DATED 28 February 2002
THE SELLERS
- and -
RIGHT ASSOCIATES LIMITED
- and -
RIGHT MANAGEMENT CONSULTANTS, INC
- and -
ATLAS GROUP HOLDINGS LIMITED
AGREEMENT
- relating to -
THE SALE AND PURCHASE OF THE ENTIRE ISSUED SHARE CAPITAL OF
ATLAS GROUP HOLDINGS LIMITED
Lovells
CONTENTS
Clause Page No
1. INTERPRETATION 1
2. SALE AND PURCHASE OF SHARES 9
3. CONDITIONS 10
4. PRE-COMPLETION 12
5. CONSIDERATION 16
6. COMPLETION 16
7. RETENTION AND NET ASSET ADJUSTMENT 19
8. WARRANTIES 21
9. LIMITATION ON CLAIMS 24
10. RESTRICTIVE COVENANTS 29
11. ANNOUNCEMENTS 30
12. FURTHER ASSURANCE AND AVAILABILITY OF INFORMATION 30
13. INTEREST 30
14. CONTINUING OBLIGATIONS AND ASSIGNMENT 31
15. COSTS 31
16. NOTICES 32
17. AGENT FOR SERVICE 34
18. SEVERABILITY AND SUSPENSION OF RESTRICTIONS 34
19. ENTIRE AGREEMENT AND VARIATION 35
20. GENERAL PROVISIONS 35
21. RELEASE BY THE SELLERS 37
22. XXXXXXXXX 00
00. GOVERNING LAW AND JURISDICTION 38
24. EXCLUSIVITY 39
25. WARRANTHOLDERS 39
1. The Sellers and the Shares 41
2. The Company and the Subsidiary Undertakings 44
3. The Properties 45
4. Non-Tax Warranties 46
5. Tax Covenant and Tax Warranties 47
6. Net Asset Statement 48
DOCUMENTS IN THE AGREED TERMS
Loan Note Instrument
Loan Notes
Letter of Credit supporting the Loan Notes
Powers of attorney
Legal Opinion
Deeds of Release
Letters of Resignation
Retention Account Letter of Instruction
Termination Agreement
Indemnities for lost share certificates
SHARE PURCHASE AGREEMENT
THIS AGREEMENT is made on 28 February 2002
BETWEEN:
(1) The persons whose names and addresses are set out in column 1 of
Schedule 1 (the "Sellers");
(2) Right Associates Limited a company registered in England and Wales
under number 02017288 whose registered office is at Xxxxxxxx Xxxxx,
00-00 Xxxxxxx XX Xxxxxx, Xxxxxx XX0 0XX (the "Purchaser");
(3) Right Management Consultants, Inc a company incorporated in the
Commonwealth of Pennsylvania whose principal office is at 0000 Xxxxxx
Xxxxxx, 00xx Xxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000 XXX (the
"Guarantor"); and
(4) Atlas Group Holdings Limited, whose details are set out in Recital A
below.
RECITALS:
(A) Atlas Group Holdings Limited is a company registered in England under
number 3687653 whose registered office is at Xxx Xxxxxxx Xxxxx, 00
Xxxxxxxxx, Xxxxxx XX0X 0XX (the "Company"). Further particulars of the
Company and of each of the Subsidiary Undertakings of the Company are
set out in Schedule 2.
(B) The Sellers have agreed to sell and the Purchaser has agreed to
purchase all of the Shares on and subject to the terms of this
Agreement.
(C) In consideration of each of the Sellers entering into this Agreement,
the Guarantor has agreed to guarantee the obligations of the Purchaser
under this Agreement.
IT IS AGREED:
1. INTERPRETATION
1.1 In this Agreement (including its Recitals and Schedules):
"3i Loan" the loan made by the 3i Investors (as defined in the
Supplemental Investment Agreement) to the Company pursuant to the terms
of the Supplemental Investment Agreement;
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"3i Representative" has the meaning given to it in clause 16.4;
"3i Sellers" means 3i Group plc, 3i Parallel Ventures LP and 3i UKIP II
LP;
"Atlas 2001 Accounts" means the audited consolidated balance sheet and
profit and loss account of the Company, as at and for the period ended
on the Balance Sheet Date, in each case including all notes, reports,
statements and other documents annexed to them, whether or not pursuant
to any legal requirement, in the form annexed to the Disclosure Letter;
"Balance Sheet Date" means 31 December 2001;
"Bank of Scotland" means The Governor and Company of the Bank of
Scotland;
"Business Day" means any day (except any Saturday or Sunday) on which
banks in the City of London and the City of New York are open for
business;
"CAI" means Credit Agricole Indosuez in its capacity as Security
Trustee under the Common Terms Agreement;
"CCG" means Xxxxxx Consulting Group Limited, a company registered in
England and Wales under number 1737893, further details of which are
set out in Schedule 2;
"Commitment Letter" has meaning given in clause 3.1(f);
"Common Terms Agreement" means the common terms agreement relating to
the Senior Facilities Agreement, the Mezzanine Facility Agreement and
Junior Mezzanine Facility Agreement dated 26 February 1999 as amended
and restated on 22 April 1999 between the Company (1) Credit Agricole
Indosuez and The Governor and Company of the Bank of Scotland as Senior
Arrangers (2) The Banks and Financial Institutions whose names and
addresses are set out in Schedule 1 of the Senior Facilities Agreement
as Senior Lenders (3) The Governor and Company of the Bank of Scotland
as Ancillary Facilities Bank (4) The Governor and Company of the Bank
of Scotland as the Hedge Counterparty (5) Credit Agricole Indosuez as
the Senior Agent (6) Credit Agricole Indosuez and The Governor and
Company of the Bank of Scotland as the Mezzanine Arrangers (7) The
Financial Institutions whose names and addresses are set out in
Schedule 1 of the Mezzanine Facility Agreement as Mezzanine Lenders (8)
Credit Agricole Indosuez as Mezzanine Agent (9) Credit Agricole
Indosuez as Junior Mezzanine Agent (10) and Credit Agricole Indosuez as
the Security Trustee (11) as varied, amended or restated from time to
time;
"Company" has the meaning given in Recital (A);
"Completion" means completion of the sale and purchase of the Shares
pursuant to this Agreement;
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"Completion Date" means 22 March 2002 or such other date as the
Purchaser and the 3i Representative may agree in writing being no later
than 28 March 2002;
"Completion Date Indebtedness" means the aggregate of all external
financial debt of the Group as at the Completion Date (including
without limitation, interest accrued up to the Completion Date and any
fees, charges, costs and expenses payable) under the Facilities
Documents, the Investment Agreements and the 3i Loan but excluding hire
purchase, operating and finance lease arrangements as at the Completion
Date;
"Connected" has the meaning attributed to it by section 839 ICTA 1988;
"Consideration" means the aggregate consideration for the Shares
payable by the Purchaser to the Sellers in accordance with clause 5;
"Disclosure Letter" means the letter of the same date as this Agreement
from the Managers to the Purchaser referred to in clause 8.2;
"Effective Date" is the close of business on 28 February 2002;
"Effective Date Indebtedness" means the aggregate of all external
financial debt of the Group as at the Effective Date (including without
limitation, interest accrued up to the Effective Date and any fees,
charges, costs and expenses payable) under the Facilities Documents,
the Investment Agreements and the 3i Loan but including the sums due
under clause 6.2 to 3i plc and 3i Group plc up to the Completion Date
(but excluding hire purchase, operating and finance lease arrangements
as at the Effective Date);
"Estimated Completion Date Indebtedness" means(pound)31,857,000;
"Estimated Effective Date Indebtedness" means(pound)31,337,957.07;
"Exchange Rate" means the closing mid-market spot rate of exchange in
London for the conversion of the relevant currency into Pounds Sterling
quoted as the "Closing Mid Point" on the Completion Date or, if that is
not a Business Day, the Business Day immediately preceding that day for
Pounds Sterling against the relevant foreign currency as shown in the
London edition of The Financial Times;
"Expected Net Assets" means(pound)0.5 million negative;
"Facilities Documents" means the Senior Facilities Agreement, the
Mezzanine Facilities Agreement, the Junior Mezzanine Facilities
Agreement (and includes the Senior Credit Documents, the Mezzanine
Credit Documents and the Junior Mezzanine Credit Documents as defined
in each of the foregoing respectively) and the Common Terms Agreement;
"Governmental Entity" means, in relation to anywhere in the world, any
supra-national, national, state, municipal or local government, any
subdivision, court, administrative
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agency or commission or other authority thereof, or any
quasi-governmental or private body exercising any regulatory, taxing,
importing or other governmental or quasi-governmental authority,
including the European Commission;
"Group" means the Company and the Subsidiary Undertakings, and "Group
member" shall be construed accordingly;
"ICTA 1988" means the Income and Corporation Taxes Xxx 0000;
"Independent Accountants" means one of the five largest firms of
chartered accountants in the United Kingdom to be appointed jointly by
the Purchaser, the 3i Representative and the Managers' Representative
or, if they fail to agree an appointee within five Business Days of the
Purchaser, the 3i Representative or the Managers' Representative first
proposing such a person by notice to the others, to be appointed on the
application of the Purchaser, the 3i Representative or the Managers'
Representative by the president or the other senior officer for the
time being of the Institute of Chartered Accountants in England and
Wales;
"Initial Investment Agreement" the investment agreement between the
Company (1), the Promoters (as defined therein) (2), 3i plc (3), 3i
Group plc (4), 3i Parallel Ventures LP (5) and 3i UKIP II LP dated 26
February 1999;
"Intellectual Property" means patents, trade marks or names whether or
not registered or capable of registration, business names, registered
designs, design rights, copyrights, database rights, the right to apply
for registrations of and applications to register any of the preceding
items, together with the rights in inventions, processes, software,
know-how, trade or business secrets, confidential information or any
process or other similar right or asset capable of protection enjoyed,
owned, used or licensed by any Group member in any relevant country,
and rights in the nature of unfair competition rights and rights to xxx
for passing off, in each case wherever in the world enforceable;
"Investment Agreements" the Initial Investment Agreement and the
Supplemental Investment Agreement;
"Junior Mezzanine Facility Agreement" means the junior mezzanine
facility agreement dated 26 February 1999 between the Company (1)
Credit Agricole Indosuez and The Governor and Company of the Bank of
Scotland as the Junior Mezzanine Arrangers (2) The Banks and Financial
Institutions whose names and addresses are set out in Schedule 1
thereto (3) and Credit Agricole Indosuez (as the Junior Mezzanine
Agent) (4) as varied, amended or restated from time to time;
"Loan Note Instrument" means the instrument to be executed by the
Purchaser constituting the Loan Notes in the agreed terms;
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"Loan Notes" means the loan notes in the agreed terms to be issued by
the Purchaser to the Managers pursuant to clause 6.3(d) including the
form of letter of credit to support the Loan Notes in substantially the
agreed terms;
"Management Accounts" means the management accounts of the Group
covering the period 1 January 2002 to 28 February 2002;
"Managers" means Xxxxxxx Xxxxxxx, Xxxxxx XxXxx, Xxxx Xxxxxxxxxxxx,
Xxxx-Xxx Buridans and Xxxxxx Burn;
"Managers' Representative" means the representative of the Managers
appointed pursuant to clause 16.3;
"Material Adverse Change" means an act, event or circumstance which
occurs in the period between the date hereof and Completion where a
Group member suffers an adverse effect which materially reduces the
value of the Group as a whole.
In arriving at a determination of the value of the Group for the
purposes of determining whether a Material Adverse Change has occurred
regard shall be had to the manner by which the purchase price for the
Shares has been agreed by the parties.
