (1) Business Day after the Condition in
clause 2.1.3 is satisfied or waived in accordance with this
agreement, Teal must pay the sum of US$346,153.84 ("Sum") to
Teal's Solicitors, which is to be held on the following terms:
2.6.1 SUM HELD ON TRUST: Teal's Solicitors must hold the
Sum as stakeholder on trust in an interest bearing
account in the names of both parties until Settlement
or termination of this agreement;
2.6.2 RISK OF LOSS OF SUM: The risk of loss of the Sum
rests with the party who has the right to payment of
the Sum on Settlement or termination of this
agreement;
2.6.3 ENTITLEMENT TO SUM: The Sum is to be paid by Teal's
Solicitors as follows:
Agreement for Sale and Purchase of Trees Page 9
(a) SETTLEMENT: If Settlement takes place, it is
to be paid to FCF in part payment of the
Purchase Price;
(b) TERMINATION DUE TO FCF'S DEFAULT: If this
agreement is terminated under clauses
9.2.1(a) or 11.16, or otherwise because of
FCF's default, it is to be paid to Teal; and
(c) TERMINATION DUE TO TEAL'S DEFAULT: If this
agreement is terminated because of the
default of Teal, it becomes the property of
FCF and is to be paid to FCF.
2.6.4 ENTITLEMENT TO INTEREST ON SUM: The interest earned
on the Sum must be paid by Teal's Solicitors to the
party entitled to be paid the Sum under clause 2.6.3.
2.6.5 SOLICITORS' LETTER ABOUT SUM: Teal will procure
Teal's Solicitors to provide a letter addressed to
both parties confirming the terms on which the Sum
will be held pursuant to this clause 2.6.
3 NON-COMPLETION FEE
If either FCF or Teal terminates this agreement under clause 2.4
because the Condition in clause 2.1.2 is not satisfied, then FCF shall
pay to Teal a non completion fee of NZ$692,307.69, such fee to be paid
to Teal in a lump sum in immediately available cleared funds within 14
days of either party serving written notice on the other party of the
termination of this agreement. If FCF is required to pay any amount
under this clause 3, the parties must procure that any amount held by
Teal's Solicitors under clause 2.5 is paid to FCF. FCF will not be
required to pay any amount under this clause 3 where either party is
entitled to terminate this agreement under clause 2.4 because the
Condition in clause 2.1.1 is not satisfied.
4 SALE AND PURCHASE
FCF agrees to sell and Teal agrees to purchase the Trees on the terms
and conditions contained in this agreement. The parties further agree
to prepare and execute the Related Agreements with the intent that the
parties will be able to comply with their respective obligations under
clause 7 of this agreement on the Settlement Date.
5 PURCHASE PRICE AND PAYMENT
5.1 PRICE FOR TREES: The consideration for the purchase of the
Trees is the Purchase Price excluding GST.
5.2 PAYMENT OF PURCHASE PRICE FOR TREES: The Purchase Price shall
be paid or satisfied in US dollars, by the payment of the
Purchase Price, less the Sum, by electronic transfer of
immediately available cleared funds to
Agreement for Sale and Purchase of Trees Page 10
a bank account nominated by FCF, such transfer of funds to be
received by FCF's bank at the earliest practicable time on the
Settlement Date (FCF to supply details of its bank account in
writing to Teal no later than five Business Days prior to the
Settlement Date). The parties acknowledge that Settlement can
only take place at a time when banks in both New Zealand and
the United States of America are open for business.
5.3 PURCHASE PRICE LOWEST PRICE: The Parties agree that the
Purchase Price plus the GST amount for the Trees is the lowest
price within the meaning of section EH 48(3)(a) of the Income
Tax Xxx 0000 that the Parties would have agreed upon as at the
date of this agreement for this sale by FCF of the Trees upon
the basis of payment in full on the Settlement Date. The
parties agree that they will compute their taxable income for
the relevant period on the basis that the Purchase Price
includes no capitalised interest and they will file their tax
returns in respect to the Purchase Price accordingly.
5.4 DEFAULT INTEREST PAID BY TEAL: If from any cause whatever
(save FCF's default) any portion of the Purchase Price or the
GST Amount (if payable under clause 10.1.2(a)) is not paid on
the due date Teal will without prejudice to any of FCF's
rights or remedies under this agreement pay to FCF interest at
the Default Interest Rate to be calculated daily and
compounded monthly on the unpaid portion of the Purchase Price
or the GST Amount (if payable under clause 10.1.2(a)) from the
due date until payment in full.
5.5 DEFAULT INTEREST PAID BY FCF: If FCF fails to refund to Teal
any part of the Purchase Price and any part of the GST Amount
when due, FCF will pay to Teal interest at the Default
Interest Rate to be calculated daily and compounded monthly on
the amount to be refunded from the due date until payment in
full.
6 PENDING SETTLEMENT
In respect of the period from execution of this agreement until
Settlement ("Period") unless the prior written consent of Teal is given
to act otherwise:
6.1 HARVESTING: FCF will ensure that no harvesting or other
removal of Trees is carried out in the Stands;
6.2 MANAGE TREES: FCF shall manage the Trees in good faith
employing the same degree of care and skill as:
6.2.1 CONDUCT OF OUR AFFAIRS: FCF employs in the conduct of
its own affairs; or
6.2.2 HIGHLY COMPETENT MANAGER: a highly competent manager
with expertise in large scale commercial plantation
forestry management would use in carrying out
equivalent obligations;
Agreement for Sale and Purchase of Trees Page 11
whichever is the higher standard;
6.3 NO DISPOSAL OR ENCUMBRANCE: FCF will ensure that no Trees are
disposed of and that no new Encumbrance is created over the
Trees (or any of them); and
6.4 INITIAL MANAGEMENT PLANS: the parties shall undertake
negotiations in good faith to agree during the Period on the
initial Management Plans.
6.5 BENEFIT OF ACCESS ARRANGEMENTS: Teal may in the course of due
diligence identify access arrangements, rights of way or other
easements in the name of FCF or its Affiliates which are
appurtenant to the Land, or which are held by FCF or its
Affiliates in gross, whether registered or unregistered
("Access Arrangements"), which in Teal's reasonable opinion
are desirable to meet the Purpose. The parties shall then use
their best endeavours to agree prior to Settlement the basis
upon which the benefit of the Access Arrangements will be made
available to Teal. Where such agreement has been reached, at
Settlement FCF shall deliver documents reasonably acceptable
to Teal recording the basis upon which Teal will obtain the
benefit of the Access Arrangements.
7 SETTLEMENT
7.1 TIME AND PLACE: Settlement will take place at the earliest
practicable time on the Settlement Date at the offices of
FCF's Solicitors or at another place agreed on by FCF and
Teal.
7.2 POSSESSION AND TITLE: Possession of, and title to, the Trees
will be given and taken on Settlement. Subject to Settlement,
the benefit of the Trees will accrue to Teal from 2.00pm on
the Settlement Date.
7.3 DELIVERY OF RECORDS ON SETTLEMENT DATE: On Settlement FCF will
deliver and make available to Teal, at FCF's offices,
possession and control of the Records with the intent that the
unencumbered right and interest therein shall pass by
delivery.
7.4 DELIVERY BY FCF: On Settlement, FCF will deliver the following
complete and executed documents:
7.4.1 FORESTRY RIGHT: the Forestry Right in registrable
form;
7.4.2 ENCUMBRANCE: unconditional releases from the holders
of each Encumbrance over the Trees together with
unconditional consent to the creation and
registration of the Forestry Right in registrable
form;
7.4.3 RELATED AGREEMENTS: counterpart copies of the Related
Agreements other than the Forestry Right, together
with any undertakings or other documents that are
required to be delivered as a term of this agreement
or which are annexed to,
Agreement for Sale and Purchase of Trees Page 12
or are required to be provided by FCF or its
Affiliates under, the Related Agreements;
7.4.4 MANAGEMENT PLANS: copies of the initial Management
Plans;
7.4.5 TAX INVOICE: a tax invoice in a form which complies
with the GST Act in respect of the supply of the
Trees;
7.4.6 CAVEATORS' CONSENTS: such caveators' consents in
registrable form (if any) as may be necessary to
enable the Forestry Right to be registered;
7.4.7 UNDERTAKING FROM XXXXXXXX CHALLENGE INDUSTRIES
LIMITED: an undertaking from Xxxxxxxx Challenge
Industries Limited in the form set out in Annexure
Seven together with a guarantee from Xxxxxxxx
Challenge Industries Limited in the form attached to
Annexure Seven;
7.4.8 BENEFIT OF ACCESS ARRANGEMENTS: any documents the
parties agree FCF is required to deliver to Teal
pursuant to clause 6.5, such documents to be
delivered in registrable form if that is agreed by
the parties under that clause;
7.4.9 MATERIAL DOCUMENTS: such other documents material to
the transfer of the Trees as may reasonably be
required by Teal (and to be notified to FCF, at least
10 Business Days prior to the Settlement Date) and as
are reasonably required to be produced on the
Settlement Date to complete the sale and purchase of
the Trees and registration of the Forestry Right; and
7.4.10 OTHER EVIDENCE: such other evidence as Teal may
reasonably require (and to be notified to FCF, at
least 10 Business Days prior to the Settlement Date)
to satisfy Teal that the right and interest to be
transferred pursuant to this agreement in the Trees
will vest in Teal free from any Encumbrances.
7.5 TEAL'S OBLIGATIONS: At Settlement Teal shall:
7.5.1 PAYMENT: pay FCF the Purchase Price less the Sum; and
7.5.2 RELATED AGREEMENTS: deliver to FCF duly executed
counterpart copies of the Related Agreements.
8 DUE DILIGENCE MATTERS
8.1 ACCESS TO PERSONNEL AND PREMISES: Between the date of this
agreement and the Settlement Date FCF will allow Teal and any
persons authorised by Teal reasonable access during normal
business hours to:
Agreement for Sale and Purchase of Trees Page 13
8.1.1 PERSONNEL ACCESS: the most senior employees of FCF
and such other personnel and advisers as may be
reasonably nominated by Teal and approved by FCF; and
8.1.2 LAND: the Land;
for the purpose of carrying out Teal's due diligence review,
which may include but shall not be limited to inspecting the
Trees and the Land.
8.2 FULL CO-OPERATION: FCF will cause FCF's officers, employees
and professional advisers to co-operate reasonably with Teal.
8.3 NO INTERFERENCE: In exercising its rights under this clause 8
for the purposes of conducting Teal's due diligence review
Teal will ensure that Teal and any person authorised by Teal:
8.3.1 INTERFERENCE OR DISRUPTION: ensures the least
possible interference or disruption is caused to
FCF's operations; and
8.3.2 REASONABLE REQUIREMENTS: complies with all reasonable
requirements (including any health and safety
requirements) of FCF when accessing the Land or any
of FCF's premises.
