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Exhibit 4.12
SALE AND PURCHASE AGREEMENT
AMONG
(1) XXXXXXXXXXX U.K. LIMITED
(2) 3I GROUP PLC
(3) XXX XXXXXXXXX SUTTIE AND OTHERS
AND
(4) XXXXXXXXXXX INTERNATIONAL, INC.
RELATING TO THE SALE AND PURCHASE OF THE
ENTIRE ISSUED SHARE CAPITAL OF XXXXXX GROUP PLC
[LOGO]
Xxxxxxx Xxxxx W.S.
00 XXXXXX XXXXXX
XXXXXXXXX
XX0 0XX
TEL 0000 000 0000
FAX 0000 000 0000
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CONTENTS
CLAUSE PAGE
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1. Definitions and Interpretation/Schedule
2. Sale and Purchase
3. Consideration
4. Completion
5. Warranties and Undertakings by the Warrantor
6. Warranties by the Purchaser and Weatherford; Registration Rights; Share Price
Protection
7. Claims Procedure
8. Title Warranties and Warranty by Institutional Vendor
9. Protection of Goodwill
10. Release of Liability and Guarantees
11. Effect of Completion
12. Remedies and Waivers
13. Assignation
14. Further Assurance
15. Specific Indemnities
16. Notices
17. Announcements
18. Costs and Expenses
19. Invalidity
20. General
21. Entire Agreement
22. Governing Law and Jurisdiction
SCHEDULE
Part 1A Target Group Structure
Part 1B The Target
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Part 1C Shareholdings in Target
Part 2A The UK Subsidiaries
Part 2B The Non-UK Subsidiaries
Part 3 Completion Obligations
Part 4 [Intentionally Blank]
Part 5A Title Warranties
Part 5B General Warranties
Part 5C Pension Warranties
Part 5D Property and Environmental Warranties
Part 5E Intellectual Property Warranties
Part 5F Tax Warranties
Part 5G International Tax Warranties
Part 6 Vendor Limitations
Part 7 The Properties
Part 8 Intellectual Property
Part 9 Definitions and Interpretation
AGREED FORM DOCUMENTS
AF1 Tax Deed
AF2 Registration Rights Agreement
AF3 Indebtedness Statement
AF4 Irrevocable power of attorney relating to the voting of shares
AF5 Resignation letter of directors/secretary
AF6 Consultancy Agreement
AF7 Form of Proxy
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THIS AGREEMENT AMONG:
(1) WEATHERFORD U.K. LIMITED, a company incorporated in England and Wales with
registered number 862925 and having its registered office at 00/00 Xxxxx
Xxxx, Xxxxx Xxxxxxxx, Xxxxxxx, XX00 0XX ("the Purchaser");
(2) 3i GROUP PLC, a company incorporated in England and Wales with registered
number 1142830 and having its registered office at 00 Xxxxxxxx Xxxx, Xxxxxx
("xxx Institutional Vendor");
(3) THOSE PERSONS (other than the Institutional Vendor) whose names and
addresses are set out in Part 1C of the Schedule ("the Majority Vendors");
(4) XXXXXXXXXXX INTERNATIONAL. INC. a company incorporated in Delaware, United
States of America and having its registered office at 000 Xxxx Xxx
Xxxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000 ("Weatherford");
(the Institutional Vendor and the Majority Vendors being together called
"the Vendors").
WHEREAS:
(A) The Vendors are the legal and beneficial owners of the entire issued share
capital (the "Sale Shares") of Xxxxxx Group plc ("Target") in the
proportions set out in Part 1C of the Schedule.
(B) The Vendors have agreed to sell and the Purchaser has agreed to purchase
the Sale Shares on the terms set out in this Agreement.
(C) Certain of the Majority Vendors are the legal and beneficial owners of the
Minority Interests (as hereinafter defined) and have agreed to sell the
Minority Interests to the Purchaser as a condition of the purchase of the
Sale Shares by the Purchaser for the Consideration.
NOW IT IS HEREBY AGREED AS FOLLOWS:
1. DEFINITIONS AND INTERPRETATION/SCHEDULE
1.1 Unless the context shall otherwise require, words and expressions
in this Agreement shall be given the meanings ascribed to them in,
and shall be interpreted in accordance with, Part 9 of the
Schedule.
1.2 The Schedule forms part of and shall be construed as one with this
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Agreement.
2. CONDITIONS PRECEDENT
2.1 Without prejudice to the obligations of the Vendors under this
Agreement the obligation of the Purchaser to complete the sale and
purchase of the Sale Shares herein provided for is conditional
upon:-
2.1.1 it being confirmed by way of confidential guidance (subject
only to such conditions as may be acceptable to the
Purchaser) from the Office of Fair Trading to the
satisfaction of the Purchaser that the Secretary of State for
Trade and Industry would not be likely to refer the
transaction or any part of the transaction contemplated in
this Agreement to the Competition Commission for
investigation.
2.1.2 the Majority Vendors allowing the Purchaser and its
authorised representatives (as previously notified to Xx. Xxx
Xxxxxx) such access to such senior employees (as previously
notified to Xx. Xxx Xxxxxx), assets, files and records and
premises of each Target Group Company as the Purchaser may
reasonably require for a period of not less than five
Business Days commencing on the day after the third Business
Day after the day on which the Purchaser's Solicitors receive
the confidential guidance referred to in Clause 2.1.1 to
enable the Purchaser to carry out such due diligence as the
Purchaser may deem appropriate. Such due diligence will be
carried out in co-operation with and in consultation with
Xx Xxx Xxxxxx.
2.1.3 the Purchaser not discovering any Material Adverse Effect of
the Target Group. For the purpose of this clause the
expression "Material Adverse Effect" shall mean any event,
circumstance or fact which individually or in the aggregate
results in a materially adverse effect on the Target Group's
business (including customer relationships), operations,
properties, condition (financial or
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otherwise), assets or liabilities taken as a whole.
2.1.4 The Majority Vendors delivering to the Purchaser (sent by
e-mail to Xxxx Xxxxxx at xxxx.xxxxxx@xxxxxxxxxxx.xxx and to
Xxxxxxxx Xxxxx at xxxxxxxx.xxxxx@xxxx.xxx) management
accounts for the Target Group as at 31st December 2000
together with a list of rental assets (and their location) of
the Target Group as at 31st December 2000 in form and
substance reasonably satisfactory to the Purchaser.
2.2 The Purchaser reserves the right to waive any or all of the
conditions in Clause 2.1.
2.3 It is expressly agreed and declared that any act or omission by the
Purchaser indicating that the conditions in Clause 2.1 (or any of
them) have been satisfied or shall be deemed to be satisfied or
shall be waived shall be wholly without prejudice to its rights
under any other clause of this Agreement or the Tax Deed.
2.4 In the event that the conditions in Clause 2.1 have not been
fulfilled or waived by 30th April 2001 any of the parties shall be
entitled by notice in writing to all of the other parties to
terminate this Agreement whereupon the Purchaser shall cease to
have any liability under this Agreement. Notwithstanding the
foregoing terms of this clause 2.4, (a) any notice by the Purchaser
to terminate this Agreement in the event of the Purchaser not being
reasonably satisfied with the management accounts and list of
assets referred to Clause 2.1.4 above must be served on the
Majority Vendor's Solicitors no later than two Business Days after
receipt by the Purchaser of the said management accounts and list
of assets; and (b) any notice by the Purchaser to terminate this
Agreement as a result of the Purchaser discovering a Material
Adverse Effect must be served on the Majority Vendors not later
than 5 p.m. (UK time) on the sixth Business Day after the day on
which such due diligence is commenced; and in either case, in the
event that no such
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notice is served or is not served timeously, the Purchaser shall be
deemed to have waived such condition in terms of Clause 2.2.
3. SALE AND PURCHASE
3.1 Subject to the terms and conditions of this Agreement, (and in
particular Clause 2) each of the Vendors as the legal and
beneficial owners (except for the Trustees who shall sell in their
capacity as trustees) shall sell and the Purchaser shall purchase
the Sale Shares set opposite his name in Columns 3 and 4 of Part 1C
of the Schedule, with all rights and privileges attached to them at
the Completion Date, free and clear of all and any encumbrances.
The Purchaser, relying on the undertakings, representations,
warranties and covenants contained in this Agreement agrees to buy
the Sale Shares on those terms.
3.2 Each of the Vendors hereby waives all rights of pre-emption, other
restrictions on transfer and rights of veto or otherwise held by
each such Vendor under the Articles of Association of members of
the Target Group or otherwise in respect of the transfer of the
Sale Shares to the Purchaser or its nominee(s) hereunder.
4. CONSIDERATION
4.1 The consideration for the sale and purchase of the Sale Shares
shall be the Consideration payable in accordance with Clause 4.3
below.
4.2 The Vendors shall be entitled to the Consideration in the
percentages set out in column 5 of Part 1C of the Schedule.
4.3 Upon completion of the matters referred to in paragraphs 1, 2, 3
and 4 of Part 3 of the Schedule inclusive the Purchaser shall cause
there to be issued to the Vendors the Weatherford Shares in such
name or names as may be requested in writing by the Vendors and
deliver certificates to the Majority Vendors Solicitors on behalf
of the Vendors.
4.4.1 Within ten Business Days after the Completion Date the Purchaser
will prepare and deliver to the Majority Vendors' Solicitors a
statement
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(attaching copies of the relevant bank statements) showing the
aggregate credit balance (calculated by setting off debit balances
against credit balances) on all bank accounts of the Non-UK
Subsidiaries (other than in the UK and Jersey) as the close of
business on the last Business Day before Completion as listed in
the Disclosure Letter.
4.4.2 The Majority Vendors' Solicitors may within five business days
after receipt by them of said statement notify the Purchaser that
they do not agree with the statement. If no such notice is received
by the Purchaser within such five day period the statement will be
deemed to be agreed. If such notice is received within such five
day period the matters in dispute will be referred to an
independent expert whose decision shall be final and binding on the
parties. In the event that the parties are unable to agree upon the
appointment of an independent expert, such expert shall be
appointed, on the application of the Purchaser or the Majority
Vendors' Solicitors by the President of the Institute of Chartered
Accountants of Scotland.
4.4.3 The credit balance on the statement agreed or determined pursuant
to Clause 4.4.2 will constitute additional consideration for the
Sale Shares ("the Additional Consideration"). Within ten business
days after the Additional Consideration has been agreed or
determined the Purchaser will procure the issue to the Vendors (in
the percentages set out Part 1C of the Schedule) of such number of
Weatherford Shares as is equal to the US Dollar value of the
Additional Consideration (calculated on the basis of the rates of
exchange current on the third business day prior to the date on
which such Weatherford Shares are to be issued) divided by the Fair
Market Value.
4.5 No fractional shares of Weatherford shall be issued to the Vendors
and to the extent a fractional share would otherwise be issued, the
number of Weatherford Shares to be issued would be rounded up or
down to the nearest whole.
4.6 For the purpose of calculating the number of Weatherford Shares to
be issued
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the rate of conversion from Sterling to Dollars will be fixed on
the third business day prior to the Completion Date ("the Fix
Date") and shall be the average rate of exchange over the ten
Business Days preceding the Fix Date. For this purpose the rate of
exchange for each Business Day will be the Pound Spot Closing
mid-point rate published in the Financial Times on the day in
question. In the event that in respect of any day during the ten
Business Days referred to the said rate of conversion is lower than
$1.35 then the rate for that day for the purposes of this Clause
4.6 shall be deemed to be $1.35 and in the event that the said rate
of conversion is higher than $1.55 then the rate for that day for
the purposes of this Clause 4.6 shall be deemed to be $1.55.
5. PRE-COMPLETION
5.1 Prior to Completion the Warrantor shall not knowingly and shall
procure (as far as he can) that the Company and the Subsidiaries
shall not do any act or thing or omit to do any act or thing the
commission or omission of which would constitute a breach of any of
the Warranties or which would make any of the Warranties untrue or
inaccurate or misleading.
5.2 The Majority Vendors will procure that between the date of signing
this agreement and Completion the collection of book debts by
members of the Target Group will be carried out only in the
ordinary course of business in accordance with the normal practice
of each such member.
6. COMPLETION
6.1 The purchase and sale of the Sale Shares shall be completed at the
offices of the Majority Vendors' Solicitors or at such other place
as the parties may agree on the Completion Date when the parties
shall each comply with their respective obligations set out in Part
3 of the Schedule.
6.2 The Purchaser shall not be obliged to complete the purchase of any
of the Sale Shares unless all of the Sale Shares are sold and
purchased simultaneously.
7. WARRANTIES AND UNDERTAKINGS BY THE WARRANTOR
7.1 The Warrantor hereby warrants and represents to and undertakes with
the
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Purchaser that the Warranties as at the date of this Agreement:
7.1.1 save as fairly disclosed in the Disclosure Letter, are true
and accurate in all respects;
7.1.2 are (without prejudice to the provisions of paragraph 10.3
of Part 6 of the Schedule and the content of the Disclosure
Letter) not and are not to be affected or limited by any
previous or other disclosures express or implied, written or
oral to the Purchaser, its officers or representatives or
professional advisers or by any investigation made by or on
behalf of the Purchaser into the affairs of the Target Group
or by any information of which the Purchaser or its agents
have knowledge (actual or constructive); and
7.1.3 shall not in any respect be extinguished or affected by
Completion.
7.2 The provisions of Part 6 of the Schedule shall apply to limit the
Warrantor's liability in respect of the Warranties, the Indemnities
and the Tax Deed to the extent specified therein and/or any claim
for breach thereof.
7.3 7.3.1 Notwithstanding any other provision of this Agreement and
without limiting the rights of the Purchaser in any way
the Warrantor hereby undertakes to the Purchaser that if
there is a breach of any of the Warranties which relates
to a quantified liability or increased liability incurred
by any member of the Target Group the Warrantor will pay
in cash to the Purchaser (or , if so directed by the
Purchaser, to the relevant Target Group Company) within 5
Business Days after written demand, an amount equal to
the aggregate of:
7.3.1.1 the amount which if received by the relevant
Target Group Company would be necessary to put
that company into the position which would have
existed
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had there been no breach of the Warranties; and
7.3.1.2 all costs, liabilities, damages and expenses
suffered or incurred by the Purchaser and/or the
relevant Target Group Company and which would not
have been suffered or incurred if the relevant
warranty had been true and accurate.
7.3.2 Interest will run on any amount due to the Purchaser under
Clause 7.2.1 at the Rate from the due date for payment
under that sub-Clause until the date upon which payment
in full has been made to the Purchaser (or as the case
may be, to the relevant Target Group Company, if
directed).
7.4 For the avoidance of doubt it is expressly agreed and declared that
save for the Disclosure Letter and the Second Disclosure Letter (if
any), no letter, document or other communication shall be deemed to
constitute a disclosure for the purposes of the Warranties. The
Purchaser acknowledges that it has had an opportunity to review all
documents listed in the annexures to the Disclosure Letter and the
Disclosure Bundle.
7.5 The Warrantor undertakes not to make and will procure (to the
extent that he is able) that no other person claiming under or
through him will make any claim against any Target Group Company or
any officer or employee of any Target Group Company on whom he may
have relied before entering into any term of this Agreement or the
Tax Deed or in the preparation of the Disclosure Letter or the
Second Disclosure Letter in respect of any claim under this
Agreement or any omission from or statement in the Disclosure
Letter or the Second Disclosure Letter.
7.6 Each of the Warranties shall be construed as separate and
independent and save as expressly otherwise provided shall not be
limited by reference to any other such Warranty or by anything in
this Agreement.
7.7 In determining damages for any breach of the Warranties the
Purchaser shall
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not be required to cease to conduct or to wind down any business or
to rely on the limited liability of any group company in mitigation
of its loss. The Purchaser hereby acknowledges that entering into
this Agreement it is not relying on any warranty, representation or
undertaking whatsoever and by whomsoever made save for the
representations, warranties and undertakings set out in this
Agreement.
7.8 Any payment made by any of the Majority Vendors to the Purchaser
under the Warranties, the Indemnities or under the Tax Deed or
otherwise by the Vendors under this Agreement will be treated as a
reduction by the amount so paid of the Consideration for the Sale
Shares.
8. DISCLOSURES AFTER SIGNING
8.1 The Warranties shall be deemed to be repeated immediately prior to
Completion with reference to the facts and circumstances then
existing but subject to any exceptions disclosed in the Second
Disclosure Letter delivered to the Purchaser by the Warrantor and
accepted by the Purchaser pursuant to Clause 8.2 (but without
prejudice to the Purchaser's rights under Clause 8.3 and subject
always to the limitations in Part 6 of the Schedule).
8.2 The Warrantor shall disclose to the Purchaser in terms of the
Second Disclosure Letter (with reasonably sufficient details to
enable the Purchaser to assess the impact thereof) as soon as
practicable after becoming aware of the same and in any event prior
to Completion any matter or thing which may arise after the date
hereof and before Completion which constitutes, or might reasonably
be expected to constitute a breach of any of the Warranties and in
respect of which, other than in respect of any matter referred to
in Clause 8.3, the Purchaser shall have no claim against the
Warrantor except to the extent of any additional liability (both as
to substance and quantum) beyond that disclosed in the Disclosure
Letter. For the avoidance of doubt, there shall be deemed to be
disclosed to the Purchaser any matters or things undertaken with
the prior written consent of the Purchaser and, notwithstanding
that
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they might otherwise constitute a breach of the Warranties or any
other provision of this Agreement, the provision of Clause 8.3
shall not apply in respect of any such matters.
8.3 In the event of any such matter or thing as is mentioned in Clause
8.2 being disclosed to the Purchaser before Completion which in any
such case is material in the context of the transactions
contemplated herein as a whole, then the Purchaser may at its sole
option:-
8.3.1 resile from this Agreement by notice in writing to the
Vendors in which case neither party shall have any
liability to the other hereunder; or
8.3.2 proceed to Completion in which case the Warrantor shall be
absolved from all liability he would otherwise have had in
respect of such matter or thing under the Warranties.
9. WARRANTIES BY THE PURCHASER AND WEATHERFORD, REGISTRATION RIGHTS; SHARE
PRICE PROTECTION
9.1 The Purchaser and Weatherford hereby jointly and severally warrant
and represent to the Vendors that as at the date of this Agreement
and as at Completion:
9.1.1 Organisation and Qualification. Each of Weatherford and
the Purchaser is a corporation, duly incorporated, validly
existing and in good standing under the laws of the
jurisdiction of its incorporation and has all requisite
corporate power and authority to own, lease and operate
its properties and to carry on its business as it is now
being conducted.
9.1.2 Articles of Incorporation; By-Laws. Weatherford has
furnished to the Vendors a complete and correct copy of
the Articles of Incorporation and the By-Laws, as amended
or restated, of each of Weatherford and the Purchaser.
Neither Weatherford nor the Purchaser is in violation of
any of the provisions of its Articles of
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Incorporation or By-Laws.
9.1.3 Capitalisation
9.1.3.1 As of the date of this Agreement, the authorised
capital stock of Weatherford consists of (i)
250,000,000 shares of Weatherford Common Stock
and (ii) 3,000,000 shares of preferred stock,
par value $1.00 per share.
9.1.3.2 At Completion or at the date of issuance in the
case of shares of Weatherford Common Stock
issued pursuant to Clause 9.3.1, such shares
will be duly authorised, validly issued, fully
paid and non-assessable and not subject to
adverse claims of third parties or pre-emptive
rights created by statute, Xxxxxxxxxxx'x
Articles of Incorporation or By-Laws or any
agreement to which Weatherford is a party or is
bound. Upon delivery of the Weatherford Shares
at Completion or at the date of issuance in the
case of shares of Weatherford Common Stock
issued pursuant to Clause 9.3.1, the Vendors
will own such shares free and clear of all
adverse claims.
9.1.4 Authority; Enforceability. Each of Weatherford and the
Purchaser has the requisite corporate power and authority
to execute and deliver this Agreement, the Registration
Rights Agreement and the Tax Deed, to perform its
obligations under each such agreement, and to consummate
the transactions contemplated by each such agreement. The
execution and delivery of this Agreement, the Registration
Rights Agreement and the Tax Deed by each of Weatherford
and the Purchaser, and the consummation by each of
Weatherford and the Purchaser of the transactions
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contemplated by each such agreement, have been duly
authorised by all necessary corporate action and no other
corporate proceedings on the part of Weatherford or the
Purchaser are necessary to authorise this Agreement, the
Registration Rights Agreement or the Tax Deed or to
consummate the transactions contemplated by each such
agreement. This Agreement, the Registration Rights
Agreement and the Tax Deed have each been duly executed
and delivered by each of Weatherford and the Purchaser
and, assuming the due authorisation, execution and
delivery by the Vendors, each constitutes a legal, valid
and binding obligation of Weatherford and the Purchaser,
enforceable against each of them in accordance with their
terms, subject to public policy limitations with respect
to the indemnification provided in the Registration Rights
Agreement.
9.1.5 No Conflict; Required Filings and Consents
9.1.5.1 The execution and delivery of this Agreement by
Weatherford and the Purchaser do not, and the
performance of this Agreement by Weatherford and
the Purchaser will not (i) conflict with or
violate the Articles or Certificate of
Incorporation or By-Laws or equivalent
organisational documents of Weatherford or the
Purchaser, or any resolution adopted by the
board of directors or stockholders of Weatherford
or the Purchaser, (ii) subject to (A) obtaining
consents, approvals, authorisations and permits
of, and making filings with or notification to,
any governmental or regulatory authority,
whether domestic or foreign ("Governmental
Entities"), pursuant to the applicable
requirements of any foreign or domestic federal,
state
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or local law, statute, ordinance, rule,
regulation, order, judgement or decree ("Laws")
or of any third party, and (B) obtaining the
consents, approvals, authorisations and permits
of, and making filings with or notifications to
any Governmental Entities pursuant to the
applicable requirements of Law, conflict with or
violate any Laws applicable to Weatherford, the
Purchaser or any of Xxxxxxxxxxx'x subsidiaries or
by which any of their respective properties is
bound or affected; or (iii) result in any breach
of or constitute a default (or an event that with
notice or lapse of time or both would become a
default) under, or to give to others any rights
of termination, amendments, acceleration or
cancellation of, or result in the creation of a
lien or encumbrance on any of the properties or
assets of Weatherford, the Purchaser or any of
Xxxxxxxxxxx'x subsidiaries pursuant to, any note,
bond, mortgage, indenture, contract, agreement,
lease, license, permit, franchise or other
instrument of obligation to which Weatherford,
the Purchaser or any of Xxxxxxxxxxx'x
subsidiaries is a party or by which Weatherford,
the Purchaser or any of Xxxxxxxxxxx'x
subsidiaries or any of their respective
properties is bound or affected, except for any
such matters described in clause (ii) or (iii)
that would not have a Weatherford Material
Adverse Effect.
9.1.5.2 Based in part on the representations by the
Warrantor, the execution and delivery of this
Agreement by Weatherford and the Purchaser do
not, and the
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performance of this Agreement by Weatherford and
the Purchaser shall not, require any prior
consent, approval, authorisation or permit of, or
filing with or notification to, any Governmental
Entities or other third party in addition to
those required to be disclosed in the Disclosure
Letter.
9.1.6 Reports; Financial Statements
9.1.6.1 Since 31 December 1999 Weatherford and its
subsidiaries have filed (i) all forms, reports,
statements, notices and other documents required
to be filed with the SEC (collectively, the
"Xxxxxxxxxxx SEC Reports"). The Xxxxxxxxxxx SEC
Reports were prepared in all material respects in
accordance with the requirements of applicable
laws (including the Securities Act and the
Securities Exchange Act of 1934, as amended, as
the case may be). As of their respective dates,
the Xxxxxxxxxxx SEC Reports did not contain any
untrue statement of a material fact or omit to
state a material fact required to be stated
therein or necessary to make the statements made
therein, in light of the circumstances in which
they were made, not misleading. Since the filing
of Xxxxxxxxxxx'x latest quarterly report on Form
10-Q, there has been no Weatherford Material
Adverse Effect that has not been disclosed
through press releases issued by Xxxxxxxxxxx or
in a current report filed with the SEC, in each
case prior to the date of this Agreement.
9.1.6.2 Each of the consolidated financial statements
(including, in each case, any related notes
thereto)
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contained in the Xxxxxxxxxxx SEC Reports (i) has
been prepared in all material respects in
accordance with the published rules and
regulations of the SEC and Generally Accepted
Accounting Principles ("GAAP") applied on a
consistent basis throughout the periods involved
(except (x) to the extent required by changes in
GAAP and (y) with respect of Weatherford SEC
reports filed prior to the date of this
Agreement, as may be indicated in the notes
thereto) and (ii) fairly presents the
consolidated financial position of Weatherford
and its subsidiaries as of the respective dates
thereof and the consolidated results of
operations and cash flows for the periods
indicated, except that (A) any unaudited
interim financial statements were or will be
subject to normal and recurring year-end
adjustments which were not or are not expected to
be material in amount and (B) any pro forma
financial information contained in such
consolidated Financial Statements is not or may
not be necessarily indicative of the consolidated
financial position of Weatherford and its
subsidiaries as of the respective dates thereof
and the consolidated results of operations and
cash flows for the periods indicated.
9.1.7 Completion; Disclosure. Each of the representations and
warranties set forth in this Clause 9 shall be deemed made
at and as of the date of this Agreement and at the date of
Completion except to the extent such representations and
warranties specifically refer to a date other than the
date of this Agreement.
9.1.9 Certain Proceedings. There is no pending Proceeding (as
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hereinafter defined) that has been commenced against
Xxxxxxxxxxx or the Purchaser, or against any of their
Officers, directors or stockholders in connection with the
affairs of Xxxxxxxxxxx or the Purchaser, and that
challenges, or may have the effect of preventing,
delaying, making illegal or otherwise interfering with,
any of the transactions contemplated by the Agreement
and/or the Registration Rights Agreement or that involves
material claims not disclosed in the Weatherford SEC
Reports against Xxxxxxxxxxx or its affiliates. To the
knowledge of Weatherford and the Purchaser, no such
Proceeding has been threatened. For the purposes of this
Agreement, a Proceeding means any action, binding
arbitration, audit, hearing, formal investigation,
litigation or suit (whether civil, criminal or
administrative) commenced, brought, conducted or
heard by or before any court, arbitrator, mediator or
governmental authority.
