Exhibit 99.5
THIS AGREEMENT is made on the 11th day of November, 2003
BETWEEN:
1. BARCLAYS BANK PLC of 00 Xxxxxxx Xxxxxx, Xxxxxx, XX0X 0XX (registered in
England number 1026167) ("Barclays");
2. FOSPV LIMITED of 00 Xxxxxxx Xxxxxx, Xxxxxx XX0X 0XX (registered in England
number 3859383) (the "Purchaser");
3. OAK DEDICATED LIMITED of 0 Xxxxxxx Xxxxx, Xxxxxxx Xxxx, Xxxxxx XX0X 0XX
(registered in England number 3263556) ("Oak1");
4. OAK DEDICATED TWO LIMITED of 0 Xxxxxxx Xxxxx, Xxxxxxx Xxxx, Xxxxxx XX0X
0XX (registered in England number 2852607) ("Oak2");
5. OAK DEDICATED THREE LIMITED of 0 Xxxxxxx Xxxxx, Xxxxxxx Xxxx, Xxxxxx XX0X
0XX (registered in England number 2982085) ("Oak3"); and
6. LASALLE (UK) LTD. of Canon's Court, Victoria Street, Xxxxxxxx, Bermuda
HM12 (registered in Bermuda number 34318) (the "Seller").
IT IS HEREBY AGREED AS FOLLOWS:
1. DEFINITIONS AND INTERPRETATION
1.1 In this Agreement, the following terms shall have the following meanings,
unless the context otherwise requires:
(i) "Additional Amount" has the meaning given to it in clause 3;
(ii) "Barclays Group Member" means Barclays, the Purchaser and any other
company which is a member of the same "group" (as defined in Section
413 ICTA 1988) as Barclays (but excluding the Companies);
(iii) "Companies" means Xxx0, Xxx0 and Oak3 (and "Company" means any of
them);
(iv) "Conditions" means the conditions set out in Schedule 1;
(v) "Escrow Account" has the meaning given to it in the Escrow Deed;
(vi) "Escrow Deed" means the escrow deed entered into in connection with
this Agreement on or about the date hereof between the Companies,
the Seller, ING Bank N.V., London Branch, Magicsunny, Flintstone
Limited and Trenwick Managing Agents Limited;
(vii) "Group Relief" means group relief as defined in Section 402 ICTA
1988;
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(viii) "ICTA 1988" means the Income and Corporation Taxes Xxx 0000;
(ix) "LaSalle" means LaSalle Re Limited, a company registered in
Bermuda (number 18791);
(x) "Lloyd's" means The Society of Lloyd's as constituted under the
Lloyd's Xxx 0000;
(xi) "Magicsunny" means Magicsunny Limited, a company registered in
England (number 04818520);
(xii) "MBO Incentive" has the meaning given to it in the Escrow Deed;
(xiii) "Relevant Sum" has the meaning given to it in clause 5.1, 5.2, 5.3
or 5.4 (as the case may be);
(xiv) "Sale and Purchase Agreement" means the sale and purchase
agreement between the Purchaser, the Seller, LaSalle, Barclays and
certain persons named therein as Directors of the Companies dated
the same date as this Agreement relating to the ordinary issued
share capital of the Companies;
(xv) "TIL" means Trenwick International Limited, a company registered
in England (number 2494812);
(xvi) "TIL Group Relief Agreement" means the agreement between TIL and
the Companies relating to the surrender of amounts by way of Group
Relief dated 26th September, 2003;
(xvii) "TUKMS" means Trenwick UK Management Services Limited, a company
registered in England (number 02733994); and
(xviii) TUKMS Forbearance Deed means the Deed of Forbearance entered into
on or about the date hereof between TUKMS and the Companies.
1.2 Any word or expression defined in the Sale and Purchase Agreement shall
have the same meaning in this Agreement, unless the context otherwise
requires.
1.3 Any words importing the singular include the plural and vice versa, and
any references to persons include (without limitation) bodies corporate.
1.4 Any headings to clauses in this Agreement are for convenience only and
shall not affect their interpretation.
1.5 Any reference to this Agreement includes any recital to it, and any
reference to a clause is a reference to a clause of this Agreement.