8.4 PROVISION OF DUE DILIGENCE INFORMATION: From the date of this
agreement, FCF will use its reasonable endeavours to supply
all information requested in the Due Diligence Information
Request to Teal as soon as possible and in any event no later
than 20 January 2003 unless the parties agree otherwise in
writing. All such information is to be provided on the
following terms:
8.4.1 INFORMATION IN WRITING: all information is to be
distributed in writing to Teal by Xxxxxxx Xxxxxx of
FCF;
8.4.2 REQUESTS IN WRITING: Any requests by Teal for:
(a) INFORMATION NOT PROVIDED: information not
yet provided by FCF in response to the Due
Diligence Information Request;
(b) CLARIFICATION: clarification of information
previously provided by FCF; or
(c) INFORMATION NOT WITHIN SCOPE: information
that is not within the scope of the Due
Diligence Information Request;
must be sent in writing to Xxxxxxx Xxxxxx or Xxxxx
Xxxxxx of FCF;
Agreement for Sale and Purchase of Trees Page 14
8.4.3 NO REQUESTS AFTER 17 FEBRUARY 2003: Teal agrees that
it shall not request information for the purposes of
clause 2.1.3 after the close of business on 17
February 2003; and
8.4.4 NO RESPONSES AFTER 19 FEBRUARY 2003: FCF undertakes
to use its reasonable endeavours to respond to all
requests for information made by Teal under clause
8.4.2 within 5 Business Days of receiving such
requests, and for the avoidance of doubt, all such
responses must be given by FCF to Teal by the close
of business on 19 February 2003.
8.5 LIST OF ADDITIONAL DUE DILIGENCE INFORMATION: By no later than
the close of business on 19 February 2003, the parties must
agree in writing on the list of documents included in the
Additional Due Diligence Information and on the application of
Warranty 1.5.1 or 1.5.2 to the Additional Due Diligence
Information, and FCF shall thereafter provide Teal with the
agreed list by the close of business on 21 February 2003. If
the parties cannot agree on the list, it will be determined
under clause 15.
8.6 COPIES OF MATERIALS: If Settlement does not occur under this
agreement, Teal will either, at FCF's option, return to FCF
copies of any documents provided by FCF to Teal or destroy the
same (and certify to FCF that such has occurred), without
taking any further copies of those materials.
9 RISK
9.1 RISK: The Trees will be at FCF's sole risk until Settlement
and thereafter will be at Teal's sole risk subject to the
provisions of any of the Related Agreements providing
otherwise.
9.2 DAMAGE OR DESTRUCTION: In the event that the Trees, or any of
the Trees, are damaged or destroyed prior to Settlement, the
following provisions shall apply.
9.2.1 MORE THAN 10% OF PLANTED AREA: Should, prior to
Settlement, the Trees or any Trees (being more than
10% of the Trees by planted area) be materially
damaged or destroyed by fire, windthrow or otherwise,
then Teal may at its sole discretion either:
(a) TERMINATION: terminate this agreement; or
(b) REPLACEMENT TREES: agree with FCF on
alternative replacement trees of equal value
to be provided by FCF which shall be of no
lesser quality, age class and silvicultural
condition than the Affected Trees.
Where FCF is unable to provide a sufficient quantity
of replacement trees of equal value which are of no
lesser quality,
Agreement for Sale and Purchase of Trees Page 15
age class and silvicultural condition than the
Affected Trees, Teal in its sole discretion may agree
to accept replacement trees which are of a quality,
age class and silvicultural condition which differs
from the Affected Trees.
9.2.2 LESS THAN 10% OF PLANTED AREA: Should, prior to
Settlement, 10% or less by planted area of the Trees
be materially damaged or destroyed by fire, windthrow
or otherwise, then FCF and Teal shall agree on
alternative replacement trees of equal value to be
provided by FCF which shall be of no lesser quality,
age class and silvicultural condition than the
Affected Trees.
9.2.3 FAILURE TO AGREE ON REPLACEMENT TREES: Any such
replacement trees under clause 9.2.1(b) or 9.2.2 are
to comprise stands or part stands situated on the
Land and shall be agreed by the parties or, failing
agreement within 7 days of a dispute arising, shall
be selected by a Forestry Consultant to be selected
by agreement between the parties, or failing
agreement, by an independent Forestry Consultant to
be appointed by the chairman of the Consultants
Committee of the New Zealand Institute of Forestry.
That Forestry Consultant must provide written
undertakings of confidentiality prior to commencement
of his or her selection process and must resolve the
dispute as an expert and not as an arbitrator. The
Forestry Consultant's selection shall be final and
binding on FCF and Teal. The costs of the Forestry
Consultant must be shared equally by FCF and Teal.
9.2.4 CONSEQUENTIAL AMENDMENT TO RELATED AGREEMENTS: Where
any agreement or selection pursuant to clauses 9.2.1,
9.2.2 or 9.2.3 requires the Related Agreements to be
amended to give effect to such agreement or
selection, the Related Agreements shall be amended by
the parties and the cost of such amendments shall be
borne equally, unless the agreement or selection was
necessitated by an act or omission of FCF or Teal, in
which case the cost of amending the Related
Agreements shall be borne by the party at fault.
9.2.5 CONSEQUENCES OF TERMINATION: If this agreement is
terminated by Teal under clause 9.2.1(a), this
agreement (other than clause 16 and clause 3 (but
only where the event leading to the termination
contemplated in clause 3 precedes the event
triggering clause 9.2.1(a)), which will survive
termination) will end and no party will have any
claim against any other party arising under or in
connection with termination.
9.2.6 SATISFACTION OF CLAIMS: The provision of any
replacement trees under this clause 9 will be in full
and final satisfaction of any claims Teal will have
arising from the damage or destruction of any Trees.
Agreement for Sale and Purchase of Trees Page 16
10 GOODS AND SERVICES TAX
10.1 GST: In addition to the Purchase Price, Teal shall pay to FCF
an amount equal to the GST charged on the supply of the Trees
under this agreement ("the GST Amount") by either:
10.1.1 SET OFF: obtaining written acceptance from the Inland
Revenue Department that FCF's liability to account
for GST to the Inland Revenue Department on the
supply of the Trees is satisfied by Teal assigning to
FCF the benefit of Teal's input tax credit in respect
of that supply ("Set Off") as contemplated by the
Deed of Assignment; or
10.1.2 PAYMENT: if the Set Off is not implemented by the
Inland Revenue Department on or before the seventh
Business Day of the month following the month in
which Settlement occurs, or on any other date as
agreed by the parties in writing ("Set Off Date")
upon Teal receiving a refund from the Inland Revenue
Department in respect of the GST charged on the
supply of the Trees under this agreement, immediately
paying:
(a) GST AMOUNT: the GST Amount to FCF; and
(b) INTEREST: any interest (net of tax) that
Teal receives from the Inland Revenue
Department in respect of that refund to FCF.
10.2 GST RETURN: Teal will:
10.2.1 RETURN: ensure that the GST return for the taxable
period in which Settlement occurs is filed on or
before the third Business Day of the month following
the month in which Settlement occurs;
10.2.2 DEDUCTION: claim a GST input tax deduction equal to
the GST charged on the supply of Trees under this
agreement in that GST return; and
10.2.3 RESPOND TO QUERIES: promptly respond to any queries
raised by the Inland Revenue Department in respect of
that GST input tax deduction.
10.3 CO-OPERATION: FCF and Teal will co-operate in good faith to
ensure that the Set Off is implemented by the Inland Revenue
Department before the Set Off Date.
11 WARRANTIES
11.1 FCF'S REPRESENTATIONS: FCF represents and warrants to Teal in
the terms of the Warranties with the intent that Teal does, in
entering into
Agreement for Sale and Purchase of Trees Page 17
this agreement, rely on the truth of the statements contained
in the Warranties.
11.2 SEPARATE WARRANTIES: Each Warranty is given as a separate and
independent Warranty and except as otherwise expressly
provided will not be limited by reference to any other
Warranty or by anything in this agreement.
11.3 WARRANTIES REPEATED: Each Warranty will be deemed to have been
repeated and re-affirmed by FCF on Settlement, as if it had
been made on and effective as at that time.
11.4 WARRANTY CLAIMS: If Teal becomes aware of a matter which could
give rise to a Warranty claim (which for the avoidance of
doubt, requires actual knowledge by Teal of such a matter),
FCF is not liable in respect of it unless written notice of
the relevant facts is given by Teal to FCF's Solicitors as
soon as reasonably practicable and in any event within 40
Business Days of Teal becoming aware of those facts.
11.5 COMMENCEMENT OF PROCEEDINGS: The liability of FCF in respect
of any Warranty claim will absolutely terminate if dispute
resolution measures in respect of it have not been commenced
within six months of service of written notice of the Warranty
claim. This does not apply if FCF has assumed conduct of the
Warranty claim in question in accordance with clause 11.18.2.
11.6 MAXIMUM LIABILITY: FCF's maximum aggregate liability in
respect of all breaches of this agreement including, but
without limitation, any breach of the Warranties, cannot
exceed the Purchase Price plus any GST. Teal's maximum
aggregate liability in respect of all breaches of this
agreement cannot exceed the Purchase Price plus any GST and
any default interest payable under clause 5.4.
11.7 WARRANTY CLAIM THRESHOLD: No Warranty claim may be made by
Teal unless the total of all Warranty claims to be made or
which have been made exceed in aggregate NZ$300,000, in which
event all Warranty claims individually or in series may be
made, but any claim so made will be for all amounts claimed
and not just for the amount in excess of NZ$300,000. No
individual Warranty claim may be made for an amount less than
NZ$30,000.
11.8 PERIOD FOR WARRANTY CLAIMS: In relation to all Warranties
other than Warranties 4, 5, 7, 10.2, 10.3 and 15, Teal may not
make any Warranty claims after 24 months following the
Settlement Date. In relation to Warranties 4, 5, 7, 10.2, 10.3
and 15, Teal may make Warranty claims at any time up to the
expiry or earlier termination of the Forestry Right.
11.9 WARRANTIES QUALIFIED: Each Warranty is given subject to:
11.9.1 DISCLOSURE LETTER: the matters fairly disclosed in
the Disclosure Letter;
Agreement for Sale and Purchase of Trees Page 18
11.9.2 AGREEMENT: any matter expressly provided for under
this agreement or any Related Agreement or done or
omitted to be done after the date of this agreement
with Teal's prior written consent;
11.9.3 PUBLIC REGISTERS: any matter recorded in any public
register in New Zealand and capable of being searched
by Teal, whether or not searches of the registers
have been made; and
11.9.4 INSPECTION: all information that would be reasonably
evident on a proper visual inspection of Trees
(accepted by FCF as not requiring a tree by tree
inspection) whether or not inspections have been made
but is otherwise subject to no qualification whatsoever.
11.10 DISCLOSURE LETTER EXHAUSTIVE:
11.10.1 EXPRESS DISCLOSURE: No letter, document or other
communication constitutes a disclosure for the
purposes of clause 11.9.1, unless it is expressly set
down in, or annexed to, the Disclosure Letter.
11.10.2 QUALIFICATION OF WARRANTIES: The Disclosure Letter
will only be effective to qualify any of the
Warranties to the extent it makes fair disclosures of
fact relating to identified Warranty section
headings.