9.2 Xxxxxxxxxxx will register for resale all of the Xxxxxxxxxxx Shares
pursuant to the terms of the Registration Rights Agreement. If and
when paragraph (k) of Rule 144 under the Securities Act (or a
comparable provision of any successor rule) becomes applicable to
any Weatherford Shares that continue to be held by any Vendor, then
upon receipt of the certificates evidencing such shares,
Xxxxxxxxxxx will promptly deliver or cause to be promptly delivered
to such Vendor (or, if so instructed, to his assignees) new
certificates not bearing any legend restricting transfer.
9.3 Weatherford and the Purchaser agree to provide the Vendors with the
following price protection with respect to the Xxxxxxxxxxx Shares:
9.3.1 In the event that on the first anniversary of the
Completion Date ("the Protection Termination Date") the
Market Value (as hereinafter defined) of Weatherford
Common Stock is less than Fair Market Value per share
("the Floor Price"), (the difference
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between the Market Value and the Floor Price multiplied by
the number of Weatherford Shares held by the Vendors at
the Protection Termination Date being hereinafter referred
to as the "Deficiency"), Weatherford and the Purchaser
jointly and severally agree and undertake at the option
of each Vendor within five Business Days of the Protection
Termination Date, to either (1) issue to the Vendors or
their respective nominees an additional number of
registered shares of Weatherford Common Stock equal to the
Deficiency divided by the Market Value of the Xxxxxxxxxxx
Common Stock, which shares of Weatherford Common Stock
will be freely tradable on a national securities exchange
or otherwise without restrictions or (2) pay an amount of
cash equal to the Deficiency by wire transfer of same day
funds into such bank accounts as the Vendors may
respectively nominate in US dollars or at each Vendor's
option in pounds sterling converted at the average rate of
exchange over the ten Business Days preceding the
Protection Termination Date calculated using the Pound
Spot Closing mid-point rate published in the Financial
Times on the day in question (such share issuance or cash
payment being hereinafter referred to as an "Adjusted
Payment").
9.3.2 In the event that the Xxxxxxxxxxx Shares are not issued or
the cash not paid (as the case may be) to the Vendors in
respect of the Deficiency within five Business Days of the
later of (a) the date on which each Vendor gives notice
intimating whether he wishes his Adjusted Payment settled
in cash or (if applicable) Weatherford Shares and (b) the
Protection Termination Date, interest shall run on the
amount of the Deficiency at the Rate for the period from
the Protection Termination Date until the date of issuance
or payment (as the case may be).
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9.3.4 For the purpose of this Clause 9.3 "Market Value" means
the average closing sale price of Weatherford Common Stock
on the New York Stock Exchange for the ten consecutive
Business Days ending on the Protection Termination Date as
published in the Financial Times adjusted (if appropriate)
in accordance with sub-clause 9.3.5.
9.3.5 For purposes of this Clause 9.3, all references to Market
Value as of any date shall mean the sum of the Market
Value and the market value of any stock, securities or
other property or the amount of any cash that may have
been received by a Vendor or to which a Vendor is entitled
prior to or as of the date in question in respect of a
share of Weatherford Common Stock issued to him as
Consideration or Additional Consideration. The
determination of the market value of any such stock or
security shall be based on the closing sale price of that
stock or security on the principal stock exchange on which
it is listed if that security is traded on a national
securities exchange as reported in the Financial Times. If
any other security or property is received, its value
shall be determined by agreement by a nationally
recognised investment banking firm selected in good faith
by Weatherford. In the event of a reclassification of the
Xxxxxxxxxxx Common Stock into a greater or less number of
shares of Weatherford Common Stock, all references to
numbers of shares of Weatherford Common Stock and all
market prices for the Xxxxxxxxxxx Common Stock including
the Floor Price, shall be appropriately adjusted to
reflect such reclassification.
9.3.6 For purposes of this Clause 9.3, in the event there is a
distribution of any stock, securities, cash or other
property by Weatherford to the Xxxxxxxxxxx stockholders
(including the Vendors as holders
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of the Xxxxxxxxxxx Shares), the Floor Price shall be
reduced (except as may be reduced by the application of
Clause 9.3.5) by the market value (as of the distribution
date) of such stock, securities, cash or other property so
received by a Vendor in respect of a share of the
Xxxxxxxxxxx Common Stock issued to him at the Completion
Date.
9.4 In this Clause 9.4: (i) a "Registration Failure" means that the
Shelf Registration has not been declared effective by the SEC or
if, having been declared effective Weatherford has exercised its
right under the Registration Rights Agreement to suspend sales
under the Shelf Registration or a stop order has been issued by the
SEC or other proceedings are brought by the SEC any of which
prevent sales pursuant to the Shelf Registration on the applicable
Put Date; (ii) First Put Date means the date that is ninety days
after the Completion Date; (iii) Second Put Date means the date
that is one hundred and eighty days after the Completion Date; and
(iv) Third Put Date means the date that is two hundred and seventy
days after the Completion Date.
9.4.1 If a Registration Failure exists on the First Put Date
then each Vendor shall have the right and option
exercisable for thirty days after the First Put Date, to
compel the Purchaser and Weatherford to repurchase for
cash all or any portion of one-third of the Xxxxxxxxxxx
Shares received by such Vendor as Consideration or
Additional Consideration at a price per share equal to the
Floor Price plus a cash payment that is equal to interest,
calculated at the base rate from time to time of Bank of
Scotland plus 2%, from the Completion Date until paid, on
the amount that is equal to three times the aggregate
Floor Price of the shares as to which the option is
exercised.
9.4.2 If a Registration Failure exists on the Second Put Date,
then each Vendor shall have the additional right and
option exercisable for
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thirty days after the Second Put Date, to compel the
Purchaser and Weatherford to repurchase for cash all or
any portion of one-third of the Xxxxxxxxxxx Shares
received by such Vendor as Consideration or Additional
Consideration (or an additional one-third of such
Weatherford Shares where the Vendor has exercised the
right and option under Clause 9.4.1) at a price per share
equal to the Floor Price plus a cash payment that is equal
to interest, calculated at the base rate from time to time
of Bank of Scotland plus 2% from the Completion Date until
paid, on the amount that is equal to two times the
aggregate Floor Price of the shares as to which the
option is exercised.
9.4.3 If a Registration Failure exists on the Third Put Date,
then each Vendor shall have the right and option,
exercisable for thirty days after the Third Put Date, to
compel the Purchaser and Weatherford to repurchase for
cash all or any portion of one-third of the Xxxxxxxxxxx
Shares received by such Vendor (or an additional one-third
of such Weatherford Shares where the Vendor has exercised
the right and option under either or both of Clauses 9.4.1
and 9.4.2), at a price per share equal to the Floor Price
plus a cash payment that is equal to interest, calculated
at the base rate from time to time of Bank of Scotland
plus 2%, from the Completion Date until paid, on the
amount that is equal to the aggregate Floor Price of the
shares as to which the option is exercised.
9.4.4 Each option created by this Clause 9.4 in favour of a
Vendor is exercisable by written notice from such Vendor
to the Purchaser during the exercise period of such
option. If an option is exercised, the completion of the
purchase and sale of the shares shall occur on the fifth
Business Day thereafter. The Vendor shall
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deliver certificates representing the shares, duly
endorsed for transfer to Weatherford, against which
delivery Weatherford and the Purchaser shall pay the
amount due to the selling Vendor by wire transfer of same
day funds (to such bank account as may be designated by
such Vendor) in US dollars or at the option of the Vendor
in pounds sterling converted at the average rate of
exchange over the ten Business Days preceding the Put Date
in question calculated using the Pound Spot Closing
mid-point rate published by the Financial Times on the day
in question. In the event that any such payment is not
made timeously interest shall run on the total sum due at
the Rate from the due date for payment until settled in
full.
9.5 Weatherford hereby unconditionally and irrevocably agrees to cause
the Purchaser to comply with the Purchaser's whole obligations
under this Agreement and to be jointly and severally liable for the
performance by the Purchaser of its agreements and obligations
hereunder as if Weatherford were the primary party hereto and shall
not be discharged or otherwise impaired or prejudiced by any
assignation of the Purchaser's rights and/or obligations hereunder
pursuant to Clause 16.2 but shall continue in full force and
effect. Weatherford and the Purchaser, jointly and severally, will
indemnify the Vendors (or any of them) for any loss, damage, cost
or expense (including, without limitation, reasonable attorneys'
fees) incurred by any Vendor by reason of the failure of
Xxxxxxxxxxx or the Purchaser to comply with its agreements,
obligations, covenants or undertakings in this Agreement, the Tax
Deed and/or the Registration Rights Agreement or the inaccuracy,
breach or incorrectness of any warranty or representation of
Xxxxxxxxxxx or the Purchaser herein or therein.
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10. CLAIMS PROCEDURE
10.1 In the event of the Purchaser becoming aware of any claim or any
matter which may involve the Warrantor in liability for breach of
the Warranties or the Indemnities or in the case of a breach of any
of the Title Warranties, the Majority Vendors (in this Clause, a
"Claim"), the Purchaser will notify the relevant Majority Vendors
in writing as soon as reasonably practicable after becoming aware
of the same and shall provide reasonable details of the facts and
circumstances of the Claim as shall then be known to the Purchaser
provided that a failure to provide such notice shall not limit the
obligations of the Majority Vendors except to the extent they are
actually prejudiced.
10.2 In the case of a Claim resulting from a claim made or which may be
made by a third party (in this Clause, a "Third Party Claim") the
relevant Majority Vendors shall within 10 Business Days of having
received notice thereof pursuant to Clause 10.1 intimate in writing
to the Purchaser whether or not the relevant Majority Vendors
desire to conduct the defence of such Third Party Claim.
10.3 If the relevant Majority Vendors do not give timeous notice in
accordance with Clause 10.2, the relevant Majority Vendors shall be
deemed to have given notice in accordance with such Clause that
they do not wish to conduct the defence of such Third Party Claim.
Always provided that where the relevant Majority Vendors do not
give timeous notice in accordance with Clause 10.2 any dispute
relating to such Third Party Claim shall be conducted by the
Purchasers but the Purchaser shall keep the relevant Majority
Vendors informed on a reasonable basis as may be requested from
time to time.
10.4 If the relevant Majority Vendors have given timeous notice that the
relevant Majority Vendors desire to conduct the defence of a Third
Party Claim then:
10.4.1 the Purchaser shall and shall procure (to the extent then
within its power) that each Target Group Company shall take
such lawful action as the relevant Majority Vendors may
reasonably request to
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avoid, dispute, resist, appeal, compromise or defend the
Third Party Claim subject to the Purchaser and each Target
Group Company being specifically indemnified and secured to
their reasonable satisfaction against any Losses which they
or any of them may thereby incur;
10.4.2 the relevant Majority Vendors shall fully and effectually
indemnify and secure the Purchaser and each relevant Target
Group Company to its satisfaction against any and all Losses
which they may incur as a result of such Third Party Claim
and the defence thereof and hereby undertake that they shall
meet in full, without recourse to the Purchaser or any
Target Group Company, the full amount of such Third Party
Claim and the whole costs and expenses of the Purchaser and
the Target Group Company in defending the same including
without prejudice any professional or other costs incurred
by any or each of them in being advised with regard thereto;
10.4.3 the relevant Majority Vendors shall from time to time and
forthwith upon the request of the Purchaser keep the
Purchaser fully informed of the conduct of and any
negotiations relating to the defence of such Third Party
Claim.
10.5 If the relevant Majority Vendors have intimated or are deemed to
have intimated that they do not wish to defend any Third Party
Claim, the Purchaser and each relevant Target Group Company may
take such action as they see fit with regard thereto provided that,
although the relevant Majority Vendors shall not be deemed to have
admitted any liability to the Purchaser with regard to such Third
Party Claim subject as aforesaid, the liability of the relevant
Majority Vendors shall not be diminished or extinguished on the
grounds that the Purchaser or any Target Group Company took or
ought to have taken or omitted to take any action with regard to
such Third Party
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Claim
10.6 The Purchaser shall be entitled to refuse to allow the Majority
Vendors to take over the conduct of a Third Party Claim under
Clause 10.4, and shall be entitled to refuse to comply with a
request made by the Majority Vendors in relation to a Third Party
Claim if it is reasonable for the Purchaser to exercise such right
of refusal taking into account the likelihood of success of the
Third Party Claim and the protection of the goodwill of the Target
Group's business but to the extent that the Majority Vendors are
prejudiced by any such refusal they shall be relieved of the
liability which they would otherwise have had under the terms of
this Agreement provided that in the event that the relevant
Majority Vendor does not agree that it is reasonable for the
Purchaser to exercise such right of refusal on the basis of the
likelihood of success of the Third Party Claim the relevant
Majority Vendor and the Purchaser shall at the request of the
relevant Majority Vendor remit to a Queens Counsel (to be agreed by
the parties) the question of whether or not there is a reasonable
prospect of defending the Third Party Claim. In the event that such
Queens Counsel is of the opinion that there is a reasonable
prospect of successfully defending the Third Party Claim the
Purchaser will not be entitled to refuse to comply with the
relevant request on the grounds that defence is unlikely to
succeed. In the event that such Queens Counsel is of the opinion
that there is no reasonable prospect of successfully defending the
Third Party Claim the Majority Vendors will not be so relieved of
such liability.
10.7 For the avoidance of doubt, should the Purchaser fail to give
notice of a claim as soon as practicable as required by Clause
10.1, the relevant Majority Vendors shall (without prejudice to
paragraphs 5 to 7 of Part 6 of the Schedule) not be absolved or
released of liability but shall be entitled to claim a reduction
(up to 100%) in liability they would otherwise have, to the extent
that they are prejudiced by the delay of the Purchaser.
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11. TITLE WARRANTIES AND WARRANTY BY INSTITUTIONAL VENDOR
The provisions of Part 6 of the Schedule shall have effect in relation to
any Claim made by the Purchaser for a breach of the Warranties (other than
the Title Warranties).
11.1 Each of the Majority Vendors represents, warrants and undertakes to
the Purchaser in the terms of Part 5A of the Schedule.
11.2 The Institutional Vendor warrants to the Purchaser that it has the
capacity and authority and is entitled absolutely and
unconditionally to sell and transfer the full legal and beneficial
ownership of the Sale Shares set opposite its name in Part 1C of
the Schedule and that the Purchaser shall receive the Sale Shares
of the Institutional Vendor free and clear of any liens or
encumbrances.
12. PROTECTION OF GOODWILL
12.1 Xx Xxx Xxxxxx, Xx. Xxxxx Xxxxxx and Xxx. Xxxxxx hereby undertake to
the Purchaser with the intent of assuring to the Purchaser the full
benefit and value of the goodwill and connections of each of the
Target Group Companies and as a constituent part of the Agreement
for the sale of the Sale Shares that neither of them will and that
they will procure that none of their respective Connected Persons
will:
12.1.1 in the Territory for the period of five years next following
the date of this Agreement directly or indirectly and
whether for their own account or in partnership with another
or others or as agent for another or others engage in or be
concerned with or interested in (except as the holder for
investment of securities dealt on a stock exchange and not
exceeding 3% in nominal value of the securities of any
class) or provide financial, technical or other support to
any business which competes directly or seeks to compete
directly with any business carried on by any of the Target
Group Companies at the date of this Agreement. For the
purposes of this
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Clause 12 the parties agree that the business carried on by
the Target Group Companies at the date of this agreement
shall without prejudice to the foregoing generality be
deemed to include the following: fishing and oilfield tool
rental business, casing installation, wire line and coil
tubing, pipeline commissioning, power generation rental,
solids control and the manufacture, sale and rental of
drilling and fishing jars;
12.1.2 except to the extent required by law not at any time
following the date of this Agreement divulge to any person
or otherwise make use of any secrets, trade secrets,
confidential knowledge or information concerning the
business, finance or affairs of any of the Target Group
Companies.
12.1.3 (without prejudice to the generality of the provisions
contained in Clauses 12.1.1 and 12.1.2 of this Clause) for
the period of five years next following the date of this
Agreement directly or indirectly solicit, interfere with or
endeavour to entice away from any of the Target Group
Companies any person who is a director or employee of any
such company engaged in its management or the management of
any of its branches or in a sales capacity or otherwise in a
commercially sensitive position (whether or not such person
would commit any breach of his contract of employment or
engagement by reason of leaving the service of such company)
nor knowingly employ or aid or assist in or procure the
employment by any other person, firm or company of any such
person;
12.1.4 (without prejudice to the generality of the provisions
contained in Clause 12.1.1 and 12.1.2) for the period of
five years next following the date of this Agreement not do
any act or thing likely to have the effect of causing any
customer or any supplier of
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goods or services to any of the Target Group Companies or
other person in the habit of dealing with any of the Target
Group Companies to cease to deal with any of the Target
Group Companies either at all or in part or on the terms on
which he had previously dealt with any of the Target Group
Companies or likely to have the effect of causing any person
having a contract or arrangement with any of the Target
Group Company to breach, terminate or modify that contract
or arrangement;
12.1.5 not at any time following the Completion Date in connection
with any business use any of the names of any of the Target
Group Companies or the words "Xxxxxx", or "Offshore Rentals"
or "Marine Rentals" or any names or words similar to or
likely to be confused with them;
For the avoidance of doubt none of the foregoing restrictions shall
prevent or any or all of Xx. Xxx Xxxxxx, Xx. Xxxxx Xxxxxx or Xxx.
Xxxxxx from a shareholder and/or director and/or employee of the
Retained Group and/or B.S.W. Limited (Company Number 2894198)
having its Registered at Engineering Building, Lancaster
University, Bailrigg, Lancaster after provided that neither company
acts in such a way as would constitute breach of the provisions of
this Clause if it were bound by the terms hereof.
12.2 Each undertaking and agreement contained in this Clause 12 shall be
read and construed independently of the other undertakings and
agreements herein contained and if any undertaking or agreement is
held to be invalid whether as an unreasonable restraint of trade or
for any other reason the remaining undertakings and agreements
shall continue to apply to the extent that they shall not also be
held to be invalid and the undertaking or agreement which is held
to be invalid shall be referred by the parties to a Queen's Counsel
(to be agreed by the parties) whose opinion shall be sought
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as to what restriction (not imposing any wider restrictions on the
parties) would be legal and valid and the parties hereby agree that
such undertaking or agreement shall be altered accordingly, the
costs and expenses of the Queen's Counsel shall be borne equally by
the parties hereto.
12.3 Xx Xxx Xxxxxx, Xx. Xxxxx Xxxxxx and Xxx. Xxxxxx by their execution
hereof hereby agree that having regard inter alia to the price paid
by the Purchaser for the Sale Shares the restrictions contained in
this Clause are reasonable and necessary for the protection of the
legitimate interests of the Purchaser and that having regard to
those circumstances those covenants do not work harshly on them.
12.4 Xx Xxx Xxxxxx, Xx. Xxxxx Xxxxxx and Xxx. Xxxxxx hereby irrevocably
consent to the Purchaser furnishing particulars of this Agreement
to the UK Competition Authorities.
13. RELEASE OF LIABILITY AND GUARANTEES
13.1 The Majority Vendors hereby acknowledge and confirm that neither
they nor the Retained Group Company have a claim on any account
whatsoever against any member of the Target Group and hereby
irrevocably and with effect from Completion waive any such claim
which may hereafter be or become competent and/or available to
them.
13.2 The Majority Vendors undertake with the Purchaser to procure the
unconditional and complete release of each member of the Target
Group prior to Completion from all securities, charges, guarantees,
undertakings and indemnities whatsoever given by any member of the
Target Group in respect of any indebtedness or obligation
whatsoever of any of the Vendors or the Retained Group Company or
any of their Connected Persons.
13.3 The Institutional Vendor hereby acknowledges and confirms that it
does not have any claim against the Purchaser other than pursuant
to this Agreement or against any member of the Target Group other
than the Fixed Dividend payable on the Preference Shares in terms
of the Articles of Association of the
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Company for the period from 1 November 1999 up to but excluding the
Completion Date and the redemption monies payable on the Preference
Shares.
14. EFFECT OF COMPLETION
Any provision of this Agreement and any other documents referred to in it
which is capable of being performed after but which has not been performed
at or before Completion and all Warranties and the indemnities, covenants,
representations and undertakings (including for the avoidance of doubt the
warranties, representations and undertakings given by the Purchaser and
Weatherford in Clause 9) contained in or entered into pursuant to this
Agreement shall remain in full force and effect notwithstanding Completion.
15. REMEDIES AND WAIVERS
15.1 No delay or omission by any party in exercising any right, power or
remedy provided under this Agreement or any other documents
referred to in it shall:
15.1.1 impair such right, power or remedy; or
15.1.2 operate as a waiver thereof.
15.2 The single or partial exercise of any right, power or remedy
provided under this Agreement shall not preclude any other or
further exercise thereof or the exercise of any other right, power
or remedy.
16. ASSIGNATION
16.1 The rights of the Majority Vendors under this Agreement shall not
be assignable without the written consent of the Purchaser.
16.2 Without prejudice to the guarantee obligations of Weatherford in
terms of Clause 9.5 all of the rights and obligations of the
Purchaser under this Agreement and under the Tax Deed (the
"Rights") may be assigned by the Purchaser without the consent of
the Vendors provided that such assignee undertakes in writing to
the Vendors to be bound by and to perform all of the obligations of
the assignor under this Agreement.
16.3 The Rights shall if assigned to any member of the Purchaser's Group
or to any
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permitted assignee be enforceable by such parties in accordance
with the terms of this Agreement and the Tax Deed which shall be
entitled to the full benefit of any indemnity, warranty,
representation or undertaking in favour or expressed to be in
favour of the Purchaser but every such party shall be subject to
all limitations and restrictions on the Purchaser set out therein.
17. FURTHER ASSURANCE
The Majority Vendors shall from time to time, on being required to do so by
the Purchaser now or at any time in the future, do or procure that there is
done all such acts and/or execute or procure the execution of all such
documents in a form satisfactory to the Purchaser as they may reasonably
consider necessary for giving full effect to this Agreement and securing to
it the full benefit of the rights, powers and remedies conferred upon it in
this Agreement.
18. SPECIFIC INDEMNITIES
18.1 The Warrantor hereby undertake to indemnify and keep indemnified
the Purchaser (for itself and as agent and/or trustee for each
Target Group Company) from and against all actions, proceedings,
losses, damages, liabilities, claims, costs and expenses whatsoever
which may be sustained or suffered by the Purchaser and/or any
member of the Target Group in respect of:-
18.1.1 any indebtedness or obligation whatsoever of the Retained
Group Company and for which any Target Group Company may be
liable in whole or in part pursuant to any securities,
charges, guarantees, surety, undertakings or indemnities
given by any Target Group Company;
18.1.2 the amount of the Indebtedness exceeding the amount shown in
the Indebtedness Statement.
18.1.3 any claims against any member of the Target Group by Abacus
Trust Company (Isle of Man) ("Abacus") in respect of any
loan made by Abacus to any member of the Target Group or in
respect
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of any other matter whatsoever.
18.1.4 any claims made against any member of the Target Group by
any of the Non-Xxxxxx Shareholders arising directly as a
result of or in respect of the acquisition by the Purchaser
of the Company pursuant to this Agreement.
18.1.5 any assets the purchase price or part of the purchase price
for which is represented in the Capital Creditors not being
in the possession of or under the control of or leased out
by a Target Group Company or as a result of good title to
any such asset not being held by a Target Company.
18.1.6 all requirements, orders, awards, actions, claims and
demands made, sustained or incurred by, brought against the
Purchaser or the Target Group for itself or as trustee, as
the case may be in connection with the SSAS.
18.1.7 the following claims against members of the Target Group:-
(a) claim by Xxxxx International (North Sea) Limited
("Xxxxx") against Fishing Services Limited for
(pound)6,534.50;
(b) claim by Xxxxx against Wellserv plc for
(pound)26,496.00;
(c) claim by Xxxxx against Offshore Rentals Limited for
(pound)1,013,217.79;
(d) claim by Xxxxx against Mid-Europe Supply Limited for
(pound)36,283.05;
(e) claim by Gagie Corporation against Offshore Rentals
Limited for US$343,613;
(f) claim by Scottish Enterprise against Downhole
Technology Limited for (pound)175,000;
plus in each case all costs and expenses incurred by the
relevant members of the Target Group in connection with
such claims.
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19. SECURITIES LAW MATTERS
19.1 The Vendors recognise and understand that the Weatherford Shares
will not, except as expressly provided in the Registration Rights
Agreement, be registered under the U.S. Securities Act of 1933 (the
"Securities Act") or under the securities laws of any other
jurisdiction (the "Securities Laws"). The Weatherford Shares are
not being so registered in reliance upon exemptions from the
Securities Act and the Securities Laws which are predicated, in
part, on the representations, warranties and agreements of the
Vendors contained herein.
19.2 Each of the Vendors severally represents and warrants that (i) the
Vendor has business knowledge and experience, such experience being
based on actual participation therein, (ii) the Vendor is capable
of evaluating the merits and risks of an investment in the
Weatherford Shares and the suitability thereof as an investment
therefor and (iii) the Weatherford Shares to be acquired by the
Vendors will be acquired solely for investment and not with a view
toward resale or redistribution in violation of the Securities Act
or the Securities Laws, it being acknowledged that the Vendors will
have the right to resell the shares as provided in the Registration
Rights Agreement or under the Securities Act and any resale or
intended resale by them pursuant to the Registration Rights
Agreement or under the Securities Act will not be a breach of this
representation.
19.3 The Vendors acknowledge that the certificates representing the
Weatherford Shares will be imprinted with the following legend, the
terms of which are specifically agreed to:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, OR THE SECURITIES LAWS OF ANY JURISDICTION, IN RELIANCE UPON
EXEMPTION FROM REGISTRATION REQUIREMENTS. WITHOUT SUCH
REGISTRATION,
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SUCH SHARES MAY NOT BE SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED, EXCEPT UPON DELIVERY TO THE COMPANY OF AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT REGISTRATION IS
NOT REQUIRED FOR SUCH SALE, PLEDGE, HYPOTHECATION OR TRANSFER OR
THE SUBMISSION TO THE COMPANY OF SUCH OTHER EVIDENCE AS MAY BE
SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH SALE, PLEDGE,
HYPOTHECATION OR TRANSFER SHALL NOT BE IN VIOLATION OF THE
SECURITIES ACT OF 1933 OR APPLICABLE STATE SECURITIES LAWS OR ANY
RULE OR REGULATION PROMULGATED THEREUNDER.