For the purposes of determining whether such an act, event or
circumstance has occurred, any act, event or other circumstance arising
from any of the following shall not be taken into account and shall be
excluded:
(a) any seasonal or cyclical effect on the Group's business (not
specific to the business) or the industry in which the Group
operates (the "Industry") consistent with previous experience
in the business of the Industry (provided that such event or
change does not adversely affect the Group in a
disproportionate manner when compared to other companies
carrying on business in the Industry);
(b) the occurrence or continuance of any material disruption or
material adverse change in the financial, banking or capital
markets (provided that such event or change does not adversely
affect the Group in a disproportionate manner when compared to
other companies carrying on business in the Industry);
(c) any economic, political, regulatory or other circumstances
which are not specific to the Group and which are outside the
reasonable control of the Group (provided that such event or
change does not adversely affect the Group in a
disproportionate manner when compared to other companies
carrying on business in the Industry); and
(d) any event or change generally affecting the Industry,
including general economic or financial conditions in the
Industry, (provided that such event or change does
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not adversely affect the Group in a disproportionate manner
when compared to other companies carrying on business in the
Industry);
"Material Contracts" has the meaning given in clause H.7 of Schedule 4;
"Mezzanine Facility Agreement" means the mezzanine facility agreement
dated 26 February 1999 between the Company (1) Credit Agricole Indosuez
and The Governor and Company of the Bank of Scotland as the Mezzanine
Arrangers (2) The Banks and Financial Institutions whose names and
addresses are set out in Schedule 1 thereto (3) and Credit Agricole
Indosuez as Mezzanine Agent (4) as varied, amended or restated from
time to time;
"Net Asset Statement" has the meaning set out in Schedule 6, Part A,
paragraph 1;
"Net Assets" means the net assets of the Group as at the Effective Date
as set out in Part B of Schedule 6 next to the title "Adjusted Net
Assets"; "Net Cash Schedule" has the meaning given in clause 4.2(b);
"Non-Tax Warranties" means those warranties set out in Schedule 4 and
in clauses 8.12 and 8.13;
"Non-Tax Warranty Claim" means any claim for breach of any Non-Tax
Warranties;
"Principal Group Members" has the meaning given in clause H.8(a) of
Schedule 4;
"Proceedings" means any proceedings, suit, or action arising out of or
in connection with this Agreement;
"Properties" means the properties occupied by Group members in the UK,
France, Canada and Japan as described in Schedule 3;
"Purchaser's Auditors" means such firm of chartered accountants as the
Purchaser may appoint from time to time for the purposes of Schedule 6;
"Purchaser's Group" means the Guarantor and its Subsidiary
Undertakings;
"Purchaser's Solicitors" means Xxxxx & XxXxxxxx of 000 Xxx Xxxxxx
Xxxxxx, Xxxxxx XX0X 0XX;
"PVML" means Parallel Ventures Managers Limited, being one of the
Sellers in its capacity as administrator of the Parallel Ventures
(No.2) Co-Investment Plan;
"Respective Proportions" means (in relation to the Sellers) the
proportions in which they receive the Consideration as set out in
Schedule 1 column 3;
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"Restricted Area" means:
(a) the United Kingdom, Belgium, Canada, France, Germany, Italy,
Japan, Luxembourg, the Netherlands, the Republic of Ireland,
Spain and Switzerland (in the case of Xxxxxxx Xxxxxxx, Xxxxxx
XxXxx and Xxxxxx Burn);
(b) the United Kingdom (in the case of Xxxx Xxxxxxxxxxxx); or
(c) France (in the case of Xxxx-Xxx Buridans);
"Restricted Business" means the businesses of the Group carried on at
the Completion Date save in respect of Xxxxxx Burn where in each
circumstance Restricted Business shall mean the businesses of any
company whose principal activities are the provision of outplacement
services;
"Restricted Period" means a period commencing on the Completion Date
and ending on the second anniversary of the Completion Date;
"Retention" means, in respect of the Sellers who are not Managers and
Xxxx-Xxx Buridans, the cash amount of (pound)1,802,895.00 and in
respect of the Managers (but excluding Xxxx-Xxx Buridans) a nominal
amount of (pound)197,105 of the Loan Notes in each case in the amounts
set out in Schedule 1, column 6, to be retained from the Consideration
and dealt with in accordance with the provisions of clause 7;
"Retention Account" means the bank account referred to in clause 7.1;
"Retention Account Letter of Instruction" means the retention account
letter of instruction in the agreed terms;
"Sellers' Auditors" means Deloitte & Touche of Hill House, 0 Xxxxxx Xxx
Xxxxxx, Xxxxxx XX0X 0XX;
"Sellers' Solicitors" means Lovells of 00 Xxxxxxx Xxxxxxx, Xxxxxx XX0X
0XX;
"Senior Employee" has the meaning given to it in clause 4.5(l);
"Senior Facilities Agreement" means the facilities agreement dated 26
February 1999 between the Company (1) Credit Agricole Indosuez and The
Governor and Company of the Bank of Scotland as Senior Arrangers (2)
The Banks and Financial Institutions whose names and addresses are set
out in Schedule 1 thereto (3) The Governor and Company of the Bank of
Scotland as Ancillary Facilities Bank (4) and Credit Agricole Indosuez
as the Senior Agent (5) as varied, amended or restated from time to
time;
"Shares" means the issued shares in the capital of the Company
described in Schedule 1, being the entire issued share capital of the
Company;
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"Subsidiary Undertakings" means the subsidiary undertakings in respect
of which the Company is a parent undertaking, full details of each of
which are set out in Schedule 2 and "Subsidiaries" shall be construed
accordingly;
"Supplemental Investment Agreement" the supplemental investment
agreement between the Company (1), the Promoters (as defined therein)
(2), 3i plc (3), 3i Group plc (4), 3i Parallel Ventures LP (5) and 3i
UKIP II LP dated 6 April 1999;
"Tax Covenant" means the covenant set out in Schedule 5, Part A;
"Tax Disclosure Letter" means Part two of the Disclosure Letter;
"Tax Warranties" means those warranties set out in Schedule 5, Part B;
"Taxation" has the meaning ascribed to it in paragraph 1 of Schedule 5
and "Tax" shall be construed accordingly;
"UK Group Members" means the Company, Coutts Consulting Limited, Coutts
Consultants Limited, Coutts PDC Limited and Corecare Limited;
"Warrantholders" means CAI and the Bank of Scotland;
"Warrantholders' Representatives" means Xx Xxx Xxxxxx of CAI and Xxxxx
XxXxx of Bank of Scotland;
"Warranties" means the Non-Tax Warranties and the Tax Warranties; and
"Warranty Claim" means any claim for breach of any of the Warranties.
1.2 In this Agreement, unless the context otherwise requires:
(a) references to this Agreement or any other document include
this Agreement or such other document as varied, modified or
supplemented in any manner from time to time;
(b) references to any party shall, where relevant, be deemed to be
references to or to include, as appropriate, their respective
permitted successors, assigns or transferees;
(c) references to Recitals, clauses and Schedules and sub
divisions of them are references to the Recitals and clauses
of, and Schedules to, this Agreement and sub divisions of them
respectively;
(d) references to any enactment include references to such
enactment as re-enacted, amended or extended whether before,
on or (in the case only of re-enactment or consolidation
without substantive amendment) after the date of this
Agreement and any subordinate legislation made from time to
time under it (except to the extent that any re-enactment
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amendment or extension would increase the liability of any
party under this Agreement);
(e) references to a "person" include any individual, company,
corporation, firm, partnership, joint venture, association,
organisation, institution, trust or agency, whether or not
having a separate legal personality;
(f) references to the one gender include all genders, and
references to the singular include the plural and vice versa;
(g) any reference to indemnifying any person against any
circumstance includes indemnifying and holding that person
harmless from all actions, claims, demands and proceedings of
any nature from time to time made against that person and all
losses, damages, payments, awards, costs or expenses made,
suffered or incurred by that person as a consequence of, or
which would not have arisen but for, that circumstance;
(h) where any statement is qualified by the expression "so far as
the Managers are aware" or "to the best of the Managers'
knowledge and belief" or any similar expression it shall be
deemed to include an additional statement that it has been
made after due and careful enquiry;
(i) headings are inserted for convenience only and shall be
ignored in construing this Agreement; and
(j) the words "company", "subsidiary", "subsidiary undertaking"
and "parent company" have the meanings given to them by the
Companies Xxx 0000 as amended by the Companies Xxx 0000.
1.3 The Recitals and Schedules to this Agreement form part of it.
1.4 The Company is a party to this Agreement for the purposes of clause
15.2 only .
1.5 Any reference in this Agreement to a document being "in the agreed
terms" is to a document in the terms agreed between the parties and for
identification purposes only signed or initialled by them or on their
behalf on or before the date of this Agreement.
2. SALE AND PURCHASE OF SHARES
2.1 On and subject to the terms of this Agreement, each Seller shall sell
with full title guarantee the Shares set opposite its name in Schedule
1 and the Purchaser shall purchase all the Shares on and with effect
from Completion, in each case free from all charges, liens, equities,
encumbrances, claims or restrictions whatsoever and together with all
rights which are now, or at any time hereafter may become, attached to
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them (including without limitation the right to receive all dividends
and distributions declared, made or paid on or after Completion).
2.2 Each Seller agrees that it and its nominees hereby waive any rights
which may have been conferred on them under the articles of association
of the Company or otherwise or in any other way to have any of the
Shares offered to them for purchase at any time on or before the
transfer of the Shares pursuant to the provisions of this Agreement.
2.3 The Purchaser shall not be obliged to complete the purchase of any of
the Shares unless the purchase of all the Shares is completed
simultaneously.
3. CONDITIONS
3.1 Completion is conditional upon:
(a) in relation to the Irish Mergers and Monopolies (Control) Xxx
0000 (as amended) (the "Act"):
(i) the receipt by one or more parties of a statement in
writing by the Minister indicating that she has
decided not to make an order under section 9 of the
Act in relation to the transaction;
(ii) in the event of a conditional order having been made
under section 9 of the Act by the Minister, the
Purchaser and the 3i Representative being satisfied
with the conditions of that order and the conditions
of that order having been complied with in full; or
(iii) the relevant period specified in section 6(1) of the
Act having elapsed without the Minister having made
an order under section 9 of the Act in relation to
the transaction;
(b) the Sellers (other than the Managers and PVML) so far as they
are able in their capacity as shareholders in the Company and
the Managers not having failed in any respect to comply with
their obligations under clauses 4.1(b), 4.2(a), 4.4(a), (b),
(c), (d), (g), (k) (o) or (s), or if having so failed, not
thereafter and upon reasonable written notice failing to
remedy any such failure to the Purchaser's reasonable
satisfaction PROVIDED THAT this condition shall only be
treated as not having been satisfied if the consequences of
any such failure are material in the context of the sale of
the Shares;
(c) Warranties N.1 to N.8 (inclusive) in Schedule 4 and the
warranties set out in clause 8.11 remaining true and accurate
at Completion (subject to the contents of the Disclosure
Letter) as if repeated at Completion;
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(d) no temporary restraining order, preliminary or permanent
injunction or other order issued by a Governmental Entity of
competent jurisdiction being in effect which has the effect of
making the sale of the Shares contemplated by this Agreement
illegal or otherwise prohibiting its consummation;
(e) there being no Material Adverse Change;
(f) the satisfaction or waiver of all the conditions precedent
(other than any condition precedent as to this Agreement
becoming unconditional) to the draw down of funds by the
Guarantor set out in the commitment letter dated 26 February
2002 from First Union National Bank and First Union Securities
Inc. to the Guarantor (the "Commitment Letter"); and
(g) there being no pending or, to the actual knowledge of the
Purchaser, the 3i Representative or the Managers'
Representative, threatened claim, action, investigation or
proceeding seeking to restrain or prohibit the sale of Shares
contemplated by this Agreement where in the opinion of a
Queen's Counsel of at least 10 years call (or where the
relevant law is not English law, another reputable lawyer)
with relevant expertise there is a reasonable basis for such a
claim, action, investigation or proceeding.
3.2 Without prejudice to the foregoing, each of the Managers and the
Purchaser agrees that it shall use its reasonable endeavours (and the
Managers shall procure so far as they are able that the Company and
each other Group member shall) upon a request from the other, promptly
co-operate with and provide all necessary information reasonably
required by the other or by the relevant authority or agency in respect
of all requests and enquiries in connection with this Agreement and the
arrangements relating thereto from any such authority or agency for the
purposes of satisfying the conditions set out in clause 3.1(a).
