EXHIBIT 4.11
SHARE SALE AGREEMENT
BONDS INDUSTRIES LIMITED
Pacific Dunlop Limited
and
Pacific Brands Holdings Pty Ltd
PB Holdings NV
[LOGO OF FREEHILLS]
000 Xxxxxxx Xxxxxx Xxxxxxxxx Xxxxxxxx 0000 Xxxxxxxxx
Telephone 00 0 0000 0000 Facsimile 61 3 9288 1567
xxx.xxxxxxxxx.xxx.xx DX240 Melbourne
SYDNEY MELBOURNE PERTH CANBERRA BRISBANE HANOI HO CHI MINH CITY SINGAPORE
Correspondent Offices JAKARTA KUALA LUMPUR
Liability limited by the Solicitors' Limitation of Liability Scheme, approved
under the Professional Standards Xxx 0000 (NSW)
Reference NJW:BAE
TABLE OF CONTENTS
Clause Page
1 Definitions and interpretation 1
1.1 Definitions 1
1.2 Interpretation 5
1.3 Business Day 6
1.4 Conflict 6
2 Sale and purchase 6
2.1 Sale of shares 6
2.2 Associated rights 6
3 Purchase Price 7
3.1 Amount 7
3.2 Payment at Completion 7
3.3 Final payment 7
4 Completion 7
4.1 Date for Completion 7
4.2 Delivery of documents 7
4.3 Board meetings 8
4.4 Buyer's obligations at completion 8
4.5 Interdependence 8
4.6 Conduct until Shares are registered 9
5 Before Completion 9
5.1 Carrying on Business 9
5.2 Treatment of Cash in Hand 10
5.3 Inter Company Debt 10
5.4 Strategic Investment Programme 10
6 After Completion 10
6.1 Obligations relating to Taxes or Duties 10
6.2 Consultation 10
6.3 Indemnity 10
7 Warranties 11
8 Limitation of liability 11
9 Competition 11
9.1 Undertaking 11
9.2 Acquisition of interests in competing Businesses 11
9.3 Exclusion from restraint 12
9.4 Related Corporations 12
9.5 Severability 12
10 Release of guarantees 12
11 Guarantee and indemnity - Seller 13
11.1 Guarantee 13
11.2 Indemnity 13
11.3 Extent of guarantee and indemnity 13
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11.4 Continuing guarantee and indemnity 13
11.5 Warranties of the Guarantor 14
11.6 Rights 14
12 Guarantee and Indemnity - Buyer 14
12.1 Guarantee 14
12.2 Indemnity 14
12.3 Extent of guarantee and indemnity 14
12.4 Continuing guarantee and indemnity 15
12.5 Warranties of the Buyer Guarantor 15
12.6 Rights 15
13 Superannuation 15
13.1 Membership of Buyer's Fund 15
13.2 Transfer 16
13.3 Calculation of Accrued Benefit Values 16
13.4 Payment of Accrued Benefit Values 17
13.5 Undertakings by Buyer and Seller 18
Schedule 1 - Share Details 20
Schedule 2 - Warranties 21
1 Buyer Authorised 21
Schedule 3 - Disclosure Schedule 37
Schedule 4 - Intellectual Property Rights 38
Schedule 5 - Superannuation Funds 39
Schedule 6 - Contracts 40
Schedule 7 - Guarantees 41
Schedule 8 - Employees 42
Schedule 9 - Plant and Equipment 43
Schedule 10 - Assets Leases 44
Schedule 11 - Properties 45
Schedule 12 - Inter Company Debts 46
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THIS SHARE SALE AGREEMENT
is made on 2001 between the parties specified in parts 1, 2 and
3 of schedule 1.
RECITALS
A. The Seller is the owner of the Shares.
B. The Seller agrees to sell and the Buyer agrees to buy the Shares
on the terms and conditions set out in this agreement.
C. The Guarantor agrees to guarantee the performance by the Seller
of its obligations pursuant to this agreement.
D. The Buyer Guarantor agrees to guarantee the performance by the
Buyer of its obligations pursuant to this agreement.