Each Vendor understands and acknowledges that appropriate stop
transfer notations will be placed in the records of Weatherford and
with its transfer agents in respect of the Weatherford Shares to be
issued to the Vendors. Weatherford agrees that any Weatherford
Shares sold pursuant to an effective registration statement,
including a registration statement or the Shelf Registration filed
pursuant to the Registration Rights Agreement or under the
Securities Act, shall have the above legend removed to permit the
closing of the sale within Three Business Days of written notice of
the sale and certification by the Vendor that the sale was made
pursuant to the plan of distribution described in the registration
statement or the Shelf Registration and the prospectus delivery
requirements under the Securities Act were fully complied with in
connection with the sale.
20. NOTICES
20.1 All notices, requests, demands or other communications to or upon
the parties shall be in writing and shall be given by delivery or
by fax by being sent by first class recorded mail posted in the
United Kingdom:
20.1.1 in the case of the Purchaser and Weatherford to their
respective registered offices herein stated or to such other
address in the
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Xxxxxx Xxxxxxx as either of them may from time to time
notify to the Vendors for such purposes;
20.1.2 in the case of the Majority Vendors, it shall be sufficient
to serve notice on Xx. Xxx Xxxxxx at the address set out in
this Agreement or to such other address in the United
Kingdom as he may from time to time notify to the Purchaser
for such purposes;
20.1.3 in the case of the Institutional Vendor to the address set
out in this Agreement or such other address in the United
Kingdom as it may from time to time notify to the Purchaser
for such purpose.
20.2 Any such notice, request, demand or communication shall:
20.2.1 if delivered personally, be deemed to have been received at
the time of such delivery or if delivery is not on a
Business Day on the Business Day following such delivery;
20.2.2 if given by first class recorded mail posted in the United
Kingdom, be deemed to have been received on the second
Business Day occurring after the date of posting.
20.3 All notices or communications to the Purchaser shall be clearly
marked on the exterior and on the first page "For the urgent
attention of the Company Secretary" and shall be copied to the
Purchaser's Solicitors clearly marked on the exterior and on the
first page "For the urgent attention of Xxxxxxxx Xxxxx".
20.4 All notices or communications to any of the Majority Vendors or the
Warrantor shall be copied to Xxxxx & Williamsons, Xxxxxxxxxx Xxxxx,
0 Xxxxx Xxx, Xxxxxxxx, XX00 0XX and marked for the attention of
Xxxxxx Xxxxxx/Xxxxxxx X. Xxxxxx
20.5 All notices or communications to the Institutional Vendor shall be
copied to Ledingham Chalmers, Xxxxxxxxx Xxxxx, Xxxx Xxxxxx,
Xxxxxxxx and marked for the attention of Xxxxx Xxxxxx.
21. ANNOUNCEMENTS
Except as required by law or by the rules of any stock exchange or other
regulatory
38
36
authority or taxation authority, whether or not having the force of law no
announcement, disclosure or circular concerning or in connection with the
existence or the subject matter of this Agreement or any ancillary
transaction shall be made or issued by or on behalf of any party hereto
without the prior written consent of the others (which consent shall not be
unreasonably withheld).
22. COSTS AND EXPENSES
22.1 The parties shall each pay their own costs in connection with the
preparation and negotiation of this Agreement and in preparing and
negotiating this Agreement and any other documents referred to in
this Agreement. For the avoidance of any doubt the Purchaser shall
be responsible for payment of any stamp duty or equivalent tax or
levy in any other jurisdiction on this Agreement and on the
transfers of the Sale Shares to be effected hereunder.
22.2 The Majority Vendors represent and undertake to the Purchaser that
no costs or expenses relating to the sale of the Sale Shares have
been incurred, assumed or borne by any Target Group Company.
23. INVALIDITY
If at any time any provision of this Agreement is or becomes illegal,
invalid or unenforceable in any respect under the law of any jurisdiction,
that shall not affect or impair:
23.1 the legality, validity or enforceability in that jurisdiction of
any other provision of this Agreement; or
23.2 the legality, validity or enforceability under the law of any other
jurisdiction of that or any other provision of this Agreement.
24 GENERAL
Interest will run on any sums payable by the Majority Vendors under or in
connection with this Agreement at the Rate from the due date for payment
until paid.
25. ENTIRE AGREEMENT
This Agreement, the Tax Deed, the Disclosure Letter and the other documents
to be delivered at Completion in accordance with Part 3 of the Schedule
contain the entire
39
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agreement between the parties or any of them with respect to the
transactions contemplated in this Agreement and shall (save where there has
been a fraudulent misrepresentation) supersede all prior proposals,
representations, agreements and negotiations relating thereto, whether
written, oral or implied, between the parties or any of them or their
respective advisers or any of them and no modification or alteration of
this Agreement or the Tax Deed shall be enforceable except by an amendment
in writing duly executed by all the parties hereto or, in the case of a
waiver, duly executed by the party waiving compliance.
26. GOVERNING LAW AND JURISDICTION
This Agreement and the documents to be entered into pursuant to it shall be
governed by and construed in all respects in accordance with the law of
Scotland and each of the parties hereto hereby prorogates the non-exclusive
jurisdiction of the Court of Session as regards any claims or matters
arising hereunder: IN WITNESS WHEREOF these presents consisting of this and
the preceding thirty-six pages together with the Schedule extending to nine
Parts annexed hereto are executed as follows:-
SIGNED for and on behalf of the said
WEATHERFORD U.K. LIMITED at Aberdeen on
24th day of February 2001 by Xxxx Xxxxxxx
Xxxxxx, a Director of the Company this Witness:- /s/ Xxxx X. Xxxxxx
----------------------------
Director
Witness: (Sign) /s/ Xxxxx Xxxxxx Connan
-----------------------
Name: (PRINT) Xxxxx Xxxxxx Connan
Address: 0 Xxxxxx Xxxxxx, Xxxxxxxx
Occupation: Solicitor
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SIGNED for and on behalf of the said
3i GROUP PLC at Aberdeen on 24th day of
February 2001 by Xxxxxxx Xxxxx
Xxxx, as Attorney for 3i Group plc
before this Witness:- /s/ Xxxxxxx Xxxx
--------------------------------
Attorney
Witness: (Sign) /s/ Xxxxx Xxxxxx Connan
-----------------------
Name: (PRINT) Xxxxx Xxxxxx Connan
Address: 0 Xxxxxx Xxxxxx
Xxxxxxxx
Occupation: Solicitor
SIGNED for and on behalf of the said XXX
XXXXXXXXX XXXXXX TRUST by Xxx Xxxxxxxxx
Suttie and P&W Trustees
(Aberdeen) Limited at Aberdeen on
24th day of February /s/ Xxxxxx Xxxxxx
2001 before this Witness:- --------------------------------
AS ATTORNEY FOR XXX XXXXXXXXX SUTTIE
/s/ Xxxxxxx X. Xxxxxx, Director
Witness: (Sign) /s/ Xxxxx Xxxxxx Connan
-----------------------
Name: (PRINT) Xxxxx Xxxxxx Connan
Address: 0 Xxxxxx Xxxxxx
--------------------------------
Xxxxxxxx X&X TRUSTEES (ABERDEEN) LIMITED
Occupation: Solicitor
SIGNED by XXXXXX XXXXXX as Attorney for
the said XXXXX XXXXXXXX XXXXXX at
Aberdeen on 24th day of
February 2001 before this Witness:- /s/ Xxxxxx Xxxxxx
--------------------------------
AS ATTORNEY FOR XXXXX XXXXXXXX XXXXXX
Witness: (Sign) /s/ Xxxxx Xxxxxx Connan
-----------------------
Name: (PRINT) Xxxxx Xxxxxx Connan
Address: 0 Xxxxxx Xxxxxx
Xxxxxxxx
Occupation: Solicitor
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SIGNED by XXXXXX XXXXXX as Attorney for
the said XXXXXXX XXXXXXXXX XXXXXX at /s/ Xxxxxx Xxxxxx
Aberdeen on 24th day of February ---------------------------------
2001 before this Witness:- AS ATTORNEY FOR XXXXXXX XXXXXXXXX XXXXXX
Witness: (Sign) /s/ Xxxxx Xxxxxx Connan
-----------------------
Name: (PRINT) Xxxxx Xxxxxx Connan
Address: 0 Xxxxxx Xxxxxx
Xxxxxxxx
Occupation: Solicitor
SIGNED by the said XXX XXXXXXXXX
SUTTIE at Aberdeen on 24th day of February 2001
before this Witness:- /s/ Xxxxxx Xxxxxx
---------------------------------
AS ATTORNEY FOR XXX XXXXXXXXX SUTTIE
Witness: (Sign) /s/ Xxxxx Xxxxxx Connan
-----------------------
Name: (PRINT) Xxxxx Xxxxxx Connan
Address: 0 Xxxxxx Xxxxxx
Xxxxxxxx
Occupation: Solicitor
42
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SIGNED for and on behalf of the said
XXXXXXXXXXX INTERNATIONAL, INC. by
Xxxx Xxxxxxx Xxxxxx, an Officer /s/ Xxxx X. Xxxxxx
at Aberdeen on 24th day of February ---------------------------------
2001 before this Witness:- Director
Witness: (Sign) /s/ Xxxxx Xxxxxx Connan
-----------------------
Name: (PRINT) Xxxxx Xxxxxx Connan
Address: 0 Xxxxxx Xxxxxx
Xxxxxxxx
Occupation: Solicitor
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THIS IS THE SCHEDULE IN 9
PARTS REFERRED TO IN THE
FOREGOING SALE AND PURCHASE
AGREEMENT AMONG XXXXXXXXXXX
U.K. LIMITED, 3i GROUP PLC,
XXX XXXXXX AND OTHERS AND
XXXXXXXXXXX INTERNATIONAL,
INC. DATED 24 FEBRUARY 2001
SCHEDULE
PART 1A
TARGET GROUP STRUCTURE
TARGET GROUP STRUCTURE
GROUP COMPANIES %OWNED BY TARGET
--------------- ----------------
Communication Rentals Limited 100%
Design Engineering Limited 61%
Downhole Technology Limited 100%
Drill-Xxxxxx Limited 50.1%
Fishing Services Limited 100%
Independent Integrated Services Limited 100%
International Petroleum Equipment Limited 61%
International Petroleum Equipment
Norge A/S 100%
Intervention Well Systems Limited 100%
Mid-Europe Supply Limited 100%
Xxxxxxxx XxXxxx Associates Limited 100%
Offshore Rentals Limited 100%
Offshore Rentals Norge A/S 100%
Offshore Rentals Deutschland GmbH 100%
Xxxxxx International (Oil & Gas)
Nigeria Limited 85%
BOSS Oilfield Services Limited 50%
Offshore Rentals Dubai LLC 47.6%
Powerflo (Rentals) Dubai LLC 47.6%
Xxxxxx Production Services Limited 100%
Xxxxxx Group Venezuela CA 100%
Xxxxxx Engineering Company Limited 100%
Powerflo Rentals Limited 75%
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Powerflo Rentals Norge A/S 100%
Powerflo Systems Limited 100%
PowerGen Rentals Limited 100%
Pump Rentals (International) Limited 100%
Quality Commissioning Limited 100%
Recovery Systems Limited 100%
Tank Rentals plc 80%
Wellserv plc 87%
Integrated Well Services Limited 33.33%
45
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SCHEDULE
PART 1B
THE TARGET
NAME: Xxxxxx Group plc
NUMBER: SC160645
DATE OF INCORPORATION: 26th September 1995
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxx Xxxx Xxxx, Xxxxxx,
Xxxxxxxx, XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)515,910
SHARE CAPITAL:
Issued: 355,910 ordinary shares of(pound)1.00 each
135,000 A ordinary shares of(pound)1.00 each
1,875,000 preference shares of(pound)0.01 each
DIRECTORS: Xxxxxx Xxxxxxxx
Xxx Xxxxxxx
Xxx X Xxxxxx
Xxxxxxx X. Xxxxxx
Xxxxxxx Xxxxxx Xxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE
DATE: 30 April
AUDITORS: Deloitte & Touche
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44
SCHEDULE
PART 1C
SHAREHOLDINGS IN TARGET
(1) (2) (3) (4) (5)
SHAREHOLDER ADDRESS CLASS OF SHARE NUMBER HELD PERCENTAGE OF
CONSIDERATION
------------ ------------------ -------------- ------------- -------------
3i Group PLC 00 Xxxxxxxx Xxxx, X Xxxxxxxx 135,000 27.50
Xxxxxx XX0 0XX
Preference 1,875,000*
Xxxxx Xxxxxxxx Xxxxxx 00 Xxxxxx Xxxxx, Xxxxxxxx 12,275 2.50
Xxxxxxxx XX0 0XX
Xxxxxxx Xxxxxxxxx Xxxxxx "Parklea", North Ordinary 63,750 13.00
Xxxxxxx Xxxx,
Xxxxxxxx, XX00 0XX
Xxx Xxxxxxxxx Xxxxxx "Parklea", North Ordinary 272,885 55.58
Xxxxxxx Xxxx,
Xxxxxxxx, XX00 0XX
Xxx Xxxxxxxxx Suttie and "Parklea", North Ordinary 7,000 1.42
P&W Trustees (Aberdeen) Deeside Road, ------
Ltd as trustees of Ian A Xxxxxxxx, XX00 0XX
Suttie Trust 100%
===
* To be redeemed immediately prior to Completion.
47
45
SCHEDULE
PART 2A
THE UK SUBSIDIARIES
NAME: BOSS Oilfield Services Limited
NUMBER: SC195226
DATE OF INCORPORATION: 14.4.99
REGISTERED OFFICE: Xxxxxxxxxx Xxxxx, 0 Xxxxx Xxx, Xxxxxxxx, XX00 0XX
AUTHORISED AND ISSUED Authorised:(pound)100
SHARE CAPITAL: Issued: 2 Ordinary Shares of(pound)1
DIRECTORS: Xxx X. Xxxxxx
Xxxxxx X. Xxxxx
Xxxxxxx X. Xxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: None
SHAREHOLDER: 50% subsidiary of Offshore Rentals Limited
50% subsidiary of Xxxxx International (North Sea)
Limited
NAME: Communication Rentals Limited
NUMBER: SC176534
DATE OF INCORPORATION: 18.6.97
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised:(pound)10,000
SHARE CAPITAL: Issued: 10,000 ordinary shares of(pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
48
46
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Design Engineering Limited
NUMBER: SC190479
DATE OF INCORPORATION: 21.10.98
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised:(pound)10,000
SHARE CAPITAL: Issued: 101 ordinary shares of(pound)1
DIRECTORS: Xxx X. Xxxxxx
Xxxxx C.O. Xxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of The Governor and
Company of the Bank of Scotland
SHAREHOLDER: 61% subsidiary of Xxxxxx Group PLC (62 shares)
39% held by X. Xxxxx (39 shares)
NAME: Downhole Technology Limited
NUMBER: SC157994
DATE OF INCORPORATION: 15.5.95
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)100
SHARE CAPITAL: Issued: 2 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
49
47
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Drill-Xxxxxx Limited
NUMBER: SC169830
DATE OF INCORPORATION: 8.11.96
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised:(pound)1,000
SHARE CAPITAL: Issued: 1,000 ordinary shares of(pound)1
DIRECTORS: Xxx X. Xxxxxx
Xxxx X. Xxxxxxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Bond and Floating Charge in favour of the Governor
and Company of the Bank of Scotland
SHAREHOLDER: 50.1% subsidiary of Xxxxxx Group PLC (501 shares)
49.9% held by Xxxx X. Xxxxxxxxxx (499 shares)
NAME: Fishing Services Limited
NUMBER: SC153760
DATE OF INCORPORATION: 21.10.94
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised:(pound)10,000
SHARE CAPITAL: Issued: 2 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
50
48
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Independent Integrated Services Limited
(formerly Powerflo Rentals Limited)
NUMBER: SC136260
DATE OF INCORPORATION: 29.1.92
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)100
SHARE CAPITAL: Issued: 100 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: International Petroleum Equipment Limited
NUMBER: SC126025
DATE OF INCORPORATION: 5.7.90
REGISTERED OFFICE: Xxxxxxxxxx Xxxxx, 0 Xxxxx Xxx, Xxxxxxxx, XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)100,000
SHARE CAPITAL: Issued: 101 ordinary shares of (pound)1
51
49
DIRECTORS: Xxx X. Xxxxxx
Xxxxx C.O. Xxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 61% subsidiary of Xxxxxx Group plc (62 shares)
39% held by F Friis (39 shares)
NAME: Intervention Well Systems Limited
NUMBER: SC075514
DATE OF INCORPORATION: 10.7.81
REGISTERED OFFICE: Xxxxxxx, Xxxxx Xxxxxxx Xxxx, Xxxxxxxx
AUTHORISED AND ISSUED Authorised: (pound)100
SHARE CAPITAL: Issued: 100 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Mid-Europe Supply Limited
NUMBER: SC133467
DATE OF INCORPORATION: 16.8.91
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)254,650
52
50
SHARE CAPITAL: Issued: (pound)124,778 A ordinary shares of (pound)1
(pound)129,872 B ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Xxxxxxxx XxXxxx Associates Limited
NUMBER: SC115632
DATE OF INCORPORATION: 16.1.89
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)500,000
SHARE CAPITAL: 499,900 ordinary shares of (pound)1
100 'A' ordinary shares of (pound)1
Issued: 9,999 ordinary shares of (pound)1
1 'A' ordinary share of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Bond and Floating Charge in favour of the Governor
and Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
53
51
NAME: Offshore Rentals Limited
NUMBER: SC109985
DATE OF INCORPORATION: 22.3.88
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)300,000
SHARE CAPITAL: Issued 165,000 ordinary shares of (pound)1
135,000 'B' ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge and Standard Security in favour of
Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Oilwell Production Services Limited
NUMBER: SC158568
DATE OF INCORPORATION: 12.6.95
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)10,000
SHARE CAPITAL: Issued: 100 Ordinary Shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
54
52
NAME: Xxxxxx Engineering Company Limited
NUMBER: 427621
DATE OF INCORPORATION: 14.1.47
REGISTERED OFFICE: Xxxx Xxxx Xxxx, Xxxxx Xxxxxxxx, Xx Xxxxxxxxxxx,
X00 0XX
AUTHORISED AND ISSUED Authorised: (pound)5,000
SHARE CAPITAL: Issued: 4,800 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
Xxxx X. Xxxxx
Xxxxxxxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Debenture in favour of the Governor and Company of
the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Powerflo Rentals Limited (formerly Pump Rentals
(International) Limited
NUMBER: SC140356
DATE OF INCORPORATION: 23.9.92
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)165,000
SHARE CAPITAL: Issued: 158,996 ordinary shares of (pound)1
DIRECTORS: Xxx Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
55
53
SHAREHOLDER: 75% subsidiary of Xxxxxx Group PLC (119,247 shares)
25% held by Xxxxx X. Xxxxxx (39,749 shares)
NAME: Powerflo Systems Limited (formerly Woma (UK)
Limited)
NUMBER: 1237504
DATE OF INCORPORATION: 15.12.75
REGISTERED OFFICE: Xxxx Xxxx Xxxx, Xxxxx Xxxxxxxx, Xx Xxxxxxxxxxx,
X00 0XX
AUTHORISED AND ISSUED Authorised: (pound)10,000
SHARE CAPITAL: Issued: 9,000 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
Xxxxxx X. Xxxxx
Xxxxxxxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Debenture in favour of the Governor and Company of
the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: PowerGEN Rentals Limited (formerly Harran
Engineering Limited)
NUMBER: SC129021
DATE OF INCORPORATION: 14.12.90
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)55,000 'A' ordinary shares of
(pound)1
SHARE CAPITAL: (pound)67,000 ordinary shares of
(pound)1
Issued: 55,000 'A' ordinary shares of (pound)1
67,000 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
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ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Bond and Floating Charge in favour of the Governor
and Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Pump Rentals (International) Limited (formerly
Marischal Industrial Services Limited)
NUMBER: SC067835
DATE OF INCORPORATION: 10.8.79
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED (pound)100
SHARE CAPITAL: 100 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Bond and Floating Charge in favour of the Governor
and Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Quality Commissioning Limited
NUMBER: SC160639
DATE OF INCORPORATION: 26.9.95
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)100
SHARE CAPITAL: Issued: 2 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
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55
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Recovery Systems Limited
NUMBER: SC162923
DATE OF INCORPORATION: 26.1.96
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)100
SHARE CAPITAL: Issued: 80 'A' ordinary shares of (pound)1
20 'B' ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 100% subsidiary of Xxxxxx Group PLC
NAME: Tank Rentals PLC
NUMBER: SC125694
DATE OF INCORPORATION: 19.6.90
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)300,000
SHARE CAPITAL: Issued: 300,000 ordinary shares of (pound)1
DIRECTORS: Xxx X. Xxxxxx
Xxx. Xxxxxxx X. Xxxxxx
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SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Floating Charge in favour of the Governor and
Company of the Bank of Scotland
SHAREHOLDER: 80% subsidiary of Xxxxxx Group PLC (240,000 shares)
20% held by Xxx X. Xxxxxx (60,000 shares)
NAME: Wellserv plc
NUMBER: SC107585
DATE OF INCORPORATION: 12/11/87
REGISTERED OFFICE: Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx,
XX00 0XX
AUTHORISED AND ISSUED Authorised: (pound)50,000
SHARE CAPITAL: Issued: 125,000 ordinary shares of (pound)0.40
DIRECTORS: Xxx X. Xxxxxx
Xxxxx Xxxxx
SECRETARY: Xxxxx & Williamsons
ACCOUNTING REFERENCE DATE: 30 April
AUDITORS: Deloitte & Touche
CHARGES: Bond and Floating Charge in favour of the Governor
and Company of the Bank of Scotland
SHAREHOLDER: 87% subsidiary of Xxxxxx Group plc (108,750 shares)
13% held by X. Xxxxx (16,250 shares)
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PART 2B
THE NON-UK SUBSIDIARIES
NAME: Offshore Rentals Norge A/S
NUMBER: 948138735
DATE OF INCORPORATION: 30.06.1988
REGISTERED OFFICE: Norsea Xxxx 0, Xxxxxxx, 0000 Xxxxxxxxx, Xxxxxx
AUTHORISED AND ISSUED Authorised: NOK 50,000
SHARE CAPITAL: Issued: 50 shares of NOK 1,000
DIRECTORS: Xxx Xxxxxx
Xxxxx Xxxxx
SECRETARY: N/A
SHAREHOLDER: Offshore Rentals Limited (100%)
TAX JURISDICTION: Norway
NAME: Offshore Rentals Deutschland GmbH
NUMBER: HRA5640
DATE OF INCORPORATION: 02.08.2000
REGISTERED OFFICE: Xxxxxxxx 0, X-00000 Xxxxx, Xxxxxxx
AUTHORISED AND ISSUED Authorised: 25,000 Euros (DM50,000)
SHARE CAPITAL: Issued: 25,000 Euros (DM50,000)
DIRECTORS: Xxx Xxxxx
SECRETARY: Xxxxxxx Thonigs
SHAREHOLDER: Xxx Xxxxxx (100%)
TAX JURISDICTION: Germany
NAME: Offshore Rentals Dubai LLC
NUMBER: 42968
DATE OF INCORPORATION: 27.07.1994
REGISTERED OFFICE: N/A
AUTHORISED AND ISSUED Authorised: UAE Dirhams 300,000
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SHARE CAPITAL: Issued: 300 shares of UAE Dirhams 1,000 each
DIRECTORS: Xxx Xxxxxx
SECRETARY: N/A
SHAREHOLDER: Khalifa Nasser Khalifa Bel Habala (157 shares)
Offshore Rentals Limited (143 shares)
TAX JURISDICTION: United Arab Emirates
NAME: Powerflo Rentals (Dubai) LLC
NUMBER: 46777
DATE OF INCORPORATION: 09.05.1996
REGISTERED OFFICE: N/A
AUTHORISED AND ISSUED Authorised: UAE Dirhams 300,000
SHARE CAPITAL: Issued: 300 shares of UAE Dirhams 1,000 each
DIRECTORS: Xxx Xxxxxx
SECRETARY: N/A
SHAREHOLDER: Khalifa Nasser Khalifa Bel Habala (157 shares)
Offshore Rentals Limited (143 shares)
TAX JURISDICTION: United Arab Emirates
NAME: Powerflo Rentals Norge A/S
NUMBER: 977 298 997
DATE OF INCORPORATION: 23.12.1996
REGISTERED OFFICE: Norsea Xxxx 0, Xxxxxxx, 0000 Xxxxxxxxx, Xxxxxx
AUTHORISED AND ISSUED Authorised: NOK 100,000
SHARE CAPITAL: Issued: 1,000 shares of NOK 100
DIRECTORS: Xxx Xxxxxx
SECRETARY: N/A
SHAREHOLDER: Xxxxxx Group plc (100%)
NAME: International Petroleum Equipment Norge A/S
NUMBER: 962136206
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DATE OF INCORPORATION: 08.11.1999
REGISTERED OFFICE: Norsea Xxxx 0, Xxxxxxx, 0000 Xxxxxxxxx, Xxxxxx
AUTHORISED AND ISSUED Authorised: NOK 1,000,000
SHARE CAPITAL: Issued: 10,000 shares of NOK 100 each
DIRECTORS: Xxx Xxxxxx
SECRETARY: Xxxxx Xxxxx
SHAREHOLDER: International Petroleum Equipment Limited (100%)
TAX JURISDICTION: Norway
NAME: Xxxxxx International (Oil & Gas) Nigeria Limited
NUMBER: RC378477
DATE OF INCORPORATION: 12.04.00
REGISTERED OFFICE: 00x Xxxxx Xxxxxx Xxxxxx, Xxxxxxxx Xxxxxx, Xxxxx,
Xxxxxxx
AUTHORISED AND ISSUED Authorised: N 5,000,000
SHARE CAPITAL: Issued: N 5,000,000
DIRECTORS: Xxx Xxxxxx
Femi Omatayo
Xxxxxx Xxxxxxxx
SECRETARY: N/A
SHAREHOLDER: Offshore Rentals Limited - 4,250,000 shares (85%)
Femi Omatayo - 375,000 shares (7.5%)
Xxxxxx Xxxxxxxx - 375,000 shares (7.5%)
TAX JURISDICTION: Nigeria
NAME: Xxxxxx Group De Venezuela CA
NUMBER: RIF: J304920377
NIT: 0047164346
DATE OF INCORPORATION: 25.11.1997
REGISTERED OFFICE: Xxxxxxx Xxxxxxxxxxxx, XX Xxxxxxx Xxxxx, Xxxx 0,
Xxxxxxx 1, Xxxx
Xxxxxx 0000, Xxxxxxxxx, P O Xxx 00,
Xxxxxx Xxxxxxxxxx, Xxxxxxxxx
00
00
AUTHORISED AND ISSUED 2,000,000 VEB
SHARE CAPITAL:
DIRECTORS: Xxx Xxxxxx
Xxx Xxxxxxx Xxxxxx
Xxxxxxx Xxxxx
Xxxxxx Xxxxxxxx
Xxx Xxxxxxx
SECRETARY: N/A
SHAREHOLDER: Xxxxxx Group plc (100%)
TAX JURISDICTION: Xxxxxxxxx
00
00
SCHEDULE
COMPLETION OBLIGATIONS
PART 3
1. The Majority Vendors shall procure payment by the Company to the
Institutional Vendor of the fixed dividend accrued on the Preference Shares
for the period from 1 November 1999 up to but excluding the Completion Date
together with the sum of (pound)1,875,000 in redemption of the Preference
Shares, the total amount to be paid by telegraphic transfer or such other
form of electronic transfer as the Institutional Vendor may reasonably
require to such bank account as may be notified to the Majority Vendors'
Solicitors by the Institutional Vendor.