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1.6 Any reference to any statute or statutory instrument includes reference to
any extension, modification, amendment, consolidation or re-enactment of,
and any subordinated legislation made under, such statute.
2. SURRENDER OF GROUP RELIEF OF (pound)200 MILLION IN AGGREGATE
2.1 Subject to clause 4, each of the Companies undertakes that it shall, in
relation to any period beginning after Completion (including, without
limitation, its period of account ending on 31st December, 2004),
surrender to Barclays (and/or to any one or more Barclays Group Members
specified by Barclays by notice in writing served on such Company) any
trading losses and/or other amounts which are eligible for surrender by
such Company to Barclays (and/or such Barclays Group Members, as the case
may be) by way of Group Relief in accordance with Chapter IV of Part X
ICTA 1988 and which are specified by Barclays in one or more notices
served in writing on such Company from time to time, provided that the
aggregate of the amounts so surrendered by all of the Companies pursuant
to this clause 2.1 shall not exceed (pound)200,000,000.
2.2 Subject to clause 4, on the date falling one Business Day after the date
on which the Conditions have been satisfied as described in clause 4,
Barclays shall (on behalf of itself and/or the relevant Barclays Group
Members, as the case may be) irrevocably pay the following amounts to (or
to the direction of) each of the Companies in consideration for all losses
and other amounts which are to be validly surrendered by way of Group
Relief in accordance with Chapter IV of Part X ICTA 1988 by such Company
to Barclays (and/or the relevant Barclays Group Members, as the case may
be) pursuant to clause 2.1:
(a) (pound)10,080,000 to (or to the direction of) Oak1;
(b) (pound)3,850,000 to (or to the direction of) Oak2; and
(c) (pound)70,000 to (or to the direction of) Oak3.
2.3 Without prejudice to Barclays' right to serve any subsequent notice as
described in clause 2.4, Barclays shall, on the date of this Agreement,
serve a notice specifying the relevant Barclays Group Members and the
relevant amounts required to be surrendered by each of the Companies for
the purposes of clause 2.1.
2.4 Any notice served by Barclays for the purposes of clause 2.1 may amend an
earlier such notice (including, without limitation, any notice served
pursuant to clause 2.3). To the extent that any notice served by Barclays
pursuant to clause 2.1 is inconsistent with any earlier such notice, the
notice most recently served shall prevail over any earlier such notice.
3. SURRENDER OF ADDITIONAL GROUP RELIEF
3.1 Subject to clause 4, if and to the extent that:
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(i) the aggregate amount of all losses and other amounts which are
available and eligible to be legally and validly surrendered by way
of Group Relief by the Companies to Barclays (or any Barclays Group
Members) in accordance with Chapter IV of Part X ICTA 1988 exceeds
(pound)200,000,000;
(ii) Barclays requests, by notice served in writing on any Company from
time to time, in relation to any period beginning after Completion,
that such Company surrender to Barclays (or to any Barclays Group
Member specified by Barclays in such notice) any such trading loss
or other amount which is available and eligible to be legally and
validly surrendered by way of Group Relief by such Company to
Barclays (or any Barclays Group Members) in accordance with Chapter
IV of Part X ICTA 1988 (the "Additional Amount"), in addition to any
amounts required to be surrendered by such Company pursuant to
clause 2; and
(iii) such Company agrees to make such surrender,
then:
(a) such Company shall surrender the Additional Amount to Barclays (or
such Barclays Group Member, as the case may be) in accordance with
such notice; and
(b) Barclays shall (on behalf of itself or the relevant Barclays Group
Member, as the case may be) pay to (or to the direction of) such
Company a sum equal to 7 per cent of the Additional Amount in
consideration for such surrender.
3.2 Subject to clause 4, each Company undertakes that it shall use its
reasonable endeavours to agree to the making of any surrender requested
pursuant to sub-clause 3.1 (after taking account of any actual or expected
utilisation of the relevant amount to reduce or eliminate any taxable
profits of such Company otherwise arising or expected to arise in any
subsequent or prior period). Barclays undertakes that it shall use its
reasonable endeavours to request any surrender which is eligible to be
requested pursuant to sub-clause 3.1, provided that the accounting period
of such Company to which such surrender would relate has ended and no
person has taken any step or action to instigate or commence the
winding-up of such Company, the appointment of any administrator or
receiver (including any administrative receiver) to such Company or any
other form of insolvency-related procedure in relation to such Company.