11.10.3 NO PREJUDICE TO CLAIMS: Subject to clauses 11.9 and
11.11.5:
(a) INFORMATION REGARDING TREES: no information
about the Trees of which Teal has knowledge
(actual or constructive) will prejudice any
claim which Teal will be entitled to bring
or will operate to reduce any amount
recoverable by Teal; and
(b) NO MODIFICATION OR DISCHARGE DEEMED: none of
the Warranties will be deemed in any way
modified or discharged by reason of
investigation or inquiry made or to be made
by or on behalf of Teal.
11.11 ACKNOWLEDGMENT: Teal acknowledges and agrees to each of the
following:
11.11.1 ONLY REPRESENTATIONS ETC: the Warranties are the only
representations, warranties or other assurances of
any kind given by or on behalf of FCF and on which
Teal may rely in entering into this agreement;
Agreement for Sale and Purchase of Trees Page 19
11.11.2 NO OTHER BASIS: no verbal statement, promise or
forecast made by or on behalf of FCF may form the
basis of, or be pleaded in connection with, any claim
by Teal under or in connection with this agreement;
11.11.3 FUTURE VALUE: no representation or warranty is given
by or on behalf of FCF regarding the future value or
financial performance of the Trees;
11.11.4 NO IMPLIED WARRANTIES: all representations or
warranties implied by any law are expressly excluded
to the maximum extent permitted by law; and
11.11.5 NO BREACH: as at the date on which the Condition in
clause 2.1.3 is satisfied, it has no actual knowledge
of any matter or thing which constitutes a breach of
any of the Warranties.
11.12 DUE INQUIRY: Where in Schedule One a Warranty is given "so far
as FCF is aware" or "to the best of FCF's knowledge and
belief", it is deemed to be given after due and careful
inquiries have been made by FCF.
11.13 BENEFIT: If FCF makes any payment by way of damages for breach
of the Warranties and Teal receives any benefit in connection
with the circumstances giving rise to the claim in respect of
which the payment was made, Teal must, once it has received
such benefit, immediately repay to FCF an amount equal to the
lesser of the amount of such benefit and the payment.
11.14 MITIGATION: Teal must not do any act or thing (other than in
the ordinary course of business) which may give rise to a
Warranty claim which would not otherwise arise.
11.15 PENDING SETTLEMENT: FCF further undertakes with Teal that:
11.15.1 DISCLOSURE: FCF will immediately disclose in writing
to Teal any matter or circumstance which may arise or
become known to FCF after the date of this agreement
and before Settlement which does or may constitute a
material breach of, or is materially inconsistent
with, any of the Warranties; and
11.15.2 NO BREACH OF WARRANTIES: pending Settlement FCF will
not do or omit to do or suffer to be done anything
whereby any Warranty will or may be materially
untrue, misleading or inaccurate as at Settlement.
11.16 CANCELLATION OF AGREEMENT: If, pending Settlement:
11.16.1 FCF BREACH: FCF materially breaches any Warranty or
any of FCF's obligations under this agreement; or
Agreement for Sale and Purchase of Trees Page 20
11.16.2 NEW CIRCUMSTANCES: any circumstances arise which have
the effect of making any of the Warranties materially
incorrect or untrue;
Teal will be entitled at Teal's absolute discretion to give
FCF notice cancelling this agreement at any time before
Settlement. This right of cancellation is separate from and
additional to any rights conferred on Teal by law or otherwise
under this agreement and shall be without prejudice to any
claim relating to any cause of action accrued or accruing
prior to or in relation to such cancellation.
11.17 NOTICE OF CANCELLATION: Any notice given under clause 11.16
will be effective as against FCF if given to FCF's Solicitors.
11.18 THIRD PARTY CLAIMS: If any Warranty claim arises as a result
of or in connection with a liability or alleged liability to a
third party, then the following applies:
11.18.1 AVOIDANCE ETC: Teal must take such action at FCF's
cost in all things to avoid, dispute, appeal or
compromise the liability as may be requested by FCF;
11.18.2 CONDUCT OF APPEALS ETC: FCF is entitled to conduct
any appeal, dispute, compromise or defence of the
dispute and of any incidental negotiations at FCF's
costs in all things;
11.18.3 PERSONS AND INFORMATION: Teal must make available to
FCF at FCF's costs in all things the persons and all
information as FCF may reasonably require for
avoiding, disputing, appealing, or compromising any
such liability.
11.19 INDEMNITY BY FCF: FCF shall indemnify Teal and its respective
officers, directors, employees and Affiliates against all
losses, liabilities, costs, claims, charges, expenses, actions
and demands which Teal may incur as a direct result of a
breach by FCF of any of the Warranties listed in Schedule One
and the reasonable solicitors' costs incurred by Teal in
respect of any breach by FCF of any of the Warranties listed
in Schedule One including (but without limiting the generality
of this clause):
11.19.1 RESTORATION COSTS: any cost of correction or
restoration to the warranted or covenanted state or
condition; and
11.19.2 VALUE DIFFERENCE: any difference in value caused by
any such breach;
provided that nothing expressed or implied in this agreement
shall confer any liability on FCF in respect of any indirect,
consequential or special loss, damage, cost or expense of any
kind including (but not limited to) loss of savings and profit
suffered or incurred by Teal as a direct or indirect result of
a breach by FCF of any of the Warranties.
Agreement For Sale and Purchase of Trees Page 21
11.20 PURCHASE PRICE REDUCTION: Any payment FCF is required to make in
relation to any breach of Warranty is to be made to Teal in reduction
and refund of the Purchase Price and the GST Amount and FCF will issue
a credit note as required under section 25 of the GST Act at the time
of the payment.
11.21 NO DOUBLE CLAIMS: Neither party is entitled to claim more than once in
respect of any one matter giving rise to a claim under this agreement
or any of the Related Agreements.
11.22 ACCESS: If Teal makes a Warranty claim against FCF, Teal will make
available to FCF on a confidential basis, all information, books and
records of Teal as FCF may reasonably require for the purposes of
answering or defending such Warranty claim. Teal must preserve all
documents, books and records and any other information relevant to the
matter which may give rise to the Warranty claim.
11.23 TEAL'S WARRANTIES ON EXECUTION: Teal warrants and represents to FCF
that on execution each of this agreement and the Related Agreements
will constitute legal, valid and binding obligations enforceable
against Teal in accordance with their respective terms.
11.24 TEAL'S WARRANTIES ON SETTLEMENT: On Settlement Teal warrants and
represents to FCF that the Settlement, execution and delivery of this
agreement and the Related Agreements and the performance by Teal of its
obligations under this agreement and the Related Agreements;
11.24.1 VALID AUTHORISATION: will have been validly authorised by all
necessary action on the part of Teal;
11.24.2 LAW: will not contravene any law binding on it;
11.24.3 INCORPORATION DOCUMENTS: will not contravene its incorporation
documents.
11.25 TEAL'S CORPORATE POWERS: Teal warrants and represents to FCF that Teal
has and will continue to have the necessary corporate powers to enter
into this agreement and the Related Agreements and to perform its
obligations under it and the Related Agreements.
11.26 TEAL'S GST WARRANTIES: Teal warrants and represents that:
11.26.1 REGISTERED PERSON: it will be a registered person under the
GST Act at Settlement;
11.26.2 GROUP COMPANIES: it will not apply to be and will not at any
time have applied to be a member of a group of companies for
the purposes of subsections 55(2) to 55(7) of the GST Act;
11.26.3 CONSOLIDATED GROUP OF COMPANIES: it will not be and will not
at any time have been a member of a consolidated
Agreement For Sale and Purchase of Trees Page 22
group of companies for the purposes of the Income Tax Xxx
0000.
12. COSTS
Except as expressly provided elsewhere in this agreement, each party is
to bear its own costs in connection with the preparation, negotiation
and execution of this agreement and the Related Agreements and other
documentation contemplated by this agreement.
13. DELAY
No delay, grant of time, release, compromise, forbearance (whether
partial or otherwise) or other indulgence by one party concerning any
breach of any other party's obligations under this agreement is to:
13.1 NO WAIVER: operate as a waiver of or prevent the subsequent
enforcement of that obligation; or
13.2 NO DEEMED WAIVER: be deemed a delay, grant of time, release,
compromise, forbearance (whether partial or otherwise) or
other indulgence of, or a waiver of, any subsequent or other
breach.
14. ASSIGNMENT
14.1 CONSENT: Subject to clause 14.2, this agreement shall be
binding upon and inure to the benefit of the parties, their
respective successors and permitted assigns. A party may not
assign its rights or transfer its obligations under this
agreement to any other person or entity without the prior
written consent of the other party (which consent shall not be
unreasonably withheld).
14.2 NOMINATION: Prior to Settlement, Teal may nominate a suitable
person or entity to acquire as beneficial owner the Trees and
to hold the Forestry Right. Subject to clauses 14.3 and 14.4
of this agreement, from and after such nomination, the person
or entity so nominated shall take over all rights, privileges
and obligations conferred on or undertaken by Teal under this
agreement and the Related Agreements as if such nominated
person or entity was Teal. Any nomination must be for this
agreement and all the Related Agreements.
14.3 LIABILITY: Any nomination made pursuant to clause 14.2 of this
agreement shall release Teal from its liability under this
agreement as principal obligor to FCF for the performance of
its obligations under this agreement.
14.4 DEED: In the case of a request for assignment the assignor
shall obtain the execution by the proposed transferee of a
deed of covenant to be prepared by the other party's
solicitors at the assignor's costs whereby the proposed
assignee covenants with the other party to observe and perform
all the terms of this agreement and the Related Agreements. In
the case
Agreement For Sale and Purchase of Trees Page 23
of a nomination made pursuant to clause 14.2, Teal shall
obtain the execution by the proposed nominee of a deed of
covenant to be prepared by Teal's solicitors at Teal's costs
whereby the proposed nominee covenants with FCF to observe and
perform all the terms of this agreement and the Related
Agreements.
15. RESOLUTION OF DISPUTES
In the event of a dispute arising between the parties in relation to
this agreement the following provisions will apply.
15.1 NEGOTIATE: A party claiming that a dispute has arisen
concerning this agreement must give notice to the other party
specifying the matter in dispute. The parties will use their
best endeavours to resolve the dispute by negotiation in good
faith. The parties will attend at least one meeting to discuss
and attempt to resolve the dispute as a condition precedent to
taking any other steps concerning the dispute (including but
not limited to commencing any legal proceedings other than an
application for injunctive relief). The attendees at such
meeting will include the Managing Director of UBS Timber
Investors (or nominee) and the Chief Executive Officer of
Xxxxxxxx Challenge Forests Limited (or nominee). All
discussions will be without prejudice and will not be referred
to in any later proceedings.
15.2 ARBITRATION: If the dispute cannot be resolved in accordance
with clause 15.1 within ten (10) Business Days after the date
of the notice referred to in clause 15.1, then any party may
then require (by written notice to the other party) the
dispute to be referred to arbitration. If this clause is
invoked then the following shall apply.