2. The Majority Vendors shall on Completion (subject to performance by the
Purchaser and Weatherford of their respective obligations under paragraph 4
below) deliver to the Purchaser:
2.1 duly executed transfers in favour of the Purchaser of the Sale Shares
held by them together with the share certificates for such Sale
Shares (or in the case of any lost certificate an indemnity in the
Agreed Form in relation to it);
2.2 duly executed transfers (for no consideration) and share certificates
in respect of the Minority Interests in favour of the Purchaser.
2.3 irrevocable powers of attorney of the Majority Vendors in the Agreed
Form;
2.4 a counterpart of the Tax Deed duly executed by Xx. Xxx Xxxxxx;
2.5 the seals, certificates of incorporation (and, if applicable,
certificates of incorporation on change of name) and statutory books
of each of the UK Companies duly written up to date;
2.6 a counterpart of the Disclosure Letter duly executed by the
Warrantor;
2.7 to the extent not already in the possession of the relevant Target
Group Company, all bank books, cheque books and bank statements,
sales ledgers, statutory books and other books of account relating to
the business of each Target Group Company;
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2.8 written resignations and releases in the Agreed Form from Xx. Xxx
Xxxxxx resigning as director of the Target Group Companies and as
employee of the Target and releasing the Target Group from all claims
and rights of action whether by way of compensation, remuneration,
redundancy payment or otherwise.
2.9 written resignations and releases in the Agreed Form from Xx. Xxx
Xxxxxxx and Xxx. Xxxxxx resigning their offices as directors of the
Target and releasing the Target from all claims and rights of action
for loss of office.
2.10 written resignations and releases in the Agreed Form from the
Majority Vendors' Solicitors resigning office as secretary of each
Target Group Company in respect of which they hold that office.
2.11 the Indebtedness Statement.
2.12 a fully executed Deed of Amendment and Succession relating to the
SSAS in a form to be agreed.
3. On Completion the Majority Vendors shall cause board meetings of each
Target Group Company to be held at which:
3.1 persons nominated by the Purchaser shall be appointed as additional
or replacement directors and/or secretaries (as the case may be);
3.2 all existing bank mandates shall be revoked and new mandates in
relation to each account maintained by a Target Group Company (giving
authority to such persons as the Purchaser may require) shall be
approved;
3.3 the transfers referred to in paragraphs 2.1 and 2.2 shall (subject
only to stamping) be approved;
4 The Institutional Vendor shall (subject to performance by the Majority
Vendors of their obligations under paragraph 1 above and the Purchaser and
Weatherford of their respective obligations under paragraph 5 below) at
Completion deliver to the Purchaser:
4.1 duly completed and signed transfers in favour of the Purchaser in
respect of the Sale Shares held by the Institutional Vendor together
with share
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certificates for such Sale Shares (or in the case of any lost
certificate an indemnity in the Agreed Form in relation to it);
4.2 proxy in favour of the Purchaser in the Agreed Form;
4.3 an acknowledgement of receipt of the fixed dividend due on the
Preference Shares;
4.4 a counterpart of the Registration Rights Agreements duly executed by
the Institutional Vendor.
5. Upon completion of the matters specified in paragraphs 1, 2, 3 and 4 the
Purchaser shall:
5.1 deliver to the Warrantor a counterpart of the Tax Deed duly executed
by the Purchaser;
5.2 deliver to the Warrantor a counterpart of the Second Disclosure
Letter duly executed by the Purchaser;
5.3 deliver to the Vendors certified copy board minutes of the Purchaser
and Weatherford approving the entry into and performance of this
Agreement;
5.4 cause there to be issued to the Vendors the Weatherford Shares in
such name or names as may be requested in writing by the Vendors and
shall deliver certificates to the Majority Vendors' Solicitors on
behalf of the Vendors.
5.5 deliver to the Majority Vendors and the Institutional Vendor two
counterparts (one for each) of the Registration Rights Agreement duly
executed by the Purchaser and Xxxxxxxxxxx.
5.6 the Consultancy Agreement in the Agreed Form duly executed by the
Purchaser.
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SCHEDULE
PART 4
FORM OF INDEBTEDNESS STATEMENT
PROJECT OMEGA
INDEBTEDNESS STATEMENT
Consideration =(pound)189,655,000 minus (the "Indebtedness" minus
(pound) 1,750,000)
(pound)
----------
Headline Price 189,655,000
Indebtedness
Bank overdraft and loans
(per Appendix A) [ o ]
Debt factoring --
Acceptance on documentary credits --
Debentures --
Loans --
Loan Stocks (per Appendix B) [ o ]
Bonds, notes, bills of exchange --
HP commitments (per Appendix C) [ o ]
Finance Leases --
Discounted debts --
Preference Shares Redemption [ o ]
Preference Dividend [ o ]
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Others -- [ o ]
---------
Agreed deduction from Indebtedness (pound)1,750,000 [ o ]
---------------------------------------
Consideration [ o ]
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SCHEDULE
PART 5
WARRANTIES
PART 5A - TITLE WARRANTIES
1. CAPACITY AND TITLE WARRANTIES
1.1 The Sale Shares constitute the entire issued share capital of the
Target and each of the Majority Vendors is entitled (in the case of
the Trustees in their capacity as trustees) to sell and transfer the
full legal and beneficial ownership in their respective Sale Shares
to the Purchaser on the terms set out in this Agreement.
1.2 The information set out in Parts 1 and 2 of the Schedule is true and
accurate in all respects.
1.3 Each of the Majority Vendors has the necessary power, authority and
capacity to enter into and perform this Agreement and (in the case of
Xx Xxx Xxxxxx only) the Tax Deed respectively and this Agreement
constitutes valid and binding obligations of each of the Majority
Vendors in accordance with its terms.
1.4 The execution and delivery of, and the performance by the Majority
Vendors (or any of them) of their obligations under this Agreement
will not:-
(a) result in a breach of, or constitute a default under, any
instrument to which the Majority Vendors (or any of them) are a
party or by which the Majority Vendors are bound; or
(b) result in a breach of any order, judgement or decree of or
undertaking to any court or Government Body to which the Majority
Vendors (or any of them) are bound.
1.5 There is no option, right to acquire, restriction, mortgage, charge,
pledge, lien or other form of security or encumbrance or other form
of agreement (whether present, future, conditional or otherwise)
(including conversion
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rights and rights of pre-emption) on, over or affecting any of their
Sale Shares (or any unissued shares, debentures or other securities
of any of the members of the Target Group) or the right of the
Majority Vendors (or any of them) to transfer their Sale Shares and
there is no agreement or commitment to give or create any of the
foregoing, and no claim has been made by any person to be entitled to
any of the foregoing.
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PART 5B - GENERAL WARRANTIES
2. THE ACCOUNTS
2.1 The Accounts comply with the requirements of the Companies Acts and all
relevant statutory instruments, have been prepared in accordance with
applicable UK accounting standards and give a true and fair view of the
assets and liabilities and financial results of the Target Group at the
Accounts Date and of its results for the financial period ending on the
Accounts Date.
2.2 All redundant and obsolete stock (which expression includes raw materials
and work in progress) as at the Accounts Date Was wholly written off in the
Accounts, all items of stock which are unsaleable or which are the subject
of any dispute with a supplier or customer were wholly written off in the
Accounts; any slow-moving stock included in the Accounts was written down
appropriately; the value attributed to the remaining stock included in the
Accounts did not exceed the lower of cost or net realisable value as at the
Accounts Date; and the stock included in the Accounts was in the aggregate
saleable in the ordinary course of trading at not less than the value shown
in the Accounts.
3. ACCOUNTING RECORDS
All the accounts, books, ledgers and other financial records of whatsoever
kind of the members of the Target Group (including, without limitation, all
invoices and other records required for any Taxation purposes) have been
properly maintained, are in the possession of the members of the Target
Group and contain reasonably accurate records of all matters required to be
entered in them by the Companies Acts.
4. MANAGEMENT ACCOUNTS
4.1 The Management Accounts were prepared in accordance with generally
accepted accounting principles and practices, applied on a consistent
basis with the Accounts have been prepared on a consistent basis with
the management accounts of the Target Group for the twelve months
ended on the Accounts Date, and disclose with reasonable accuracy the
state of affairs
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of the Target Group as at the Management Accounts Date and of their
results for the period to which the Management Accounts relate.
4.2 Adequate provisions for all actual and contingent liabilities which
are known and all financial commitments in existence at the
Management Accounts Date have been made in the Management Accounts.
4.3 All revenue costs were accrued so as to match them as closely as
possible to the related income and provided in the Management
Accounts to the extent of the accrual as at the Management Accounts
Date.
5. NET ASSETS
5.1 The value of the fixed assets and rental assets of the Target Group in the
Management Accounts was determined in accordance with the same accounting
policies as those applied in the Accounts (and on the basis that each of
such assets are valued at a figure no greater than the value attributed to
them in the Accounts or in the case of any of such assets acquired by the
members of the Target Group after the Accounts Date at a figure no greater
than the lesser of cost and net realisable value) and (other than in
respect of depreciation) is not less than their value on the Accounts Date
as shown in the Accounts.
5.2 (a) The net working capital (as defined below) of the Target Group as at
the Completion Date will not be less than Eighty Million Pounds
((pound)80,000,000) on the basis that the items included in such net
working capital to be valued as at the Completion Date will be
determined in accordance with the same accounting policies and
principles as applied in the preparation of the management accounts
as at 30 November 2000.
(b) For the purposes of this Clause 5.2 the expression "net working
capital" shall mean as follows:-
(c) Rentals Assets, Stock, Trade Debtors, VAT receivable, other Debtors,
Bank Balances less Creditors: and for this purpose "Creditors" shall
mean Trade creditors, VAT payable, PAYE/NI, Hire purchase contracts
and Other
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creditors, as such expressions are used in the said management
accounts as at 30 November 2000.
(d) For the foregoing purpose in relation to net working capital as at
the Completion Date there shall be excluded the effect of
depreciation on Rental Assets and Stock.
(e) Any deficiency resulting from the terms of paragraph (a) above shall
entitle the Purchaser to recover the amount of the deficiency from
the Warrantor and for the purpose of this paragraph (e) the
provisions of paragraph 2. of Part 6 of the Schedule shall not apply.
6. TARGET GROUP STRUCTURE
6.1 Other than interests in any other member of the Target Group the
members of the Target Group do not have, have never had and have not
agreed to acquire any interest in the share or loan capital of any
body corporate.
6.2 Other than in the ordinary course of business the members of the
Target Group are not and have not at any time been and have not
agreed to become partners in any partnership or members of any
unincorporated association or consortium and are not and have not at
any time been and have not agreed to become a party to any joint
venture or joint project or enterprise and have not entered into any
agreement or arrangement pursuant to which they are required to share
gross or net receipts, gross or net income or any profits or gains
with any other person.
6.3 The members of the Target Group are not and have not agreed to become
members, officers or shadow directors of any body corporate and nor
do they have any liability or potential liability as former members,
officers or shadow directors of any body corporate, partnership or
unincorporated association, nor are there any circumstances which
such liability could arise.
6.4 The members of the Target Group do not have any branch, agency or
place of business or any assets outside the United Kingdom.
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7. INFORMATION SUPPLIED
7.1 To the best of the Warrantors' knowledge and belief the acquisition
of the Sale Shares by the Purchaser:-
(a) will not cause any of the members of the Target Group to lose the
benefit of any right or privilege it presently enjoys or cause
any person who normally does business with any of the members of
the Target Group not to continue to do so on the same basis as
previously; and
(b) will not result in any present or future indebtedness of any of
the members of the Target Group becoming due and payable or
capable of being declared due and payable prior to its otherwise
stated maturity; and
so far as the Warrantors are aware (having made no enquiry) the
attitude or actions of clients, customers, employees and suppliers
with regard to the members of the Target Group will not be
prejudicially affected thereby.
8. EVENTS SINCE THE ACCOUNTS DATE
Since the Accounts Date:-
8.1 the businesses of the members of the Target Group have been carried
on in the ordinary and usual course without any interruption and so
as to maintain the businesses of the members of the Target Group as
going concerns; and
8.2 there has been no adverse change in the financial or trading position
of the Target Group; and
8.3 the members of the Target Group have not acquired or disposed of any
assets or assumed or incurred any commitment or any liabilities
(whether actual or contingent) except in the ordinary and usual
course of trading; no contract, commitment, obligation, arrangement
or transaction has been entered into and no payment has been made by
any of the members of the Target Group otherwise than in the ordinary
course of carrying on its business and on normal commercial terms;
and
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8.4 the members of the Target Group have not entered into any capital
transaction as vendor, purchaser, lessor or lessee or otherwise
undertaken any commitment exceeding (pound)15,000,000 in aggregate;
and
8.5 no dividends, bonuses or other distributions have been declared, paid
or made and no management charges, directors fees or similar have
been paid or made by any of the members of the Target Group; and
8.6 no share or loan capital of any of the members of the Target Group
has been issued, redeemed, purchased or repaid by the members of the
Target Group; and
8.7 there has been no change in the policy or procedures by which any of
the members of the Target Group collects its debts, no debtor has
been released by any of the members of the Target Group on terms that
he pays less than the face value of his debt and no debt has proved
to any extent irrecoverable; and
8.8 the members of the Target Group have paid their creditors in the
ordinary and usual course of their trading.
9. TITLE TO AND CONDITION OF ASSETS
9.1 All assets owned, held or used by the members of the Target Group are
legally and beneficially owned by the members of the Target Group
free from any mortgage, charge, lien or other encumbrance save for
the assets disclosed as such in the DISCLOSURE LETTER as being held
under an agreement for leasing, hire, hire purchase or purchase on
conditional sale terms and all such assets are under the exclusive
control of the members of the Target Group; the list of rental assets
to be delivered pursuant to Clause 2.1.4 will disclose all rental
assets owned by the Target Group at Completion excluding such rental
assets as have been disposed of after 31 December 2000 in the
ordinary course of business or acquired by the Target Group after 31
December 2000.
9.2 No option, right to acquire, mortgage, charge, pledge, lien (other
than a lien arising by operation of law in the ordinary course of
trading) or other form of
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security or encumbrance or equity on, over or affecting the whole or
any part of the undertaking or assets of any of the members of the
Target Group is outstanding and there is no agreement or commitment
to give or create any of the foregoing and no claim has been made by
any person to be entitled to any of the foregoing.
9.3 To the best of the Warrantors' knowledge and belief the members of
the Target Group have not received any sum, property or benefit the
payment or transfer of which is liable to be avoided, or which is
liable to be recovered from them, under any rule of law and do not
hold any sum, property or right as nominee, trustee or constructive
trustee.
9.4 Each member of the Target Group owns or has a contractual right to
use all of the assets used to carry on its business in the manner in
which it is currently carried on and each member of the Target Group
has a contractual right to use all services and facilities it uses to
carry on its business in the manner in which it is currently carried
on.
9.5 All assets owned or used by the members of the Target Group which are
subject to a requirement of licensing or registration of ownership,
possession or use are duly licensed or registered in the sole names
of the members of the Target Group.
9.6 9.6.1 Drillpipe during the 5 year period ending on the
Completion Date has been purchased in the majority of
cases to meet or exceed the requirements of Shell Squair
specification. Where it has not, the drillpipe has been
subject to the highest level of Inspection, for example TH
Hills DS-1 Category 05. All Drill Collars and Heviwate
purchased, is inspected in accordance with the highest
applicable standard in accordance with TH Hills DS-1
Categories 3 through to 5. Minimum Tong and Pin lengths
are in accordance with DS-1 Category 5.
9.6.2 All drill collars and heviwate drillpipe purchased by any
member
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of the Target Group during the five year period ending on
the Completion Date have been subject to a minimum
inspection level of TH Hills DS-1 Category 3. All such
drill collars and heavy weight drillpipe have material
certification and mechanical property values meeting Shell
Squair stipulated requirements. All tubing purchased new
by any member of the Target Group during the five year
period ending on the Completion Date has been manufactured
in accordance with API 5CT (Specification for Casing and
Tubing) and has full material traceability.
9.6.3 All tubing owned by members of the Target Group is
inspected in accordance with API 5A5, (Field Inspection of
New Casing, Tubing & Plain End Drill Pipe) as standard.
9.6.4 Material Certification record, for drillpipe owned by the
Target Group, are available for not less than 90%.
9.6.5 All hoisting equipment owned by the Target Group is
inspected in accordance with API RP 8B (Procedures for
Inspections, Maintenance, Repair and Re-Manufacture of
Hoisting Equipment). Such equipment was purchased to the
standard 8C.
9.6.6 All non tubular drilling equipment is dimensionally
inspected in accordance with API 7K and for magnetic
particle inspection in accordance with ASTM E709.
9.6.7 BOP Equipment is inspected and tested in accordance with:-
o API 6A (Specification for Wellhead & Christmas Tree
Equipment)
o API 6D (Specification for Pipeline Valves (Gate, Ball
and Check Valves))
o API 16A (Specification for Drill Through Equipment)
o API 16D (Specification for Control Systems for
Drilling Well Control Equipment)
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o API 53 (Blowout Prevention Equipment Systems for
Drilling Xxxxx)
10. DEBTORS
10.1 No part of the amounts shown in the books or accounts of the members
of the Target Group in respect of debtors is represented by debts
which are more than three months old or by debts arising otherwise
than in the ordinary course of the members of the Target Group's
business and so far as the Warrantors are aware there are no
circumstances which indicate that any of the debts owing to the
members of the Target Group at the date hereof may prove to be
irrecoverable.
10.2 No single debtor, taken together with any Connected Person of that
debtor, owes any of the members of the Target Group an amount or
amounts in aggregate greater than 10% of the total of all debts owing
to any of the members of the Target Group.
11. BANKING AND FINANCE
11.1 The members of the Target Group have no bank, building society or
other similar accounts other than those specified in the DISCLOSURE
LETTER and true and accurate details of those accounts of the UK
Companies at close of business on the last banking day preceding the
date hereof are set out in the DISCLOSURE LETTER; the Non-UK
Companies have no facilities to overdraw their respective bank
accounts.
11.2 Neither any of the members of the Target Group nor any other person
has given or undertaken to give any security or guarantee for any
liability of any of the members of the Target Group other than (a)
guarantees under contracts with customers given in the ordinary and
usual course of trading by the Target in support of other members of
the Target Group and (b) cross corporate guarantees given to Bank of
Scotland.
11.3 The members of the Target Group are not responsible for the
indebtedness of any other person (not being a member of the Target
Group), and in particular
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but without prejudice to the generality of the foregoing are not
parties to any option or pre-emption right or a party to any
guarantee or suretyship or any other obligation to pay, purchase or
provide funds for the payment of any indebtedness of any other person
(not being a member of the Target Group).
12. INSURANCE
12.1 Particulars of all insurances maintained by any of the members of the
Target Group are attached to the DISCLOSURE LETTER, and all premiums
on all policies of insurance have been duly and punctually paid.
12.2 No claims are outstanding under any of the members of the Target
Group's insurances and so far as the Warrantors are aware, no
circumstances have arisen which may give rise to any claim under the
members of the Target Group's insurances.
12.3 The members of the Target Group have not failed to disclose any
material fact to any of their insurers or done or omitted to do any
act or thing which may entitle the members of the Target Group's
insurers to avoid liability under any of the members of the Target
Group's policies of insurance or which may render any of them void or
voidable.
12.4 All the assets of the members of the Target Group of an insurable
nature are and have at all material times been insured with reputable
insurers in amounts representing their full replacement or
reinstatement value against all risks normally insured against by
prudent persons carrying on a similar business to that carried on by
the members of the Target Group.
12.5 The members of the Target Group are and have in all material times
been adequately insured against accident, damage, third party loss
and (with the exception of loss of profits) other risks normally
insured against by prudent persons carrying on similar businesses to
that carried on by the members of the Target Group.
12.6 Details of the claims record of the Target Group for the last 3 years
are attached to the DISCLOSURE LETTER.
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13. EMPLOYEES
13.1 Save as set out in the DISCLOSURE LETTER the members of the Target
Group are not parties to any written service agreements with any of
their directors nor to any consultancy agreements or management
services agreements or arrangements with any person nor to any
contract for services to be provided to any of the members of the
Target Group.
13.2 There are no contracts of service with employees (whether or not in
writing) which cannot be terminated by the members of the Target
Group by three months' notice or less without giving rise to any
claim for damages or compensation (other than a statutory redundancy
payment or statutory compensation for unfair dismissal) or any
payment under or pursuant to their contracts of service and the
members of the Target Group have not given or received notice of
resignation from any employees earning a salary in excess of
(pound)50,000 per annum.
13.3 The schedule of employees annexed to the DISCLOSURE LETTER contains
accurate and complete particulars of each employee's name, job
description, current remuneration, age, sex, date of commencement of
continuous employment (for the purposes of the Employment Rights Act
1996) and pension scheme membership and save as set out in the
Disclosure Letter:-
(a) there are no other employees of the Target Group Companies;
(b) there are no terms and conditions of employment for any employee
other than the members of the Target Group's written standard
terms and conditions of employment as annexed to the DISCLOSURE
LETTER;
(c) no employee receives or is entitled (contingently or otherwise)
to receive any bonus or commission, variable remuneration,
insurance, benefit in kind, motor vehicle for private use or
other reward other than monetary wages or salary at a fixed rate
or any participation rights in any equity of any member of the
Target
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Group;
(d) no employee is a member of any trades union or staff association;
13.4 The members of the Target Group have not offered or agreed to
increase the remuneration or benefits of or to alter any of the terms
and conditions of employment of any employee.
13.5 No employee earning a salary in excess of (pound)50,000 per annum has
given notice of termination of his contract of employment or is under
notice of termination or dismissal and no arrears of salary, wages,
holiday pay or any other liability of any kind (including, without
limitation, redundancy payments or compensation or awards under any
employment legislation or regulation or for wrongful or unfair
dismissal) in respect of any employee or former employee are
outstanding or remain to be discharged.
13.6 There are no outstanding disputes, claims or legal proceedings
between any members of the Target Group and any of the employees or
former employees of the members of the Target Group, no such dispute
is pending or threatened and there are no circumstances which may
give rise to any such dispute, claim or proceedings.
13.7 The members of the Target Group are not involved in any industrial or
trade dispute or any dispute or negotiation with any trade union or
association of trade unions or organisation or body of employees, and
there are no circumstances likely to give rise to any such dispute.
13.8 There is not outstanding any offer of a contract of employment,
consultancy or other contract of services from a member of the Target
Group to any person for a remuneration (excluding benefits) in excess
of (pound)50,000 per annum.
14. CONTRACTS AND ARRANGEMENTS
14.1 The members of the Target Group are not parties to or bound by any
contracts or obligations, practices, arrangements or agreements
(hereinafter collectively referred to as arrangements) outside the
ordinary course of
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business.
14.2 No event or omission has occurred or been permitted to arise (nor
will Completion constitute such an event) which would entitle any
third party to terminate prematurely any contract to which any of the
members of the Target Group are parties or call in any money or
enforce any obligation before the date on which payment or
performance would normally be due.
14.3 The members of the Target Group have not entered into any
arrangements or agreements with any customer on terms materially
different to their standard terms of business as attached to the
DISCLOSURE LETTER.
14.4 The members of the Target Group have complete and accurate records in
all respects of the terms of all material contracts to which they are
parties or by which they are bound.
14.5 The terms of all contracts of the members of the Target Group have
been complied with by the members of the Target Group in all material
respects and so far as the Warrantors are aware there are no
circumstances likely to give rise to a default by the members of the
Target Group or by the other parties under any such contract.
14.6 There are no outstanding claims in an amount in excess of
(pound)50,000 in aggregate for all claims against any of the members
of the Target Group on the part of customers or other parties in
respect of defects in quality or delays in delivery or completion of
contracts or deficiencies of design or performance or otherwise
relating to liability for goods or services sold or supplied by any
of the members of the Target Group and so far as the Warrantors are
aware no such claims have been threatened or are anticipated and
there is no matter or fact in existence in relation to goods or
services currently sold or supplied by any of the members of the
Target Group which might give rise to the same.
14.7 The members of the Target Group have no knowledge of the invalidity
of or grounds for rescission, avoidance or repudiation of any
agreement or other
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transaction to which any of the members of the Target Group is a
party and have received no written notice of any intention to
terminate, repudiate or disclaim any such agreement or other
transaction.