3.3 Without prejudice to the foregoing, the Purchaser agrees that it shall
use its best efforts to procure that the condition set out in clause
3.1(f) is satisfied.
3.4 If all the conditions specified in clause 3.1 have not been satisfied
or have not been waived by the Purchaser and the 3i Representative, in
the case of clauses 3.1(a), (d) and (g), or by the Purchaser in the
case of clauses 3.1(b), (c), (e) and (f) by 12 noon (UK time) on
Thursday 28 March 2002, then:
(a) this Agreement shall terminate and have no further effect
(subject only to clauses 11 (Announcements), 15 (Costs) 23
(Governing law and jurisdiction) and 25 (Warrantholders) which
shall continue in force; and
(b) subject to those provisions referred to in (a) above surviving
in force and further subject to any liability which may arise
from any breach of the obligations
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contained in this Agreement prior to termination, the parties
shall be released from all liabilities and obligations
hereunder.
4. PRE-COMPLETION
4.1 On or prior to the date of this Agreement:
(a) the Guarantor shall deliver to the Sellers, in the agreed
terms, a written legal opinion from Fox Rothschild, O'Brien &
Xxxxxxx LLP addressed to the parties to this Agreement; and
(b) the Managers shall procure that a schedule containing
statements from Bank of Scotland, CAI and each of the 3i
Sellers detailing:
(i) the Estimated Effective Date Indebtedness; and
(ii) the Estimated Completion Date Indebtedness of each
Group member which is estimated as the amount
required to be discharged by the Company prior to the
delivery of the deeds of release in accordance with
clause 6.4(d) is delivered to the Purchaser.
4.2 Pending Completion, the Managers shall procure that:
(a) a schedule containing redemption statements from Bank of
Scotland, CAI and each of the 3i Sellers confirming:
(i) the actual amount of the Effective Date Indebtedness;
and
(ii) the actual amount of the Completion Date Indebtedness
of each Group member required to be discharged by the
Company prior to delivery of the deeds of release in
accordance with clause 6.4(d).
is delivered to the Purchaser by 9:30 a.m. (UK time) on the
Business Day of Completion;
(b) a schedule, including:
(i) bank statements of each UK Group Member together with
a reconciliation of these figures as at the Effective
Date, detailing the aggregate amount of cash of the
UK Group Members (as shown in the cash book balance
in the nominal ledger of each UK Group Member as at
the Effective Date) less any overdraft granted
pursuant to the Facilities Documents excluding cash
held in the "Dissenters' Accounts" at Lloyds TSB Bank
plc; and
(ii) bank statements of each Group Member (other than the
UK Group Members) together with a reconciliation of
these figures as at the Effective Date, detailing the
amount of cash of each Group Member (as shown in
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the cash book balance in the nominal ledger of each
such Group Member).
is delivered to the Purchaser by 12 noon (UK time) on the
Business Day before the Completion Date (the "Net Cash
Schedule"); and
(c) the Company and each Group member will carry on business in
the ordinary and usual course and, without the consent in
writing of the Purchaser, will not do anything which is not of
a routine unimportant nature.
4.3 (a) If the amounts of the Estimated Effective Date Indebtedness
and of the actual amount of the Effective Date Indebtedness
(as established by the statements delivered pursuant to
clauses 4.1(b) and 4.2(a)) differ, the following provisions of
this clause shall apply so as to effect an adjustment to the
Consideration payable by the Purchaser at Completion.
(b) If the amount of the Estimated Effective Date Indebtedness is
more than the actual amount of the Effective Date Indebtedness
then the amount of the Consideration to be paid by the
Purchaser to the Sellers pursuant to clause 6.3(d) shall be
increased by the amount of such difference, such payment to be
shared between the Sellers in the proportions set out in
Schedule 1, column 3.
(c) If the amount of the Estimated Effective Date Indebtedness is
less than the actual amount of the Effective Date Indebtedness
then the amount of the Consideration to be paid by the
Purchaser to the Sellers pursuant to clause 6.3(d) shall be
reduced by the amount of such difference, such reduction to be
shared between the Sellers in the proportions set out in
Schedule 1, column 3.
(d) The aggregate amount of the cash of the Group as set out in
the Net Cash Schedule (if positive) shall be paid by the
Purchaser to the Sellers as an additional amount of
Consideration such payment to be shared between the Sellers in
the proportions set out in Schedule 1, column 3.
4.4 Without prejudice to the provisions of clause 4.2(c), pending
Completion, the Sellers (other than PVML and the Managers) so far as
they are able in their capacity as shareholders in the Company and the
Managers shall procure so far as they are able that none of the
following matters will occur or be undertaken without the prior written
consent of the Purchaser:
(a) the modification of any of the rights attached to any shares
in any Group member or the creation or issue of any shares or
the grant or agreement to grant any option over any shares or
uncalled capital of any Group member or the issue by any Group
member of any obligations convertible into shares;
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(b) the capitalisation or repayment of any amount standing to the
credit of any reserve of any Group member or the redemption or
purchase of any shares or any other reorganisation of the
share capital of any Group member;
(c) the admission of any person (howsoever occurring) as a member
of any Group member or the transfer or approval of the
transfer of any Shares;
(d) the sale or disposal of any asset with a value in excess
of(pound)50,000 (otherwise than in the ordinary course of
business) or the shares of any Group member;
(e) the passing of any resolution by the members of any Group
member, including any alteration to the Memorandum or Articles
of Association or equivalent constitutional documents of any
Group member;
(f) the giving by any Group member of any guarantee or indemnity
other than in the ordinary course of business;
(g) the acquisition by any Group member of any shares of any other
company or the participation by any Group member in any
partnership, consortium, association or joint venture;
(h) the creation or issue or allowing to come into being of any
mortgage, charge or other security interest upon or over any
part of the property or assets or uncalled capital of any
Group member or the creation or issue of any debenture or
debenture stock;
(i) the appointment of any person as a director of any Group
member;
(j) the entry by any Group member into any capital commitment in a
sum in excess of(pound)25,000 (whether by way of purchase,
lease, hire purchase or otherwise);
(k) any Group member making any material change in the nature,
scope or organisation of its business;
(l) any Group member employing or engaging, or making any offer of
employment or engagement to, any employee or consultant whose
annual remuneration or fees would be likely to exceed
(pound)50,000 (a "Senior Employee") or making any material
changes (whether immediate, conditional or prospective) in the
terms of employment (including, without limitation, in the
amount or basis of the emoluments or benefits) of any of its
Senior Employees or in any arrangements with its consultants;
(m) any Group member entering into any agreement or arrangement
with any trade union, works council, staff association or
other employee representative body in
-15-
respect of any of its employees or directors, outside the
ordinary course of its business;
(n) any Group member granting or entering into any licence,
franchise or other agreement or arrangement concerning any
part of its name, trading names or know-how;
(o) any Group member entering into transaction with any Seller or
any of its Connected persons other than on arm's length terms
and for full and proper consideration;
(p) any Group member entering into, modifying or terminating any
contract with a value in excess of(pound)250,000;
(q) subject to clause 4.7, no Group Member will institute, settle
or agree any legal proceedings (other than in relation to
routine debt collection);
(r) no Group Member will enter into, effect or vary any claim,
disclaimer, surrender, election or consent of a material
nature for tax purposes; and
(s) the Company will not declare or make any dividend or other
distribution to the Sellers (including any dividend accrued
since 1 January 2002) and no other amounts shall be paid
(either in cash or in kind) by any Group member to any Seller
or any person Connected with any Seller, except pursuant to
any agreement in existence at the date hereof which is
disclosed in this Agreement or in the Disclosure Letter.
4.5 The Managers undertake to procure that, pending Completion:
(a) the Purchaser and its agents and professional advisers will,
upon reasonable notice and during normal working hours, be
allowed access to, and, where reasonably practicable, to take
copies of (at the expense of the Purchaser), the books and
records of or relating in whole or in part to the Group,
subject to such access not materially interfering with the
carrying on of the business of the Group; and
(b) the Purchaser is notified as soon as reasonably practicable of
any written notice, demand, citation or other communication
received by any Group member from any third party (including
any relevant authority or agency), in each case which is
material to the operation of the business of the Group as a
whole.
4.6 The Managers will procure, so far as they are able, that each of CCG
and Coutts Career Consultants Japan Limited ("CCCJ") will suspend its
current litigation against Xxxxx Xxxxxxxx in the period from the date
of this Agreement until Completion provided that such suspension is
without prejudice to CCCJ's claim.
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4.7 Each of the Company (for itself and on behalf of its other Group
members) and the Purchaser (for itself and on behalf of the other
members of the Purchaser's Group) agrees that pending Completion it
will not canvass or solicit existing customers or clients of the
Purchaser's Group or the Group (as the case may be) using the
confidential information that has been obtained during the negotiations
leading up to signing of the this Agreement.
5. CONSIDERATION
5.1 The price payable to the Sellers by the Purchaser for the Shares shall
be the sum of (pound)40,170,042.93 which shall be satisfied on
Completion by the issue of the Loan Notes and payment of the balance in
cash, both in accordance with the provisions of clause 6.3 and subject
to any adjustments to be made in accordance with clauses 4.3 and 7.
5.2 As between themselves, the Sellers shall be entitled to the
Consideration and any further payment to the Sellers as is provided for
under clause 7 in the proportions set out in column 3 of Schedule 1 in
each case in cash or in loan notes as set out in columns 4 and 5 in
Schedule 1, subject , in the case of all Sellers, other than the
Managers (excluding Xxxx-Xxx Buridans) for this purpose, to their
relevant respective entitlements to cash as indicated in column 6 of
Schedule 1 amounting to (pound)1,802,895 in total being deposited in
the Retention Account in accordance with clause 6.3(c) and then dealt
with in accordance with clause 7. The Sellers shall be severally liable
to make any payment to the Purchaser under clause 7.
6. COMPLETION
6.1 Subject to the provisions of this clause and the satisfaction or waiver
of all the conditions specified in clause 3.1, Completion shall take
place at the offices of the Sellers' Solicitors on the Completion Date
or at such other place and/or on such other date as may be agreed by
the Purchaser, the 3i Representative and the Managers Representative.
6.2 On Completion, the Purchaser shall procure that to the extent that it
has been included in the Effective Date Indebtedness and so far as the
same shall not have already been done:
(a) all monitoring fees due to 3i plc from the Company under the
Investment Agreements are paid up to date to 3i Group plc (on
behalf of 3i plc); and
(b) all sums due in respect of 3i Group plc's special director
pursuant to the Investment Agreements are paid up to date to
3i Group plc (on behalf of 3i plc).
6.3 On Completion the Purchaser shall:
(a) procure repayment by the Company and/or the Subsidiaries of
the Completion Date Indebtedness;
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(b) procure the payment by the Company of(pound)325,000 plus VAT
to Xxxxxx Burn;
(c) pay the cash element of the Retention into the Retention
Account;
(d) pay the remainder of the Consideration and any additional
amount of Consideration payable pursuant to the provisions of
clauses 4.3(b) and 4.3(d) together with interest at the rate
of 2 per cent per annum over the base lending rate of Barclays
Bank PLC from time to time, calculated on the sum referred to
in clause 5.1 after adjustment in accordance with clause 4.3
on a daily basis for the period from and including 1 March
2002 up to but not including the Completion Date (provided
that the Consideration is paid in cleared funds on that date
and if it is not so paid, then interest shall be calculated to
include the Completion Date):
(i) 90.146% in cash into the client account of the
Sellers' Solicitors XX Xxx 000 at Barclays Bank plc,
00 Xxxxxxx Xxxxxx, Xxxxxx XX0 0XX, account number
10610984 and sort code 20-00-00, to be held on behalf
of each of the Sellers as set out in Schedule 1;
(ii) 9.854% by the issue of the Loan Notes to the Managers
in the amounts specified by column 5 of Schedule 1;
and
(e) deliver to the Sellers' Solicitors certified copies of the
Loan Note Instrument together with certificates in favour of
each of the relevant Managers for that number of Loan Notes
determined in accordance with clause 6.3(d)(ii) together with
the agreed form Letter of Credit in favour of each Manager.