15.2.1 ARBITRATION ACT: The dispute will be referred to
arbitration by a sole arbitrator under the provisions
of the Arbitration Xxx 0000. The arbitrator will be
agreed upon between the parties within ten (10)
Business Days of written notice, or failing
agreement, by the President of the New Zealand Law
Society or its successor body, or any nominee of the
President. In either case, the arbitrator must not be
a person who has participated in any informal dispute
resolution procedure in respect of the dispute. Any
party may request the appointment of an expert to sit
with the arbitrator but any such expert shall have an
advisory role only and shall not have the authority
to make a binding decision. Each of the parties may
make submissions to the arbitrator as to the relevant
skills and expertise of an appropriate expert, but
the selection of an appropriate expert is ultimately
at the arbitrator's sole discretion.
15.2.2 ARBITRATION IN NEW ZEALAND: The arbitration will take
place in New Zealand.
Agreement For Sale and Purchase of Trees Page 24
15.2.3 AWARD FINAL: The award in the arbitration including
any award by the arbitrator of costs will be final
and binding on the parties.
15.2.4 AWARD OF INTEREST: The arbitrator may award interest
upon any amount due and payable under his or her
award at such rate and for such period as he or she
considers just, down to the date of the award.
15.3 PARTIES TO CONTINUE TO PERFORM: Subject to the provisions of
clauses_15.1 and 15.2, pending resolution of any dispute or
difference, the parties shall continue to perform their
respective obligations pursuant to the provisions of this
agreement.
15.4 INJUNCTIVE RELIEF: Nothing in this clause will prevent any
party commencing any legal proceedings for injunctive relief.
16. CONFIDENTIALITY
Each party will maintain as confidential at all times, and will not at
any time, directly or indirectly:
16.1 DISCLOSE: disclose or permit to be disclosed to any person;
16.2 USE: use for itself; or
16.3 USE TO DETRIMENT: use to the detriment of the other party;
any Confidential Information except:
16.4 LEGAL REQUIREMENT: subject to clause 16.10, as required by law
or regulatory body (including any stock exchange);
16.5 PUBLIC KNOWLEDGE: as is already or becomes public knowledge,
otherwise than as a result of a breach by the party disclosing
or using that Confidential Information of any provision of
this agreement;
16.6 AUTHORISED: as authorised in writing by the other party;
16.7 LENDERS AND UNDERWRITERS: as required to communicate with and
make disclosure to institutional lenders to and underwriters
for, or potential institutional lenders to and underwriters
for, FCF or Teal, provided that the relevant party shall
ensure compliance by such persons with this clause 16 and
shall be liable for any breach of such obligations by such
persons, and in the case of potential institutional lenders or
underwriters, to return all such information if the lending to
or underwriting is not consummated;
16.8 AFFILIATES AND ADVISERS: as required to communicate with and
make disclosure to Affiliates of the parties or the parties'
or the Affiliates' respective advisers who have a legitimate
need to know the information
Agreement For Sale and Purchase of Trees Page 25
in order to perform activities connected with this agreement
or the Related Agreements, and provided that the relevant
party shall ensure compliance by such persons with this clause
16 and shall be liable for any breach of such obligations by
such persons; or
16.9 OTHER: to the extent reasonably required by this agreement
(and, without limiting the effect of this clause, a party may
disclose Confidential Information only to those of its
officers, employees or professional advisers, on a "need to
know" basis, as is reasonably required for the implementation
of this agreement).
16.10 CONSULTATION: In the event that one party (the first party) is
required by law or stock exchange reporting obligations to
disclose Confidential Information, such disclosure may be made
only after the other party (the second party) has been
notified and, subject to timing obligations imposed by law or
the relevant stock exchange, has been given every reasonable
opportunity to consult with the first party as to timing and
the content of any such disclosure. In consulting with the
second party, the first party shall act in good faith and give
reasonable consideration to the second party's requests.
16.11 FCF'S SAFEGUARDS: If requested, FCF will document to the
reasonable satisfaction of Teal the internal safeguards it
will put in place to meet its confidentiality obligations
under this clause 16.
17. SEVERABILITY
Any provision of this agreement which is prohibited or unenforceable in
any jurisdiction shall be ineffective as to such jurisdiction to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions of this agreement or affecting the validity or
unenforceability of such provision in any other jurisdiction.
18. LIMITED RECOURSE
FCF undertakes and agrees as follows.
18.1 TEAL'S ASSETS: FCF will look only to the assets held by Teal
or the benefit of any insurance maintained by Teal to satisfy
the obligations or liabilities of Teal to FCF hereunder or
otherwise.
18.2 LIMITATION OF LIABILITY: None of the Affiliates of Teal,
direct or indirect holders of securities or debt of Teal, nor
any of their respective officers, directors, or employees,
shall be liable for the obligations of Teal to FCF.
18.3 NO ACTIONS OR PROCEEDINGS: FCF shall not commence any action
or proceeding against any of the persons referred to in
subclause 18.2 for the purpose of enforcing the obligations of
Teal.
Agreement For Sale and Purchase of Trees Page 26
19. NOTICES
19.1 DELIVERY OF NOTICE: All notices and other communications
required or permitted under this agreement shall be in
writing. Any written notice required under this agreement must
be signed by a duly authorised senior representative of any
party giving the notice and will be deemed validly given if:
19.1.1 PERSONAL DELIVERY: delivered personally;
19.1.2 DOMESTIC POST: sent by prepaid post; or
19.1.3 FACSIMILE: sent by facsimile transmission,
addressed to the recipient at the address or facsimile number
set out below (as applicable) or to any other address or
facsimile number that a party may notify to the other parties
by like notice.
TEAL: if to Teal to:
Teal 0 Xxxxxxx
X/- XXX Xxxxxxx Xxx Xxxxxxx Equities Limited
X X Xxx 00
Xxxxxxxx 0000
Xxxxx 00 Xxxxxx Building
000 Xxxxx Xxxxxx
Xxxxxxxx
For: Xxxxxxx Xxxxx
Facsimile: (00) 000 0000
With a copy to:
UBS Timber Investors
Trade Center, 4th Floor
00 Xxxxxxx Xxxx
Xxxx Xxxxxxx
XX 00000
Xxxxxx Xxxxxx of America
For: Xxxxx Xxxxx
Facsimile: (000) 000 000 0000
And with a copy to:
Xxxxx Xxxx LLP
000 Xxxxxxx Xxxx
Xxxxxx, XX 00000
Xxxxxx Xxxxxx of America
For: Xxx Xxxxx
Facsimile: (000) 000 000 0000
Agreement For Sale and Purchase of Trees Page 27
FCF: if to FCF, to:
Xxxxxxxx Challenge Forests Industries Limited
0 Xxxxxxxxx Xxxxxx
Xxxxxxx
Private Bag 92036
Auckland Mail Centre
Auckland
For: The Chief Executive Officer
Facsimile: (00) 000 0000
With a copy to:
Xxxxxxxx Challenge Forests Industries Limited
0 Xxxxxxxxx Xxxxxx
Xxxxxxx
Private Bag 92036
Auckland Mail Centre
Auckland
For: The Company Secretary
Facsimile: (00) 000 0000
19.2 TIME OF RECEIPT: No written communication will be effective
until received. Without limiting any other ways for a party to
prove that another party has received a notice, a notice or
other written communication under this agreement, will be
treated as received:
19.2.1 PERSONAL DELIVERY: if delivered personally, when left
with an apparently responsible person at the
recipient's address;
19.2.2 PREPAID POST: if sent by prepaid post three (3)
Business Days (if posted within New Zealand to an
address in New Zealand), or ten (10) Business Days
(if posted by prepaid airmail from country to
country) after the date of posting;
19.2.3 REGISTERED POST: if sent by registered post, on
acknowledgment of receipt by or on the recipient's
behalf;
19.2.4 AIR COURIER DELIVERY: if sent by air courier
delivery, on acknowledgment of receipt by or on the
recipient's behalf; or
19.2.5 FACSIMILE: if sent by facsimile, on the sender's
receipt of a transmission report indicating that the
facsimile was sent in its entirety to the recipient's
facsimile number;
but, if the delivery or receipt is not on a Business Day or
after 5.00pm (local time) on any Business Day, the notice will
be treated as received by the recipient at 9.00am (local time)
on the next Business Day.
19.3 COPIES OF NOTICES: If a party is required by any term of this
agreement to give a copy of a notice or other communication to
a third
Agreement For Sale and Purchase of Trees Page 28
party, the failure to give the copy of it to a third party
will not affect the effectiveness of that notice or
communication to a party.
20. ENTIRE AGREEMENT
20.1 SUPERSEDES AND REPLACES: This agreement together with the
Management Agreement, Forestry Right, Infrastructure Agreement
and Wood Supply Agreement contain the entire agreement between
the parties in connection with the subject matter hereof and
supersede and replace all prior negotiations, agreements or
representations, whether oral or written, between them with
respect thereto.
20.2 INCONSISTENCY: Except as expressly provided in this agreement,
if there is any inconsistency between this agreement and the
Related Agreements, this agreement will prevail.
21. MODIFICATION
This agreement may not be amended or modified except by written
agreement signed by the parties.
22. WAIVER
No provision of this agreement may be waived except in writing by the
party granting the waiver and then only in the specific instance and
for the specific purpose for which given.
23. COUNTERPARTS
23.1 GENERAL: This agreement may be executed in one or more
counterparts, each of which will be deemed to be an original,
but all of which together will constitute only one and the
same agreement.
23.2 FACSIMILE EXCHANGE: The parties acknowledge that this
agreement may be executed on the basis of any exchange of
facsimile copies and confirm that their respective execution
of this agreement by such means shall be a valid and
sufficient execution. The parties acknowledge that any
execution of this agreement by facsimile will be followed by
execution of the engrossments of this agreement.
24. FURTHER ASSURANCES
The parties shall execute and deliver such further and other documents
and instruments and do such other things as may be reasonably necessary
to implement and carry out the intent and purpose of this agreement.
25. NO MERGER
The parties acknowledge that the covenants, representations,
undertakings and agreements contained herein shall not merge upon
Settlement and that the same shall endure for the benefit of the party
entitled thereto notwithstanding Settlement pursuant to the provisions
of this agreement.
Agreement for Sale and Purchase of Trees Page 29
26. APPLICABLE LAW
26.1 NEW ZEALAND LAW: The law applicable to this agreement
including all submissions to arbitration shall be the law of
New Zealand and the parties irrevocably and unconditionally
agree to submit to and be bound by the jurisdiction of the
courts and tribunals of New Zealand.
26.2 NON EXCLUSIVE JURISDICTION: The submission to jurisdiction in
clause 26.1 does not (and is not to be construed to) limit the
rights of a party to take proceedings against the other party
in another court of competent jurisdiction, nor is the taking
of proceedings in one or more jurisdictions to preclude the
taking of proceedings in another jurisdiction whether
concurrently or not.
27. NO PARTNERSHIP
None of the provisions of this agreement are deemed to constitute a
partnership or joint venture between the parties and neither party has
any authority to bind or to pledge the credit of the other party in any
way except as expressly provided in this agreement.
In witness of which this agreement has been executed.