3.3 If Barclays requests, by notice served in writing, that a surrender be
made as described in paragraph (ii) of sub-clause 3.1, and paragraph (iii)
of sub-clause 3.1 is not satisfied within 20 Business Days after the date
on which such notice is served, such request shall lapse and accordingly
cease to have effect (but, for the avoidance doubt, without prejudice to
Barclays' right to serve any replacement, substitute or additional request
for the purposes of paragraph (ii) of sub-clause 3.1).
3.4 Any consideration payable for any surrender pursuant to sub-clause 3.1
shall be due on the later of:
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(a) the date falling one Business Day after the date on which all of the
conditions specified in sub-clause 3.1 have been satisfied in
relation to such surrender and all of the Conditions have been
satisfied as described in clause 4; and
(b) the 5th December falling within the accounting period of Barclays
(or the relevant Barclays Group Member, as the case may be) which is
the "claim period" in relation to such surrender for the purposes of
section 403A ICTA 1988.
4. CONDITIONS
4.1 The rights and obligations of the parties pursuant to this Agreement
(other than clauses 6 and 7) are in all respects conditional upon the
Conditions being satisfied. Provided always that Barclays shall not be
obliged to make any payment under sub-clause 2.2 if any of the Conditions
would not be satisfied immediately prior to the making of the payment
under sub-clause 2.2 and, for these purposes, notwithstanding any wording
to the contrary in the Conditions, the Conditions shall only be treated as
satisfied if they remain satisfied immediately before such payment is
made.
4.2 The Seller undertakes to disclose in writing to the Purchaser and Barclays
anything which will or may prevent Condition 1 of the Conditions from
being satisfied promptly after its coming to the notice of the Seller.
4.3 If the Conditions are not satisfied or deemed satisfied by the Completion
Date then no party shall have any liability or obligation to any other
party under this Agreement other than any obligations remaining pursuant
to Clauses 6 or 7.
5. PAYMENTS
5.1 Oak1 agrees and directs that any sum which is due to be paid by Barclays
(on behalf of itself and/or the relevant Barclays Group Members, as the
case may be) to Oak1 under clause 2 of this Agreement (referred to in this
clause 5.1 as the "Relevant Sum") shall be paid in the following manner:
(i) (pound)1,188,000 of the Relevant Sum shall be paid on behalf of Oak1
to TIL in respect of Oak1's obligations under the TIL Group Relief
Agreement;
(ii) (pound)201,600 of the Relevant Sum shall be paid on behalf of Oak1
to TUKMS in respect of the debts due and payable by Oak1 to TUKMS
[and described in more detail in the TUKMS Forbearance Deed];
(iii) (pound)288,000 of the Relevant Sum shall be paid on behalf of Oak1,
in respect of the MBO Incentive, into the Escrow Account, which the
parties acknowledge is subject to the terms of the Escrow Deed; and
(iv) the remaining (pound)8,402,400 of the Relevant Sum shall be paid on
behalf of Oak1 into the Escrow Account, which the parties
acknowledge is subject to the terms of the Escrow Deed.
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5.2 Oak2 agrees and directs that any sum which is due to be paid by Barclays
(on behalf of itself and/or the relevant Barclays Group Members, as the
case may be) to Oak2 under clause 2 of this Agreement (referred to in this
clause 5.2 as the "Relevant Sum") shall be paid in the following manner:
(i) (pound)132,000 of the Relevant Sum shall be paid on behalf of Oak2
to TIL in respect of Oak2's obligations under the TIL Group Relief
Agreement;
(ii) (pound)77,000 of the Relevant Sum shall be paid on behalf of Oak2 to
TUKMS in respect of the debts due and payable by Oak2 to TUKMS and
described in more detail in the TUKMS Forbearance Deed;
(iii) (pound)110,000 of the Relevant Sum shall be paid on behalf of Oak2,
in respect of the MBO Incentive, into the Escrow Account, which the
parties acknowledge is subject to the terms of the Escrow Deed; and
(iv) the remaining (pound)3,531,000 of the Relevant Sum shall be paid on
behalf of Oak2 into the Escrow Account, which the parties
acknowledge is subject to the terms of the Escrow Deed.