6.4 On Completion each Seller (in the case of clauses 6.4(a) and 6.4(b))
and the Managers (in the case of clauses 6.4(c)-(g) inclusive) shall
subject to the Purchaser's compliance with clause 6.3 cause to be
delivered to the Purchaser at the offices of the Sellers' Solicitors or
at the registered office of the relevant Group member (in respect of
clause 6.4 (g)):
(a) a duly executed transfer of the Shares set opposite the
relevant Seller's name in Schedule 1 by the registered holder
thereof in favour of the Purchaser (or as it may direct)
together with the share certificates relating to such Shares
(or an indemnity for a lost share certificate in the agreed
terms) and such other documents (including any power of
attorney under which any document required to be delivered by
it under this clause has been executed and any waivers or
consents) as the Purchaser may require to enable the Purchaser
or its nominees to be registered as the holder of such Shares;
(b) an irrevocable power of attorney in the agreed terms, duly
executed by the holder of the Shares set against the relevant
Sellers' names in column 1 of Schedule 1,
-18-
in favour of the Purchaser appointing the Purchaser to be its
lawful attorney in respect of such Shares;
(c) the written resignation of Xxxx Xxxxxxx (with effect from the
end of the relevant board meeting referred to in clause 6.5)
as an officer of the Company resigning from his office,
executed as a deed in the agreed terms;
(d) duly executed releases in the agreed terms of all mortgages,
charges and debentures granted or entered into by the Company
and each Group member together with, in the case of UK Group
members, relative declarations of satisfaction (Forms 403A)
sworn by a director of the Company and each relevant Group
member respectively and in respect of non-UK Group members the
relevant declaration of satisfaction following discharge of
the Completion Date Indebtedness (provided that each such
release delivered in respect of any such security granted in
connection with the Facilities Documents shall be held to the
order of CAI by the Purchaser until such time as CAI has
received the Completion Date Indebtedness payable in
connection with the Facilities Documents in accordance with
clause 6.3(a));
(e) a deed in the agreed terms terminating the Investment
Agreements duly executed by the parties thereto;
(f) the statutory books (duly written up to date) of the Company
and its certificates of incorporation and common seals and
other papers and documents of each Group Member in their
possession; and
(g) the statutory books of each Group member and its certificates
of incorporation and common seals (where relevant).
6.5 On Completion, the Managers shall, subject to the Purchaser's
compliance with clause 6.3, cause a board meeting of the Company to be
duly convened and held and, where appropriate, cause such board or
other meetings to be held or other steps as appropriate to be taken in
respect of each non-UK Group member and of each UK Group member so
that:
(a) the said transfers of the Shares shall be approved for
registration (subject only to the transfers being duly stamped
at the cost of the Purchaser);
(b) such persons as may be nominated by the Purchaser shall be
appointed directors and secretary of the Group members (within
the maximum number, if any, permitted under their respective
articles of association); and
(c) all authorities to the bankers of each Group Member shall be
revoked and authority shall be given to such persons as the
Purchaser may nominate to operate the bank accounts of each
Group Member.
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6.6 The Sellers' Solicitors are hereby irrevocably authorised by the
Sellers to receive all amounts expressed to be payable to them pursuant
to any provision of this Agreement and the receipt by the Sellers'
Solicitors of each such amount shall be an absolute discharge to the
Purchaser who shall not be concerned to see to the application of any
such amount thereafter. All sums paid by or on behalf of the Purchaser
to the Sellers' Solicitors for the purposes of Completion shall be held
to the Purchaser's order pending Completion otherwise having occurred.
6.7 At Completion, the obligations of the parties under the Tax Covenant
shall take effect.
6.8 Without prejudice to any other remedies available to the Purchaser, if
in any respect the provisions of clauses 6.4(a), (b), (d), (e) and (f)
(but only in respect of any failure to deliver the statutory books of
the Company) are not complied with by any of the Sellers on the
Completion Date, the Purchaser may:
(a) defer Completion to a date not less than seven days and not
more than 28 days after the Completion Date (and so that the
provisions of this clause 6.8 shall apply to Completion as so
deferred) and if in any respect the provisions of this clause
6 are not complied with by any of the Sellers at such deferred
Completion, the Purchaser may rescind this Agreement; or
(b) proceed to Completion so far as practicable (without prejudice
to its rights under this Agreement).
7. RETENTION AND NET ASSET ADJUSTMENT
7.1 The cash element of the Retention (being (pound)1,802,895) shall on
Completion be paid into a designated interest-bearing account with
Barclays Bank PLC, in the joint names of the Sellers' Solicitors and
the Purchaser's Solicitors (the "Retention Account") and the Retention
(together with interest accrued thereon) shall be applied in accordance
with the provisions of this clause and the Retention Account Letter of
Instruction. The instructions given to Barclays Bank PLC on the setting
up of the Retention Account shall include an instruction that no sums
may be released from the Retention Account at any time without the
authority of the Purchaser's Solicitors and the Sellers' Solicitors.
7.2 Following Completion, the amount of the Net Assets shall be calculated
as at the Effective Date in accordance with Schedule 6.
7.3 (a) If the amount of the Net Assets is less than the Expected Net
Assets then the amount of the difference together with any
interest accrued on this amount from the Effective Date (and
for these purposes interest shall be deemed to have accrued on
this sum during the period from and including 1 March 2002 and
up to and including the Completion Date at the rate of 2 per
cent per annum over the base lending rate of Barclays Bank
PLC, from time to time calculated on a daily
-20-
basis) shall be paid to the Purchaser in accordance with
clause 7.4, within seven days of the agreement or
determination of the value of the Net Assets.
(b) If the value of the Net Assets is equal to zero or greater
than zero, then the amount by which it is greater than zero
together with any interest accrued on this amount from the
Effective Date (and for these purposes interest shall be
deemed to have accrued on this sum during the period from and
including 1 March 2002 and up to and including the Completion
Date at the rate of 2 per cent per annum over the base lending
rate of Barclays Bank PLC, from time to time calculated on a
daily basis) shall be paid to the Sellers' Solicitors on
behalf of the Sellers in their Respective Proportions by the
Purchaser within seven days of the agreement or determination
of the value of the Net Assets. Such payment shall be in
addition to the release of the Retention referred to in clause
7.6.
7.4 The aggregate liabilities of all Sellers specified in clause 7.3(a)
shall in each case be satisfied by a combination of payment in cash of
amounts standing to the credit of the Retention Account and by the
cancellation of the Loan Notes held by the relevant Managers following
their issue pursuant to clause 6.3(d)(ii). The liability of each Seller
and the relevant combination by which such liabilities shall be settled
and calculated shall be as follows:
(a) 90.1458% of any amount payable to the Purchaser shall be
satisfied in cash from the Retention Account in respect of the
money otherwise payable to the 3i Sellers, PVML, the
Warrantholders, The Royal Bank of Scotland Trust Company
(Jersey) Limited and Xxxx-Xxx Buridans; and
(b) 9.8542% of any amount payable to the Purchaser being satisfied
by cancellation of the relevant principal amount of the Loan
Notes (including interest accrued and accruing in respect of
such notes up to the date of cancellation) of the relevant
Managers (being each of the Managers other than Xxxx-Xxx
Buridans) in the relevant proportions of such Managers to each
other as set out alongside their names in column 3 of Schedule
1 and the cancellation of each (pound)1 of principal amount of
Loan Note shall extinguish (pound)1 of liability.
7.5 Pending the agreement of the Net Assets pursuant to clause 7.3, the
Retention and all interest accrued thereon shall be held in the
Retention Account until the Net Assets are finally settled or otherwise
determined.
7.6 Following any payments required pursuant to clauses 7.3 and 7.4 the
parties shall procure that the cash element of the Retention (or the
balance thereof following any such payments) and all interest accrued
thereon shall be forthwith released to the Sellers' Solicitors on
behalf of the 3i Sellers, PVML, the Warrantholders, The Royal Bank of
Scotland Trust Company (Jersey) Limited and Xxxx-Xxx Buridans and all
rights of the
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Purchaser arising under this clause 7 as exercisable hereunder and
under condition 3.12 of the Instrument constituting the Loan Notes to
cancel any principal amount (including interest) under the Loan Notes
in respect of any liability of the relevant Managers under this clause
7 shall forthwith cease.
7.7 The Sellers and the Purchaser shall promptly give to the Sellers'
Solicitors and the Purchaser's Solicitors respectively all such written
instructions as shall be necessary to give effect to the provisions of
this clause 7.
7.8 All payments and the cancellation of Loan Notes referred to in this
clause 7 shall constitute an adjustment to the Consideration.
7.9 The liability of each Seller to make a payment to the Purchaser
pursuant to this clause 7 shall be limited to and in any event shall
not exceed in the case of 3i Sellers, PVML, the Warrantholders, The
Royal Bank of Scotland Trust Company (Jersey) Limited and Xxxx-Xxx
Buridans that portion of the amount standing to the credit of the
Retention Account from time to time which is proportionate to that
Sellers' portion of the Consideration received by those Sellers and in
the case of the relevant Managers the sum of (pound)197,105 which may
be satisfied by the cancellation (on a (pound)1 for (pound)1 basis) of
the relevant proportion for each Manager of the relevant principal
amount of their Loan Notes.
7.10 The Purchaser shall not be entitled to set-off any amounts due from the
Sellers against the Retention Account, other than as provided in this
clause 7.
8. WARRANTIES
8.1 The Managers hereby warrant to the Purchaser (for itself and as trustee
for its successors in title):
(a) at the date of this Agreement that the Warranties are true;
(b) at Completion, the Warranties set out in paragraphs A.1, X.0,
X.0, X.0, X.0, X.0, X.0 to N.8 (inclusive) of Schedule 4 and
the statement set out in clause 8.12 hereof will be true as if
repeated at Completion;
(c) at Completion, the statement set out in Clause 8.13 hereof
will be true,
in each case subject to clauses 8.2 and 9.
8.2 The Warranties are given subject to the matters fairly disclosed by the
Disclosure Letter. Subject to clause 8.4, no other knowledge and no
investigation by or on behalf of the Purchaser shall prejudice any
claim made by the Purchaser under the Warranties or operate to reduce
any liability in respect thereof.
8.3 The Managers acknowledge that the Purchaser has entered into this
Agreement in reliance upon the Warranties and has been induced by them
to enter into this Agreement.
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8.4 The Purchaser warrants to the Managers that at the date hereof, neither
the Purchaser nor the Guarantor is actually aware of any fact, matter
or circumstance which constitutes or is reasonably likely to constitute
a breach of the Warranties and to the extent that either the Purchaser
or the Guarantor is so aware that any such matter actually would give
rise to a claim, no claim may be made under the Warranties in respect
of such fact, matter or circumstance.
8.5 Each of the Managers hereby agrees to disclose to the Purchaser in
writing as soon as reasonably practicable upon becoming aware of the
same, any matter, event or circumstance (including any omission to act)
which may arise or become known to it after the date of this Agreement
and before Completion which constitutes a breach of any of the
Warranties.
8.6 The Managers shall give to the Purchaser and its solicitors and
accountants all such information and documentation relating to the
Company and each Group member as the Purchaser shall reasonably require
before Completion to enable it to satisfy itself as to the accuracy and
due of observance of the Warranties.
8.7 Each of the Warranties set out in each paragraph of Schedules 4 and 5
shall be separate and independent and shall not be limited by reference
to any other paragraph of those Schedules.
8.8 The Managers agree with the Purchaser for itself and as trustee for the
Group members and their respective officers and employees to waive all
the rights, remedies or claims which they have or may have in respect
of any misrepresentations in or omissions from any information or
advice supplied or given by any Group member or their respective
officers, employees or agents and on which the Managers have relied in
giving the Warranties, preparing the Disclosure Letter and/or entering
into this Agreement and/or the documents referred to herein. This
clause shall not preclude any Manager from claiming against any other
Manager under any right of contribution or indemnity to which he may be
entitled.