14.8 No members of the Target Group are parties to nor bound by any
arrangements of a long term nature being those which cannot be
terminated by the relevant member of the Target Group on three months
notice or less.
14.9 No members of the Target Group are party to any arrangements for the
purchase by a member of the Target Group of any fixed assets which
arrangements remain outstanding as at the Completion Date.
14.10 There are no arrangements between a member of the Target Group and
any of the Vendors or any Connected Person of any of the Vendors.
15. COMPETITION AND FAIR TRADING
15.1 None of the acts, omissions, practices, agreements or arrangements of
any Group Company:-
(a) has infringed or infringes in any material respect any law,
legislation or regulation (civil or criminal) relating to
competition, restrictive trade practices, anti-trust, monopolies,
merger control, fair trading or restraint of trade in any part of
the world ("Competition Law") or may result in action being taken
by any supra-national, governmental or quasi-governmental body or
court;
(b) has been or should be or should have been registered with or
notified to any supra-national, governmental or
quasi-governmental body or court under Competition Law or liable
to result in action by any supra-national, governmental or
quasi-governmental body or court as a result of failure to
register or notify;
(c) is or has been the subject of any investigation, inquiry,
proceedings, report or reference under Competition Law and
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there are no facts known to the Warrantor which are likely to
give rise to any of the foregoing;
(d) is void or unenforceable in whole or in any material respect by
reason of Competition Law.
15.2 There is no undertaking or assurance given to any body or court which
is binding on Group Company relating to any of the matters listed in
paragraph (a) of the preceding warranty nor has such undertaking or
assurance been requested and Group Company has not breached and is
not in breach of any such undertaking or assurance.
15.3 There is no act, notice, decision or order of any body or court which
is binding on Group Company (other than public general legislation)
relating to Competition Law and Group Company has not breached in any
material respect and is not in any material respect in breach of any
such act, notice, decision or order.
15.4 The entering into and implementation of this Agreement is not a
breach by any Group Company of or in relation to any Group Company
prohibited by or as far as the Warrantor is aware (but without any
enquiry) likely to result in action by any body or court against any
Group Company in relation to Competition Law.
16. GRANTS
No grants, subsidies and allowances have been applied for or received by
any of the members of the Target Group from the European Communities or any
governmental, quasi-governmental or other body (save for any of which full
particulars are disclosed in the DISCLOSURE LETTER) and there are no
grounds upon which any such grant, subsidy or allowance or any part thereof
could be liable to be repaid or recovered whether by reason of completion
of this Agreement or otherwise.
17. INSIDER MATTERS
17.1 There is no contract, arrangement or understanding to which any of
the members of the Target Group is a party or by which it is bound
which is not
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on normal commercial terms.
17.2 The financial position of the members of the Target Group and their
results as appearing from the Accounts or the Management Accounts
were not affected by any transaction, contract or arrangement not on
normal commercial terms.
17.3 Neither the Warrantors nor any Connected Persons of the Warrantors,
either individually or collectively, or with any other person or
persons, have any estate, right or interest, directly or indirectly,
in any business which is or is likely to be or become competitive
with the business of any of the members of the Target Group or any
part thereof as carried on at the Completion Date.
18. LICENCES AND CONSENTS
No licences, consents, permissions or approvals from any governmental or
quasi-governmental bodies or courts other than those which are disclosed in
the DISCLOSURE LETTER are held or are required to hold the assets of the
members of the Target Group or for the proper and effective carrying on of
their businesses and all reports, returns and information required by law
or as a condition of any licence, consent, permission or approval have been
given or made to the appropriate person or authority and all appropriate
fees paid and there is no circumstance known to the Warrantors (whether
arising from the acquisition of the Sale Shares by the Purchaser or
otherwise) which indicates that any licence, consent, permission or
approval is likely to be suspended, cancelled or revoked or not renewed on
expiry.
19. LEGAL REQUIREMENTS
19.1 The members of the Target Group have at all times performed and
observed all material requirements of all applicable laws, statutes,
statutory instruments, regulations, orders, contracts, agreements,
licences or obligations of whatsoever nature which affect any of the
members of the Target Group or the operation of any of the members of
the Target Group's business.
19.2 So far as the Warrantor is aware no member of the Target Group nor
any Employee or former employee or any officer or former officer of
any member of the Target Group has made or received any sensitive
payment.
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For the purposes of this Warranty the expression "sensitive payment"
shall include (i) receipts from, or payment to, central or local
government officials or employees or (ii) commercial bribes or (iii)
amounts received with an understanding that rebates or refunds will
be made in contravention of the laws of any jurisdiction either
directly or through a third party, or (iv) political contributions.
20. LITIGATION AND DEFAULTS
The members of the Target Group are not subject to any outstanding
judgements, orders or decrees of any court or any undertaking to any court,
judicial authority or supra-national, governmental or quasi-governmental
body or any outstanding arbitration award; no injunction or interdict has
been granted against any of the members of the Target Group; there are no
civil, criminal or arbitration proceedings in progress or pending against
any of the members of the Target Group or against any person for whose acts
or defaults the members of the Target Group is or may be vicariously liable
and there are no facts known to the Warrantors likely to give rise to any
such proceedings.
21. INSOLVENCY
21.1 No order has been made or petition presented or resolution passed for
the winding-up or administration of any of the members of the Target
Group, nor are there any grounds on which any person would be
entitled to have any of the members of the Target Group wound up or
placed in administration, nor has any person threatened to present
such a petition or convened or threatened to convene a meeting of any
of the members of the Target Group to consider a resolution to wind
up any member of the Target Group or any other resolutions, nor has
any step been taken in relation to any of the members of the Target
Group under the law relating to insolvency or the relief of debtors
in any part of the world.
21.2 No diligence, distress, execution or other process has been used or
levied on any asset owned or used by any of the members of the Target
Group, nor (so
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far as the Warrantors are aware) has any person threatened any such
diligence, distress, execution or other process.
21.3 No person has appointed or (so far as the Warrantors are aware)
threatened to appoint or become entitled to appoint an administrative
or other receiver of any of the members of the Target Group's
business or assets or any part of them.
21.4 The members of the Target Group are not apparently insolvent and have
not ceased trading or stopped payment to their creditors and there
are no grounds on which any of the members of the Target Group could
be found to be unable to pay its debts for the purposes of section
123 of the Insolvency Xxx 0000.
22. CUSTOMERS AND SUPPLIERS
22.1 No substantial customer, sub contractor or supplier of any of the
members of the Target Group has in the two years ended on the date of
this Agreement ceased or indicated an intention to cease trading or
dealing with, utilising the services of or supplying any of the
members of the Target Group and there are no facts known to the
Warrantors which are likely to make any such loss imminent nor is any
substantial customer, sub contractor or supplier expected to make any
substantial reduction in trading or dealing with, utilising the
services of or making supplies to any of the members of the Target
Group after the date of this Agreement (for which purposes a customer
shall be deemed substantial if in any year in the three years ended
on the Accounts Date it has purchased ten per cent or more in value
of the services provided by the Target Group in that year or bought
five per cent or more in value of the goods supplied by the Target
Group in that year and a supplier shall be deemed substantial if in
any year in the two financial years ended on the Accounts Date it has
supplied ten per cent or more of the goods or services purchased by
the Target Group in that year).
22.2 There is included in the Disclosure Letter a list of the ten largest
customers of
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the Target Group showing the turnover attributable to such customers
during the twelve month period ending on the Management Accounts
Date.
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PART 5C - PENSION WARRANTIES
1. PENSIONS
Apart from the Pension Schemes, the Personal Pension Contributions and the
Life Scheme, the Target Group does not contribute to or participate in and
is not in any way responsible for any retirement benefits, pension or life
assurance scheme or arrangement within the meaning of s612 of the 1988 Act,
fund or personal pension scheme whether in the United Kingdom or overseas
relating to any of its present or past directors or Employees and save as
aforesaid no Target Group Company is under any legal or ex gratia
obligation to provide a retirement, death or disability, accident or
sickness pension or payments to or in respect of any such director or
Employee or person claiming through them. No proposal has been announced or
implied to establish or contribute to any other such scheme or fund.
2. DISCLOSURE OF INFORMATION
2.1 All relevant particulars of the Pension Schemes and the Life Scheme
have been disclosed, including without prejudice to the generality of
the foregoing:-
2.1.1 all trust documentation or insurance policy documentation, all
booklets and announcements made to members, endorsements and
details of insurance premiums, and a complete list of the
assets of the Pension Schemes;
2.1.2 full membership data including details of eligibility criteria
for membership;
2.1.3 the record of contributions paid over the previous year
detailing rates of contribution by the Target Group and
Employees;
2.2 all of this information which has been made available to the
Purchaser or its advisers is true in all material respects and
accurately describes benefits provided and the costs of such benefits
to the Target Group.
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3. ESTABLISHMENT
3.1 The Pension Schemes and the Life Scheme are established under
irrevocable trust and comply and have at all times complied with all
applicable primary and secondary legislation relative to occupational
and personal pension schemes including the 1993 Act, the 1995 Act and
the Financial Services Xxx 0000.
3.2 The Life Scheme and the Wellserv Schemes are exempt approved schemes
under Chapter I of Part XIV of the 1998 Act for the purposes of the
PSO and there is no reason why such approval should be withdrawn. The
Group Personal Pension Plan is approved under Chapter IV of Part XIV
of the 1988 Act.
3.3 A PSO letter of approval of the Pension Schemes is held by the
trustees of the Pension Schemes and no event or transaction has taken
place in relation to the Pension Schemes whose validity is dependent
on the approval of the PSO without that approval having been
obtained.
3.4 None of the Pension Schemes is contracted out of the state earnings
related pension scheme although members of the Group Personal Pension
Plan may elect to contract out on an individual basis.
3.5 The Wellserv Scheme is closed and the costs of administration and
winding up of this scheme are either paid from the assets of the
scheme or are fully provided for in the Target Group's accounts. No
Target Company has any outstanding, pending or future liability or
commitment to make contributions or payments for expenses or costs
relating to the Wellserv Scheme.
4. FINANCE AND INVESTMENT
4.1 The trustees of the Occupational Schemes have legal title to and
physical possession of or control over all of the assets of the
Occupational Schemes. There are no encumbrances over any of the
assets of the Occupational Schemes.
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4.2 All employer and Employee contributions and premiums due at the date
of this Agreement to the trustees of the Pension Schemes or any
insurance company have been deducted and paid to the trustees (or
insurance company, if applicable) within the prescribed period under
the 1995 Act and in accordance with the schedule of contributions or
payment schedule.
4.3 There are no loans in existence from the Occupational Schemes to any
Target Group Company or to any Member or beneficiaries of the
Occupational Schemes or to any third party and as at the date of this
Agreement none of the assets of the Occupational Schemes is an
employer related investment within the meaning of section 40 of the
0000 Xxx.
4.4 Apart from lump sum benefits on death in service, benefits quantified
by reference to a level of pay are not and have never been provided
by or promised through the Pension Schemes.
4.5 Each participating employer of the Pension Schemes and the Life
Scheme has been party to a valid Deed of Adherence which has at all
times been complied with in all material respects and its
participation in the Pension Schemes and the Life Scheme has been
approved by the PSO.
5. EXERCISE OF DISCRETION
5.1 Apart from as disclosed none of the Target Group, the Warrantor or
the Pension Schemes' or Life Scheme's trustees have given
undertakings or assurances to the Members beneficiaries under the
Pension Schemes or Life Scheme or Employees as to the introduction,
continuance, increase or improvement of any retirement, death or
disability benefits or as to the announcement of any benefit on the
happening of a given set of circumstances.
5.2 No discretion has been exercised under the Pension Schemes or Life
Scheme to provide a benefit which would not otherwise already be
provided for under the Pension Schemes or Life Scheme, to waive any
standard eligibility conditions, to augment or provide new benefits
or to refuse admission to an
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Employee or director who would otherwise be eligible to join the
Pension Schemes or Life Scheme or to alter the payment of expenses or
contributions by any Target Group Company.
5.3 Neither employees of the Target Group who have been made redundant
nor officers of the Target Group who have been removed from office
are, or have been, routinely treated more favourably under the
Pension Schemes than other members.
6. DEATH BENEFITS
6.1 Any benefits payable on the death of a Member whilst in employment
(other than a return of Member's own contributions) or during a
period of sickness or disability are fully insured, all premiums due
to the insurance company have been paid and each Member or other
beneficiary has been covered for such benefits by an insurance
company of repute at normal rates and on normal terms for persons in
good health. So far as the Warrantor is aware, having made enquiry of
the trustees or administrators of the Pension or Life Schemes,
nothing has been done or left undone which might entitle the
insurance company to avoid or limit its liability under any contract
covering these benefits. The Warrantor has given the Purchaser full
details of the current premiums for this insurance, and copies of the
insurance contracts.
7. DISCRIMINATION
7.1 The Pension Schemes and the Life Scheme do not and have never been
operated in such a way as to directly or indirectly discriminate
between:-
7.1.1 male and female Employees as regards eligibility, the rates of
contribution and the amounts of any benefits provided or the
dates on or from which the benefits are to be or may be
provided in any way which is contrary to Article 141 of the
Treaty of Rome or any corresponding domestic legislation;
7.1.2 all other Employees in any other unlawful discriminatory manner
as regards eligibility, rates of contributions and the amounts
of
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any benefits provided or the dates on or from which the benefits are
to be or may be provided.
8. EXTERNAL ADVISERS
8.1 All consulting, actuarial, trusteeship and other fees, charges and
expenses of whatever nature with respect to the Pension Schemes and
Life Scheme have been paid and no services have been rendered for
which an account or invoice has not been delivered to and paid by the
Target Group. All costs, charges and expenses are met from the assets
of the Pension Schemes and Life Scheme.
9. DISPUTES
9.1 Apart from routine benefit claims, there are no pending claims for
incapacity or ill health pensions and there are no current disputes
concerning such benefits, no disputes relating to access or benefits
provided by the Pension Schemes or Life Scheme and no complaints
under the trustees' internal dispute resolution procedure,
arbitrations, claims to OPAS, pensions ombudsman complaints,
complaints to OPRA, or claims or litigation in progress, pending or
threatened by any of the Members, beneficiaries of the Pension
Schemes or Life Scheme or Employees and there are no facts or
circumstances likely to give rise to any such proceedings.
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PART 5D - PROPERTY AND ENVIRONMENTAL WARRANTIES
1. THE UK PROPERTIES
In relation to the UK Properties:-
1.1 The UK Properties comprise all land and buildings situated in the
United Kingdom occupied or used by Target Group or in which any
member of Target Group has an interest.
1.2 Target Group is in sole occupation of the UK Properties and it has
not granted any lease, licence, concession or any other arrangement
whereby a third party has been given or is entitled to occupation of
the UK Properties.
1.3 The UK Properties are held free of all fixed or floating charges or
other securities and there are no options, rights to acquire or
rights of pre-emption affecting the UK Properties which are binding
on Target Group. Target Group has not agreed to dispose of any of the
UK Properties or any part or parts of any of them or interest therein
and has not agreed to acquire any other land or buildings or any
interest (including as tenant or licensee), or right in any other
land situated in the United Kingdom.
1.4 Target Group has, throughout the period of its ownership or tenancy
of the UK Properties, had vacant and undisputed possession or
occupation of the UK Properties and there are no circumstances of
which the Warrantors are aware which would entitle a superior,
landlord or other person to validly exercise any right of irritancy
or forfeiture or which would otherwise restrict or terminate the
continuing vacant and undisputed possession or occupation of the UK
Properties by Target Group.
1.5 Save in respect of the UK Leasehold Properties no member of Target
Group has any continuing or outstanding liability (actual or
contingent) in respect of any lease or licence of any land and/or
buildings in the United Kingdom whether as tenant, guarantor or
surety.
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1.6 There are no outgoings payable in respect of the UK Properties other
than the usual local authority rates or equivalent local taxes,
payments due under title deeds and water, drainage and other utility
charges (and in respect of the UK Leasehold Properties rent,
insurance premiums and service charge) all of which have been paid to
date.
1.7 There are no outstanding or threatened actions, disputes, claims or
demands between Target Group and any third party affecting the UK
Properties .
1.8 None of the UK Properties is in an area designated or proposed to be
designated:-
(a) as a conservation area;
(b) as a site of special scientific interest;
(c) as a site of outstanding natural beauty; or
(d) as an environmentally sensitive area.
So far as the Warrantors are aware, but without having made any
enquiry, there are no pending designations or applications in
relation to any of the above matters in respect of the UK Properties.
None of the buildings or structures on the UK Properties has been
listed as being of special historic or architectural interest.
1.9 There is no outstanding stop notice, enforcement notice, notice to
treat, notice of entry, notice for compulsory acquisition or other
statutory notice in respect of any of the UK Properties or the
business carried on therefrom and so far as the Warrantors are aware
no such notices have been threatened or are pending.
1.10 All statutes, orders and regulations affecting the UK Properties and
in relation to the use of or the employment of persons or the use of
any fixtures, machinery or moveables in the UK Properties have been
observed in all material respects and so far as the Warrantors are
aware there are no outstanding requirements of any competent
authority in relation to such statutes, orders or regulations.
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1.11 Each of the UK Properties has direct access to and egress from (both
pedestrian and vehicular) a public road. The sewers and water
supplies serving the UK Properties are maintained by the local
authority, and the UK Properties are supplied with electricity by
statutory undertakers and in so far as the Warrantors are aware, but
without making any enquiry, all necessary rights exist to lead
services from the UK Properties to the public supply.
1.12 No person has any legal right to enter upon any of the UK Properties
save only as such rights are reserved to the landlords of the UK
Leasehold Properties or as such rights are reserved under statutory
authority or the common law.
1.13 There are no disputes with any adjoining or neighbouring owners or
occupiers with respect to boundary walls and fences or with respect
to servitudes, easements, rights or means of access to or from any of
the UK Properties.
1.14 There are no unexpired defects liability periods under any building
contracts relating to any of the UK Properties and there are no
outstanding or contemplated actions, proceedings, costs, claims,
damages or losses arising under any such building contracts or any
professional appointments, warranties or guarantees relating to any
development of any UK Properties in which Target Group has an
interest.
1.15 The particulars of the UK Properties as detailed in Parts 7A and 7B
of the Schedule are accurate in all material respects.
2. THE UK LEASEHOLD PROPERTIES
In relation to the UK Leasehold Properties:-
2.1 No application for landlords' consent or approval is outstanding.
2.2 No rent review under the UK Lease Documentation has been agreed or
determined otherwise than on the basis of open market value. No rent
reviews are outstanding.
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2.3 So far as required under the UK Lease Documentation landlords'
consent has been granted in respect of any material alteration,
improvement or extension of the UK Leasehold Properties.
2.4 Target Group has complied with all obligations and covenants of the
tenants under the UK Lease Documentation in all material respects and
neither Target Group or the Warrantors are aware of any outstanding
material breach of any obligations or covenants of the landlords
under the Lease Documentation. There is no current dispute between
the landlords and the tenants in respect of any of the UK Leasehold
Properties.
2.5 The UK Lease Documentation comprises all of the documentation
affecting or relating, to any material extent, to the tenants'
interest in the UK Leasehold Properties.
2.6 To the best of the warrantor's knowledge and belief the respective
landlords of the UK Leasehold Properties had the power and authority
to enter into the UK Lease Documentation. Target Group has not
granted or entered into any assignation or surrender in respect of
the UK Leasehold Properties.
2.7 None of the leases of the UK Leasehold Properties contain change of
control provisions that would be triggered by Completion.
3. TITLE (UK PROPERTIES)
3.1 Target Group has a valid title to each of the UK Properties whether
as heritable/freehold proprietor or as tenant.
3.2 There are no title conditions or burdens which are unduly onerous,
and without limitation there are no title conditions or burdens which
prohibit the present use of the UK Properties. All title conditions
and burdens affecting the UK Properties have in all material respects
been implemented or if of a continuing nature been complied with to
date and there is no outstanding allegation of a breach or
non-observance of any title condition.
3.3 No deeds which are capable of being recorded in the Register of
Sasines or given effect in the Land Register of Scotland or HM Land
Registry and no
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fixed or floating charge, debenture or other security document in
respect of or affecting the UK Properties have been granted by Target
Group.
3.4 There are no overriding interests as defined in the Land Xxxxxxxxxxxx
(Xxxxxxxx) Xxx 0000 or the Land Registration Xxx 0000 adversely
affecting any of the UK Properties.
3.5 All title deeds, or copies thereof, and documents necessary to prove
the title of Target Group to the UK Properties are in the possession
of Target Group.
3.6 The UK Properties are not held on trust for any other party.
4. PLANNING LEGISLATION AND BUILDING CONTROL (UK PROPERTIES)
4.1 The existing use of the UK Properties is the permitted use under the
Town and Country Planning legislation of the relevant jurisdiction
and any regulations, orders, consents or permissions made or given
thereunder. There are no planning conditions which restrict or affect
the permitted use of the UK Properties or which are unduly onerous,
personal or unusual or which limit the period of validity of any
planning permission.
4.2 All "development" as defined in the Town and Country Planning
legislation of the relevant jurisdiction carried out on the UK
Properties has been in accordance with the Town and Country Planning
legislation in question and any regulations, orders, consents or
permissions made or given thereunder and there are no material
conditions in relation to such development which have still to be
implemented.
4.3 There is no outstanding monetary claim or liability, contingent or
otherwise in respect of any of the UK Properties under the Town and
Country Planning legislation of the relevant jurisdiction or
otherwise, and the Warrantors confirm that to the best of their
knowledge, there is no likelihood of any of the same arising.
4.4 No planning permission in respect of any of the UK Properties has
been revoked and there is no application for planning permission
awaiting determination. No planning decision or deemed refusal is
subject to appeal.
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4.5 There is no agreement affecting any of the UK Properties under
Section 75 of the Town and Country Xxxxxxxx (Xxxxxxxx) Xxx 0000 or
under any legislation of similar nature in any jurisdiction nor any
agreement to create the same.
4.6 All buildings and works on or comprising part of the UK Properties
have been erected or carried out in accordance with the Building
(Scotland) Acts or where applicable in accordance with equivalent
legislation of the relevant jurisdiction and all necessary statutory
consents have been obtained, and Completion Certificates or
equivalent certification of the relevant jurisdiction have been
issued by the local authority in relation to all such buildings and
works.
5. MINERALS (UK PROPERTIES)
None of the UK Properties has been affected by any mineral workings and
the Warrantors are not aware of any proposals to carry out mineral
workings on or adjacent to the UK Properties.
6. CONDITION OF PROPERTIES (UK PROPERTIES)
6.1 There are no outstanding liabilities in respect of the maintenance,
repair, rebuilding or renewal of the Properties or any property
common to the UK Properties and other properties, nor are any such
works proposed by or in the contemplation of Target Group.
6.2 Neither the Warrantors nor Target Group has received any adverse
surveyor's, engineer's or other professional's report in respect of
the UK Properties and the central heating system, lifts, sprinkler
systems, fire or burglar alarm systems, telephone system, gas,
electricity and other services and associated apparatus and other
mechanical or electrical apparatus within the UK Properties.
6.3 So far as the Warrantors are aware there has been no treatment of
woodworm or other infestation, dry rot, wet rot or rising damp
carried out to the UK Properties and there are no agreements,
certificates, guarantees, warranties or
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insurance policies relating to any construction, repair, replacement,
treatment.
7. FIRE REGULATIONS (UK PROPERTIES)
The UK Properties comply with the relevant fire precautions legislation
in all material respects and any Fire Certificates (or equivalent
certification in the relevant jurisdiction) necessary for the
occupation of the UK Properties have been obtained and complied with in
all material respects. No Fire Certificate (or equivalent certification
in the relevant jurisdiction) contains any unusual conditions. There
are no outstanding requirements (formal or informal) at the instance of
the relevant fire authority.
8. INSURANCE (UK PROPERTIES)
8.1 All buildings and other structures on the UK Properties are insured
for the full reinstatement cost thereof against fire and other normal
commercial risks. Target Group has never been refused such insurance
for the UK Properties.
8.2 There are no special or unusual terms or restrictions contained in
any insurance policy relating to any of the UK Properties and the
premiums payable thereunder are not in excess of the normal rates
payable for comparable property in the area in question and in which
there is carried on a business similar to that carried on from the UK
Properties.
9. THE NON-UK PROPERTIES
9.1 The Non-UK Properties comprise all land and buildings situated
outwith the United Kingdom occupied or used by Target Group or in
which any member of Target Group has an interest.
9.2 Target Group is in sole occupation of the Non-UK Properties and it
has not granted any lease, licence, concession or any other
arrangement whereby a third party has been given or is entitled to
occupation of the Non-UK Properties.
9.3 The Non-UK Properties are held free of al fixed or floating charges
or other securities and there are no options, rights to acquire or
rights of pre-emption
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affecting the Non-UK Properties which are binding on Target Group.
Target Group has not agreed to dispose of any of the Non-UK
Properties or any part or parts of any of them or interest therein
has not agreed to acquire any other land or buildings or any interest
(including as tenant or licensee) or right in any other land situated
outwith the United Kingdom.
9.4 Target Group has, throughout the period of its ownership or tenancy
of the Non-UK Properties, had vacant and undisputed possession or
occupation of the Non-UK Properties and there are no circumstances of
which the Warrantors are aware which would entitle a landlord or
other person to exercise any right to restrict or terminate the
continuing vacant and undisputed possession or occupation of the
Non-UK Properties by Target Group.
9.5 Save in respect of the Non-UK Leasehold Properties no member of
Target Group has any continuing or outstanding liability (actual or
contingent) in respect of any lease or licence of any land and/or
buildings outwith the United Kingdom whether as tenant, guarantor or
surety.
9.6 There are no outgoings payable in respect of the Non-UK Properties
other than the usual local taxes, payments due under title deeds and
water, drainage and other utility charges (and in respect of the
Non-UK Leasehold Properties rent, insurance premiums and service
charge) all of which have been paid to date.
9.7 There are no outstanding or threatened actions, disputes, claims or
demands between Target Group and any third party affecting the Non-UK
Properties or any neighbouring property
9.8 No person has any legal right to enter any of the Non-UK Properties
save only as such rights are reserved to the landlords of the Non-UK
Leasehold Properties or as such rights are reserved under statutory
authority or the common law.