SIGNED by XXXXXXXX CHALLENGE
FORESTS INDUSTRIES LIMITED by:
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
WITNESS:
(if other than two directors sign)
__________________________________
Signature of witness
__________________________________
Full name of witness
__________________________________
Occupation of witness
__________________________________
Address of witness
Agreement for Sale and Purchase of Trees Page 30
SIGNED by TEAL 3 LIMITED by:
____________________________________________ ________________________________
Full name of attorney Signature of attorney
WITNESS:
(if other than two directors sign)
__________________________________
Signature of witness
__________________________________
Full name of witness
__________________________________
Occupation of witness
__________________________________
Address of witness
SCHEDULE ONE
WARRANTIES
This schedule contains the representations and warranties given under clause 11
of the Agreement.
1. ALL INFORMATION TRUE: So far as FCF is aware, all information
(excluding any financial budgets, financial forecasts or financial
projections):
1.1 THIS AGREEMENT: contained in this agreement is complete and
accurate in all respects;
1.2 DISCLOSURE LETTER: contained in the Disclosure Letter is
complete and accurate in all material respects;
1.3 OTHER INFORMATION: provided in the Additional Due Diligence
Information was complete and accurate in all material respects
when given.
In this Warranty 1:
1.4 COMPLETE: "complete" means that all material information in
the possession of FCF in relation to the relevant item of
information has been supplied to Teal; and
1.5 ACCURATE: "accurate" means:
1.5.1 DERIVED FROM SAMPLING ETC: where in accordance with
industry practice the relevant information is derived
from sampling, statistical analysis, estimation or
other similar methods and tools, that in deriving the
information, FCF has applied accepted industry
practice and standards; or
1.5.2 NO MATERIAL ERRORS: in every other case where clause
1.5.1 does not apply, does not contain any material
errors; and
1.5.3 NOT MISLEADING: is not, to FCF's actual knowledge
(which for the purposes of this clause shall include
the knowledge of the Specified Persons), misleading
in any material respect.
2. STANDING: FCF is a company registered pursuant to the Companies Xxx
0000.
3. POWER OF ENTERING INTO AGREEMENT
3.1 ON SETTLEMENT: On Settlement, execution and delivery of this
agreement and the Related Agreements and the performance by
FCF of its obligations under this agreement and the Related
Agreements:
Agreement for Sale and Purchase of Trees Page ii
3.1.1 VALID AUTHORISATION: will have been validly
authorised by all necessary action on the part of
FCF;
3.1.2 LAW: will not contravene any law binding on it;
3.1.3 INCORPORATION DOCUMENTS: will not contravene its
incorporation documents;
3.1.4 OTHER AGREEMENTS: will not contravene the provisions
of or constitute a default under any other agreement
to which it is a party or by which any of its Trees
are bound; and
3.1.5 CORPORATE POWERS: FCF will have and continue to have
the necessary corporate powers to enter into this
agreement and the Related Agreements and perform its
obligations under it and the Related Agreements.
3.2 ON EXECUTION: On execution each of this agreement and the
Related Agreements will constitute legal, valid and binding
obligations enforceable against FCF in accordance with their
respective terms.
4. NO ENCUMBRANCES: FCF:
4.1 NOT CREATED: has not created or agreed to create or suffered
to arise any Encumbrance over any of the Trees and is not
aware of the existence or likelihood of any such Encumbrance
arising; and
4.2 CLEAR TITLE: will at Settlement have, full legal and
beneficial interest in and title, free from Encumbrance, to
all the Trees.
5. INSOLVENCY:
5.1 RECEIVERS: No receiver or manager of all or part of the Land
or the Trees has been appointed or is threatened or expected
to be appointed.
5.2 LAND AND TREES: There is no unsatisfied judgment or award
outstanding against FCF concerning any of the Land or the
Trees and no execution or process of any court or authority
has been issued against or levied or enforced on FCF
concerning any of the Land or the Trees.
6. NO BREACH OF AGREEMENTS: So far as FCF is aware, no agreement to which
FCF is a party concerning the Trees will be determined or adversely
affected by reason of the Trees' transfer to Teal.
7. NO LITIGATION:
7.1 PROCEEDINGS: FCF is not involved in any litigation,
arbitration, prosecution or other legal proceedings involving
the Land or the Trees ("Proceedings"), whether as plaintiff,
defendant or otherwise, and, so far as FCF is aware, there are
no Proceedings pending or threatened.
Agreement for Sale and Purchase of Trees Page iii
7.2 CLAIMS: So far as FCF is aware, there are no claims, facts or
events which are likely to give rise to any Proceedings.
7.3 INQUIRIES: FCF is not, concerning the Trees, involved in (and,
so far as FCF is aware, no facts or events exist which are
likely to cause FCF to be involved in or come before) any
inquiry, whether convened by a governmental, regulatory or
territorial board of inquiry or commission or any other
administrative body or organisation (whether judicial or
quasi-judicial).
8. NO BREACH OF STATUTES: So far as FCF is aware, it has not done or
omitted to do any act or thing which is or could be in contravention of
the provisions of any statute or statutory regulations applicable to
the Land or the Trees, and all statutory, territorial and other
mandatory requirements applicable to the Land have been complied with
and there are no such requirements which have not been complied with.
9. ENVIRONMENTAL MATTERS:
9.1 WARRANTY: In this warranty:
9.1.1 ENVIRONMENT: "Environment" means the environment or
surroundings including (without limitation) air
(including, without limitation, that within natural
or man-made structures, whether above or below
ground), water (including, without limitation,
territorial and inland waters, natural water, drains
and sewers) and land (including, without limitation,
river bed under any water as described above, surface
land and sub-surface land);
9.1.2 ENVIRONMENTAL LAW: "Environmental Law" means
environmental law as defined in clause 1 of this
agreement; and
9.1.3 SUBSTANCE: "Substance" includes (without limitation)
any solid, liquid, gas, noise, or electro-magnetic or
other radiation.
9.2 LAND AND TREES: In respect of the Land and the Trees:
9.2.1 CONSENTS: FCF has obtained and complied with all
consents necessary under Environmental Law and so far
as FCF is aware, no notification or indication
(formal or informal) has been received that further
consents or remedial action may be required, or that
any existing consent may be withdrawn, restricted,
amended, not renewed, not renewed in full, or
otherwise affected;
9.2.2 OTHER CIRCUMSTANCES: so far as FCF is aware, no
circumstances exist that may lead to, or be included
in, any investigation, inquiry, order, decree,
judgment, notice or other communication nor to the
withdrawal, limitation, restriction, amendment,
non-renewal or non-renewal in full of any consent.
Agreement for Sale and Purchase of Trees Page iv
10. TREES
10.1 MANAGEMENT OF TREES: Prior to date of execution of this
agreement, FCF has managed the Trees in good faith employing
the same degree of care and skill as FCF employs in the
conduct of its own affairs.
10.2 EXCLUSIVE OCCUPATION: Other than is disclosed in the
Disclosure Letter, FCF has exclusive occupation and quiet
enjoyment of the Land as at the date of this agreement.
10.3 BEST OF KNOWLEDGE AND BELIEF: In respect of the Trees, to the
best of the knowledge and belief of FCF:
10.3.1 LEGAL BOUNDARIES: all of the Trees are situated
within the legal boundaries of the Land; and
10.3.2 MATERIAL DISPUTES: there are no material disputes
with any adjoining or neighbouring owner with respect
to any such Trees or the use of the Land and there
are no facts or circumstances which are likely to
give rise to any such dispute.
11. FOREST STEWARDSHIP COUNCIL CERTIFICATION
FCF has Forest Stewardship Council Certification in relation to its
management of the Trees and the Land at the date of this agreement,
and, subject to the parties agreeing otherwise, will up to the
Settlement Date, use its reasonable endeavours to ensure that it
maintains such certification.
12. NO RIGHTS AT SETTLEMENT
On Settlement, there will be no forestry rights other than the Forestry
Right or other matters materially affecting the rights of FCF or its
successors and assigns in respect of the Trees.
13. NO FENCING XXX 0000 CLAIM
So far as FCF is aware, FCF has not received any written notice nor
does it have any knowledge of a claim or claims by owners or occupiers
of any land contiguous to the Land pursuant to the Fencing Xxx 0000
which could require it to erect or repair a fence between the Land and
any contiguous land.
14. TREATY OF WAITANGI CLAIMS
To the best of FCF's knowledge no claims have been made in respect of
the Land under the Treaty of Xxxxxxxx Xxx 0000 and there are no ongoing
disputes or discussions with Tangata Whenua concerning sites of
cultural, spiritual or historical significance to Tangata Whenua, other
than those set forth in the Disclosure Letter.
Agreement for Sale and Purchase of Trees Page v
15. RATES ETC
There will be no arrears of general rates or water rates or charges
levies and other outgoings charged or assessed in respect of the Land
and FCF will not be in arrears with respect to rates or other charges,
levies and other outgoings which have been lawfully imposed on FCF as
occupier of the Land.
16. GEOTHERMAL ARRANGEMENTS
The Geothermal Arrangements represent the only agreements and
arrangements concerning or touching upon geothermal exploration or
development activities or rights in relation to the Land.
ANNEXURE ONE
FORESTRY RIGHT
ANNEXURE TWO
INFRASTRUCTURE AGREEMENT
ANNEXURE THREE
MANAGEMENT AGREEMENT
ANNEXURE FOUR
WOOD SUPPLY AGREEMENT
ANNEXURE FIVE
DEED OF ASSIGNMENT OF GST INPUT CREDIT
This DEED is made on
BETWEEN Teal 3 Limited (TEAL)
AND Xxxxxxxx Challenge Forest Industries Limited (FCF)
BACKGROUND
X. Xxxx will carry on a forestry business upon completion of the
Agreement.
X. Xxxx is GST registered.
C. FCF is GST registered.
D. FCF has entered into an agreement selling certain parts of its forestry
business to Teal.
E. The Inland Revenue Department will be asked to allow the GST liability
payable by FCF to the Inland Revenue Department and the corresponding
and equivalent GST input tax credit available to Teal to be offset.
F. The parties have agreed as set out below.
IT IS AGREED:
1. INTERPRETATION
In this deed unless the context indicates otherwise:
1.1 DEFINITIONS:
"AGREEMENT" means the Agreement for Sale and Purchase of Trees between
Teal and FCF dated [ ].
"ASSIGNED TAX CREDIT" means any GST input tax credit (which includes
any GST refund or reduction in a GST liability otherwise due to the
Inland Revenue Department) that Teal is to claim in respect of its
acquisition of the Trees.
"GST" means tax as defined in the Goods and Services Tax Xxx 0000.
"TREES" means the Trees as defined in the Agreement which are supplied
by FCF to Teal.
Page ii
1.2 Words which are capitalised and which are not otherwise
defined in this Deed shall have the meaning of those words as
they are defined in the Agreement.
1.3 If there is any inconsistency between this Deed and the
Agreement, this Deed is to prevail.
2. THE ASSIGNMENT
2.1 Teal hereby assigns absolutely to FCF the Assigned Tax Credit
in payment of an equal amount in respect of Teal's obligation
to pay GST to FCF. FCF accepts such payment.