THE PARTIES AGREE
in consideration of, among other things, the mutual promises contained
in this agreement:
1 DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this agreement:
Accounting Standards has the meaning given to that term in the
Co-ordination Agreement;
Accounts has the meaning given to that term in the Co-ordination
Agreement;
Accounts Date means 30 June 2001;
Accrued Benefit Value means the total amount accumulated or accrued in
respect of a Member under the governing rules of the Seller's Fund as
at the Completion Date, calculated in accordance with clause 13.3;
Apportionment Statement has the meaning given to that term in the
Co-ordination Agreement;
Assets Leases means all leases, hire purchase agreements, conditional
purchase agreements and other hiring arrangements to which the Company
is party including, but not limited to, those listed in schedule 10,
but excludes leases in relation to the Leased Properties;
Authorisation means any consent, registration, agreement, certificate,
licence, approval, permit, authority or exemption from, by or with a
Governmental Agency;
Business means the business carried on by the Company as more
particularly described in part 6 of schedule 1;
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Business Day means a day on which banks are open for business in
Melbourne, Sydney and Auckland excluding a Saturday or a Sunday or a
public holiday;
Business Records means, the Company's customer lists and supplier
lists, records of Intellectual Property Rights, Assets Leases,
Contracts and Properties;
Buyer means the company specified in part 2 of schedule 1;
Buyer Group Companies has the meaning given to that term in the
Co-ordination Agreement;
Buyer Guarantor means the company specified in part 8 of schedule 1;
Buyer's Fund means the Buyer's superannuation fund established or
nominated by the Buyer for the purpose of clause 13;
Buyer's Warranties means the warranties set out in part 1 of schedule
2;
Cash in Hand means the amount of cash at bank on deposit or at hand in
the Company;
Claim means any claim or any course of action (including, but not
limited to, in contract, in tort or under statute) in respect of this
agreement;
Company means the company specified in part 4 of schedule 1;
Completion means completion of the sale and purchase of the Shares
under clause 4;
Completion Date has the meaning given to that term in the
Co-ordination Agreement;
Completion Statement has the meaning given to that term in the
Co-ordination Agreement;
Conditions has the meaning given to that term in the Co-ordination
Agreement;
Contracts means the agreements to which the Company is a party to the
extent they relate to the Business and which are, wholly or partly,
executory as at the Completion Date, including, but not limited to,
those listed in part 1 of schedule 6, but excludes:
(a) the Assets Leases; and
(b) leases in relation to the Leased Properties;
Co-ordination Agreement means the Co-ordination Agreement executed on
the same day as this agreement by, among others, the Seller and the
Buyer;
Dollars, A$ and $ means Australian dollars;
Duty means any stamp, transaction or registration duty or similar
charge imposed by any Governmental Agency and includes, but is not
limited to, any interest, fine, penalty, charge or other amount
imposed in respect of the above, but excludes any Tax;
Effective Time has the meaning given to that term in the Co-ordination
Agreement;
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Employees means an employee of the Company listed in schedule 8 who is
still employed in the Business as at the Completion Date;
Encumbrance means any mortgage, charge, lien, pledge, other security
interest or encumbrance (other than liens arising in the ordinary
course of business by operation of law and title retention in respect
of stock-in-trade);
Environmental Law has the meaning given to that term in the
Co-ordination Agreement;
External Funds means the superannuation schemes listed in part 2 of
schedule 5;
Foreign Exchange Contracts means all foreign exchange hedging
contracts entered by the Seller which relate exclusively to the
Business which remain current as at Completion, details of which will
be provided to the Buyer at the date of this agreement and at
Completion;
Freehold Properties means the freehold land owned by the Company and
more particularly described in part 1 of schedule 11;
Governmental Agency means any government or any governmental,
semi-governmental, administrative, fiscal or judicial body,
department, commission, authority, tribunal, agency or entity in any
part of the world;
Guarantees means the guarantees and other letters of comfort and
commitments of financial support given by the Seller and its Related
Corporations in relation to the Business which remain in force at the
date of this agreement, including but not limited to, as listed in
schedule 7;
Guarantor means the company specified in part 3 of schedule 1;