5.3 Oak3 agrees and directs that any sum which is due to be paid by Barclays
(on behalf of itself and/or the relevant Barclays Group Members, as the
case may be) to Oak3 under clause 2 of this Agreement (referred to in this
clause 5.3 as the "Relevant Sum") shall be paid in the following manner:
(i) (pound)1,400 of the Relevant Sum shall be paid on behalf of Oak3 to
TUKMS in respect of the debt due and payable by Oak3 to TUKMS and
described in more detail in the TUKMS Forbearance Deed;
(ii) (pound)2,000 of the Relevant Sum shall be paid on behalf of Oak3, in
respect of the MBO Incentive, into the Escrow Account, which the
parties acknowledge is subject to the terms of the Escrow Deed; and
(iii) the remaining (pound)66,600 of the Relevant Sum shall be paid on
behalf of Oak3 into the Escrow Account, which the parties
acknowledge is subject to the terms of the Escrow Deed.
5.4 Each of the Companies agrees and directs that any sum which is due to be
paid by Barclays (on behalf of itself and/or the relevant Barclays Group
Members, as the case may be) to such Company under clause 3 of this
Agreement (referred to in this clause 5.4 as the "Relevant Sum") shall be
paid in the following manner (and in the following order of priority):
(i) if and to the extent that, at the time when the Relevant Sum is due
to be paid, such Company is obliged to pay any amount to TIL under
the TIL Group Relief Agreement, the Relevant Sum shall be paid on
behalf of such Company to TIL in respect of that obligation; and
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(ii) any remainder of the Relevant Sum shall be paid on behalf of such
Company into the Escrow Account, which the parties acknowledge is
subject to the terms of the Escrow Deed.
5.5 If and to the extent that any sum payable under this Agreement is not paid
on the due date for payment, such unpaid sum shall carry interest
calculated at LIBOR from (and including) such due date for payment to (but
excluding) the date on which such sum is actually paid.
6. NOTICES
6.1 Any notice or other communication requiring to be given or served under or
in connection with this Agreement shall be in writing and shall be
sufficiently given or served if delivered or sent:
(i) in the case of Oak1 to:
Address: 0 Xxxxxxx Xxxxx,
Xxxxxxx Xxxx,
Xxxxxx
XX0X 0XX
Attention: The Directors
Telephone: 000 0000 0000
Facsimile: 020 7369 3100
(ii) in the case of Oak2 to:
Address: 0 Xxxxxxx Xxxxx,
Xxxxxxx Xxxx,
Xxxxxx
XX0X 0XX
Attention: The Directors
Telephone: 000 0000 0000
Facsimile: 020 7369 3100
(iii) in the case of Oak3 to:
Address: 0 Xxxxxxx Xxxxx,
Xxxxxxx Xxxx,
Xxxxxx
XX0X 0XX
Attention: The Directors
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Telephone: 000 0000 0000
Facsimile: 020 7369 3100
(iv) in the case of the Purchaser to:
Address: 00 Xxxxxxx Xxxxxx
Xxxxxx
XX0X 0XX
Attention: The Directors
with a copy to:
Barclays Capital
5 Xxx Xxxxx Xxxxxxxxx
Xxxxxx Xxxxx
Xxxxxx
X00 0XX
Attention: Head of Structured Capital Markets
Telephone: 000 0000 0000
Facsimile: 020 7773 1868
(v) in the case of Barclays to:
Address: 00 Xxxxxxx Xxxxxx
Xxxxxx
XX0X 0XX
Attention: The Directors
with a copy to:
Barclays Capital
5 Xxx Xxxxx Xxxxxxxxx
Xxxxxx Xxxxx
Xxxxxx
X00 0XX
Attention: Head of Structured Capital Markets
Telephone: 000 0000 0000
Facsimile: 020 7773 1868
(vi) in the case of the Seller to:
Address: 0 Xxxxxxxxxx Xxxxx,
Xxxxxxxx,
0
XX,
XXX 00000
Attention: Xxxx Xxxxx
Telephone: 000 000 000 0000
Facsimile: 001 203 353 5550
with a copy to La Salle at:
Address: Canon's Court,
00 Xxxxxxxx Xxxxxx,
Xxxxxxxx,
Xxxxxxx XX00
Xxxxxxxxx: The President
Telephone: 000 000 000 0000
Facsimile: 001 441 295 8666
6.2 Any notice or other communication requiring to be given or served under or
in connection with this Agreement shall be delivered by hand or sent by
courier, or prepaid first class post or by facsimile. If sent by courier
such notice or communication shall conclusively be deemed to have been
given or served at the time of despatch, in case of service in the United
Kingdom, or on the following Business Day in the case of international
service. If sent by post such notice or communication shall conclusively
be deemed to have been received two Business Days from the time of
posting, in the case of inland mail in the United Kingdom or three
Business Days from the time of posting in the case of international mail.