8.9 The Purchaser acknowledges that it does not rely on and has not been
induced to enter into this Agreement on the basis of any warranties,
representations, covenants, undertakings, indemnities or other
statements whatsoever, other than those expressly set out in this
Agreement and acknowledges that, except as set out in clauses 8.1 and
8.11, none of the Sellers, the Company or any Group member or any of
their agents, officers or employees have given any such warranties,
representations, covenants, undertakings, indemnities or other
statements.
8.10 The Purchaser warrants to each of the Sellers that:
(a) it has the requisite power and authority to enter into and
perform this Agreement and the Tax Covenant and any documents
ancillary hereto;
-23-
(b) this Agreement and any documents ancillary hereto constitute
legal and binding obligations of the Purchaser in accordance
with their terms; and
(c) the execution and delivery of, and the performance by the
Purchaser of its obligations under this Agreement and any
documents ancillary hereto will not:
(i) result in a breach of any provision of the memorandum
or articles of association or by laws or other
constitutional documents of the Purchaser;
(ii) result in a breach of, or constitute a default under,
any agreement or instrument to which the Purchaser is
a party or by which it is bound and which is material
in the context of the transactions contemplated by
these agreements;
(iii) result in a breach of any order, judgment or decree
of any court or governmental agency to which the
Purchaser is a party or by which it is bound and
which is material in the context of the transactions
contemplated by these agreements; or
(iv) require the Purchaser to obtain any consent or
approval of, or give any notice to or make any
registration with, any governmental or other
authority which has not been obtained, given or made
at the date hereof both on an unconditional basis and
on a basis which cannot be revoked (save pursuant to
any legal or regulatory entitlement to revoke the
same other than by reason of any misrepresentation or
misstatement); and
(d) the Purchaser has provided to the Sellers or their advisers
evidence that the cost to the Purchaser of arranging a
Commitment Letter confirming debt facilities was in excess of
$250,000.
8.11 Each of the Sellers in respect of itself and its Shares only (and for
the avoidance of doubt, not in respect of any other Seller or Seller's
Shares) severally warrant to the Purchaser that:
(a) it has the requisite power and authority to enter into and
perform this Agreement and any documents required pursuant
hereto to be entered into by it;
(b) this Agreement and any documents required pursuant hereto to
be entered into by it constitute legal and binding obligations
on it in accordance with their terms; and
(c) the sale of the Shares by it under this Agreement shall be
made with full title guarantee and at Completion such Shares
will be free from all charges, liens, equities, encumbrances,
claims or restrictions whatsoever and together with all rights
which are at Completion or may at any time thereafter become
attached to them.
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For the avoidance of doubt, the limitations on claims set out in clause
9 (other than clause 9.3 insofar as this clause relates to the Managers
only) shall not apply to any claims for breach of the warranties in
this clause 8.11 but the aggregate amount for any claims against any
Seller for breach of these warranties in the case of any Seller who is
not a Manager shall not exceed the Consideration received by that
Seller.
8.12 All current insurance policies relating to the assets and business of
each Group Member have been disclosed to the Purchaser and, so far as
the Managers are aware, are adequately summarised in or otherwise
disclosed by the Disclosure Letter. All premiums due in respect of such
policies have been paid and none of the Managers will take any action
between the date of this Agreement and Completion to put any of these
policies in default.
8.13 The Management Accounts have been carefully prepared on a basis
consistent with the Atlas 2001 Accounts and give a materially accurate
view of the assets and liabilities and profits and losses of the Group
as at and to the date they were drawn up.
9. LIMITATION ON CLAIMS
9.1 The Managers shall have no liability in respect of any breach or
non-fulfilment of any of the Non-Tax Warranties unless the Purchaser
has served on the Managers' Representative a written notice on or
before 31 March 2003 giving such reasonable particulars of the claim as
the Purchaser then has including, if capable of any quantification when
notice is given, the Purchaser's then best estimate of the amount of
the Managers' liability in respect thereof and has issued and served
proceedings in respect thereof within six months of the date of such
written notice (or, in the case of a claim against a Manager for which,
at the time at which the same is notified to the Managers'
Representative, in accordance with the foregoing provisions of this
clause 9.1, that Manager does not have liability pursuant to clause
9.2, within six months of the date on which the Manager does have
liability for that claim for the purposes of clause 9.2 provided that
proceedings are in any event issued on or before 31 March 2004).
9.2 No Non-Tax Warranty Claim shall be made unless the amount to be claimed
in respect of any single Non-Tax Warranty Claim exceeds (pound)25,000
(provided that claims under the same Non-Tax Warranty in respect of
similar facts and circumstances may be aggregated for these purposes)
and unless the aggregate amount of all such Non-Tax Warranty Claims
when aggregated with claims under the Tax Covenant and Tax Warranties
exceeds (pound)250,000 PROVIDED that if such aggregate amount does
exceed (pound)250,000, the Managers' liability shall not be limited to
the excess and the whole amount shall be recoverable in full, subject
to clauses 9.3 and 9.4.
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9.3 The aggregate amount of each Manager's liability in respect of all
Warranty Claims and claims under the Tax Covenant shall be limited to
and in no event exceed the amount set opposite each Manager's name in
column 7 of Schedule 1.
9.4 The liability of each of the Managers in respect of each Warranty Claim
in respect of which they are jointly liable shall be proportionate, so
that each Manager's liability shall be limited to and shall in no event
exceed a sum equal to a fraction of the total liability of those
Managers who are liable in respect of that Warranty Claim, where the
numerator of that fraction is the amount set opposite that Manager's
name in column 7 of Schedule 1 and the denominator is the aggregate
amount set opposite the respective names in column 7 of Schedule 1 of
all Managers who are liable in respect of that Warranty Claim.
9.5 The Purchaser and each Manager shall be entitled to set off each
Managers' rights under the Loan Notes against any liability in respect
of Warranty Claims and under the Tax Covenant that is agreed by the
Managers or proven in a court of competent jurisdiction by the
cancellation of Loan Notes (excluding interest accrued and accruing in
respect of such notes up to the date of cancellation which shall remain
for the benefit of the Manager and shall be paid on the next interest
payment date) and the cancellation of each (pound)1 of principal amount
of Loan Note shall extinguish (pound)1 of liability, save that the
Managers shall have no right of set-off for claims if fraud by that
Manager is established.
9.6 The Managers shall not be liable in respect of any Warranty Claim if
and to the extent that the loss occasioned thereby has been recovered
under an earlier Warranty Claim. The liability of the Managers under
the Tax Covenant shall be reduced if and to the extent that the
liability to Taxation shall have been recovered under the Warranties or
under any part of the Tax Covenant (and vice versa).
9.7 The limitations on the liability of the Managers set out in this clause
9 shall not apply to any Non-Tax Warranty Claim, if the Non-Tax
Warranty Claim involves any fraudulent act or fraudulent or wilful
omission on the part of the Managers.
9.8 The Purchaser shall give written notice to the Managers' Representative
as soon as reasonably practicable following any breach or circumstance
which may give rise to a Non-Tax Warranty Claim coming to the notice of
the Purchaser (but the failure of the Purchaser so to notify shall not
prejudice the enforceability of any claim notice of which shall have
been served within the applicable time limits specified within clause
9.1);
9.9 Clause 9.10 shall apply in circumstances where:
(a) any claim is made against any member of the Purchaser's Group
which may give rise to a Non-Tax Warranty Claim by the
Purchaser against any of the Managers;
(b) any member of the Purchaser's Group is or may be entitled to
make recovery from some other person of any sum by virtue of
any facts or circumstances by
-26-
reference to which the Purchaser has or may have a Non-Tax
Warranty Claim against any of the Managers; or
(c) any of the Managers shall have paid to the Purchaser an amount
in respect of a Non-Tax Warranty Claim and subsequent to the
making of such payment any member of the Purchaser's Group
becomes or shall become entitled to recover from some other
person a sum which is recoverable by virtue of the facts and
circumstances which gave rise to the claim,
provided that, for the avoidance of doubt, the provisions of this
clause 9.9 shall not apply to the claim made by Messrs Axmith and
Xxxxxxx against CCG (as referred to in the Disclosure Letter) or any
claim made directly in connection therewith.
9.10 The Purchaser shall and shall procure that each other member of the
Purchaser's Group shall:
(a) promptly and diligently take all such action as the Managers'
Representative may reasonably request, including the
institution of proceedings and the instruction of professional
advisers to act on behalf of the relevant member of the
Purchaser's Group, to avoid, dispute, resist, compromise,
defend or appeal against any such claim against the relevant
member of the Purchaser's Group as is referred to in clause
9.9(a) (other than any claim the defence of which may in the
reasonable opinion of the Purchaser adversely affect the
goodwill of the business of the relevant member of the
Purchaser's Group) or to make such recovery as is referred to
in paragraphs 9.9(b) or 9.9(c), as the case may be;
(b) not make any admission of liability or settle or compromise
any claim (other than any claim the defence of which may in
the reasonable opinion of the Purchaser adversely affect the
goodwill of the business of the relevant member of the
Purchaser's Group) which has given or may give rise to a
Non-Tax Warranty Claim against any of the Managers without the
prior written consent of the Managers' Representative which
consent shall not be unreasonably withheld or delayed; and
(c) in the case of paragraph 9.9(c) only, reasonably promptly
repay to the Sellers' Solicitors on behalf of the Managers an
amount equal to the amount so recovered (less costs of
recovery not reimbursed by the Managers and after deducting
any amount of loss incurred by the Purchaser in respect of the
claim not compensated by the Managers or, if lower, the amount
paid by the Managers to the Purchaser,
PROVIDED THAT the Purchaser shall give reasonable access to the
Managers' Representative or his duly authorised representatives during
normal working hours on reasonable notice to all relevant books of
account, records and correspondence of the relevant member of the
Purchaser's Group which relate to such Non-Tax Warranty Claim
-27-
and permit the Managers and their representatives and advisers to
ascertain or extract any relevant information therefrom and (if so
requested by the Managers at their own cost) provide copies thereof and
will use all its reasonable endeavours to procure that the auditors
(past and present) of any relevant Group member make available their
audit working papers in respect of audits of the relevant Group
member's accounts for any relevant accounting period in connection with
such Non-Tax Warranty Claim or potential Non-Tax Warranty Claim. The
Managers' Representative agrees that all confidential information so
obtained shall be kept confidential and only disclosed, on a
confidential basis, to other Managers and their professional advisers.
PROVIDED FURTHER THAT the Managers shall indemnify and hold harmless
all members of the Purchaser's Group against all damages, losses, costs
and expenses reasonably incurred by any of them arising from any action
taken by any member of the Purchaser's Group at the request of the
Managers' Representative pursuant to clause 9.10(a) or any failure to
admit any liability or settle or compromise any liability or claim, as
referred to in clause 9.10(b), because the Managers' Representative
refused to consent to such admission, settlement or compromise.
9.11 The Managers shall not be liable in respect of a Non-Tax Warranty Claim
to the extent of:
(a) any amount which is included as a liability in or is otherwise
reflected in respect of the subject matter of such Non-Tax
Warranty Claim in the Net Asset Statement; or
(b) any amount by which the valuation of any asset has been
reduced to take account of the subject matter of such Non Tax
Warranty Claim in the Net Asset Statement.
If any Non-Tax Warranty Claim is made the Purchaser shall use all its
reasonable endeavours to procure that the Managers and their
representatives and advisers are given reasonable access to the working
papers underlying the Net Asset Statement for the purposes of
ascertaining whether any, and if so what, amount is applicable to the
Warranty Claim for the purposes of this clause 9.11.
9.12 The Managers shall not have any liability in respect of any Non-Tax
Warranty Claim to the extent that such Non-Tax Warranty Claim arises or
is increased in circumstances in which the Purchaser (or any persons
deriving title from it) acts or omits to act (other than an act or
omission carried out pursuant to a legally binding obligation of any
Group member entered into on or before Completion) outside its ordinary
course of business after Completion and it or any of its directors
knows that such act or omission could reasonably be expected to give
rise to or increase such Non-Tax Warranty Claim and a reasonable
alternative course of action was available to the Purchaser (or the
person deriving title from it) which could be expected not to have
given rise to such Non-Tax Warranty Claim or to a Non-Tax Warranty
Claim of such amount.