2.2 Teal will do all things reasonably necessary for FCF to obtain
the full benefit of the Assigned Tax Credit, including
executing any further documents or instruments necessary to
vest the full benefit of the Assigned Tax Credit in FCF.
2.3 Any amount received by Teal in respect of the Assigned Tax
Credit (including any interest (net of tax) that Teal receives
from the Inland Revenue Department in respect of that amount)
is to be held by Teal on trust for FCF and paid to FCF under
clause 3. Teal's obligation to pay any amount under clause 3
will not be limited in any way by the extent of any amount
held by Teal on trust for FCF under this clause 2.3.
3. PAYMENT OF GST SHORTFALL
To the extent (if any) that, notwithstanding the assignment of the
Assigned Tax Credit, the Agreement requires Teal to pay an amount to
FCF in respect of the GST on the supply of the Trees, Teal will pay in
cash any such amount to FCF in accordance with the terms of the
Agreement.
Page iii
EXECUTION
EXECUTED as a deed
SIGNED by TEAL 3 LIMITED by:
____________________________________________ ________________________________
Full name of attorney Signature of attorney
WITNESS:
(if other than two directors sign)
__________________________________
Signature of witness
__________________________________
Full name of witness
__________________________________
Occupation of witness
__________________________________
Address of witness
SIGNED by XXXXXXXX CHALLENGE
FORESTS INDUSTRIES LIMITED by:
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
WITNESS:
(if other than two directors sign)
__________________________________
Signature of witness
__________________________________
Full name of witness
__________________________________
Occupation of witness
__________________________________
Address of witness
ANNEXURE SIX
DUE DILIGENCE INFORMATION REQUESTED BY TEAL
STAND RECORDS
Forest description by stand including the year of establishment, area, GF
rating, harvesting classification, current stocking, tending history and lead
distances to Taupo, Kinleith, Mt Maunganui, Rotorua and Kawerau
List of stands and their associated yield tables
MAPPING INFORMATION
MAPPING INFORMATION
Location map of each forest showing for all stands within the age class range,
defined as 1988 and earlier for Teal 3.
- Latest orthophoto or digital aerial photography
Maps showing
- Stand boundaries
- River/water courses
- Native vegetation (including Tasman and New Zealand Accord areas)
- Any Wahi Tapu sites, and other sites of cultural significance.
- Roads
- Plot locations of latest PHI and MRI as well as PSPs.
AUDIT REQUIREMENTS
UBS through CFK will select a sample of stands and the appropriate GIS layers.
FCF are to firstly provide a listing of all available GIS layers from which CFK
will select their information requirements. CFK will require as a minimum for
the information to be provided in Arc View shape files, the following:
- Stand Boundaries and stocked areas
- Relevant Orthophoto or digital photography (and control points).
- Roads and Landing information
- Areas (ha)
- Native vegetation, and river/water courses
RESOURCE DESCRIPTION
STAND INFORMATION
Stand information, showing for the
- Pruned logs PLI, checking classification and information on resin
pockets.
- Structural classification for each stand.
- Other log quality investigations that have been carried out including
any customer feedback.
- Information relating actual sale grades to the SOP family grades used
in the yield tables that relates to Teal 3
Page ii
INVENTORY
- One liner individual plot summaries for the latest MRI or PHI
undertaken.
- Individual plot information for PHI undertaken to enable existing
inventory to be "grown on"
GROWTH AND YIELD
- Harvest Reconciliation Information
All clear fell harvest reconciliations from 1st January 2001 that have
been done, comparing actual outturn to PHI/ Yield table projections.
- PSP Data
Data from PSP measurements from age 15 through until age 30
- Growth Models
Copies of all relevant growth models
ENVIRONMENTAL
COPIES OF RESOURCE CONSENTS
Copies of all current resource consents, their date of expiry, as well as any
reviews and special conditions including all supporting material. All relevant
information in relation to any breaches of consent together with details of the
relevant local authority's enforcement actions.
All relevant information in relation to other resource consents obtained in the
past 2 years but no longer current
NATIVE VEGETATION
All relevant information in relation to of any native vegetation, and in
particular areas protected under the Tasman or New Zealand accord, or that for
part of the reserve cover for FSC accreditation. All relevant information in
relation to any special management requirements.
CULTURAL SITES
- All relevant information in relation to any Wahi Tapu sites. This will
include their location, any Historic Places requirements, and
management implications
- All relevant information in relation to any other sites of cultural or
historical significance to Maori or Pakeha, whether registered or not.
This will include their location, any Historic Places requirements,
and management implications
- All relevant information in relation to any contaminated sites whether
registered or not
COMPLIANCE
All relevant information in relation to any notice or demand received and any
knowledge of any requisition or outstanding requirement:
- imposed by any local or government authority; and/or
- given by any person under the Resource Management Xxx 0000.
All relevant information in relation to any consent or waiver in relation to any
application under the Resource Management Xxx 0000 which directly or indirectly
affects the affected land.
Page iii
FOREST HEALTH
- From 1 January 1998 details of the annual New Zealand Forest Owners
forest health surveys and details of Dothistroma surveys and control.
- Details of any other material forest health issues, including
nutrients, previous or current disease or pest occurrences
- History of fire/ wind damage in the forests, including major events as
well as smaller more localised events
ACCESS
ROADS
For roads on the Land and adjoining land
- Map showing access roads available to access the stands
- Map showing roads including off highway roads where access by UBS may
be restricted by FCF for commercial reasons together with supporting
documentation
- Map showing roads where access is restricted for legal reasons
together with the supporting documentation
- Map showing where roads are not available because upgrading is
required.
OTHER ACCESS
All relevant information in relation to, together with location maps or sketches
of any non-registered (formal or informal):
- Access arrangements either across the Land or adjoining land or to it;
- Agreements or other arrangements either indirectly or directly
affecting the Land or adjoining land whether a burden or benefit
(including site protection and access to individuals or groups for the
purposes of food gathering, native vegetation harvesting, hunting,
etc)
RESTRICTED ACCESS
All relevant information in relation to any restricted areas (eg. research
areas, research plots) within the stands allocated to Teal 3.
FOREST COSTS
Provide for the last two years operations on a unit cost basis details of the
actual:
- Harvesting costs, by compartment/stand
- Transport costs by destination
- Road line salvage costs by compartment/stand
- Road and landing construction
- Maintenance costs
PRICES
Details for the last two years by month of actual prices to an identified price
point received by log grade broken down into internal and external domestic
markets, and Log prices by grade on an FOB basis for export markets.
Page iv
GEOTHERMAL RIGHTS
All relevant information concerning any geothermal energy rights in relation to
the Land (whether registered or not) granted to third parties.
ANNEXURE SEVEN
UNDERTAKING FROM XXXXXXXX CHALLENGE INDUSTRIES LIMITED
In consideration of Teal 3 Limited entering into the Agreement for Sale and
Purchase of Trees ("the Agreement") with Xxxxxxxx Challenge Forests Industries
Limited, Xxxxxxxx Challenge Industries Limited agrees to grant a guarantee to
Teal 3 Limited of Xxxxxxxx Challenge Forests Industries Limited's obligations
and liability under the Agreement and the Related Agreements in the form
attached and undertakes to Teal 3 Limited that during the term of the Forestry
Right Xxxxxxxx Challenge Industries Limited shall:
1. ensure that Xxxxxxxx Challenge Industries Limited maintains net assets
in any year of the Forestry Right in an amount not less than the
Purchase Price;
2. provide to Teal 3 Limited a copy of the audited financial statements of
Xxxxxxxx Challenge Forests Limited and its group, as soon as they
become available for release;
3. provide to Teal 3 Limited a certificate from the Chief Financial
Officer of Xxxxxxxx Challenge Forests Limited, issued no later than
five months after the end of the financial year of Xxxxxxxx Challenge
Forests Limited, confirming that as at the end of that financial year
the net assets of Xxxxxxxx Challenge Industries Limited are no less
than the Purchase Price;
4. no later than the end of December in each year provide to Teal 3
Limited a copy of the unaudited financial statements of Xxxxxxxx
Challenge Industries Limited.
5. Xxxxxxxx Challenge Industries Limited represents and warrants to Teal 3
Limited on execution and delivery of this undertaking and the guarantee
given under this undertaking that this undertaking and the guarantee
given under this undertaking:
(a) will have been validly authorised by all necessary action on
the part of Xxxxxxxx Challenge Industries Limited;
(b) will not contravene any law binding on it;
(c) will not contravene its incorporation documents;
(d) will not contravene the provisions of or constitute a default
under any other agreement to which it is a party;
(e) will constitute legal, valid and binding obligations
enforceable against Xxxxxxxx Challenge Industries Limited in
accordance with their respective terms;
and that Xxxxxxxx Challenge Industries Limited will have and continue
to have the necessary corporate powers to enter into this undertaking
and the guarantee given under this undertaking and perform its
obligations under this undertaking and the guarantee given under this
undertaking.
Page ii
All calculations of net assets required to be carried out pursuant to this
undertaking must be made using those accounting principles used for the
preparation of the financial statements of Xxxxxxxx Challenge Forests Limited
Capitalised terms have the meaning ascribed to them in the Agreement.
EXECUTED AS A DEED by Xxxxxxxx Challenge Industries Limited by:
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
Witness:
(if other than two directors sign)
__________________________________
Signature of witness
__________________________________
Full name of witness
__________________________________
Occupation of witness
__________________________________
Address of witness
DEED OF GUARANTEE AND INDEMNITY
BETWEEN
XXXXXXXX CHALLENGE INDUSTRIES LIMITED
AND
TEAL 3 LIMITED (OR NOMINEE)
[XXXXXXX GRIERSON LOGO]
TABLE OF CONTENTS
1. INTERPRETATION........................................................... 1
2. GUARANTEE................................................................ 2
3. LIABILITY NOT TO BE AFFECTED............................................. 3
4. PAYMENTS................................................................. 4
5. SUSPENSION OF RIGHTS..................................................... 5
6. REPRESENTATIONS AND WARRANTIES........................................... 6
7. UNDERTAKINGS............................................................. 6
8. COSTS ................................................................... 7
9. RELEASE.................................................................. 7
10. SET-OFF.................................................................. 7
11. NOTICES.................................................................. 7
12. CURRENCY INDEMNITY....................................................... 9
13. GENERAL.................................................................. 10
14. CONFIDENTIALITY.......................................................... 11
GUARANTEE AND INDEMNITY dated the 2003
PARTIES
1. XXXXXXXX CHALLENGE INDUSTRIES LIMITED ("Guarantor")
2. TEAL 3 LIMITED (OR NOMINEE) ("Beneficiary")
THIS DEED WITNESSES:
1 INTERPRETATION
In this Guarantee, unless the context indicates otherwise:
1.1 DEFINITIONS:
"BUSINESS DAY" means a day on which registered banks are open
for banking business in Auckland, excluding Saturdays, Sundays
and public holidays;
"CONFIDENTIAL INFORMATION" means any information disclosed by
the Guarantor to the Beneficiary on the express basis that
such information is confidential;
"DEBTOR" means Xxxxxxxx Challenge Forests Industries Limited;
"DEFAULT INTEREST RATE" means default interest rate as that
term is defined in clause 1 of an agreement for sale and
purchase of trees between the Debtor and the Beneficiary dated
[ ] ("Agreement");
"GUARANTEE" means this guarantee and indemnity;
"GUARANTEED MONEY" means all money which the Debtor presently
is, or at any time becomes, actually or contingently liable to
pay to the Beneficiary under the Agreement and any of the
Related Agreements;
"GUARANTEED OBLIGATIONS" means all obligations (whether
present or future) of the Debtor to the Beneficiary under the
Agreement and any of the Related Agreements;
1.2 GENERAL:
(a) words denoting the singular include the plural and
vice versa;
(b) words denoting any gender includes all genders;
Guarantee and Indemnity Page 2
(c) references to any document (however described) will
include references to that document as modified,
varied, novated, supplemented or replaced from time
to time;
(d) headings and the table of contents are for
convenience only and will not affect interpretation;
and
(e) capitalised terms not defined in this Guarantee shall
have the meaning ascribed to them in the Agreement.