Intellectual Property Rights means the rights and interests of the
Company in the internet domain names, trademarks, patents, copyrights
and designs listed in schedule 4;
Inter Company Debt means any amount owing (including trade accounts
payable and receivable):
(a) by the Company to a member of the PDL Group (except in that
member's capacity as an entity carrying on any part of the
Pacific Brands Business); or
(b) by a member of the PDL Group (except in that member's capacity as
an entity carrying on any part of the Pacific Brands Business) to
the Company,
immediately before Completion;
Interest Rate means the average rate displayed on the Reuters Page
BBSW for 90 day bank bills at 10:10 am Melbourne time applicable to
each Business Day on which amounts are outstanding as confirmed by
Westpac Banking Corporation and on the basis that for a day other than
a Business Day the rate applicable to the last preceding Business Day
will apply;
Leased Properties means the properties leased under the Property
Leases;
Linked Transaction Agreements has the meaning given to that term in
the Co-ordination Agreement;
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Loss includes any damage, loss, claim, action, liability, cost,
expense, outgoing or payment;
Member means an Employee who is a member of the Seller's Fund
immediately before the Completion Date;
Pacific Brands Business has the meaning given to that term in the
Co-ordination Agreement;
Payment Date has the meaning given to that term in the Co-ordination
Agreement;
PDL Group means Pacific Dunlop Limited ABN 89 004 085 330 and its
Related Corporations, immediately before Completion;
Plant and Equipment means the plant, equipment, machinery, tools,
furniture, fittings, lease hold improvements and motor vehicles owned
by the Company as at Completion and used exclusively in the Business
including, without limitation, those listed in schedule 9;
Power means any right, power, authority, discretion or remedy
conferred on the parties by this agreement or any applicable law;
Properties means the Leased Properties and the Freehold Properties;
Property Leases means the leases of real property listed in part 2 of
schedule 11;
Purchase Price means the price payable for the Shares under clause
3.1;
Records means all original and copy records, documents, books, files,
reports, accounts, plans, correspondence, letters and papers of every
description and other material regardless of their form or medium and
whether coming into existence before, on or after the date of this
agreement, belonging or relating to or used by the Company including
(without limitation) certificates of registration, minute books,
statutory books and registers, books of account, Tax returns, title
deeds and other documents of title, customer lists, price lists,
computer programs and software, and trading and financial records;
Related Corporation means a "related body corporate" as defined in the
Corporations Act;
Seller means the company specified in part 1 of schedule 1;
Seller Group Companies has the meaning given to that term in the
Co-ordination Agreement;
Seller's Actuary means a qualified actuary nominated by the Seller for
the purposes of clause 13.3;
Seller's Fund means the superannuation fund listed in part 1 of
schedule 5;
Seller's Warranties means the warranties set out in part 2 of schedule
2;
Shares means all the issued shares in the capital of the Company, as
specified in part 5 of schedule 1;
SIP Registrations means the registrations of the Company for the
financial years ended 2001 and 2002 under the SIP Scheme;
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SIP Scheme means the Textile, Clothing and Footwear Strategic
Investment Program Scheme 1999 made under section 8 of the Textile,
Clothing and Footwear Strategic Investment Program Act 1999 (Cwth);
Stock means the stock of the Business owned by the Company as at
Completion and includes, but is not limited to, raw materials,
components, work in progress, finished goods, packaging materials,
promotional materials, spare parts and other consumables;
Tangible Assets means Plant and Equipment and Stock;
Tax means any tax, levy, charge, impost, duty, fee, deduction,
compulsory loan or withholding, which is assessed, levied, imposed or
collected by any Governmental Agency and includes, but is not limited
to any interest, fine, penalty, charge, fee or any other amount
imposed on, or in respect of, any of the above but excludes Duty;
Tax Law means any law relating to Tax;
Transfer Date means:
(a) the date agreed by the Seller and the Buyer for this purpose, not
being earlier than the Completion Date; or
(b) if the Buyer and Seller do not agree a date for the purposes of
paragraph (a) of this definition within one month of the
Completion Date, the date which is three months after the
Completion Date; and
Warranties means the Buyer's Warranties and the Seller's Warranties.