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9.13 Subject to the provisions of clause 14.2, the Warranties shall only be
actionable by the Purchaser and no other party shall be entitled to
make any Warranty Claim or take any action whatsoever against the
Managers under or arising out of or in connection therewith.
9.14 The Purchaser shall not be entitled to rescind or repudiate this
Agreement for any reason after Completion.
9.15 The Purchaser shall not be entitled to claim that any fact, matter or
circumstance constitutes or gives rise to a Warranty Claim if and to
the extent that such fact, matter or circumstance:
(a) has been fairly disclosed in or pursuant to:
(i) this Agreement; or
(ii) the Disclosure Letter or the Tax Disclosure Letter.
9.16 The Purchaser shall not be entitled to claim that any fact, matter or
circumstance constitutes or gives rise to a claim under paragraph 2 of
the Tax Covenant if and to the extent that such fact, matter or
circumstance has been fairly disclosed in the Tax Disclosure Letter.
For the avoidance of doubt, the Purchaser shall be entitled to make a
claim under paragraph 10 of the Tax Covenant notwithstanding that the
fact, matter or circumstances constituting or giving rise to the claim
under paragraph 10 of the Tax Covenant has been disclosed in the Tax
Disclosure Letter.
9.17 The Managers shall not be liable to make any payment in respect of any
Warranty Claim to the extent that the claim is based upon a liability
which is contingent only or is otherwise not capable of being
quantified unless and until such liability ceases to be contingent and
becomes an actual liability or becomes capable of being quantified, as
the case may be
PROVIDED THAT:
(a) this clause shall not operate to avoid a claim made in respect
of a contingent or unquantifiable liability within the
applicable time limits specified in clause 9.1 if the
requisite details of such claim have been provided before the
expiry of the relevant period (even if such liability does not
become an actual or quantifiable liability, as the case may
be, until after the expiry of such period); and
(b) in relation to a claim made as mentioned in paragraph 9.17(a)
the time limits specified in clause 9.1 shall be deemed to be
amended in respect of any such claim so as to cause any such
claim to cease and determine if such claim has not become a
claim in respect of an actual liability or a quantifiable
liability within 12 months of the date of provision of details
referred to at 9.17(a) and further if
-29-
proceedings in respect of such claim have not been commenced
in accordance with clause 9.1 within six months from such date
on which the liability ceases to be contingent and becomes an
actual liability or becomes quantifiable, as the case may be.
9.18 If the Managers pay any sum in respect of any Warranty Claim or under
the Tax Covenant the amount of the Consideration paid by the Purchaser
to the Managers hereunder for the Shares shall be deemed to be reduced
by the amount of any such payment.
9.19 Nothing contained in this clause 9 shall limit the Purchaser's
obligations at common law to mitigate any loss or damage resulting from
or arising as a consequence of any circumstances giving rise to any
Warranty Claim.
9.20 The Managers shall not be liable in respect of any Non-Tax Warranty
Claim in respect of any matters resulting from a change of accounting
policy or practice or the length of any accounting period of the
Purchaser or any Group member introduced after Completion unless
introduced to comply with any requirement of law which has not been
properly complied with by any Group member on or prior to Completion.
10. RESTRICTIVE COVENANTS
10.1 Each of the Managers hereby undertakes to the Purchaser that except in
circumstances where, after Completion, his employment with any Group
member is wrongfully terminated or he resigns because of a repudiatory
breach of his service agreement of such nature as to amount to a
wrongful termination of his employment he will not himself, either
alone or jointly with others, whether as principal, agent, manager,
shareholder, independent contractor, consultant or in any other
capacity, directly or indirectly through any other person, for his own
benefit or that of others at any time during the Restricted Period:
(a) engage in or carry on or be concerned or interested in any
Restricted Business within the Restricted Area in competition
with any Group member (other than as a holder for investment
of no more than three per cent of any class of shares or
securities dealt in on a recognised stock exchange);
(b) canvass or solicit or accept orders for the supply of any
goods or services substantially similar to or otherwise
competing with those supplied in the normal course of the
Restricted Business from any person who has been a customer of
any Group member during the 12 months preceding the Completion
Date, or induce or seek to induce any such person to cease
being a customer of any Group member;
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(c) solicit or entice away or knowingly encourage any employee of
any Group member earning (pound)50,000 per annum or above to
leave the employment of that Group member (as the case may
be); or
(d) provided that no provision of this clause 10.1 shall operate
to prevent any Manager from properly carrying out his duties
in accordance with his respective contract of employment with
any Group member.
10.2 Each of the covenants contained in clause 10.1 is entirely separate and
severable and enforceable accordingly. Each of such covenants is
considered fair and reasonable in all the circumstances by the parties
but in the event that any such restriction shall be found to be void or
ineffective but would be valid and effective if some part thereof were
deleted or the duration or area of application reduced such restriction
shall apply with such modification as may be necessary to make it valid
and effective.
11. ANNOUNCEMENTS
11.1 No announcement or statement or other disclosure about this Agreement
or the subject matter of, or any matter referred to in, this Agreement
(including the negotiations leading up to this Agreement, and the
business or affairs of the Purchaser or any member of the Purchaser's
Group which are not already in the public domain) shall be made or
issued before, on or after Completion by or on behalf of any party
without the prior written approval of the Purchaser, the 3i
Representative and the Managers' Representative (such approval not to
be unreasonably withheld or delayed) PROVIDED that nothing shall
restrict the making by any party (even in the absence of agreement by
all the other parties) of any statement which may be required by law or
regulation or called for by the requirements of the Financial Services
Authority, the United States Securities and Exchange Commission or any
other regulatory authority but then only to the extent so required.
12. FURTHER ASSURANCE AND AVAILABILITY OF INFORMATION
Each of Sellers shall execute and deliver all such instruments and
other documents and take all such actions as the Purchaser may from
time to time reasonably require in order to give full effect to those
provisions of this Agreement which create obligations for that
particular Seller and the Purchaser shall bear or reimburse any
expenditure to third parties reasonably incurred by that particular
Seller in so doing.
13. INTEREST
If any amount required to be paid under this Agreement is not paid when
it is due, such amount shall bear interest at the rate of two per cent
per annum over the base lending rate of Barclays Bank PLC from time to
time, calculated on a daily basis for the period
-31-
from the relevant due date for payment up to and including the date of
actual payment, as well after as before any judgment.
14. CONTINUING OBLIGATIONS AND ASSIGNMENT
14.1 Subject to clause 14.2, each of the obligations, warranties,
representations, indemnities and undertakings accepted or given by the
Sellers or the Purchaser or any of them under this Agreement or any
document referred to herein ("Obligations") shall continue in full
force and effect notwithstanding Completion taking place and shall be
binding on the respective successors, estates and personal
representatives of the Sellers or the Purchaser (as the case may be).
14.2 The Purchaser shall not:
(a) assign or purport to assign any of the rights under this
Agreement (except to a member of the Purchaser's Group, save
that upon the assignee ceasing to be a member of the Purchaser
Group or a resolution being passed to wind up the assignee or
upon the assignee receiving a final notice of dissolution (an
"Event"), all such assigned rights shall immediately be
assigned to a member of the Purchaser's Group within five
Business Days of such Event); or
(b) enter or purport to enter into any declaration of trust in
favour of any third party in respect of any of its rights
under this Agreement.
Notwithstanding the foregoing, the Purchaser may assign such of its
rights under this Agreement as relate only to Warranty Claims or claims
under the Tax Covenant for collateral security purposes to any lender
providing financing to the Purchaser for the acquisition of the Shares
as contemplated by this Agreement, and any such lender may exercise all
of the rights and remedies of the Purchaser hereunder as relate only to
Warranty Claims or claims under the Tax Covenant provided that they
comply with all relevant terms of the Agreement in respect of such
claims and provided further that no assignee shall have any greater
rights under this Agreement against the Managers than the Purchaser
would have had.
14.3 On or prior to any assignment permitted pursuant to clause 14.2 other
than the collateral assignment permitted thereby, the Purchaser shall
procure that the assignee shall covenant in favour of the Sellers to
observe and perform the obligations remaining to be fulfilled under
this Agreement and in all such cases the obligations of clause 22 shall
continue.
15. COSTS
15.1 Subject to clause 15.2, each party shall pay its own costs and expenses
in relation to the negotiation, preparation, and implementation of this
Agreement (and the documents
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referred to herein), including the fees and disbursements of their
respective legal, accountancy and other advisers.
15.2 In the event that:
(a) the conditions in clause 3.1 have been fulfilled or duly
waived and the Purchaser has demonstrated to the 3i
Representative and the Managers' Representative that it is
able to perform all of its obligations to be performed by it
on Completion, including (but without limitation) that it has
the funds immediately available to it to fund the
Consideration; and
(b) the Sellers do not transfer all of their Shares to the
Purchaser on the Completion Date other than due to a breach by
the Purchaser of this Agreement or if this Agreement becomes
frustrated, void, illegal, invalid or unenforceable under the
law of any jurisdiction then, without prejudice to the
parties' existing rights pursuant to this Agreement, within
five Business Days following a written demand by the
Purchaser, the Company shall, to the extent it may lawfully do
so, pay to the Purchaser the sum of (pound)400,000.
15.3 In the event that:
(a) the conditions in clause 3.1 have been fulfilled or duly
waived and each of the Sellers have demonstrated to the
Purchaser that each of them is able to perform all of its
respective obligations on Completion; and
(b) the Purchaser does not complete the purchase of the Shares on
or before 28 March 2002 then within five Business Days
following a written demand by the 3i Representative and the
Managers' Representative, the Purchaser, to the extent it may
lawfully do so, shall pay the Sellers the sum of
(pound)400,000, to be divided amongst the Sellers in the
proportions set out in column 3 of Schedule 1.
15.4 The Managers confirm that no expense of whatever nature relating to the
sale of the Shares pursuant to this Agreement has been or is to be
borne by the Company or any member of the Group.
16. NOTICES
16.1 Any notice or other communication to be given under this Agreement
shall be in writing, shall be deemed to have been duly served on, given
to or made in relation to a party if it is left at the authorised
address of that party, sent by internationally recognised courier
addressed to that party at such address, or sent by fax transmission to
a machine situated at such address and shall if:
(a) personally delivered, be deemed to have been received at the
time of delivery;
-33-
(b) sent by internationally recognised courier, be deemed to have
been received on the second Business Day after the date of
despatch; or
(c) sent by fax transmission, be deemed to have been received upon
receipt by the sender of a fax transmission report (or other
appropriate evidence) that the fax has been transmitted to the
addressee,
Provided that where, in the case of delivery by hand or fax
transmission, delivery or transmission occurs after 6 pm on a Business
Day or on a day which is not a Business Day, receipt shall be deemed to
occur at 9 am on the next following Business Day.
16.2 For the purposes of this clause the authorised address of each of the
Sellers shall be the address set out in Schedule 1 and the authorised
address of the Purchaser shall be the relevant address set out at the
head of this Agreement or such other address as each party may notify
to the others in writing from time to time in accordance with the
requirements of this clause or clause 17. Any correspondence sent to 3i
Group plc, 3i Parallel Ventures II LP, 3i UKIP II LP and PVML shall be
marked with the case reference number: JJD/5508081.