If sent by facsimile, such notice or communication shall conclusively be
deemed to have been received when confirmation of receipt has been
received by the sender.
7. GENERAL
7.1 The parties to this Agreement intend that the terms of this Agreement
shall be enforceable by each Barclays Group Member by virtue of the
Contracts (Rights of Third Parties) Xxx 0000, but that this Agreement
shall not be enforceable by any other person who is not a party to it.
7.2 Any time, date or period referred to in any provision of this Agreement
may be extended by mutual agreement between the parties but as regards any
time, date or period originally fixed or any time, date or period so
extended, time shall be of the essence.
7.3 No failure or delay by any party to this Agreement in exercising any
right, power or privilege hereunder or otherwise available at law shall
impair such right, power or privilege or be construed as a waiver thereof
nor shall any single or partial exercise of any right, power or privilege
preclude any other or further exercise thereof or the
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exercise of any other right, power or privilege. The rights and remedies
herein provided are cumulative and not exclusive of any rights and
remedies provided by law.
7.4 Each party shall pay its own costs and expenses in relation to the
negotiation, preparation and execution of this Agreement.
7.5 If any term or provision in this Agreement is held to be illegal or
unenforceable, in whole or in part, under any enactment or rule of law,
such term or provision or part shall to that extent be deemed not to form
part of this Agreement but the enforceability of the remainder of this
Agreement shall not be affected.
7.6 The parties to this Agreement shall and shall procure that their
affiliates shall keep strictly confidential details of the transaction
contemplated by this Agreement or any ancillary matter and no announcement
concerning the same shall be made either before or after its execution by
either party without the prior written approval of the other except as may
be required by statute or by any securities exchange or regulatory or
governmental body to which any party is subject or submits wherever
situated, including (without limitation) Lloyd's, the UK Listing
Authority, The Stock Exchange, the Financial Services Authority, the
Inland Revenue or The Panel on Take-overs and Mergers, whether or not the
requirement has the force of law or (b) for the purposes of any court
proceedings in respect of the enforcement of any right or obligation under
the Credit Agreement.
7.7 The Seller shall not, and shall procure that no member of the Seller Group
shall, take any action which might frustrate or prejudice the acts or
transactions intended to be effected under or pursuant to this Agreement,
and the Seller shall, and shall procure that the members of the Seller
Group shall, at all times execute, or procure the execution of, all such
deeds and documents and do all such things as Barclays may reasonably
require for perfecting such acts or transactions (provided that the Seller
shall not be required pursuant to this clause 7.7 to grant, or procure
that any member of the Seller Group grants, any mortgage, charge or other
security or to procure that any Company executes any such deed or document
or does any other such thing after the execution of the Sale and Purchase
Agreement).
7.8 No future variation to this Agreement shall be effective unless made in
writing and signed by each of the parties.
7.9 No party may at any time assign all or any part of its rights or benefits
under this Agreement.
7.10 This agreement may be executed in any number of counterparts, and by the
parties on separate counterparts, but shall not be effective until each
party has executed at least one counterpart. Each counterpart shall
constitute an original of this Agreement, but all the counterparts shall
together constitute but one and the same instrument.
7.11 This Agreement and the documents to be entered into pursuant to it, save
as expressly referred to therein, shall be governed by and construed in
accordance with English law and the parties irrevocably agree that the
courts of England are to have exclusive
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jurisdiction to settle any disputes which may arise out of or in
connection with this Agreement and such documents.