1.2 INTERPRETATION
In this agreement, unless the context otherwise requires:
(a) headings and underlinings are for convenience only and do not
affect the interpretation of this agreement;
(b) words importing the singular include the plural and vice versa;
(c) words importing a gender include any gender;
(d) other clauses of speech and grammatical forms of a word or phrase
defined in this agreement have a corresponding meaning;
(e) an expression importing a natural person includes any company,
partnership, joint venture, association, corporation or other
body corporate and any Governmental Agency;
(f) a reference to a part, clause, party, annexure or schedule is a
reference to a clause and part of, and a party, annexure and
schedule to this agreement and a reference to this agreement
includes any annexure and schedule;
(g) a reference to a statute, regulation, proclamation, ordinance or
by-law includes all statutes, regulations, proclamations,
ordinances or by-laws amending, consolidating or replacing it,
and a reference to a statute
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includes all regulations, proclamations, ordinances and by-laws
issued under that statute;
(h) a reference to a document includes all amendments or supplements
to, or replacements or novations of, that document;
(i) a reference to a party to a document includes that party's
successors and permitted assigns;
(j) where the day on or by which any thing is to be done is not a
Business Day, that thing must be done on or by the following
Business Day;
(k) no rule of construction applies to the disadvantage of a party
because that party was responsible for the preparation of this
agreement or any part of it;
(l) if a covenant, undertaking, representation, warranty, indemnity
or agreement is made or given by two or more parties, that
covenant, undertaking, representation, warranty, indemnity or
agreement is made or given and binds those parties jointly and
severally; and
(m) if a party comprises two or more persons, a covenant,
undertaking, representation, warranty, indemnity or agreement
made or given by that party binds those persons jointly and
severally.
1.3 BUSINESS DAY
Where the day on or by which any thing is to be done is not a Business
Day, that thing must be done on or by the next Business Day.
1.4 CONFLICT
If there is any conflict or inconsistency between anything contained
in this agreement and anything contained in the Co-ordination
Agreement, then the Co-ordination Agreement will prevail.
2 SALE AND PURCHASE
2.1 SALE OF SHARES
Subject to the Conditions having been fulfilled or waived in
accordance with the Co-ordination Agreement, the Seller will sell and
the Buyer will buy the Shares for the Purchase Price free of
Encumbrances and other third party rights on Completion.
2.2 ASSOCIATED RIGHTS
The Shares will be transferred under this agreement with all rights
attached or accruing to them on and from the Effective Time. The Buyer
is not entitled to the rights attached to the Shares as at the date of
this agreement or to any rights which accrue between the date of this
agreement and the Effective Time, including dividend rights.
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3 PURCHASE PRICE
3.1 AMOUNT
The Purchase Price is the value ascribed to the Company in the
Apportionment Statement in accordance with the terms of the
Co-ordination Agreement.
3.2 PAYMENT AT COMPLETION
It is acknowledged that under the Co-ordination Agreement, an amount
must be paid at Completion by the Buyer to Pacific Dunlop Limited (or
as otherwise directed by it) on behalf of the Seller.
3.3 FINAL PAYMENT
On the Payment Date, the Buyer or the Seller, as appropriate, must pay
to the other any net amount plus interest on the amount which may be
payable in accordance with the provisions of the Co-ordination
Agreement.
4 COMPLETION
4.1 DATE FOR COMPLETION
Completion must take place on the Completion Date, subject to and as
provided for in the Co-ordination Agreement.
4.2 DELIVERY OF DOCUMENTS
At Completion, the Seller must deliver to the Buyer:
(a) original share certificates for the Shares;
(b) duly completed transfers of the Shares to the Buyer in
registrable form, executed by the Seller;
(c) duly executed releases of all guarantees that have been obtained
in accordance with clause 10;
(d) the original certificate of incorporation or registration of the
Company;
(e) all original documents of title in relation to the Freehold
Properties and Intellectual Property Rights;
(f) the written resignations of all directors and the secretary of
the Company (including a written acknowledgment that he or she
has no Claim against the Company for loss of office, breach of
contract, redundancy, compensation, payment or repayment of loans
or otherwise, except for payments properly payable as an employee
for accrued salary, holiday pay and long service leave up to the
Completion Date) except Xxxx Rostolis and Xxxxxxx Xxxxx Xxxxxxx,
to be effective on the appointment of the directors to be
appointed at the Board meetings to be convened under clause 4.3;
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(g) evidence that the Company has transferred its shares in Mt
Waverley Estates Pty Ltd ACN 004 552 694 to a member of the PDL
Group which is not being sold as part of the sale of the Pacific
Brands Business;
(h) any power of attorney or other authority under which the
transfers of the Shares are executed;
(i) duly executed instruments irrevocably waiving in favour of the
Buyer all rights of pre-emption which any person has in respect
of any of the Shares; and
(j) all Records, which must be complete and up to date (by
constructive delivery at the Company's premises).