2. GUARANTEE
2.1 GUARANTEE: The Guarantor guarantees to the Beneficiary the due
and punctual payment by the Debtor of the Guaranteed Money and
the due and punctual performance of the Guaranteed
Obligations.
2.2 PAYMENT ON DEFAULT: If the Debtor defaults in the due and
punctual payment of any of the Guaranteed Money, the Guarantor
will pay that money to the Beneficiary on demand.
2.3 PRINCIPAL DEBTOR: The Guarantor's obligations under this
Guarantee are:
(a) principal obligations and may be enforced against the
Guarantor without the Beneficiary being required to
exhaust any remedy it may have against the Debtor or
to enforce any security the Beneficiary may hold with
respect to the Guaranteed Money; and
(b) unconditional and irrevocable.
2.4 CONTINUING GUARANTEE: This Guarantee is a continuing guarantee
for the Guaranteed Money. It is not discharged by any payment
or anything else, and remains in full force until the
Beneficiary has executed and delivered a release to the
Guarantor.
2.5 REINSTATEMENT: If any payment received by the Beneficiary on
any account of the Guaranteed Money is or may be avoided by
law (despite a release having been executed and delivered by
the Beneficiary):
(a) the Guarantor's obligation to have made such payment
will be deemed not to have been affected or
discharged under this Guarantee or any other security
given to the Beneficiary; and
(b) the Beneficiary and the Guarantor will, in any such
case, be deemed to be restored to the position in
which each would have been, and will be entitled to
exercise the rights they respectively would have had,
if that payment had not been made.
Guarantee and Indemnity Page 3
3. LIABILITY NOT TO BE AFFECTED
The liability of the Guarantor under this Guarantee shall not be
abrogated, prejudiced or affected by any of the following:
3.1 GRANTING OF TIME ETC: the granting of time, credit or any
indulgence or other concession to the Debtor or the Guarantor
or any other guarantor of the Debtor or to any other person by
the Beneficiary;
3.2 FAILURE TO DEMAND: any failure by the Beneficiary to present,
demand or give notice in respect of any negotiable instrument;
3.3 COMPOUNDING ETC: any compounding, compromise, release,
abandonment, waiver, variation, relinquishment or renewal of
any agreements, securities, documents of title, assets, or of
the rights of the Beneficiary against the Debtor or the
Guarantor or any other person;
3.4 ACTS OR OMISSIONS: anything done or omitted or neglected to be
done by the Beneficiary in exercise of the authorities, powers
and discretions vested in the Beneficiary by this Deed;
3.5 SECURITY OR LAW: any security or law or any other dealing,
matter or thing which but for this provision might operate to
abrogate, prejudice or affect the Guarantee (it being the
intention of the parties that the Guarantee and obligations of
the Guarantor shall be absolute and unconditional in any and
all circumstances);
3.6 OTHER LIABILITY CEASING: the liability of any other guarantor
of the Debtor or any other person ceasing from any cause
whatsoever (including release or discharge by the
Beneficiary);
3.7 JOINT OR SIMILAR GUARANTEES: any other person joining in this
or giving any similar Guarantee and/or indemnity;
3.8 LIQUIDATION OF DEBTORS ETC: the liquidation or bankruptcy of
the Debtor or any other guarantor of the Debtor or any other
person;
3.9 INCOMPETENCE OF OTHERS ETC: any other guarantor of the Debtor
or any other person being incompetent to give any other
Guarantee or any collateral security or failing to become
legally bound in whole or in part under any of them
respectively;
3.10 SECURITIES VOID ETC: any security from time to time held or
taken in respect of the indebtedness or obligations of the
Debtor or the Guarantor or any other guarantor of the Debtor
or any other person to the Beneficiary being void, defective
or informal or being released, partially released, discharged,
partially discharged or varied in any way;
3.11 FAILURE TO PROVIDE SECURITY: failure of the Debtor or the
Guarantor or any other guarantor of the Debtor or any other
person to provide any security which has been stipulated by
the Beneficiary;
Guarantee and Indemnity Page 4
3.12 VARIATIONS: any variation of this Guarantee and Indemnity
and/or any other Guarantee and/or indemnity given in relation
to any of the Guaranteed Money and/or any of the Guaranteed
Obligations;
3.13 FAILURE TO GUARANTEE ETC: any person intended to Guarantee
payment of the Guaranteed Money and/or performance of the
Guaranteed Obligations failing or refusing to do so;
3.14 CLAIMS: any claim that the Beneficiary has not fully realised
all securities held by it in respect of the Guaranteed Money
and/or the Guaranteed Obligations or has not realised any of
such securities in a manner so as to maximise their realisable
value; or
3.15 OTHER MATTERS: any other matter or thing whatsoever.
4. PAYMENTS
4.1 PAYMENT: The Guarantor will make each payment to the
Beneficiary under this Guarantee in funds which are freely
transferable and immediately available for disbursement on the
day of payment.
4.2 NO DEDUCTIONS: All payments by the Guarantor to the
Beneficiary under this Guarantee will be made free of any
restriction or condition and, except to the extent required by
law, without deduction or withholding of any nature whether by
way of set-off, counterclaim or otherwise.
4.3 GROSS UP: If:
(a) the Guarantor is required by law to make any
deduction or withholding from any amount paid or
payable by it to the Beneficiary under this
Guarantee; or
(b) the Beneficiary is required by law to make any
deduction, withholding, or payment on, or calculated
by reference to, any amount received or receivable by
it under this Guarantee for or on account of tax
(except on account of tax on overall net income of
the Beneficiary) or otherwise,
then the amount payable by the Guarantor in respect of which
such deduction, withholding or payment is required to be made
will be increased to the extent necessary to ensure that,
after the making of such deduction, withholding or payment,
the Beneficiary receives and retains (free from any liability
in respect of any such deduction, withholding or payment) a
net amount equal to the amount which it would have received
and so retained had no such deduction, withholding or payment
been required to be made.
Guarantee and Indemnity Page 5
4.4 NOTIFY BENEFICIARY: The Guarantor will:
(a) notify the Beneficiary immediately if it is required
to make any deduction or withholding;
(b) ensure that such deduction or withholding does not
exceed the legal minimum; and
(c) pay the amount required to be deducted or withheld to
the applicable taxation or other authority before the
date on which penalties attach.
4.5 TAX RECEIPTS: The Guarantor will deliver to the Beneficiary
promptly, on receipt, a copy of the receipt issued by the
applicable taxation or other authority or other evidence
satisfactory to the Beneficiary evidencing that such deduction
or withholding has been made.
4.6 INTEREST: The Guarantor will pay to the Beneficiary on demand
interest on all amounts payable by the Guarantor from the due
date to the date of actual receipt by the Beneficiary. Such
interest will accrue and be calculated on a daily basis (after
as well as before judgment) at the Default Interest Rate.
Interest will be compounded at monthly intervals.
5. SUSPENSION OF RIGHTS
5.1 Until the Guaranteed Money has been paid and discharged in
full, the Guarantor will not, without the consent of the
Beneficiary:
(a) take any steps to enforce a right or claim against
the Debtor in respect of any money paid by the
Guarantor to the Beneficiary under this Guarantee; or
(b) have or exercise any rights in competition with the
Beneficiary (including any right of subrogation or
indemnity).
5.2 BENEFICIARY AUTHORISED TO PROVE: Until the Beneficiary shall
have received one hundred cents in the dollar in respect of
the indebtedness of the Debtor in relation to the Guaranteed
Money, the Guarantor authorises the Beneficiary to:
(a) prove or claim for all money which the Guarantor has
paid or are otherwise owing to the Guarantor and have
not been repaid by the Debtor or any other guarantor
of the Debtor or any other person; and
(b) retain and to carry to a suspense account and
appropriate at the discretion of the Beneficiary any
amount received.
5.3 GUARANTOR'S WAIVER OF RIGHTS: So far as is necessary to give
effect to anything contained or implied in this Guarantee and
to ensure that the whole of the Guaranteed Money and
Guaranteed Obligations are paid or
Guarantee and Indemnity Page 6
satisfied or performed in full, the Guarantor waives in favour
of the Beneficiary all rights whatever against the
Beneficiary, the Debtor, any other guarantor of the Debtor or
any other person or their or its estate and assets. Such
waiver extends to and includes rights of subrogation,
contribution and marshalling.
6. REPRESENTATIONS AND WARRANTIES
6.1 REPRESENTATIONS: The Guarantor represents and warrants to the
Beneficiary that:
(a) the Guarantor has taken all necessary corporate
action to authorise the performance of, and
compliance with, its obligations under this
Guarantee; and
(b) the Guarantor has not taken any security interest or
benefit from the Debtor for or in consideration of
assuming the obligations contained under this
Guarantee or any part of them.
(c) the Guarantor is solvent and able to pay the
Guarantor's indebtedness as it falls due.
6.2 NO RELIANCE: The Guarantor confirms that it has not executed
this Guarantee as a result of or in reliance on any promise,
representation, statement or information of any kind or nature
whatever given by the Beneficiary.
6.3 NO DISCLOSURE: Subject to the Agreement and the Related
Agreements, the Guarantor confirms that the Beneficiary was
not, before execution of this Guarantee and is not in the
future, liable to do anything (including disclosing any
information to the Guarantor) relating to the affairs of the
Debtor or any transactions of the Debtor with the Beneficiary.
6.4 CONTINUING: The representations and warranties in this clause
6 will be deemed to be repeated continuously at all times
during which this Guarantee remains in effect by reference to
the facts and circumstances then existing.
7. UNDERTAKINGS
The Guarantor will:
7.1 INFORMATION: provide the Beneficiary within five Business Days
of receiving a reasonable request from the Beneficiary with
such information relating to its financial condition,
business, assets or affairs as is relevant to the performance
of its obligations under this Guarantee provided however that
the Guarantor is under no obligation to provide information
that it considers, in its absolute discretion, disclosure of
which would be a breach of any applicable Stock Exchange
Listing Rules; and
Guarantee and Indemnity Page 7
7.2 PROCEEDINGS: give the Beneficiary prompt notice of any
litigation, or proceedings affecting it or any of its
business, assets or affairs.