7.12 Nothing contained in this Agreement shall affect the right to serve
process in any other manner permitted by law or the right to bring
proceedings in any other jurisdiction for the purposes of the enforcement
or execution of, any judgement or other settlement in any other courts.
IN WITNESS WHEREOF this Agreement has been duly executed the day and year first
before written.
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Schedule 1
Conditions
Court and Regulatory Approval
1. (i) Trenwick Group Limited, Trenwick America Corporation and LaSalle
(collectively, the "Debtors") shall have submitted to the United
States District Court for the District of Delaware (the "Bankruptcy
Court") a motion in the form of Annex L of the Sale and Purchase
Agreement (the "Motion");
(ii) the Bankruptcy Court shall have entered an order in the form of
exhibit "L" to the Motion, or in such other form as shall be
reasonably satisfactory to the Debtors, the Purchaser and Barclays
(the "Order"); and
(iii) such Order shall not have been stayed, modified or amended.
Compliance with Clauses 5 and 8.2 of the Sale and Purchase Agreement
2. The Directors have complied fully with their obligations in Clause 5 of
the Sale and Purchase Agreement in the period from today's date until the
date on which Condition 1 is satisfied.
3. The Seller has complied fully with its obligations in Clause 8.2 of the
Sale and Purchase Agreement until the date on which Condition 1 is
satisfied.
Company Rep Letters
4. The representations made by the Directors for and on behalf of each of the
Companies set out in the Company Rep Letters dated today's date and
addressed to FOSPV remain on the date on which Condition 1 is satisfied
true and accurate in all material respects.
Purchaser protection
5. There being no public announcement by H.M. Treasury, the Inland Revenue or
any other Tax authority, after today's date but before the satisfaction of
the other Conditions of any change, enactment or introduction of, or any
possible change, enactment or introduction of, any law or published
practice of the Inland Revenue or any other Tax authority which in
Barclays' reasonable opinion will or may adversely affect:
(a) the ability of Barclays or any Barclays Group Member validly to
claim Group Relief in respect of any losses of any of the Companies,
or
(b) the quantum of the losses available for surrender by way of Group
Relief to Barclays or any Barclays Group Member pursuant to clause 2
of this Agreement.
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Standstill Deeds
6. No party to a Standstill Deed (as defined in the Sale and Purchase
Agreement) having done any act in the period from today's date until the
making of the payment by Barclays under sub-clause 2.2 of this Agreement
which would have breached such Standstill Deed had the taking effect of
such Standstill Deed not been suspended until the making of such payment.
Novation and Allotment Agreement
7. The Novation and Allotment Agreement (as defined in the Sale and Purchase
Agreement) has been completed in accordance with its terms.
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Signed by
as duly authorised attorney for and on behalf of:
BARCLAYS BANK PLC
/s/ Xxxx Xxxxx
----------------------------
Signed by
as duly authorised attorney for and on behalf of:
FOSPV LIMITED
/s/ Xxxx Xxxxx
----------------------------
Signed by
as duly authorised attorney for and on behalf of:
OAK DEDICATED LIMITED
/s/ R D Law
----------------------------
Signed by
as duly authorised attorney for and on behalf of:
OAK DEDICATED TWO LIMITED
/s/ R D Law
----------------------------
Signed by
as duly authorised attorney for and on behalf of:
OAK DEDICATED THREE LIMITED
/s/ R D Law
----------------------------
Signed by
as duly authorised attorney for and on behalf of:
LASALLE (UK) LTD.
/s/ R D Law
----------------------------
Dated 11 November, 2003
BARCLAYS BANK PLC
and
FOSPV LIMITED
and
OAK DEDICATED LIMITED
and
OAK DEDICATED TWO LIMITED
and
OAK DEDICATED THREE LIMITED
and
LASALLE (UK) LTD.
-----------------------------
GROUP RELIEF
AGREEMENT
-----------------------------
Xxxxxxxxx and May
Xxx Xxxxxxx Xxx
Xxxxxx XX0X 0XX
(Ref: GI/JZXM)
TX033090020