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9.9 There are no disputes with any adjoining or neighbouring owners or
occupiers with respect to boundary walls and fences or with respect
to servitudes, easements, rights or means of access to or from any of
the Non-UK Properties.
9.10 The particulars of the Non-UK Properties as detailed in Part 7C of
the Schedule are accurate in all material respects.
10 THE NON-UK LEASEHOLD PROPERTIES
In relation to the Non-UK Leasehold Properties:-
10.1 No application for landlords' consent or approval is outstanding.
10.2 No rent review under the Non-UK Leasehold Documentation has been
agreed or determined otherwise than on the basis of open market
value. No rent reviews are outstanding.
10.3 So far as required under the Non-UK Leasehold Documentation
landlords' consent has been granted in respect of any material
alteration, improvement or extension of the Non-UK Leasehold
Properties.
10.4 Target Group has complied with all material obligations and covenants
of the tenants under the Non-UK Leasehold Documentation in all
material respects and neither Target Group nor the Warrantors are
aware of any material breach of any obligations or covenants of the
landlords under the Non-UK Leasehold Documentation. There is no
current dispute between the landlords and the tenants in respect of
any of the Non-UK Leasehold Properties.
10.5 Target Group has not granted or entered into any contract to grant
any assignation or surrender in respect of the Non-UK Leasehold
Properties.
10.6 The Non-UK Lease Documentation comprises all the documentation
effecting or relating, to any material extent, to the tenant's
interest in the Non-UK Leasehold Properties.
10.7 None of the leases of the Non-UK Leasehold Properties contains a
change of control provision that would be triggered by Completion.
11. TITLE TO NON-UK PROPERTIES
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11.1 Target Group has a valid title to each of the Non UK-Properties
whether as proprietor or as tenant.
11.2 All documents of title and leases, or copies thereof, necessary to
prove the title of Target Group to the Non-UK Properties are in the
possession of Target Group.
11.3 The Non-UK Properties are not held in trust for any other party.
12. ENVIRONMENTAL MATTERS
12.1 The business and operation of Target Group does not breach any
applicable Environmental Law and/or any condition of or arising out
of the giving of any applicable Environmental Licence in effect as of
the date of this warranty and no Event has occurred which, with
notice or the passage of time or both, does or is likely to
constitute a breach of any such Environmental Law or Environmental
Licence.
12.2 No Hazardous Substance has been used, disposed of, generated, stored,
transported, dumped, released, deposited, spilled, burned or emitted
at, on, from or under any premises (whether or not owned, leased,
occupied or controlled by Target Group) in circumstances where this
might result in a liability on Target Group.
12.3 Neither Target Group nor the Warrantors have received any notice
advising them, or other information indicating that any of the
Properties or the activities of Target Group or any of its respective
predecessors is in breach of any applicable Environmental Law or any
applicable Environmental Licence or that Target Group is responsible
(or potentially responsible) for the clearance, treatment or disposal
of any Hazardous Substances at, on, or beneath the Properties or at,
on, or beneath any land adjacent thereto and there are no
circumstances which may lead to the service of any such notice.
12.4 None of the Properties has or will fall to be designated as
contaminated land or a special site under Part IIA of the
Environmental Protection Act 1990 or has or will be subject to an
equivalent designation under any applicable
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Environmental Law and neither the Target Group nor the Warrantors
have received notice of any such designation.
12.5 Neither Target Group nor the Warrantors have not received any notice
or complaint from any person relating to the Properties or their
ownership or occupation or the conduct of the business of Target
Group in relation to waste noise, vibration, smell, fumes, smoke,
soot, ash, dust, grit, pollution, chemicals, leachate, groundwater or
any noxious, radioactive, inflammable, explosive, dangerous or
offensive gases or substances and there are no circumstances which
may lead to any such notice or complaint.
12.6 No prosecutions have been brought under any Environmental Law with
regard to the Properties or the use of the Properties.
12.7 No offences have been committed on or in connection with the
Properties or the use of the Properties under any Environmental Law.
12.8 No works have been carried out on the Properties under any
Environmental Law by any statutory authority in respect of which such
authority is entitled to recover costs for Target Group.
12.9 None of the Properties is:-
12.9.1 within 250 metres of a landfill site;
12.9.2 within an area regarded as a hazard area requiring the
approval of the Health and Safety Executive of any development
proposal thereon; or
12.9.3 within a litter control area.
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PART 5E - INTELLECTUAL PROPERTY WARRANTIES
1. GENERAL
1. The Target Group is the owner, or the lawful licensee of:
1.1.1 all IPR that is used by the Target Group in the Business, or
necessary to lawfully conduct, the Business in the manner and
to the extent that the Business is carried on immediately prior
to Completion; and
1.1.2 all IPR that is necessary for the Target Group to supply the
products (including software products) and provide the services
which the Business offers to supply or provide, immediately
prior to Completion.
2. REGISTERED IPR
2.1 All the IPR which the Target Group owns and which is registered or is
the subject of an application for registration anywhere in the world
is listed in Part 8 of the Schedule. The details shown in the said
Part 8 of the Schedule, including the registered
proprietor's/applicant's name, are true, complete and accurate.
2.2 The Warrantors are not aware of any reason why the said applications
to register IPR listed in Part 8 of the Schedule should not proceed
to a valid grant.
2.3 All fees payable for applications for registered IPR listed in Part 8
of the Schedule which are due and payable up to the Completion Date
have been paid in full.
2.4 There are no facts or circumstances known to the Warrantors which
could form the basis of a claim that any part of the registered IPR
owned by the Target Group should be revoked, invalidated or rendered
unenforceable.
3. COMPANY INTELLECTUAL PROPERTY
All of the Target Group Intellectual Property is owned by the Target Group
free and clear of all pledges, securities, interests, mortgages, charges,
liens and other
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encumbrances.
4. INFRINGEMENT/CHALLENGE
4.1 No Target Group Company has received any notification or is aware
that the carrying on the Business and using the Target Group
Intellectual Property in the Business in the manner carried on or
used by the Target Group immediately prior to Completion infringes or
breaches or misuses any third party's IPR or the moral rights of any
third party or constitute a breach of confidence or unfair
competition rights or passing off and, as far as the Warrantors are
aware, no proceedings of any kind, in that regard have been commenced
or are threatened.
4.2 None of the Target Group Intellectual Property or the IPR licensed to
it, is the subject of any current or (so far as the Warrantors are
aware) threatened claim or opposition or proceedings in relation to
its validity or enforceability or as to the Target Group's rights of
ownership thereto (whether such claims are by employees, ex-employees
or other third parties).
4.3 So far as the Warrantors are aware, no third party is infringing,
breaching, misusing or using without authorisation or threatening to
infringe, misuse or use without authorisation any of the Target Group
Intellectual Property or the IPR licensed to it, nor has the Target
Group made a claim or raised proceedings of any kind against any
third party for breach or infringement or misuse of IPR or breach of
confidence or unfair competition rights or passing off.
4.4 No member of the Target Group has made or raised or is involved in
any oppositions, claims or proceedings challenging the rights of any
third party to obtain registration of any IPR or the entitlement of
any third party to any registered IPR or the validity or
enforceability of any IPR registered in the name of a third party.
4.5 No moral rights have been asserted nor so far as the Warrantors are
aware are there any which are capable of being asserted, which could
materially
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affect the use or value of any of the Target Group Intellectual
Property.
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PART 5F - TAX WARRANTIES
1. RETURNS AND DISPUTES
1.1 (a) All returns, computations, accounts, notices, statements,
reports, registrations and information which have been or
should have been made or given by or in respect of any Target
Group Company for any Taxation purpose (i) have been made or
given within the requisite periods and on a proper basis and
correct, complete and up-to-date and are true and accurate and
(ii) none of them is, or so far as the Warrantors are aware,
might be, the subject of any dispute with any Taxation
Authority or give rise to any liability to Taxation not
provided for in the Accounts in respect of any accounting
period ending on or before the Accounts Date.
(b) In all corporation tax returns and computations submitted by
or on behalf of any Target Group Company to the Inland Revenue
in respect of any accounting period ending on or after 1
October 1994 proper adjustments have been made for all
expenditure which is disallowable (including any expenditure
which is disallowable by reason of section 577 of the TA
1988).
1.2 (a) There is no existing dispute between any Target Group Company
and any Taxation Authority and so far as the Warrantors are
aware there are no circumstances likely to give rise to any
such dispute.
(b) No assessments (whether estimated assessments or otherwise)
or determinations are under discussion, or are a matter of
dispute, with any Taxation Authority or are the subject of
any appeal.
(c) No Taxation Authority has at any time carried out or is at
present conducting any review, audit, investigation or enquiry
into the business or affairs of any Target Group Company (or
any aspect
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thereof) and no Target Group Company has received any
indication that, and the Warrantors, having made all
reasonable enquiries, know of no reason why, any such review,
audit or investigation or enquiry is to be or may be
initiated by any Taxation Authority.
2. CLEARANCE AND CONSENTS
2.1 No Transaction has been effected in the seven years ending on the
date of this Agreement by any Target Group Company in respect of
which any consent or clearance from any Taxation Authority was
required or was sought (i) without such consent or clearance having
been validly obtained before the Transaction was effected and (ii)
otherwise than in accordance with the terms of and so as to satisfy
any conditions attached to the relevant consent or clearance, and
(iii) otherwise than at a time when and in circumstances in which the
relevant consent or clearance was valid and effective.
2.2 All particulars furnished to the relevant Taxation Authority in
connection with the application for any consent or clearance by or on
behalf of any Target Group Company fully and accurately disclosed all
facts and circumstances material to the decision of the relevant
Taxation Authority.
2.3 To the best of the Warrantors' knowledge, information and belief
there are no circumstances that have arisen since any application for
any such consent or clearance was made which might reasonably be
expected to cause such consent or clearance to be or become invalid
or to be withdrawn by the Taxation Authority concerned.
2.4 All clearances and consents obtained by any Target Group Company from
any Taxation Authority in respect of Transactions which were
effected, together with the relevant application, are attached to the
DISCLOSURE LETTER.
3. TAXATION AGREEMENTS AND CONCESSIONS
3.1 The amount of Taxation chargeable on each Target Group Company or for
which any Target Group Company has become accountable during or for
any
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accounting period ended on or within seven years before the Accounts
Date has not depended on any concession or other formal or informal
agreement or arrangement with any Taxation Authority.
3.2 The Disclosure Letter sets out full particulars of any agreement,
arrangement or election between each Target Group Company and any
Taxation Authority pursuant to which any Target Group Company is
authorised not to comply with what but for such agreement or
arrangement would be its statutory obligations or whereby, it is
assessed or accountable for Taxation other than in accordance with
the strict terms of the relevant legislation or the published
practice of the relevant Taxation Authority.
3.3 No Target Group Company has taken any action which has had or will
have the result of altering, prejudicing or in any way disturbing any
arrangement or agreement which any Target Group Company has
previously had with any Taxation Authority.
3.4 No Target Group Company is or has at any time been a party to a
special arrangement as is referred to in Inland Revenue Statement of
Practice SP10/93 dated 8 October 1993.
4. PAYMENT OF AND LIABILITIES FOR TAXATION AND PENALTIES ETC.
4.1 Each Target Group Company has paid all Taxation which has become due
and payable by it and all Taxation which it may become liable to pay
has been provided for in the Accounts or in its management accounts.
4.2 Since the Accounts Date:
(a) no Target Group Company has been involved in any Transaction
which has or could give rise to a liability to Taxation (or
would have given or might give rise to such a liability but for
the availability of any Relief) other than Taxation in respect
of normal trading income or receipts of such Target Group
Company arising from Transactions entered into by it in the
ordinary course of its business;
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(b) no Target Group Company has entered into any transaction which
will or may (disregarding any statutory right to make any
election or claim and any allowance and any relief other than
one available under Section 38 TCGA) give rise to a liability
to corporation tax on chargeable gains or to any balancing
charge.
4.3 No Target Group Company has, nor has any director or officer of any
Target Group Company, paid or become liable to pay, any fine, penalty
or interest charged by virtue of the Taxes Management Xxx 0000 or the
VATA or any other statutory provision, order or regulation relating
to Taxation.
5. ADEQUACY OF PROVISION FOR TAXATION
5.1 The provision or reserve for Taxation included in the Accounts is
sufficient to cover:-
(a) all Taxation for which each Target Group Company was liable or
accountable at the Accounts Date (whether or not it has or may
have any right of reimbursement against any other person); and
(b) all Taxation for which each Target Group Company may after the
Accounts Date become or have become liable or accountable
including, without prejudice to the generality of the
foregoing, all Taxation:-
(i) on or in respect of or by reference to profits, gains or
income earned, accrued, received or realised or deemed
for Taxation purposes to have been earned, accrued,
received or realised for or in any period ended on or
before the Accounts Date; or
(ii) any Transaction effected entered into or occurring or
deemed to have been effected or entered into or to have
occurred on or before the Accounts Date; or
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(iii) in respect of all distributions made and all interest or
charges paid or accrued on or before the Accounts Date.
5.2 Full disclosure has been made in the DISCLOSURE LETTER of any
difference between the accounting and Taxation treatment of all items
in the Accounts.
6. TAXATION CLAIMS AND RELIEFS
6.1 Each Target Group Company has submitted all claims, elections and
disclaimers that have been assumed to have been made or will be made
for the purposes of preparing the Accounts.
6.2 (a) During the period commencing three years before the date of this
Agreement and ending on Completion:
(i) there has been and will be no discontinuance of or major
change in the nature or conduct of any trade carried on by
any Target Group Company or any of its predecessors
(within the meaning of section 343 TA 1988); and
(ii) there has been no change in the ownership of any Target
Group Company for the purposes of sections 245, 245A or
767A to 769 (inclusive) TA 1988.
(b) At no time prior to Completion has the scale of activities of
any trade carried on by any Target Group Company or any of it
predecessors (within the meaning of section 343 TA 1988) become
small or negligible within the meaning of sections 245 or 768
TA 1988.
7. SECONDARY TAXATION LIABILITIES
No event or Transaction has occurred or been entered into pursuant to
which, and there are and will at Completion be, no circumstances in which,
any Target Group Company is or may become liable to pay or make
reimbursement or indemnity in respect of, or otherwise bear, any Taxation
(or amounts corresponding thereto)
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directly or primarily chargeable against or attributable to any other
person, firm or company in consequence of the failure by any other person,
firm or company to discharge that Taxation within any specified period or
otherwise, where such Taxation relates to a profit, income or gain or any
Transaction effected, entered into or occurring or any circumstance
occurring (in either case whether wholly or partly) prior to Completion.
8. TAXATION RESIDENCE AND OFFSHORE INTERESTS
Each Target Group Company has been resident for all Taxation purposes in
and only in the United Kingdom at all times since its incorporation and
will be so resident at Completion and has never been treated or regarded as
resident in any jurisdiction other than the United Kingdom for any Taxation
purpose (including any double taxation agreement or convention or any
double taxation relief arrangements).
9. CLOSE COMPANY MATTERS
9.1 Each Target Group Company is not and has not been or treated as been
at any time since 31 March 1989 a close investment holding company
(as defined in Section 13A TA 1988).
9.2 No distribution falling within Section 418 TA 1988 has been made or
agreed to be made by any Target Group Company.
9.3 No Target Group Company has entered into any transaction, or made any
loan or advance or written off or released any debt, falling within
Sections 419 or 422 TA 1988.
9.4 No Target Group Company has made any covenanted payments or payments
to charity falling within Section 339 TA 1988.
10. REPAYMENT OF CAPITAL ETC. AND DISTRIBUTIONS
10.1 No Target Group Company has :-
(a) repaid, or agreed to repay, any of its share capital or any
amount paid up on any of its share capital; or
(b) redeemed, or agreed to redeem, or purchased or agreed to
purchase any of its share capital; or
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(c) capitalised, or agreed to capitalise, in the form of debentures
or redeemable shares, any profits or reserves of any class or
description, or passed any resolution to do so; or
(d) issued any share capital as paid up otherwise than by the
receipt of new consideration within the meaning of Part VI TA
1988.
10.2 There are no securities (within the meaning of section 254(1) TA
1988) of any Target Group Company in issue any payment in respect of
which falls or so far as the Warrantors are aware will fall to be
treated as a distribution for the purposes of Section 209 TA 1988.
10.3 Except as properly authorised and provided for in its audited
accounts, no Target Group Company has made or been treated as having
made any distribution within the meaning of Sections 209 and 210 TA
1988 during the six years ending on the Accounts Date.
10.4 No Target Group Company has been engaged in or been a party to any of
the transactions set out in Sections 213 to 218 TA 1988 nor has any
Target Group Company made or received a chargeable payment as defined
herein.
10.5 Each Target Group Company has properly accounted for all advance
corporation tax payable by it in respect of distributions (including
interest on equity notes after 14 May 1992) and deemed distributions
within the meaning of Sections 209 and 210 TA 1988.
11. DEDUCTIBLE EXPENDITURE
11.1 All rents, interest, annual payments, emoluments paid or payable by
each Target Group Company since the Accounts Date or which any Target
Group Company is under an obligation (whether conditional or
otherwise) to pay in the future are, or (under the law as presently
in force) will be wholly deductible in computing profits, or against
profits, for Taxation purposes.
11.2 No payment has been made or agreed to be made by any Target Group
Company to or in respect of any of its directors (including, but not
limited to, pension contributions) which will not be deductible in
full for corporation tax
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purposes, either in computing income profits or in computing
corporation tax payable by it.
12. LOSSES AND RELIEF
Nothing has been done, and no event or series of events or circumstances
has occurred or will as a result of any contract, agreement or arrangement
entered into before Completion occur, which might, when taken together with
this Agreement being entered into or becoming unconditional or Completion
or otherwise, cause or contribute to the loss, restriction, postponement or
disallowance to any Target Group Company of any Relief.
13. GROUP TAXATION
13.1 No Target Group Company has ever been a member of a group of
companies (as defined for any Taxation purpose) (other than solely
with any other Target Group Company).
13.2 No Target Group Company has made or claimed or agreed to make or
claim or become liable to make or claim and will not on or before
Completion make or claim or agree or arrange to make a claim or
become liable to make or claim:-
(a) any surrenders of any amount by way of group relief under
Chapter IV of Part X TA 1988; or
(b) any surrender of advance corporation tax under Section 240 TA
1988 in respect of any accounting period ending less than seven
years prior to the date of this Agreement or the accounting
period current at the date of this Agreement.
13.3 No Target Group Company has:-
13.3.1 paid any dividend without advance corporation tax or made any
payment without deduction of income tax in the circumstances
specified in Section 247(6) TA 1988; or
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13.3.2 given any notice pursuant to Section 247(3) TA 1988 in respect
of any dividends paid or agreed to be paid by it.
13.4 No surplus shadow ACT has been allocated to any Target Group Company.
13.5 No Target Group Company has made an election under paragraph 11(3) SI
1999/358 (Corporation Tax (Treatment of Surplus Unrelieved ACT)
Regulations).
14. CAPITAL ALLOWANCES
14.1 Since the Accounts Date, no act has been done or omitted to be done
or omitted, agreed or permitted to be done by any Target Group
Company and no Target Group Company has suffered any occurrence, as a
result of which (in any such case) any balancing charge has arisen or
may arise under Section 4 CAA 1990.
14.2 No Target Group Company has made any election under Section 37 CAA
1990 in respect of any asset owned by it at the Accounts Date or
acquired by it since that date.
14.3 No balancing charge in respect of any capital allowances claimed or
given would arise if all of the assets of any Target Group Company
(or where computations are made for capital allowances purposes for
pools of assets, all the assets in that pool) were to be realised for
a consideration equal to the book value thereof as shown in, or
adopted for the purpose of, the Accounts, (or, in the case of any
asset acquired since the Accounts Date for a consideration equal to
the consideration given for the acquisition) except to the extent
that such balancing charge is fully provided for in the Accounts.
14.4 No asset in respect of which any Target Group Company has claimed or
is or may be entitled to claim capital allowances is:-
(a) leased to any person other than where such asset is used for a
qualifying purpose by such person within s39 CCA 1990; or
(b) a fixture in circumstances where the right of any Target Group
Company to claim capital allowances is
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(i) dependent on some other person making or consenting to the
making of an election; or
(ii) is or may be disputed by any person or any Taxation
Authority; or
(c) an asset to which Part XV of the VAT Regulations 1995 applies.
14.5 No claim for any allowance under CAA 1990 in respect of any
accounting period ending on or before the Accounts Date has been or
will be restricted by operation of S159 CAA 1990 (time when capital
expenditure is incurred).
15. TRANSFER PRICING ETC.
15.1 No Target Group Company owns or has agreed to acquire, any asset, nor
has any Target Group Company received or agreed to receive any
services or facilities (including without limitation the benefit of
any loan or advance or any licences or agreements), the consideration
for the acquisition or provision of which was or will be in excess of
its market value, or otherwise than on an arm's length basis.
15.2 No Target Group Company has either disposed or agreed to dispose of
any asset, nor has any Target Group Company provided or agreed to
provide any services or facilities (including without limitation the
benefit of any loan or advance or any licences or agreements), the
consideration for the disposal or provision of which was or will be
less than its market value, or otherwise than on an arm's length
basis.
16. CORPORATION TAX ON CHARGEABLE GAINS
16.1 The entry into or Completion of this Agreement will not result in any
profit or gain being deemed to accrue to any Target Group Company for
Taxation purposes.
16.2 All chargeable assets of each Target Group Company were acquired at
market value at the time of acquisition and there are no
circumstances giving rise or which may give rise to liability or loss
under or pursuant to Sections 17, 30, 139, 140, 176, 177 or 179 TCGA.
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16.3 If each of the assets of each Target Group Company was disposed of
for a consideration equal to the book value of that asset in, or
adopted for the purpose of, the Accounts, no liability to corporation
tax on chargeable gains not fully provided for in the Accounts would
arise; and, for the purpose of determining the liability to
corporation tax on chargeable gains, there shall be disregarded any
statutory right to make any election or claim and any relief and
allowances available to any Target Group Company other than amounts
falling to be deducted under Section 38 TCGA and allowances given
under Chapter IV of Part II TCGA.
16.4 No Target Group Company has been a party to or concerned in any
Transaction as a result of which the consideration received or
receivable for any disposal of an asset by any Target Group Company
may be increased under Section 30 TCGA.
16.5 No Target Group Company owns any assets acquired in circumstances
such that any of the provisions of Chapter II of Part IV TCGA applied
to its acquisition.
16.6 Since the Accounts Date no Target Group Company has disposed of or
acquired any asset in such circumstances that the provisions of
Section 17 TCGA did or could apply thereto.
16.7 No election has been made under Section 35(5) TCGA which applies to
any assets of any Target Group Company nor has any Target Group
Company made its first relevant disposal for the purposes of Section
35(6) TCGA.
16.8 No claim has been made by any person in respect of the transfer of
any asset by or to any Target Group Company under Sections 23, 140,
140C, 152 to 158 (inclusive), 175 or 247 TCGA which would affect the
amount of any gain or allowable loss which would, but for such claim,
accrue or be treated as accruing on any disposal of any asset of any
Target Group Company or which has or will operate to postpone the
payment of corporation tax on any such gain.
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16.9 No Target Group Company has made an election under paragraph 4
Schedule 2 TCGA.
16.10 No Target Group Company has either made or is entitled to make a
claim under Section 24(2), Section 253 or Section 254 TCGA.
16.11 No Target Group Company has realised a loss on the disposal or deemed
disposal of an asset in relation to which its ability to set the
whole of that loss against any chargeable gain arising in the same or
a later accounting period is or may be restricted or excluded whether
pursuant to Section 18 TCGA or otherwise.
16.12 No asset owned by any Target Group Company has at any time since its
acquisition been subjected to a reduction in value such that any
allowable loss arising on its disposal is likely to be reduced or
eliminated or any chargeable gain arising on its disposal is likely
to be increased.
16.13 No Target Group Company has or will at Completion have distributable
profits which would be chargeable profits as those terms are defined
in Section 31 TCGA if the Section 30 disposal therein referred to
took place on Completion.
16.14 No Target Group Company has acquired any assets subject to a claim
under Section 165 TCGA.
17. PAYE AND NATIONAL INSURANCE
17.1 Each Target Group Company has properly operated the PAYE and National
Insurance contributions systems by making such deductions as are
required by law from all payments made or deemed to be or treated as
made by it or on its behalf, and by duly accounting to the Inland
Revenue for all sums so deducted and for all other amounts for which
it is required to account under the PAYE and National Insurance
contributions systems (including on notional payments and
contributions on car and car fuel benefits assessed annually) and by
making all returns and reports and providing all
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information in respect of any payments made or treated as made and
any benefits provided for directors, employees or others.
17.2 No Target Group Company has suffered any PAYE audit by the Inland
Revenue or visit by the Department of Social Security within the
seven years ending with the date of this Agreement or has been
notified that any such audit or visit will or is expected to be made.
17.3 There are set out in the Disclosure Letter particulars of all
dispensations, notifications and/or notices received by each Target
Group Company under Section 166 TA 1988.
17.4 No Target Group Company operates any scheme approved under Section
202 TA 1988 or Chapter III of Part V TA 1988.
17.5 None of the directors or employees of any Target Group Company are in
contracted-out employment for national insurance contribution
purposes.
18. OTHER DEDUCTIONS FROM PAYMENTS
Each Target Group Company has complied in all respects with all statutory
provisions relating to Taxation and requiring the deduction or withholding
of Taxation from any payment made by it, or deemed to have been made by it
(in the case of interest) by having been credited to the account of any
person, and has properly accounted to the relevant Taxation Authority for
any such Taxation which ought to have been accounted for.
19. ANTI-AVOIDANCE PROVISIONS
19.1 No Target Group Company has in the seven years ending on the date of
this Agreement been engaged in, or been a party to or otherwise
involved in, any transaction or series of transactions or scheme or
arrangement of which the main purpose, or one of the main purposes,
was or could be said to be the avoidance of Taxation or deferral of
or a reduction in the liability to Taxation or account for any
Taxation.