16.3 The Managers and all other Sellers, other than the 3i Sellers and PVML
("non-3i Sellers") hereby appoint Xxxxxx XxXxx as their duly authorised
agent and representative ("Managers' Representative") who may, subject
to this clause 16.3, authorise the making of any request, election,
proposal or consent expressed to be made on behalf of them to the other
parties. Any variation, supplement, deletion or replacement of or from
this Agreement pursuant to clause 19.3 may be authorised by the
Manager's Representative and Warrantholders' Representatives on behalf
of the non-3i Sellers. Before exercising the authority conferred on him
by this clause 16.3, the Managers' Representative shall first give
notice to and consult, where practicable, with the Warrantholders'
Representative. The other parties shall be entitled at their sole
discretion to have regard, in relation to any notice given to any
Manager or non-3i Seller, only to notices, including requests,
elections or proposals, issued by the Managers' Representative and the
other parties may relay any communication from the Managers'
Representative. Service of any notice or other communication on the
Managers' Representative shall be deemed to constitute valid service
thereof on all the Managers and service on each of the other non-3i
Sellers shall be in accordance with the provisions of clauses 16.1 and
16.2. In the event of the death or incapacity of Xxxxxx XxXxx, the
Managers shall notify to the Purchaser a successor to him as the
Managers' Representative.
16.4 3i Group plc, 3i Parallel Ventures LP, 3i UKIP II LP and PVML hereby
appoint any one of the authorised signatories of 3i Investments plc
from time to time as their duly authorised agent and representative
("3i Representative") who may authorise the making of any request,
election, proposal or consent expressed to be made on behalf of all or
any of
-34-
them to the other parties. The other parties shall be entitled at their
sole discretion to have regard, in relation to any notice given by any
3i Seller and PVML (other than a Manager or a non-3i Seller) only to
notices, including requests, elections or proposals, issued by the 3i
Representative. Service of any notice or other communication on the 3i
Representative by sending to the address of 3i Investments plc, marked
with the case reference number JJD/5508081 shall be deemed to
constitute valid service thereof on 3i Group plc, 3i Parallel Ventures
LP, 3i UKIP II LP and (for the purposes of clauses 3, 5, 6 and 7 only)
PVML.
17. AGENT FOR SERVICE
17.1 The Purchaser irrevocably agrees that any document may be sufficiently
and effectively served on it in connection with any Proceedings in
England and Wales by service on its agent Xxxxx & XxXxxxxx, or on the
replacement agent if one has been appointed and notified to the 3i
Representative and the Managers' Representative.
17.2 Any document served pursuant to this clause shall be marked for the
attention of:
(a) Xxxxx & XxXxxxxx at 000 Xxx Xxxxxx Xxxxxx, Xxxxxx XX0X 0XX
(Attention: Xxxx Xxxxxx) or such other address within England
or Wales as may be notified to the 3i Representative and the
Managers' Representative by the Purchaser; or
(b) such other person as is appointed as agent for service
pursuant to clause 17.4 at the address notified pursuant to
clause 17.4.
17.3 Any document addressed in accordance with clause 17.2 shall be deemed
to have been duly served if left at the specified address, when it is
left.
17.4 If the agent referred to in clause 17.1 (or any replacement agent
appointed pursuant to this clause) at any time ceases for any reason to
act as such, the Purchaser shall appoint a replacement agent to accept
service having an address for service in England or Wales and shall
notify the 3i Representative and the Managers' Representative of the
name and address of the replacement agent; failing such appointment and
notification, the 3i Representative and the Managers' Representative
shall be entitled by notice to the Purchaser to appoint such a
replacement agent to act on the Purchaser's behalf.
17.5 A copy of any document served on an agent pursuant to this clause shall
be delivered to the Purchaser at its address for the time being for the
service of notices and other communications under clause 16, but no
failure or delay in so doing shall prejudice the effectiveness of
service of such document in accordance with the provisions of clause
17.1.
18. SEVERABILITY AND SUSPENSION OF RESTRICTIONS
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18.1 If any provision of this Agreement (or of any document referred to
herein) is held to be illegal, invalid or unenforceable in whole or in
part the legality, validity and enforceability of the remaining
provisions of this Agreement (or such document) shall not in any way be
affected or impaired thereby.
18.2 If any liability of one or more but not all of the Sellers shall be or
become illegal, invalid or unenforceable in any respect, such
circumstances shall not affect or impair the liabilities of the other
Sellers.
19. ENTIRE AGREEMENT AND VARIATION
19.1 This Agreement (together with any documents referred to herein)
contains the entire agreement and understanding of the parties and
supersedes all prior agreements, understandings or arrangements (both
oral and written) relating to the subject matter of this Agreement.
19.2 Each of the parties acknowledges and agrees that:
(a) it does not enter into this Agreement and the documents
referred to herein on the basis of and does not rely, and has
not relied, upon any statement or representation (whether
negligent or innocent) or warranty or other provision (in any
case whether oral, written, express or implied) made, given or
agreed to by any person (whether a party to this Agreement or
not) except those expressly set out or referred to in this
Agreement and the documents referred to herein and the only
remedy or remedies available in respect of any
misrepresentation or untrue statement made to it shall be a
claim for damages for breach of contract under this Agreement
and the parties shall have no right to rescind this Agreement;
and
(b) this clause 19.2 shall not apply to any statement,
representation or warranty made fraudulently or to any
provision of this Agreement which was induced by, or otherwise
entered into as a result of, fraud, for which the remedies
shall be all those available under the law governing this
Agreement.
19.3 No variation, supplement, deletion or replacement of or from this
Agreement or any of its terms shall be effective unless made in writing
and signed by the Purchaser, the Managers' Representative, the
Warrantholders' Representatives and the 3i Representative on behalf of
each party.
20. GENERAL PROVISIONS
20.1 Time shall be deemed to be of the essence in this Agreement.
20.2 The Purchaser may release or compromise the liability of any of the
Sellers hereunder or grant to any Seller time or other indulgence
without affecting the liability of any other
-36-
Seller hereunder with the prior consent of the 3i Representative,
provided that no such consent shall be required if at the relevant time
the Retention has been released in full.
20.3 Any waiver of a breach of any of the terms of this Agreement or of any
default hereunder shall not be deemed to be a waiver of any subsequent
breach or default and shall in no way affect the other terms of this
Agreement.
20.4 No failure to exercise and no delay on the part of any party in
exercising any right, remedy, power or privilege of that party under
this Agreement and no course of dealing between the parties shall be
construed or operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege preclude any
other or further exercise thereof or the exercise of any other right,
remedy, power or privilege. The rights and remedies provided by this
Agreement are cumulative and are not exclusive of any rights or
remedies provided by law.
20.5 No person other than a party or its respective successors in title may
enforce this Agreement by virtue of the Contracts (Rights of Third
Parties) Xxx 0000.
20.6 This Agreement (other than this clause 20.6) has no effect until it has
been dated. The dating of this Agreement by the solicitors or an agent
or an employee of the solicitors acting for a party who has signed and
executed this Agreement as a Deed is deemed to have been authorised by
that party.
20.7 This Agreement may be executed in any number of counterparts, each of
which when executed and delivered shall be an original, but all of
which when taken together shall constitute a single instrument.
20.8 (a) Subject to clause 20.8(b) all obligations on each of the
Sellers in this Agreement are several obligations.
(b) The obligations on the Managers in clauses 8 and 9 and under
the Tax Covenant are joint and several obligations.
20.9 Any provision of this Agreement and any other documents referred to
herein which is capable of being performed after but which has not been
performed at or before Completion and all Warranties and other
undertakings contained in or entered into pursuant to this Agreement
shall remain in full force and effect notwithstanding Completion.
20.10 The parties to this Agreement shall be entitled to all remedies as may
be available to it as a matter of English law for breach of any
obligations, undertakings or warranties under this Agreement, including
without prejudice to the generality of the foregoing, the right to
specific performance, provided that the parties have no right to
rescind this Agreement except provided for pursuant to clauses 3.4 and
6.8.
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21. RELEASE BY THE SELLERS
21.1 Subject to Completion in accordance with clause 6, each of the Sellers
hereby releases the Company and the other Group members from all
claims, liabilities, contractual obligations and other obligations of
whatsoever nature (whether actual or contingent and whether monetary
debts or duties to perform) owed to them including, but without
limitation, all liabilities in respect of accrued but unpaid dividends
save for (i) a right to receive dividends declared after the date of
this Agreement which will transfer to the Purchaser upon the sale of
the Shares pursuant to this Agreement, (ii) the 3i Loan (which shall be
repaid upon Completion) together with any unpaid fees referred to in
clause 6.2 due and payable to the 3i Sellers (iii) the Facility
Documents (until the amounts due under them are repaid upon Completion)
and (iv) obligations of Group members under employment contracts with
the Managers.
21.2 Clause 21.1 is given to the Purchaser for itself and as trustee for
each Group member.
22. GUARANTEE
22.1 In consideration of the Sellers entering into this Agreement with the
Purchaser at the request of the Guarantor, the Guarantor hereby
irrevocably and unconditionally:
(a) guarantees to the Sellers the full, prompt and complete
performance by the Purchaser of all of its obligations under
this Agreement and the due and punctual payment on demand of
all sums now or subsequently due and payable by the Purchaser
to the Sellers under or pursuant to this Agreement; and
(b) agrees as primary obligor to indemnify the Sellers on demand
from and against any loss incurred by the Sellers as a result
of any of the obligations of the Purchaser under or pursuant
to this Agreement being or becoming void, voidable,
unenforceable or ineffective as against the Purchaser for any
reason whatsoever, whether or not known to the Sellers, the
amount of such loss being the amount which the Sellers would
otherwise have been entitled to recover from the Purchaser.
22.2 The guarantee contained in this clause is a continuing guarantee and
shall remain in force until all the obligations of the Purchaser under
this Agreement have been fully performed and all sums payable by the
Purchaser have been fully paid. It is independent of every other
security which the Sellers may at any time hold for the obligations of
the Purchaser under this Agreement.
22.3 The obligations of the Guarantor shall not be affected by any act,
omission, matter or thing which, but for this provision, might operate
to release or otherwise exonerate the Guarantor from its obligations or
affect such obligations, including without limitation and whether or
not known to the Guarantor:
-38-
(a) any variation of this Agreement or any time, indulgence,
waiver or consent at any time given to the Purchaser or any
other person;
(b) any compromise or release of, or abstention from obtaining,
perfecting or enforcing any security or other right or remedy
whatsoever from or against the Purchaser or any other person;
(c) any legal limitation, disability, incapacity or other
circumstance relating to the Purchaser or any other person;
and
(d) any irregularity, unenforceability or invalidity of any
obligations of the Purchaser under this Agreement, or the
dissolution, amalgamation, reconstruction or insolvency of the
Purchaser.
22.4 This guarantee may be enforced by the Sellers without the Sellers first
taking any steps or proceedings against the Purchaser.
22.5 The Guarantor agrees that until the obligations of the Purchaser under
this Agreement have been fully and completely performed and all sums
payable by the Purchaser to each of the Sellers under or pursuant to
this Agreement have been paid, it shall not exercise any rights which
it might have by reason of the performance of its obligations under
this guarantee:
(a) to be indemnified by the Purchaser;
(b) to claim any contribution from any other guarantor of any
Purchaser's obligations under this Agreement; and/or
(c) to take the benefit (in whole or in part and whether by way of
subrogation or otherwise) of any rights of any of the Sellers
under this Agreement or any other security taken by any of the
Sellers pursuant to, or in connection with, this Agreement.
22.6 All payments to be made by the Guarantor shall be made in full without
set-off or counterclaim and free and clear of and without any deduction
whatsoever except to the extent required by law.
23. GOVERNING LAW AND JURISDICTION
23.1 This Agreement (together with all documents to be entered into pursuant
to it which are not expressed to be governed by another law) shall be
governed by, construed and take effect in accordance with English law.
23.2 The courts of England shall have non-exclusive jurisdiction to settle
any claim, dispute or matter of difference which may arise out of or in
connection with this Agreement (including
-39-
without limitation claims for set-off or counterclaim) or the legal
relationships established by this Agreement.
23.3 Each of the parties hereto agrees that in the event of any action
between any of the parties hereto being commenced in respect of this
Agreement or any matters arising under it, the process by which it is
commenced (where consistent with the applicable court rules), may be
served on them in accordance with clauses 16 and 17.