8. COSTS
The Guarantor will pay the Beneficiary on demand for all reasonable
costs and expenses (including reasonable legal costs) in connection
with:
8.1 ENFORCEMENT: the enforcement of this Guarantee; and
8.2 AMENDMENT ETC: any amendment to, or any consent, waiver or
release of this Guarantee requested by the Guarantor.
9. RELEASE
The Beneficiary will not be obliged to execute a release of this
Guarantee unless it is satisfied that:
9.1 GUARANTEED MONEY PAID: all of the Guaranteed Money has been
paid; and
9.2 NO PAYMENT AVOIDED: no payment affecting or relating to the
Guaranteed Money is or may be avoided under any law relating
to insolvency or otherwise.
10. SET-OFF
The Beneficiary is authorised to apply (without prior notice or demand)
any credit balance of the Guarantor on any account or any money owed by
the Beneficiary to the Guarantor towards satisfaction of the Guaranteed
Money or any money due and unpaid by the Guarantor to the Beneficiary
under this Guarantee.
11. NOTICES
11.1 DELIVERY OF NOTICE: All notices and other communications
required or permitted under this Guarantee shall be in
writing. Any written notice required under this Guarantee must
be signed by a duly authorised senior representative of any
party giving the notice and will be deemed validly given if:
(a) delivered personally;
(b) sent by prepaid post; or
(c) sent by facsimile transmission,
addressed to the recipient at the address or facsimile number
set out below (as applicable) or to any other address or
facsimile number that a party may notify to the other parties
by like notice.
Guarantee and Indemnity Page 8
BENEFICIARY: If to the Beneficiary to:
Teal 0 Xxxxxxx
X/- XXX Xxxxxxx Xxx Xxxxxxx Equities Limited
X X Xxx 00
Xxxxxxxx 0000
Xxxxx 00 Xxxxxx Building
000 Xxxxx Xxxxxx
Xxxxxxxx
For: Xxxxxxx Xxxxx
Facsimile: (00) 000 0000
With a copy to:
UBS Timber Investors
Trade Center, 4th Floor
00 Xxxxxxx Xxxx
Xxxx Xxxxxxx
XX 00000
Xxxxxx Xxxxxx of America
For: Xxxxx Xxxxx
Facsimile: (000) 000 000 0000
And with a copy to:
Xxxxx Xxxx LLP
000 Xxxxxxx Xxxx
Xxxxxx, XX 00000
Xxxxxx Xxxxxx of America
For: Xxx Xxxxx
Facsimile: (000) 000 000 0000
GUARANTOR: If to the Guarantor, to:
Xxxxxxxx Challenge Industries Limited
0 Xxxxxxxxx Xxxxxx
Xxxxxxx
Private Bag 92036
Auckland Mail Centre
Auckland
For: The Chief Executive Officer
Facsimile: (00) 000 0000
With a copy to:
Xxxxxxxx Challenge Industries Limited
0 Xxxxxxxxx Xxxxxx
Xxxxxxx
Private Bag 92036
Auckland Mail Centre
Auckland
Guarantee and Indemnity Page 9
For: The Company Secretary
Facsimile: (00) 000 0000
11.2 TIME OF RECEIPT: No written communication will be effective
until received. Without limiting any other ways for a party to
prove that another party has received a notice, a notice or
other written communication under this Guarantee, will be
treated as received:
(a) if delivered personally, when left with an apparently
responsible person at the recipient's address;
(b) if sent by prepaid post three (3) Business Days (if
posted within New Zealand to an address in New
Zealand), or ten (10) Business Days (if posted by
prepaid airmail from country to country) after the
date of posting;
(c) if sent by registered post, on acknowledgment of
receipt by or on the recipient's behalf; or
(d) if sent by air courier delivery, on acknowledgment of
receipt by or on the recipient's behalf; or
(e) if sent by facsimile, on the sender's receipt of a
transmission report indicating that the facsimile was
sent in its entirety to the recipient's facsimile
number;
but, if the delivery or receipt is not on a Business Day or
after 5.00pm (local time) on any Business Day, the notice will
be treated as received by the recipient at 9.00am (local time)
on the next Business Day.
11.3 COPIES OF NOTICES: If a party is required by any term of this
Guarantee to give a copy of a notice or other communication to
a third party, the failure to give the copy of it to a third
party will not affect the effectiveness of that notice or
communication to a party.
12. CURRENCY INDEMNITY
If, at any time and for any reason, an amount payable by the Guarantor
under or in respect of this Guarantee ("Relevant Amount") is converted
into and received by the Beneficiary in a currency ("Payment Currency")
other than the contractual currency of payment under the Agreement
("Contractual Currency") then the Guarantor will indemnify the
Beneficiary and will hold the Beneficiary harmless against, and will
pay the Beneficiary on demand the amount certified by the Beneficiary
as being the amount required to compensate it for, the loss suffered as
a result of any discrepancy between:
12.1 CONTRACTUAL CURRENCY RECEIVED: the amount of the Contractual
Currency which the Lender receives on converting the amount it
receives in the Payment Currency into an amount in the
Contractual Currency in accordance with its usual practice;
and
Guarantee and Indemnity Page 10
12.2 RELEVANT AMOUNT: the Relevant Amount in the Contractual
Currency.
13. GENERAL
13.1 CERTIFICATE: The certificate of the Beneficiary as to any
amount or fact which might reasonably be expected to be within
the Beneficiary's knowledge will be prima facie evidence of
such matter or fact.
13.2 SEVERABILITY: Any provision of this Guarantee which is
prohibited or unenforceable in any jurisdiction shall be
ineffective as to such jurisdiction to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions of this Guarantee or affecting the
validity or unenforceability of such provision in any other
jurisdiction.
13.3 DELAY: No delay, grant of time, release, compromise,
forbearance (whether partial or otherwise) or other indulgence
by the Beneficiary in exercising all or any of its rights,
remedies and powers or concerning any breach of any of the
Guarantor's obligations under this Guarantee is to:
(a) operate as a waiver of or prevent the subsequent
enforcement of any such rights, remedies, powers or
obligations; or
(b) be deemed a delay, grant of time, release,
compromise, forbearance (whether partial or
otherwise) or other indulgence of, or a waiver of,
any subsequent or other breach.
13.4 MODIFICATION: This Guarantee may not be amended or modified
except by written agreement signed by the parties.
13.5 WAIVER: Any consent, waiver or acknowledgement by the
Beneficiary under this Guarantee must be in writing and any
such consent, waiver or acknowledgment shall only be effective
in the specific instance and for the specific purpose given.
13.6 ADDITIONAL TO OTHER SECURITIES: This Guarantee is in addition
to and not in substitution for any other security, undertaking
or right which the Beneficiary may now or subsequently have in
respect of the Guaranteed Money and/or the Guaranteed
Obligations. This Guarantee may be enforced against the
Guarantor or any other Guarantor of the Debtor without first
having recourse to any such securities, undertaking or rights
and without taking any steps or proceedings against the
Debtor. It may be enforced notwithstanding that any other
security, undertaking or right may be in whole or in part
unenforceable by reason of any rule of law or equity and
notwithstanding any laches, acts, omissions or delays on the
part of the Beneficiary.
13.7 APPLICABLE LAW:
(a) The law applicable to this Guarantee shall be the law
of New Zealand and the parties irrevocably and
unconditionally agree to
Guarantee and Indemnity Page 11
submit to and be bound by the jurisdiction of the
courts and tribunals of New Zealand.
(b) The submission to jurisdiction in clause 13.7(a) does
not (and is not to be construed to) limit the rights
of the Beneficiary to take proceedings against the
Guarantor in another court of competent jurisdiction,
nor is the taking of proceedings in one or more
jurisdictions to preclude the taking of proceedings
in another jurisdiction whether concurrently or not.
14. CONFIDENTIALITY
The Beneficiary will maintain as confidential at all times, and will
not at any time, directly or indirectly:
14.1 DISCLOSE: disclose or permit to be disclosed to any person;
14.2 USE: use for itself; or
14.3 USE TO DETRIMENT: use to the detriment of the other party;
any Confidential Information except:
14.4 LEGAL REQUIREMENT: subject to clause 14.10, as required by law
or regulatory body (including any stock exchange);
14.5 PUBLIC KNOWLEDGE: as is already or becomes public knowledge,
otherwise than as a result of a breach by the Beneficiary of
any provision of this deed;
14.6 AUTHORISED: as authorised in writing by the Guarantor;
14.7 LENDERS AND UNDERWRITERS: as required to communicate with and
make disclosure to institutional lenders to and underwriters
for, or potential institutional lenders to and underwriters
for the Beneficiary provided that the Beneficiary shall ensure
compliance by such persons with this clause 14 and shall be
liable for any breach of such obligations by such persons, and
in the case of potential institutional lenders or
underwriters, to return all such information if the lending to
or underwriting is not consummated;
14.8 AFFILIATES AND ADVISERS: as required to communicate with and
make disclosure to Affiliates of the Beneficiary or the
Beneficiary's or the Affiliates' respective advisers who have
a legitimate need to know the information in order to perform
activities connected with this deed, the Agreement or the
Related Agreements, and provided that the relevant party shall
ensure compliance by such persons with this clause 14 and
shall be liable for any breach of such obligations by such
persons; or
14.9 OTHER: to the extent reasonably required by this deed (and,
without limiting the effect of this clause, the Beneficiary
may disclose
Guarantee and Indemnity Page 12
Confidential Information only to those of its officers,
employees or professional advisers, on a "need to know" basis,
as is reasonably required for the implementation of this
deed).
14.10 CONSULTATION: In the event that the Beneficiary is required by
law or stock exchange reporting obligations to disclose
Confidential Information, such disclosure may be made only
after the Guarantor has been notified and, subject to timing
obligations imposed by law or the relevant stock exchange, has
been given every reasonable opportunity to consult with the
Beneficiary as to timing and the content of any such
disclosure. In consulting with the Guarantor, the Beneficiary
shall act in good faith and give reasonable consideration to
the Guarantor's requests.
14.11 THE BENEFICIARY'S SAFEGUARDS: If requested, the Beneficiary
will document to the reasonable satisfaction of the Guarantor
the internal safeguards it will put in place to meet its
confidentiality obligations under this clause 14.
Executed as a deed.
SIGNED by XXXXXXXX CHALLENGE
INDUSTRIES LIMITED by:
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
WITNESS:
(if other than two directors sign)
__________________________________
Signature of witness
__________________________________
Full name of witness
__________________________________
Occupation of witness
__________________________________
Address of witness
Guarantee and Indemnity Page 13
SIGNED by TEAL 3 LIMITED (OR
NOMINEE) by:
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
____________________________________________ ________________________________
Full name of director/authorised signatory Signature of director/authorised
signatory
WITNESS:
(if other than two directors sign)
__________________________________
Signature of witness
__________________________________
Full name of witness
__________________________________
Occupation of witness
__________________________________
Address of witness