19.2 No Target Group Company has in the seven years ending on the date of
this Agreement been engaged or concerned in, or been a party to, any
transaction
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or series of transactions or scheme or arrangement in respect of
which it considered or was advised that there was a risk that any
Target Group Company could be liable to Taxation or increased
Taxation as a result of the principles laid down by the House of
Lords in the case of Xxxxxxx -v- Xxxxxx (55 TC 324).
20. VALUE ADDED TAX ("VAT") AND CUSTOMS DUTIES
20.1 Each Target Group Company:
(i) is registered in the United Kingdom and is a taxable person
for the purposes of the legislation relating to VAT and has
been so registered at all times that it has been required to
be registered by the relevant legislation;
(ii) is not registered and is not required to be registered for the
purposes of VAT (or any equivalent or similar tax) in any
jurisdiction other than the United Kingdom;
(iii) has at all times complied fully with all statutory
requirements, orders, provisions, directions or conditions
relating to VAT, including (for the avoidance of doubt) the
terms of any agreement reached with the Commissioners of
Customs and Excise and the terms of any import or export
schemes to which it is subject (whether in the United Kingdom
or elsewhere);
(iv) maintains and has at all times maintained complete, materially
correct and up-to-date records, invoices and other documents
appropriate or required for the purposes of such legislation
and has preserved such records in such form and for such
periods as are required by the relevant legislation;
(v) is not now, and will not at Completion be, in arrears with any
payment or returns thereunder, or liable to any abnormal or
non-routine payment, or any forfeiture or penalty, or to the
operation of any penal provision;
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(vi) has not been required by the Commissioners of Customs and
Excise to give security;
(vii) has not at any time been and has not applied to be a member of
a group registration made pursuant to Section 43 VATA;
(viii) has not since the Accounts Date made or been treated as having
made any exempt supplies for VAT purposes such, or of such
amount, that it is unable to obtain credit for or repayment of
all input tax paid or suffered by it;
(ix) does not provide and has not since the Accounts Date provided
domestic accommodation or ancillary goods or services for any
directors or employees;
(x) has not at any time since 31 March 1990 purchased in any
circumstances where the purchase was or was treated as neither
a supply of goods nor a supply of services pursuant to
Paragraph 5 of the VAT (Special Provisions) Order 1995 or any
provision in force prior to the date such Order became
effective;
(xi) has no responsibility for any other person's VAT records
whether as a current or former member of a VAT group
registration under Section 43 VATA or as the acquirer of any
assets or any business as a going concern or otherwise.
20.2 No Target Group Company owns the fee simple (as defined, in relation
to Scotland and Northern Ireland, by Section 96 VATA) in any land or
building (or part thereof) or any civil engineering work (or part
thereof) which at the date of this Agreement is new or uncompleted
for the purposes of item 1 of Group 1 of Schedule 9 to VATA.
20.3 The Disclosure Letter contains full particulars of all land in which
any Target Group Company has an interest and in relation to which an
election has been made by any Target Group Company or by any company
of which any Target Group Company is a relevant associate (as defined
by paragraph 3(7)
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of Schedule 10 of the VATA) to waive exemption from VAT pursuant to
the provisions of Schedule 10 VATA.
20.4 There are set out in the DISCLOSURE LETTER full particulars of each
item which each Target Group Company uses in the course or
furtherance of its business, and for the purpose of that business,
otherwise than solely for the purpose of selling the item, being
items to which Part XV of the Value Added Tax Regulations 1995
applies (irrespective of whether credit has been obtained for all
input tax in respect of any such item) and in respect of which the
period of adjustment will not have expired by Completion. Such
particulars are sufficient to enable each Target Group Company (or
any group of which it will form part for the purposes of Section 43
of the VATA following Completion) to comply with their obligations
under the said Part XV.
20.5 Each Target Group Company holds all the records or documents required
to be held by regulation 167 of the Value Added Tax Regulations 1995
in order that a claim may be made at the date hereof or subsequently
for a refund of VAT under Section 36 VATA in respect of any supply to
it. Each Target Group Company has duly claimed all bad debt relief
which may be available to it under Section 36 VATA.
20.6 Each Target Group Company has promptly paid in full all customs and
excise duties due and payable to HM Customs and Excise in respect of
any assets (including trading stock) imported or owned by it.
21. STAMP DUTY
All documents to which any Target Group Company is a party and which form
or are necessary to form part of any Target Group Company's title to any
asset owned or possessed by it and all documents to which any Target Group
Company is a party and pursuant to which any Target Group Company may have
any rights or which any Target Group Company may need or wish to enforce or
produce in evidence have been duly stamped and (where appropriate)
adjudicated and (where appropriate) stamped with a particulars delivered
stamp.
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22. INHERITANCE TAX AND GIFTS
22.1 No Inland Revenue charge for unpaid capital transfer tax or
inheritance tax has been or may be imposed under Section 237 and
Section 238 IHTA) over any asset of any Target Group Company, or in
relation to any shares in the capital of any Target Group Company and
no such Inland Revenue charge will arise after Completion in
connection with any Transaction which was entered into or effected or
which occurred on or before Completion.
22.2 There are not in existence any circumstances whereby any such power
as is mentioned in Section 212 IHTA could be exercised in relation to
any shares, securities or other assets of or owned by any Target
Group Company, or could be so exercised but for Section 264(6) IHTA
and no such power may arise after Completion in connection with any
Transaction effected, entered into or occurring on or before
Completion.
22.3 No Target Group Company is or will become liable (whether
contingently or otherwise) to pay or account for any
Taxation:-
(a) as donor or donee or as transferor or transferee of value
(actual or deemed); or
(b) as a result of any disposition, chargeable transfer or transfer
of value (in either case whether actual or deemed) made or
deemed to have been made by it or any other person
and neither the entry into of this Agreement nor Completion will
trigger any liability (actual or contingent) to any such Taxation.
23. PENSION SCHEMES
No Target Group Company has since the Accounts Date received any
payment to which Section 601 TA 1988 is applicable.
24. EMPLOYEE SCHEMES AND PEPS
24.1 No Target Group Company is a participating company in any scheme
approved under Sections 185 or 186 and Schedule 9 TA 1988.
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24.2 No Target Group Company has in issue any shares as defined in Section
87 FA 1988 which fall within Chapter II Part III FA 1988.
24.3 No Target Group Company has either established, or has contributed
to, a qualifying employee share ownership trust as defined in
Schedule 5 FA 1989.
24.4 No Target Group Company has registered or applied to register any
profit related pay scheme with the Inland Revenue.
25. CORPORATE DEBT AND SECURITIES
No Target Group Company has either issued or owns any of the following
types of securities:-
(a) qualifying corporate bonds;
(b) deep discount corporate bonds;
(c) deep gain securities;
(d) qualifying indexed securities;
(e) convertible securities.
26. INVESTMENT GRANTS
No Target Group Company has done or agreed to do anything as a result of
which any investment grant paid to it is or may be liable to be refunded in
whole or in part. The entry into or completion of this Agreement will not
result in any investment grants received by any Target Group Company
becoming liable to be repaid in whole or in part.
27. UNIFORM BUSINESS RATES AND OTHER LOCAL TAXES
27.1 Each Target Group Company has paid all amount of Taxation due in
respect of any properties owned or occupied by it.
27.2 There are no disputed matters as to the rateable value or rateable
use for the purpose of rating of any land or buildings (or part of
any land or buildings) owned, leased or occupied by any Target Group
Company.
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PART 5G
INTERNATIONAL TAX WARRANTIES
1. TAXATION RETURNS, DISPUTES, RECORDS AND CLAIMS ETC.
No material issues have been raised in any examination by any Taxation
Authority with respect to the businesses and operations of any Target Group
Company which, by application of similar principles, could reasonably be
expected to result in a proposed adjustment to the liability for Taxation
of that Target Group Company for any other taxable period not so examined.
2. TAXATION CLAIMS AND RELIEFS
2.1 No Relief or right to repayment of Taxation of any Target Group Company is
of such a nature that future availability or utilisation of that Relief or
right to repayment of Taxation will be restricted or excluded.
2.2 None of the Target Group Companies is a party to or is otherwise subject to
any arrangement having the effect of or giving rise to the recognition of a
deduction or loss in a taxable period ending on or before Completion, and a
corresponding recognition of taxable income or gain in a taxable period
ending after Completion, or any other arrangement that would have the
effect of or give rise to the recognition of taxable income or gain in a
taxable period ending after Completion without the receipt of or
entitlement to a corresponding amount of cash.
3. COMPANY RESIDENCE
Each of the Target Group Companies is treated as resident for Taxation
purposes in the jurisdiction in which the registered office is situated as
specified in Schedule Part 2B and has not been resident anywhere else at
any time since its incorporation. For the avoidance of doubt, references to
residence in this paragraph 4 shall be construed as references to residence
as determined by the local law of the jurisdiction or jurisdictions
concerned and not by (unless required by such local law) reference to the
provisions of any relevant double tax agreement, treaty or convention.
4. DOUBLE TAX TREATIES
No relief or credit which has been claimed by any Target Group Company or
which
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any Target Group Company is entitled to claim under any double tax
agreement or convention entered into between the jurisdiction in which it
is resident and any other relevant jurisdiction may be disallowed or
withdrawn, postponed, restricted, clawed back or otherwise lost as a result
of any Transaction which occurred on or before Completion.
5. BASE VALUES AND COSTS OF ACQUISITION
5.1 No claim has been made under any legislation relating to Taxation in any
jurisdiction which could affect the amount of any gain accruing or being
treated as accruing on a disposal of an asset by any Target Group Company.
5.2 If each of the assets (other than trading stock) or the plant and machinery
taken as a whole of each Target Group Company was disposed of for a
consideration equal to the book value of that asset (or, as appropriate,
plant and machinery) in, or adopted for the purpose of, the Accounts of the
relevant Target Group Company, no liability to Taxation not fully provided
for in the Accounts of the relevant Target Group Company would arise.
6. COMPLETION
None of the Target Group Companies has agreed to make, or is required to
make, any adjustment by reason of a change in accounting methods that
affect any taxable period ending after Completion. None of the Target Group
Companies has any application pending with any taxation Authority
requesting permission for any change in accounting methods that relates to
its business or operations and that affects any taxable period ending after
Completion.
7. TAXATION EQUALISATION PAYMENTS
7.1 Save for payments to Target Group Companies which are directly or
indirectly wholly owned subsidiaries of the Target or to Powerflo Rentals
Limited or to Tank Rentals PLC none of the Target Group Companies is liable
to make a payment for the utilisation, surrender or other transfer of any
Relief or right to repayment of Taxation ("Taxation Equalisation Payment"),
nor is any Taxation Equalisation Payment received by any Target Group
Company liable to be refunded other than to a Target
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Group Company which is directly or indirectly a wholly owned subsidiary of
the Target.
7.2 None of the Target Group Companies is under any obligation to surrender or
otherwise transfer any Relief or right to repayment of Taxation except to
another Target Group Company which is directly or indirectly a wholly owned
subsidiary of the Target, and no Target Group Company is a party to a
Taxation sharing agreement with a company that is not a Target Group
Company which is directly or indirectly a wholly owned subsidiary of the
Target.
7.3 Save as set out in the Disclosure Letter, with express reference to this
paragraph 9.4, no Target Group Company has ever been treated as a member of
the same group of companies, fiscal unity, organschaft, or included in a
consolidated Taxation return as any other body corporate or person for any
Taxation purpose.
8. PARTNERSHIPS, ETC.
None of the Target Group Companies is a party to any joint venture,
partnership or other arrangement or contract which is or may be treated as
a partnership for Taxation purposes.
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SCHEDULE
PART 6
WARRANTOR'S LIMITATIONS
1. The Warrantor's liability in respect of any claim under the Warranties, the
Indemnities and the Tax Deed (each a "Claim") shall, except where there has
been fraud or deliberate non-disclosure, be limited as provided in this
Part of the Schedule.
2. The Warrantor shall not be liable for any Claim (save for claims under the
Title Warranties, the Indemnities, the Tax Deed and the Tax Warranties)
until his aggregate liability for all valid claims agreed or determined
(excluding related interest and enforcement costs) shall equal or exceed
(pound)500,000 in which case the Warrantor shall be liable for the excess
over (pound)500,000 only;
3. The total aggregate liability of the Warrantor in respect of all Claims
(save for claims under the Title Warranties, the Indemnities, the Tax
Warranties and the Tax Deed) shall be limited to (pound)55,000,000.
4. The total aggregate liability of the Majority Vendors in respect of all
Claims under the Title Warranties, and of the Warrantor in respect of all
Claims under the Indemnities, the Tax Warranties and the Tax Deed shall be
limited to an amount equal to that part of the Consideration paid to the
Majority Vendors in terms of this Agreement.
5. The Warrantor shall not be liable for any breach of the Warranties (other
than the Title Warranties and the Tax Warranties) or under the Indemnities
(other than Clause 18.1.3) unless the Claim has been notified in writing to
the Warrantor (setting out such reasonable details of the facts and
circumstances giving rise to such claim and a reasonable estimate of the
aggregate liability of the Warrantor in respect of such claim as are known
at the time) prior to 31 December 2002 and legal proceedings in respect of
such Claim (in the absence of settlement or discharge of such claim) have
commenced within six months after such written notice is first served on
the Warrantor or within six months of the liability the subject of the
claim becoming actual rather than contingent (if later).
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6. The Warrantor shall not be liable for any breach of the Tax Warranties
unless the Claim (setting out such reasonable details of the claim and a
reasonable estimate of the aggregate liability of the Warrantor in respect
of such claim as are known at the time) has been notified in writing to the
Warrantor before the seventh anniversary of Completion and legal
proceedings in respect of such Claim (in the absence of settlement or
discharge of such claim) have commenced within six months after such
written notice is first served on the Warrantor or within six months of the
liability the subject of the claim becoming actual rather than contingent
(if later).
7. The Warrantor shall not be liable for any Claim (other than a Claim under
the Tax Deed) to the extent that any liability is increased or arises from:
7.1 the enactment of or coming into force after the date of this
Agreement of any legislation not enacted or not in force at the date
of this Agreement;
7.2 any amendment to any legislation which is enacted or comes into force
after the date of this Agreement;
7.3 any change in interpretation of any law or any change in
administrative practice of any government, governmental department,
agency or regulatory body announced after the date of this Agreement;
7.4 any increase in the rates of Taxation or alteration in the methods of
applying or calculating Taxation or any imposition of Taxation
announced after the date of this Agreement;
7.5 any withdrawal after the date of this Agreement of any practice or
extra-statutory concession previously published by the Inland Revenue
or other Taxation authority.
8 The Warrantor shall not be liable for any Claim (other than a Claim under
the Tax Deed) in respect of any matter or liability to the extent that an
express and specific provision (including, for the avoidance of doubt,
express and specific for matters contained in any deferred taxation
provision and any obsolete stock provision), accrual, reserve or note in
respect thereof was made in the Accounts.
9. The Warrantor shall not be liable for any Claim (other than a Claim under
the Tax
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Deed) which would not have arisen but for a voluntary act or failure to
act, omission or transaction on the part of the Purchaser and/or (at the
instance of the Purchaser) by any Target Group Company occurring after
Completion otherwise than in the ordinary course of the Business and which
the Purchaser was aware would or would be likely to give rise to a Claim.
10. The Warrantors shall have no liability in respect of any Claim (other than
a Claim under the Tax Deed):
10.1 where the liability is contingent only, unless and until such
liability becomes an actual liability and becomes due and payable; or
10.2 which arises by virtue of any revaluation of property or assets owned
by any Target Group Company after the Completion Date; or
10.3 in respect of any matter fairly disclosed in the Disclosure Letter;
or
10.4 to the extent that the subject matter of such claim is covered by a
policy of insurance in force on the date of this Agreement and
payment is made by the insurer under such policy or under a similar
policy effected by the Purchaser or any Target Group Company; or
subject to the matter being an insurance risk, would have been so
covered had such policy of insurance been maintained beyond the date
of this Agreement, and the Purchaser shall procure that all
appropriate claims under such insurance are duly and timeously made
and prosecuted in good faith.
11. Nothing in this Agreement shall restrict any general obligation at law of
the Purchaser to mitigate any loss or damage which it may suffer in
consequence of any breach by the Warrantor of the Warranties or the
Indemnities and shall take all reasonable steps (and so far as within its
power shall procure that such steps are taken) to mitigate any loss or
liability which might give rise to a claim against the Warrantors under the
Warranties and/or the Indemnities and, without prejudice to the foregoing
generality, procure that all reasonable endeavours are used to recover any
amounts due from third parties where (without being required to initiate
legal proceedings for recovery), in relation to any matter which may give
rise to a claim under the Warranties and/or
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the Indemnities, the Purchaser or any Target Group Company has or may have
a claim against such third parties.
12. If the Warrantor pays to the Purchaser an amount in discharge of a Claim
(other than a Claim under the Tax Deed) and the Purchaser subsequently
recovers (whether by payment, discount, credit, relief or otherwise) from a
third party a sum which is referable to the matter giving rise to the Claim
or obtains a relief which is so referable, the Purchaser shall forthwith
repay to the Warrantors:-
(a) an amount equal to the sum recovered from the third party (or the
value of the relief obtained, calculated by reference to the amount
saved) less any reasonable out-of-pocket costs and expenses incurred
by the Purchaser in recovering the same and less any tax suffered on
the receipt; or
(b) if the figure resulting under paragraph (a) above is greater than the
amount paid by the Warrantors to the Purchaser in respect of the
relevant claim, such lesser amount as shall have been so paid by the
Warrantors.
13. The Purchaser agrees with the Warrantor that it shall not be entitled to
recover damages from the Warrantor or to recover under any indemnity from
the Warrantor more than once in respect of the same loss and payment of any
Claim under any provision of this Agreement or the Tax Deed shall pro tanto
satisfy and discharge any other claim which is capable of being made in
respect of the same subject matter.
15. A breach of Warranty which is capable of remedy shall not entitle the
Purchaser to compensation unless the Warrantors are given written notice of
such breach and such breach is not then remedied (without any cost or
liability to the Purchaser) within 20 Business Days (or such longer or
shorter period as shall in all the circumstances be reasonable) after the
date on which such notice is served on the Warrantors.
16. If any Claim (other than a Claim under the Tax Deed) shall arise by reason
of some liability which at the time that the claim is notified to the
Warrantors is contingent only, the Warrantors shall not be under any
obligation to make any payment to the Purchaser in respect of such claim
until such time as the contingent liability ceases to be so contingent,
provided always that this sub-clause shall not operate to avoid a
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claim made in respect of a contingent liability within the time limits
specified in paragraphs 1.1.5 or 1.1.6 above (notwithstanding that no
proceedings are taken in respect thereof within the time limit specified in
paragraph 1.1.13 above); provided that once the liability in question
becomes actual then the Purchaser shall be bound to issue and serve legal
proceedings on the Warrantor within the following six month period.
17. The Warrantors shall not be liable to pay any sum in respect of the same
matter under both the Warranties and the Tax Deed, and the Purchaser shall
not be entitled to make double recovery in respect of the same matter under
different Warranties or under different parts of the same Warranty.
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SCHEDULE
SCOTTISH PROPERTIES
PART 7A
PROPERTY FORM OF TITLE GROUP COMPANY WITH TITLE
-------- ------------- ------------------------
3.04 Acres at Souterhead Road, Leasehold Offshore Rentals Limited
Altens (Petrocon House) (Ground)
2.32 Acres at Souterhead Road, Heritable Offshore Rentals Limited
Altens (Xxxxxx House)
6.08 Hectares at Souterhead Road, Leasehold Offshore Rentals Limited
Altens (Former Chevron Pipe Yard) (Ground)
Xxxx X0 Xxxxxxxxx Xxxx, Xxxxxxxx Leasehold Wellserv plc
(Occupational)
4.525 Acres at Souterhead Road, Altens Leasehold Xxxxxx Group plc
(Former Chevron Warehouse and Yard) (Ground)
3.13 Hectares, Aberdeen Offshore Sub-Leasehold (Ground) Downhole Technology Limited
Technology Park
91 Loanbank Quadrant, Xxxxx Leasehold Xxxxxx Group plc
(Occupational)
Xxxx 00, Xxxxxxxxxx Xxxxx, Xxxxxxxxx Heritable International Petroleum
Equipment Limited
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ENGLISH PROPERTIES
PART 7B
PROPERTY FORM OF TITLE GROUP COMPANY WITH TITLE
-------- ------------- ------------------------
5.240 Square Metres at Commercial Road, Leasehold Recovery Systems Limited
Lowestoft (Occupational)
Xxxx xx Xxxxxxxxx Xxxxx, Xxxxxxxxx, Leasehold Powerflo Systems Limited
Hampshire (Occupational)
00-00 Xxxxx Xxxxxx, Xxxxxxxxx Details to be provided
Subjects at Harfreys Industrial Estate, Freehold Offshore Rentals Limited
Great Yarmouth
Coal Park Lane, Southampton Freehold Xxxxxx Engineering Company Limited
000 Xxxxx Xxxx, Xxxxxxxx, Leasehold Powerflo Systems Limited
Middlesex (Occupational)
PART 7C
NON UK PROPERTIES
Den Xxxxxx, Holland
1127 Randaberg, Stravanger
Storage, Stavanger
Bygg 4 & 5 Stavanger
Bygg No. 5 Stavanger
Randaberg, Stavanger
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Dusavik, Stavanger
Kristiansund, Norway
Celle, Germany
Port Harcourt, Nigeria
Malaga, Spain
Anaco, Venezuela
Doha
Esbjerg, Denmark
Land, 00 Xxxxxxx, Xxxxxx Xxxx, Xxxx Xxxx, Xxxxx Xxxxxx
Office 00xx Xxxxx, Xxxxxxxx Xxxxxx, Xxxx Xxxxxx, Xxxx Xxxx
Dubai
Egypt
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SCHEDULE
PART 8
INTELLECTUAL PROPERTY
1. UK Patent Application No. 0006218.2
Applicant: Offshore Rentals Limited
Title: "Torque Reducing Drillstring Component"
Filing Date: 16 March 2000
2.1 UK Patent Application No. 0004354.7
Applicant: Wellserv plc
Title: "Appartus and Method"
Catch: HWU Workover Ring
Filing Date: 25 February 2000
2. International PCT Application No. PCT/GB00/04241
Applicant: Wellserv plc
Title: "Appartus and Method"
Catch: HWU Workover Ring
Filing Date: 6 November 2000
3. UK Trade Xxxx Application No. 2234718
Trade Xxxx ENHANCER Word in class 7 (drillpipe etc.)
Filed: 2 June 2000
Applicant: Xxxxxx Xxxxxxxx to be assigned to Target?
(drillpipe etc.)
4.1 UK Parent Application No. 0012571.6
Applicant: Intervention Well Systems Limited
Title: "Downhole Imaging System"
Filing Date: 25 May 2000
4.2 International PCT Application No. 0012571.6
Applicant: Intervention Wellsystems Limited
Title: "Downhole Tool Detection Means"
Filing Date: 9 December 1999
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SCHEDULE
PART 9
DEFINITIONS AND INTERPRETATION
1. In this Agreement the following words and expressions shall bear the
meanings given to them below:
"the 1988 Act" means the Income and Corporation Taxes Xxx 0000;
"the 1993 Act" means the Xxxxxxx Xxxxxxx Xxx 0000;
"the 1995 Act" means the Xxxxxxx Xxx 0000;
"Accounts" means the audited consolidated balance sheet of the Target
and the audited balance sheet of each company in the
Target Group as at the Accounts Date and the audited
consolidated profit and loss account of the Target and the
profit and loss account of each company in the Target
Group for the year ended on the Accounts Date together
with the directors' and auditors' reports and notes
thereon Provided that to the extent that the Warranties
are given as at the date of signing this Agreement the
Accounts of Offshore Rentals Limited and Fishing Services
Limited shall mean the draft balance sheets and profit
and loss accounts of said Companies in the Agreed Form;
"Accounts Date" means 30 April 2000;
"Acquisition" means the acquisition of the Sale Shares by the Purchaser
pursuant to this Agreement;
"Agreed Form" means a form agreed between the parties for the
purposes of this Agreement and having been signed or
initialled for identification purposes by the Purchaser's
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Solicitors and the Majority Vendors' Solicitors;
"Business" means the businesses carried on by the Target Group at
Completion;
"Business Day" means any day (other than a Saturday or Sunday) on
which clearing banks are open for normal business in
Edinburgh;
"Completion" means completion of the matters set out in Part 3 of the
Schedule;
"Completion
Date" means the date three Business Days after fulfilment of
the Conditions Precedent set out in Clause 2;
"Connected
Person" shall have the meaning set out in Section 839 of the 1988
Act;
"Consideration" means that number of whole shares of Weatherford Common
Stock which at a price per share of Fair Market Value are
equal in value to One hundred and eighty-nine million, six
hundred and fifty-five thousand Pounds Sterling
((pound)189,655,000) less the Indebtedness as at
Completion as certified in the Indebtedness Statement;
"Deed of
Amendment and
Succession" means the deed changing the Principal Employer for the
SSAS to the Retained Group Company and removing the Target
Group from any responsibilities or liabilities as
Principal Employer or otherwise for the SSAS in the
Agreed Form;
"Disclosure
Bundle" means the two identical indexed bundles of documents
collated by or on behalf of the Warrantors, the indexes of
which have been signed for identification by the Majority
Vendors' Solicitors and
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the Purchaser's Solicitors;
"Disclosure
Letter" means the letter of the same date as this Agreement
from the Warrantor to the Purchaser accepted in writing by
the Purchaser as disclosing:-
(a) information constituting exceptions to the
Warranties; and
(b) particulars of other matters referred to in this
Agreement.