24. EXCLUSIVITY
In consideration of the mutual undertakings and obligations set out in
this Agreement, the Sellers (other than PVML and the Managers) so far
as they are able in their capacity as shareholders in the Company and
the Managers hereby severally agree to a period of exclusivity expiring
on the earlier of (a) the Completion Date and (b) 28 March 2002, during
which time each of the Sellers (other than PVML and the Managers) will
so far as they are able in their capacity as shareholders in the
Company and the Managers will, and will procure that the Company and so
far as they are able that their respective professional advisers will:
(a) refrain from marketing the Shares or all or substantially all
of the Company's assets and/or negotiating or concluding any
agreement for the sale of the Shares or all or substantially
all of the Company's assets with any third party, including in
particular, but without limitation thereto, any party with
whom the Sellers or the Company or their respective
professional advisers have had discussions prior to the date
of this Agreement, in each case relating to the sale of the
Shares or all or substantially all of the Company's assets;
and
(b) refrain from making available to any third parties, including
in particular, but without limitation thereto, any parties
with whom the Sellers or the Company or their respective
advisers have had discussions relating to the sale of the
Shares or all or substantially all of the Company's assets
prior to the date of this Agreement, any information of any
nature whatsoever in relation to the sale of the Shares or all
or substantially all of the assets of the Company (other than
as required to facilitate the sale of Shares pursuant to this
Agreement).
25. WARRANTHOLDERS
The Sellers (other than PVML) shall procure, so far as they are able in
their capacity as shareholders in the Company, that if the Agreement is
terminated in accordance with clause 3.4 then the Company shall, as
soon as practicable thereafter and in any event within 30 Business
Days, buyback at par from the Warrantholders all the A Ordinary Shares
held by the Warrantholders and issue warrants to the Warrantholders on
exactly the same terms and subject to exactly the same provisions (save
as amended to reflect
-40-
the re-issuing of such warrants at a later date) as the warrants issued
to them by the Company pursuant to the Instruments by Way of Deed Poll
dated 26 February 1999.
Executed by the parties as a deed or under hand (as applicable) on the
date stated at the head of this Agreement.
-41-
SCHEDULE 1
The Sellers and the Shares
------------------------------------------------------------------------------------------------------------------------------------
1. Names and 2. Number and class 3. Respective 4. % of 5. % of 6. Cash to be 7. Maximum
addresses of of Shares owned Proportion (%) individual individual placed in liability
the Sellers by the Sellers Sellers' Sellers' Retention under the
in the Company Consideration Consideration Account or Warranties and
to be received to be received maximum Tax Covenant
at Completion at Completion amount of
in cash in Loan Notes loan notes
------------------------------------------------------------------------------------------------------------------------------------
3i Group plc 1,416,500 'A' 40.481 100 Nil (pound)809,601.00 N/A
(through its ordinary
nominee shares
3i Nominees
Limited)
00 Xxxxxxxx
Xxxx
Xxxxxx
XX0 0XX
------------------------------------------------------------------------------------------------------------------------------------
3i Parallel 403,702 'A' 11.537 100 Nil (pound)230,736.00 N/A
Ventures LP ordinary
(through its shares
nominee 3i
PVLP Nominees
Limited)
00 Xxxxxxxx Xxxx
Xxxxxx
XX0 0XX
------------------------------------------------------------------------------------------------------------------------------------
Parallel Ventures
Managers Limited 21,248 'A' 0.607 100 Nil (pound)12,144.30 N/A
(in its capacity ordinary
as administrator shares
of the Parallel
Ventures (No.2)
Co-investment
Plan through
its nominee
3i PVLP
Nominees
Limited)
00 Xx Xxxxx'x
Xxxxxx
Xxxxxx XX0X 0XX
------------------------------------------------------------------------------------------------------------------------------------
-42-
------------------------------------------------------------------------------------------------------------------------------------
1. Names and 2. Number and class 3. Respective 4. % of 5. % of 6. Cash to be 7. Maximum
addresses of of Shares owned Proportion (%) individual individual placed in liability
the Sellers by the Sellers Sellers' Sellers' Retention under the
in the Company Consideration Consideration Account or Warranties and
to be received to be received maximum Tax Covenant
at Completion at Completion amount of
in cash in Loan Notes loan notes
------------------------------------------------------------------------------------------------------------------------------------
3i UKIP II LP 991,550 'A' 28.337 100 Nil (pound)566,720.55 N/A
(through its ordinary
nominee 3i shares
UKIP II Nominees
Limited)
00 Xxxxxxxx Xxxx
Xxxxxx XX0 0XX
------------------------------------------------------------------------------------------------------------------------------------
Credit Agricole
Indosuez 117,215 'A' 3.35 100 Nil (pound)66,994.27 N/A
122 Leadenhall ordinary
Street shares
Xxxxxx
XX0X 0XX
------------------------------------------------------------------------------------------------------------------------------------
The Governor 66,980 'A' 1.914 100 Nil (pound)38,282.44 N/A
and Company ordinary
of the Bank shares
of Scotland
Xxx Xxxxx
Xxxxxxxxx
XX0 0XX
------------------------------------------------------------------------------------------------------------------------------------
The Royal
Bank of
Scotland 47,216 1.96 100 Nil (pound)39,208.22 N/A
Trust ordinary
Company shares
(Jersey)
Limited
------------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxxxx (*1)
00 Xxxxxx Xxxxx 78,695 3.267 3.1784 96.8216 (pound)65,348.42 (pound)900,000
0/0 Xxxxx Xxxx xxxxxxxx
Xxxxxx shares
------------------------------------------------------------------------------------------------------------------------------------
Xxxxxx XxXxx (*1)
00 Xxxxx Xxxxx 78,695 3.267 10.7983 89.2017 (pound)65,348.42 (pound)900,000
Road ordinary
Hanwell shares
London
------------------------------------------------------------------------------------------------------------------------------------
Xxxx Xxxxxxxxxxxx (*1)
Broak Oak 62,956 2.614 3.1779 96.8221 (pound)52,278.88 (pound)700,000
Milfoed ordinary
Godalming shares
Surrey
------------------------------------------------------------------------------------------------------------------------------------
-43-
------------------------------------------------------------------------------------------------------------------------------------
1. Names and 2. Number and class 3. Respective 4. % of 5. % of 6. Cash to be 7. Maximum
addresses of of Shares owned Proportion (%) individual individual placed in liability
the Sellers by the Sellers Sellers' Sellers' Retention under the
in the Company Consideration Consideration Account or Warranties and
to be received to be received maximum Tax Covenant
at Completion at Completion amount of
in cash in Loan Notes loan notes
------------------------------------------------------------------------------------------------------------------------------------
Xxxx-Xxx Buridans
18, Avenue 47,216 1.96 100 Nil (pound)39,208.22 (pound)565,000
Trudaine 00000 xxxxxxxx
Xxxxx Xxxxxx shares
------------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Burn (*1)
13 Woodthorpe 17,015 0.706 3.1801 96.8199 (pound)14,129.28 (pound)150,000
Road Putney ordinary
London shares
XX00 0XX
------------------------------------------------------------------------------------------------------------------------------------
Total 3,017,195 'A' 100% (pound)2,000,000 (pound)3,215,000
ordinary ================
shares
331,793
ordinary
shares
------------------------------------------------------------------------------------------------------------------------------------
(*1) Xxxxxxx Xxxxxxx, Xxxxxx XxXxx, Xxxx Xxxxxxxxxxxx and Xxxxxx Burn are
each to received the percentage set out alongside their name in column
4 above of their entitlement to their initial Consideration of
(pound)40,170,042.93 in cash. All further payments to each of these
four Managers pursuant to this Agreement are to be made as to 100% in
Loan Notes.
SCHEDULE 2
The Company and the Subsidiary Undertakings
Schedule available upon request by the United States Securities and Exchange
Commission
SCHEDULE 3
The Properties
Schedule available upon request by the United States Securities and Exchange
Commission
SCHEDULE 4
Non-Tax Warranties
Schedule available upon request by the United States Securities and Exchange
Commission
SCHEDULE 5
Tax Covenant and Tax Warranties
Schedule available upon request by the United States Securities and Exchange
Commission
SCHEDULE 6
Net Asset Statement
Schedule available upon request by the United States Securities and Exchange
Commission
Executed as a Deed by )
Xxxxxx Xxxxxxx )
)
as attorney for )
3i Group plc )
in the presence of: )
/S/ XXXXXX XXXXXXX ) /S/ XXXXXX XXXXXXX
------------------ ------------------
65 Holborn Viaduct Duly Authorised Attorney
London
Executed as a Deed by Xxxxxx Xxxxxxx )
on behalf of )
3i Parallel Ventures LP )
acting by its manager, 3i Investments plc, )
by )
Xxxxxx Xxxxxxx )
as attorney for 3i Investments plc )
in the presence of: )
/S/ XXXXXX XXXXXXX ) /S/ XXXXXX XXXXXXX
------------------ ------------------
Duly Authorised Attorney
Executed as a Deed )
on behalf of )
3i UKIP II LP )
acting by its manager, 3i Investments plc, )
by )
Xxxxxx Xxxxxxx )
as attorney for 3i Investments plc )
in the presence of: )
/S/ XXXXXX XXXXXXX ) /S/ XXXXXX XXXXXXX
------------------ ------------------
Duly Authorised Attorney
Executed as a Deed )
on behalf of )
Parallel Ventures Managers Limited )
as Administrator of and attorney for the )
members of Parallel Ventures (No. 2) )
Co-investment Plan acting by its attorney )
3i Investments plc, by Xxxxxx Xxxxxxx )
as duly authorised attorney of 3i )
Investments )
plc )
in the presence of: )
/S/ XXXXXX XXXXXXX ) /S/ XXXXXX XXXXXXX
------------------ ------------------
Duly Authorised Attorney
Executed as a Deed by Xxx Xxxxxx )
for and on behalf of )
Credit Agricole Indosuez ) /S/ XXX XXXXXX
) --------------
pursuant to a power of attorney date )
25 February 2002.
Executed as a Deed by Xxxxx XxXxx )
for and on behalf of )
The Governor and Company ) /S/ XXXXX XXXXX
) ---------------
of the Bank of Scotland )
Signed as a Deed by Xxxxxxx Xxxxxxx )
in the presence of: ) /S/ XXXXXXX XXXXXXX
) -------------------
Xxxxxx X. Xxxxxx
/S/ XXXXXX X. XXXXXX
00 Xxxxx Xxxxxxxxx Xxxxxx
Xxxxxxx
Signed as a Deed by Xxxxxx XxXxx )
in the presence of: ) /S/ XXXXXX XXXXX
----------------
Xxxxxx X. Xxxxxx
/S/ XXXXXX X. XXXXXX
Signed as a Deed by Xxxx Xxxxxxxxxxxx )
in the presence of: ) /S/ XXXX XXXXXXXXXXXX
---------------------
Xxxxxx X. Xxxxxx
/S/ XXXXXX X. XXXXXX
Signed as a Deed by Xxxx-Xxx Buridans )
in the presence of: ) /S/ XXXX-XXX BURIDANS
---------------------
Xxxxxx X. Xxxxxx
/S/ XXXXXX X. XXXXXX
Signed as a Deed by Xxxxxx Burn )
in the presence of: ) /S/ XXXXXXX XXXXXXX, POA
-------------------------
Xxxxxx X. Xxxxxx
/S/ XXXXXX X. XXXXXX
Executed as a Deed by Xxxxxx Xxxxxx )
for and on behalf of )
The Royal Bank of Scotland )
Trust Company (Jersey) Limited )
pursuant to a power of attorney dated ) /S/ XXXXXX X. XXXXXX
--------------------
25 February 2002
Executed as a Deed by )
Atlas Group Holdings Limited ) /S/ XXXXXX XXXXX
----------------
Director
/S/ XXXXXXX XXXXXXX
---------------------
Director/Secretary
Executed as a Deed by )
Right Associates Limited ) /S/ XXXXXXX X. XXXXXX
---------------------
Director
/S/ XXXXXX XXXXXXXXX
---------------------
Director/Secretary
Executed as a Deed by Xxxxxxx X. Xxxxxx )
for and on behalf of )
Right Management Consultants Inc. )
/S/ XXXXXXX X. XXXXXX
---------------------
Chairman and
Chief Executive Officer