"Employee" means employees of the Target Group;
"encumbrance" includes any option, right to acquire, restriction,
mortgage, pledge, lien or other form of security or
encumbrance;
"English
Properties" means the land and/or buildings situated in England which
are either owned or leased by Target Group, brief
particulars of which are set out in Part 7B of the
Schedule;
"Environmental
Law" means all laws, regulations and applicable codes of
practice, concerning the protection of human health or the
environment or the conditions of the work place or the
generation, transportation, storage, treatment or disposal
of Hazardous Substances having the force of law at the
Completion Date;
"Environmental
Licence" means any permit, licence, authorisation, consent or
other approval required by any Environmental Law for the
conduct of the Business or the occupation of the
Properties;
"Event" includes any act, omission, transaction or circumstance
(including any of such matters provided for hereunder);
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"FA" or
"F(No2)A" means the relevant Finance Act or Finance (No. 2) Act;
"Fair Market
Value" means the average closing sales price of Weatherford
Common Stock on the New York Stock Exchange for
the ten consecutive Business Days ending on the second
Business Day prior to the Completion Date as published in
the Financial Times;
"Freehold
Properties" means the heritable property situated in Scotland and the
freehold properties situated in England owned by the
Target Group, brief particulars of which are set out in
Part 7A of the Schedule;
"FRS" means a financial reporting standard issued by The
Accounting Standards Board Limited;
"Group Personal
Pension Plan" shall mean the Group Personal Pension Policy established
by the Target Group with Clerical Medical with effect
from 13 May 1997 and currently governed by the Standard
Policy Terms and Conditions as detailed in the Xxxxxx
Group PLC and Associated Companies Group Personal
Pension Plan;
"Hazardous
Substances" means any natural or artificial substance (whether in a
solid or liquid form or in a form of a gas or vapour and
whether alone or in combination with any other substance)
capable of causing harm to man or any other living
organism supported by the environment, or damaging the
environment, including but not limited to any hazardous,
toxic or dangerous waste;
"Indebtedness" means the aggregate amount of the indebtedness for
borrowed money of the Target Group (calculated by setting
off credit balances against debit balances in respect of
UK and Jersey bank accounts) as at close of
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139
business on the last Business Day immediately preceding
the Completion Date including bank overdrafts and loans,
debt factoring, liabilities under acceptance or
documentary credits, debentures, loans, loan stocks,
bonds, notes and bills of exchange, hire purchase
commitments and obligations under finance leases,
discounted debts, liability for the purchase of assets on
deferred terms (but excluding items purchased on normal
trade credit) and other such transactions having the
commercial effect of borrowing together with any costs
associated with payment of any such indebtedness in
accordance with its terms less the sum of (pound)
1,750,000;
"the Indebtedness
Statement" means the signed statement from the Warrantor addressed to
the Purchaser certifying the Indebtedness in the form
contained in Part 4 of the Schedule;
"Indemnities" means the indemnities by the Warrantor set out in Clause
18 of this Agreement;
"IPR" means all patents, registered trade marks, registered
designs and applications and the right to apply for any of
the foregoing, copyright, design right, topography rights,
database rights, utility model rights, rights in the
nature of copyright, trade, business and company names and
marks, know-how, rights in proprietary and confidential
information, rights in inventions and all other
industrial, commercial and intellectual property rights
and all other rights or forms of protection having
equivalent or similar effect to any of the foregoing
arising anywhere in the world;
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140
"Life Scheme" means the Xxxxxx Group PLC and Associated Companies Life
Assurance Scheme established under a trust deed dated 13
November 1995 the benefits of which were originally
insured and are still administered by Clerical Medical and
which are currently insured under a policy with Legal &
General Assurance Society;
"Losses" means losses, liabilities, damages fines, costs and
expenses (including, without limitation, all professional
advisory costs incurred in connection with the matter in
question;
"Majority Vendors'
Solicitors" means Xxxxx & Williamsons of Xxxxxxxxxx Xxxxx, 0 Xxxxx
Xxx, Xxxxxxxx, XX00 0XX;
"Management
Accounts" means the consolidated management accounts of the Target
Group for the period from the Accounts Date to the
Management Accounts Date;
"Management
Accounts Date" means 31 December 2000;
"Members" shall mean the Employees, Directors, ex Employees and ex
Directors of the Target Group who are entitled to benefit
under the Pension Schemes;
"Minority
Interests" means the 39,749 Ordinary Shares of (pound) 1 each in
Powerflo Rentals Limited registered in the name of Xxxxx
Xxxxxxxx Xxxxxx and the 60,000 Ordinary Shares of (pound)
1 each in Tank Rentals PLC registered in the name of
Xx. Xxx Xxxxxx;
"Xx Xxx Xxxxxx" means Xxx Xxxxxxxxx Suttie of Xxxxxxx, Xxxxx Xxxxxxx Xxxx,
Xxxxxxxx, XX00 0XX;
"Xxx. Xxxxxx" means Xxx. Xxxxxxx Xxxxxxxxx Xxxxxx, of Parklea,
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000
Xxxxx Xxxxxxx Xxxx, Xxxxxxxx, XX00 0XX;
"Non-Xxxxxx
Shareholders" means any shareholders in any of the UK Subsidiaries or
non UK Subsidiaries other than the Company, Xx Xxx Xxxxxx
and Xx Xxxxx Xxxxxx;
"Non-UK Leasehold
Documentation" means the lease of the Non-UK Leasehold Properties and the
ancillary documents relating to those leases all as
attached to the Xxxxxxxxxx Xxxxxx X0 - XX0 inclusive (with
the exception of Document BB1);
"Non UK-Leasehold
Properties" means those of the Non-UK Properties which are held on
lease or licence;
"Non-UK
Properties" means the land and/or building situated outwith the United
Kingdom which are either owned or leased by Target Group,
brief particulars of which are given in Part 7C of the
Schedule;
"Non-UK
Subsidiaries" means the overseas trading subsidiaries and undertakings,
details of which are set out in Part 2B of the Schedule;
"Occupational
Schemes" means the Wellserv Scheme, the SSAS and the Life Scheme;
"OPRA" means the Occupational Pensions Regulatory Authority;
"Pension
Schemes" means the Wellserv Scheme, the SSAS and the Group
Personal Pension Plan;
"Personal Pension
Contributions" means contributions of 2% of basic salary which are paid
by Downhole Technology Limited to a Group Personal Pension
Plan with Norwich Union in respect of 2 Employees;
"Preference
Shares" means the 1,875,000 Cumulative Redeemable
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142
Preference Shares of (pound)0.01 each in the Target's
share capital;
"Properties" means the UK Properties and the Non-UK Properties;
"PSO" means the Pension Schemes Office of the Inland Revenue;
"Purchaser's
Group" means the Purchaser and any person which is from time to
time a group undertaking of the Purchaser;
"Purchaser's
Solicitors" means Xxxxxxx Xxxxx X.X.,00 Xxxxxx Xxxxxx, Xxxxxxxxx XX0
0XX;
"Rate" means the rate of 3 per centum per annum above the base
rate from time to time of The Royal Bank of Scotland plc;
"Registration
Rights
Agreement" means the registration rights agreement between certain of
the parties in the Agreed Form;
"Retained Group
Company" means First Oil PLC (Company Number SC191745) and its
subsidiaries;
"SEC" means the United States Securities and Exchange
Commission, or any successor agency thereto;
"Securities Act" means the United States Securities Act of 1933, as
amended, or any successor legislation thereto (including
the rules and regulations promulgated thereunder);
"SSAS" means the small self-administered occupational pension
scheme known as the Offshore Rentals Directors' Scheme
established by the Target Group under a trust deed and
rules dated 7 June 1989 of which Offshore Rentals Ltd is
the Principal Employer;
"Sale Shares" means the 355,910 Ordinary Shares of (pound)1 each,
135,000 'A' Ordinary Shares of (pound)1 each which will
together
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143
comprise the entire issued share capital of the Target at
the Completion Date;
"Schedule" means the schedule comprising Parts 1 to 9 (inclusive)
which forms part of this Agreement;
"Scottish
Properties" means the land and/or buildings situated in Scotland which
are either owned or leased by Target Group, brief
particulars of which are set out in Part 7A of the
Schedule;
"Second
Disclosure
Letter" means the letter dated the same date as the Completion
Date from the Warrantor to the Purchaser containing
further disclosures against the Warranties in accordance
with the provisions of Clause 8.2;
"Shelf
Registration" shall have the meaning given to it in the Registration
Rights Agreement;
"SSAP" means a statement of standard accounting practice adopted
by The Accounting Standards Board Limited;
"Subsidiaries" means the companies and undertakings details of which are
given in Part 2 of the Schedule and "Subsidiary" shall
mean any of them;
"Taxation" shall have the meaning given to it in the Tax Deed;
"Taxation
Authority" shall have the meaning given to it in the Tax Deed;
"the Target
Group" means the Target and the Subsidiaries (but for the
avoidance of doubt specifically excluding the Retained
Group Company) and "member of the Target Group" and
"Target Group Company" means any of them;
"Target Group
Intellectual
Property" means all IPR owned by or registered or applied for in the
name of any member of the Target Group;
"Tax Deed" means a deed of covenant between certain of the parties in
the Agreed Form;
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144
"Tax Warranties" means the Warranties set out in Part 5F and Part 5G of the
Schedule;
"TCGA" means the Taxation of Chargeable Gains Xxx 0000;
"Territory" means anywhere in the world;
"Title
Warranties" means the representations and warranties contained in Part
5A of the Schedule;
"Third Party
Software" means computer programs the copyright or other IPR used,
sold, licensed or sub-licensed by the Target Group in the
Business or necessary for carrying out the Business in the
manner and to the extent carried out immediately prior to
Completion, and in each case any user manuals, or other
documentation and materials relating thereto (whether in
paper, disc or electronic form);
"Transaction" shall have the meaning given to it in the Tax Deed;
"the Trust" means the Xxx X. Xxxxxx Trust constituted by Deed of Trust
dated [ o ];
"the Trustees" means Xx. Xxx Xxxxxx and P&W Trustees (Aberdeen) Limited
as trustees of the Trust;
"UK Companies" means the Target and those subsidiaries listed in Part 2A
of the Schedule;
"UK Lease
Documentation" means the leases of the UK Leasehold Properties and the
ancillary documents relating to those leases all as
attached to the Disclosure Letter as Documents A1 - A12,
D1 - D20, F1 - F6, H1 - H24, J1 - J6 and K1 - K5;
"UK Leasehold
Properties" means those in the UK Properties which are held on lease
or licence;
"UK Properties" means the Scottish Properties and the English Properties;
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145
"VATA" means the Value added Tax Xxx 0000;
"Warranties" means the representations and warranties contained in
Clause 5 and Part 5 of the Schedule;
"Warrantor" means Xx. Xxx Xxxxxxxxx Xxxxxx;
"Weatherford
Common Stock" means the common stock of Weatherford, $1.00 par value;
"Weatherford
Material
Adverse Effect" means any change or effect that, individually or when
taken together with all such other changes or effects, is
or would reasonably be considered to be materially adverse
to the condition, financial or otherwise, results of
operation, prospects, business, properties, assets or
liabilities of Weatherford and its subsidiaries, taken as
a whole;
"Weatherford
Shares" means the shares of Weatherford Common Stock to be issued
to the Vendors as the Consideration and any Additional
Consideration pursuant to this Agreement;
"Wellserv
Scheme" means the occupational pension scheme known as the
Wellserv Pension Scheme established by Wellserv plc under
a trust deed and rules of which Wellserv plc is the
Principal Employer;
"1988 Act" means the Income and Corporation Xxxxx Xxx 0000;
"1993 Act" means the Xxxxxxx Xxxxxxx Xxx 0000;
"1995 Act" means the Pensions Xxx 0000.
2. Words and expressions defined in the Companies Xxx 0000 shall bear the same
meanings in this Agreement.
3. The masculine gender shall be deemed to include the feminine and neuter and
the singular number shall be deemed to include the plural and vice versa.
4. The Clause headings, use of bold or italic type and contents pages in this
Agreement
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146
are for convenience of reference only and shall not affect the construction
or interpretation hereof.
5. References to Recitals, Clauses, and Parts of the Schedule are to the
Recitals and Clauses of and parts of the Schedule to this Agreement and
references to paragraphs are to the paragraphs of a Part of the Schedule.
6. Reference in this Agreement to any statute or statutory provision shall
include such statute or statutory provision as from time to time amended,
re-enacted or consolidated whether before, on or (in the case of
re-enactment or consolidation only) after the date of this Agreement and
shall include statutory instruments or other subordinate legislation made
under the relevant statute, provided that no such amendment, re-enactment,
consolidation, statutory instrument or other subordinate legislation made
after the date of this Agreement shall increase the liability of any party.
7. References in this Agreement to persons shall include references to firms,
corporations or unincorporated associations.
8. For the purposes of Part 5 of the Schedule any statement in this Agreement
which is qualified by the expressions "so far as the Warrantor is aware" or
"to the best of the knowledge, information and belief of the Warrantor" or
something similar shall (unless expressly stated otherwise) be deemed to
include an additional statement that it has been made after diligent,
reasonable and proper enquiries by the Warrantor and any matter within the
knowledge or awareness of any officer or any member of the Target Group
shall be deemed to be within the knowledge or awareness of the Warrantor.
9. Words and expressions defined in the Tax Deed and not defined in this
Agreement shall bear the same meaning in this Agreement.
149
[Weatherford Logo]
WEATHERFORD U.K. LIMITED
A COMPANY INCORPORATED IN ENGLAND AND WALES
REGISTERED NUMBER 862925
REGISTERED OFFICE: 00/00 XXXXX XXXX, XXXXX XXXXXXXX, XXXXXXX, XX00 0XX
Xxxxxxxxxxx International Inc.
000 Xxxx Xxx Xxxxxxxxx
Xxxxx 000
Xxxxxxx
Xxxxx 00000
XXX
Xxx Xxxxxxxxx Xxxxxx
"Parklea"
North Xxxxxxx Xxxx
Xxxxxxxx
XX00 0XX
Xxxxxxx Xxxxxxxxx Xxxxxx
"Parklea"
Xxxxx Xxxxxxx Xxxx
Xxxxxxxx
XX00 0XX
Xxx Xxxxxxxxx Xxxxxx and P & W Trustees (Aberdeen) Limited
as Trustees of Xxx X Xxxxxx Trust
"Parklea"
North Xxxxxxx Xxxx
Xxxxxxxx
XX00 0XX
Xxxxx Xxxxxxxx Xxxxxx
00 Xxxxxx Xxxxx
Xxxxxxxx
XX0 0XX
150
3i Group plc
00 Xxxxxxxx Xxxx
Xxxxxx
XX0 0XX
19th April 2001
Dear Sirs
ACQUISITION BY WEATHERFORD UK LIMITED OF THE ENTIRE ISSUED SHARE CAPITAL OF
XXXXXX GROUP PLC ("THE ACQUISITION")
We refer to the Sale and Purchase Agreement entered into by (1) Xxxxxxxxxxx UK
Limited, (2) 3i Group plc, (3) Xxx Xxxxxxxxx Xxxxxx and others (therein together
called the "Majority Vendors") and (4) Xxxxxxxxxxx International Inc. and dated
24th February 2001 (the "Agreement"). Words and expressions defined in the
Agreement shall have the same meaning in this letter.
We also refer to the notice dated 10th April 2001 served by us in our capacity
as the Purchaser on 11th April 2001 giving the Majority Vendors and
Institutional Vendor notice that the Purchaser had discovered a Material Adverse
Effect of the Target Group and, in accordance with the provisions of Clause 2.4
of the Agreement to terminate the Agreement with effect from the date of service
thereof (the "Notice").
Notwithstanding the foregoing, it is hereby agreed by all of the parties to the
Agreement as follows:
(1) that the Notice shall be treated as if it had not ever been served and that
the Agreement shall continue to have full force and effect in accordance
with its terms subject to the amendments made in this letter agreement;
(2) the Completion Date for the Acquisition will be Thursday 19th April 2001 or
such other date as the parties agree in writing;
(3) the Consideration for the Acquisition will be that number of whole shares
of Weatherford Common Stock which at a price per share of Fair Market Value
as are equal in value to the sum of One hundred and eighty two million one
hundred and fifty five thousand Pounds Sterling ((pound)182,155,000) less
the Indebtedness as certified in the Indebtedness Statement rather than the
number of shares calculated in accordance with the definition of
Consideration stated in the Agreement;
(4) stock certificates for a number of whole shares of Weatherford Common Stock
to be issued to Xx Xxx Xxxxxx as part of the Consideration as noted in (3)
above having a Fair Market Value of Ten
151
3
million Pounds Sterling ((pound)10,000,000) ("the Retained Shares") will be
retained by the Purchaser's Solicitors for a period of one year ("the
Retention Period") from the Completion Date by way of security in respect
of any actual or alleged breach of the Warranties, or the Tax Deed or any
claims under the Indemnities, provided always:
(a) the shares represented by those stock certificates will be issued in
the name of Xx Xxx Xxxxxx and will be registered in terms of the
Registration Rights Agreement;
(b) Xx Xxx Xxxxxx may at any time during the Retention Period, elect to
sell all or any of the Retention Shares by submitting written notice
to that effect to the Purchaser's Solicitors ("Retention Period Share
Sale");
(c) the proceeds of any Retention Period Share Sale shall be dealt with as
follows:
(i) a cash sum equal to the Fair Market Value of each Retained Share
sold in terms of paragraph 4(b) above, shall be paid into an
interest bearing deposit account to be opened in the joint names
of Xx Xxx Xxxxxx and the Purchaser with The Royal Bank of
Scotland plc ("Joint Account") and such cash amount shall be held
in that account for the unexpired portion of the Retention
Period; and
(ii) the amount (if any) in excess of the Fair Market Value of each
Retained Share sold in terms of paragraph 4(b) above shall be
paid over to Xx Xxx Xxxxxx or as he lawfully directs;
(d) unless the Purchaser has served notice of a claim for an alleged
breach of the Warranties or a claim under the Indemnities or the Tax
Deed prior to the expiry of the Retention Period ("Release Date") and
such Claim has not been satisfied, settled or withdrawn prior to the
Release Date, the Purchaser's Solicitors shall deliver to Xx Xxx
Xxxxxx on the Release Date the stock certificates then held by them in
respect of Retention Shares and/or the Purchaser shall execute all
documents necessary to allow Xx Xxx Xxxxxx to uplift the funds held in
any Joint Account; and
(e) If the Purchaser has served notice of a claim for an alleged breach of
the Warranties or a claim under the Indemnities or the Tax Deed prior
to the Release Date and such claim has not been satisfied, settled or
withdrawn prior to the Release Date, the Purchaser's Solicitors shall
be entitled to continue to retain
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4
such number of Retention Shares and such amount of cash shall continue
to be held in such Joint Account which in aggregate is equal to a
reasonable estimate of the liability of Xx Xxx Xxxxxx in respect of
such claim until such claim is satisfied settled or withdrawn and the
excess amount of Retained Shares and/or cash will be delivered or paid
over to Xx Xxx Xxxxxx (as the case may be).
(5) the specific matters noted in the Schedule to the Notice (other than those
noted in the Schedule to this letter), shall not form the basis of a claim
for breach of the Warranties, or under the Indemnities or the Tax Deed;
(6) Indebtedness for the purposes of the Agreement shall be deemed to include
and shall therefore be increased by the total amount of the Outstanding
Payables which, for the purposes of this letter of agreement and the
Agreement shall be defined as:
(a) all cheques which have been drawn by the Target Group but which have
not been presented or which remain uncleared at the Completion Date;
(b) all telegraphic or electronic transfers of funds which have been
instructed by the Target Group but remain incomplete at the Completion
Date of the Acquisition; and
(c) all trade creditors accounts of the Target Group at the Completion
Date, to the extent that the same have been outstanding for a period
of 75 days or more from the date of the relevant invoice.
Provided always that, on or before the Completion Date, the parties shall
agree an estimate of the Outstanding Payables (hereinafter called the
"Estimated Outstanding Payables") which shall be deemed to be Indebtedness
and will be included in the Indebtedness Statement for the purposes of
calculating the Consideration payable at Completion.
The parties hereby agree that, as soon as possible after the Completion
Date and no later than 20 Business Days after the Completion Date the
Purchaser will determine the actual amount of the Outstanding Payables.
In the event that the Outstanding Payables exceed the Estimated Outstanding
Payables, the Majority Vendors agree to transfer to the Purchaser, within
ten Business Days of the determination of the Outstanding Payables, such
number of Weatherford Shares, at a price per share of Fair Market Value,
issued to them as part of the Consideration as is equal in value to the
amount by which the
153
5
Outstanding Payables exceed the Estimated Outstanding Payables. Upon such
transfer, any warranty by Xx Xxx Xxxxxx in relation to the Indebtedness
Statement, to the extent that it relates to the amount of Outstanding
Payables, shall be discharged pro tanto.
In the event that the Estimated Outstanding Payables exceed the Outstanding
Payables, the Purchaser agrees to issue to the Majority Vendors (on the
same basis as in Clause 4.4.3 of the Agreement) within ten Business Days of
the determination of the Outstanding Payables, such number of Weatherford
Shares, at a price per share of Fair Market Value, as additional
consideration as is equal in value to the amount by which the Estimated
Outstanding Payables exceed the Outstanding Payables.
(7) In relation to the Indebtedness Statement, the Purchaser acknowledges and
agrees that the basis of calculation of those items under the heading "HP
Commitments" shall be the relevant settlement figures for discharge of each
of the contracts or agreements to which the Target Group Companies are
party as at close of business on 18 April. In the event that the aggregate
amount of such settlement figures is greater or less than the amounts shown
under the said heading in the Indebtedness Statement then
(a) the amount of any excess shall be the subject of the indemnity
provided in Clause 18.1.2 of the Agreement but any recovery competent
to the Purchaser shall be satisfied by Xx Xxx Xxxxxx by the transfer
by Xx. Xxx Xxxxxx to the Purchaser, within ten Business Days of the
determination of the said aggregate amount of such settlement figures,
of such number of Weatherford Shares, at a price per share of Fair
Market Value, issued to him as part of the Consideration as is equal
in value to the amount of such excess or, at the option of and to the
extent required by the Purchaser by setting off the amount of such
excess against any obligation of the Purchaser in relation to the
payment of Additional Consideration to Xx. Xxx Xxxxxx in terms of
Clause 4.4.3 of the Agreement without prejudice to the entitlement of
the other Vendors to such Additional Consideration and, if such excess
is greater than the amount of Additional Consideration attributable to
Xx. Xxx Xxxxxx, then additionally against the obligation of the
Purchaser in relation to that part of the amount by which the
Estimated Outstanding Payables exceed the Outstanding Payables
attributable to Xx. Xxx Xxxxxx'x proportionate part of the entitlement
of the Majority Vendors under the final paragraph of (6) above; and
(b) the amount of any deficiency shall be satisfied by the Purchaser by
the issue to Xx. Xxx Xxxxxx within ten Business Days of the
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6
determination of such deficiency of such number of Weatherford Shares
at a price per share of Fair Market Value as additional consideration
as is equal in value to the amount of such deficiency.
(8) Indebtedness for the purposes of the Agreement shall be reduced by the sum
of One million two hundred and eighty eight thousand Pounds Sterling
((pound)1,288,000) being the sum payable to Target by a company controlled
by Xx Xxx Xxxxxx in consideration for the sale and purchase of the shares
held by Target in First Oil plc. A bankers draft for such amount will be
delivered to Target on the Completion Date.
For the avoidance of doubt the Purchaser accepts (subject to the Purchaser
confirming in writing that it is fully satisfied that the relevant liabilities
have been fully and finally discharged by the Target Group) that the matters
covered by the specific indemnities set out at Clauses 18.1.7 paragraphs (a),
(b), (c) and (d) (claims by Xxxxx International (North Sea) Limited) have been
settled and that the said indemnities will be of no further effect and no claim
shall lie against Xx Xxx Xxxxxx in respect thereof.
It is agreed that the terms of this letter shall be binding upon the parties to
the Agreement with effect from the date hereof.
For the avoidance of doubt, the remaining provisions of the Agreement shall as
amended by this letter continue to have full force and effect.
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7
Please acknowledge your receipt and acceptance of the terms of this letter by
signing the acknowledgement below.
Yours faithfully
/s/ Xxxx X. Sedge
--------------------------------------------
For and on behalf of Weatherford UK Limited
We hereby acknowledge receipt of your letter dated 19th April 2001 and confirm
our acceptance and agreement to the matters as terms therein contained.
/s/ Xxxxxxx Xxxx
--------------------------------------------
Signed for and on behalf of
3i Group plc by
as authorized signatory for 3i Group plc
Date: 19/4/01
/s/ Xxx X. Xxxxxx
--------------------------------------------
Signed for and on behalf of The
Xxx Xxxxxxxxx Suttie Trust by
Xxx Xxxxxxxxx Xxxxxx and P&W
Trustees (Aberdeen) Limited
Date: 19/4/01
/s/ Xxxxxx Xxxxxx
--------------------------------------------
Signed by * as
Attorney for Xxxxx Xxxxxxxx
Xxxxxx
Date: 19/4/01 *Xxxxxx Xxxxxx
/s/ Xxxxxx Xxxxxx
--------------------------------------------
Signed by * as
Attorney for Xxxxxxx Xxxxxxxxx
Xxxxxx
Date: 19/4/01
156
8
/s/ Xxxxxx Xxxxxx
---------------------------------------------
Signed by * as *Xxxxxx Xxxxxx
Attorney for Xxx Xxxxxxxxx
Xxxxxx
Date: 19/4/01
/s/ Xxxx X. Sedge
---------------------------------------------
Signed for and on behalf of
Xxxxxxxxxxx International Inc.
by an authorised
signatory
Date: 19th April 2001
157
9
THIS IS THE SCHEDULE REFERRED TO IN THE FOREGOING LETTER OF AGREEMENT
A. INTELLECTUAL PROPERTY
(i) Patent infringement issue with O&M/Mecur regarding HWU Workover Rig;
or
(ii) Patent infringement issue with Cougar of Canada regarding IPE drilling
jars; or
(iii) Patent infringement issue with Drill Tech regarding Torque Reducing
Drillstring Component.
B. TAX
(i) UK PAYE and social security taxes and penalties and foreign country
employment taxes and penalties for employees of the Target Group
(including an entity designed as "Xxxxxx International") that work in
overseas locations; or
(ii) Matters arising from Tax audit in Norway for sub-rental of equipment
from UK to Norway subject to the proviso that if any amount charged to
Norway for the sub-rental of this equipment is disallowed for taxation
in Norway, the Purchaser shall, at the sole cost of Xx Xxx Xxxxxx, use
all reasonable endeavours permitted by law to vary the said rental
rate such that any tax liability in respect thereof in the UK shall be
reduced accordingly.