4.3 BOARD MEETINGS
At Completion, the Seller must ensure that a meeting of the directors
of the Company is convened and conducts the following business:
(a) approval of the registration of the Buyer as the holder of the
Shares in the books of the Company;
(b) appointment of the nominees of the Buyer as directors of the
Company;
(c) alteration of the registered office of the Company to a
registered office nominated by the Buyer; and
(d) revocation of all existing mandates for the operation of bank
accounts of the Company and approval of new mandates in favour of
the officers of the Company nominated by the Buyer.
4.4 BUYER'S OBLIGATIONS AT COMPLETION
At Completion the Buyer must:
(a) pay the Seller an estimate of the Purchase Price in accordance
with clause 3.2;
(b) execute the transfers of Shares delivered by the Seller pursuant
to clause 4.2(b);
(c) deliver to the Seller written consents to act from the persons
nominated by the Buyer as the directors and secretary of the
Company; and
(d) deliver to the Seller evidence obtained by it that it has
replaced the Guarantee as required under clause 10(c).
4.5 INTERDEPENDENCE
(a) Notwithstanding any provision of a Linked Transaction Agreement
but subject to clause 4 of the Co-ordination Agreement, the
obligations of the parties to the Linked Transaction Agreements
in respect of completion (as defined in each Linked Transaction
Agreement) are interdependent.
(b) Subject to clause 4 of the Co-ordination Agreement, all actions
at Completion under this agreement and completion under each
other Linked Transaction Agreement will be deemed to take place
simultaneously and
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no delivery or payment will be deemed to have been made until all
deliveries and payments under the Linked Transaction Agreements
due to be made at or immediately after completion (as defined in
each Linked Transaction Agreement) have been made.
(c) A breach of this agreement by any party to this agreement is
deemed to constitute a breach by the defaulting party of each
Linked Transaction Agreement to which the defaulting party is a
party.
4.6 CONDUCT UNTIL SHARES ARE REGISTERED
After Completion and until the Shares are registered in the name of
the Buyer or its nominee, the Seller must take all action lawfully
required by the Buyer by written notice to the Seller to vote on any
resolutions of the Company as the Buyer directs.
5 BEFORE COMPLETION
5.1 CARRYING ON BUSINESS
The Seller will procure that the Company uses all reasonable
endeavours to ensure that between the date of this agreement and
Completion, subject to clauses 5.2 and 5.3, the Business is conducted
in the ordinary course of business and that the Company does not:
(a) enter into any material contract or arrangement outside the
ordinary course of trading or otherwise than on arm's length
terms;
(b) acquire or dispose of any assets other than on arm's length terms
in the ordinary course of business;
(c) make any material change to its policy and practice as to payment
of creditors and collection of trade receivables;
(d) engage any new employee to fill a new role with an annual
remuneration package in excess of $120,000 or, except in the
ordinary course of the Business, terminates the employment of any
of its employees or changes in any material respect the terms of
employment (including remuneration);
(e) sell or agree to sell any fixed asset with a value of more than
$250,000 or buy or commit to buy any fixed asset with a value of
more than $250,000;
(f) create any Encumbrance over any of its assets;
(g) incur any indebtedness or liability in the nature of borrowings
other than in the ordinary course of business;
(h) distribute or return any capital to its members;
(i) pay any dividend to its members or pay any management fee or
similar amount;
(j) issue any shares, options or securities which are convertible
into shares in the Company; and
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(k) alter its constitution,
unless the Buyer first consents in writing, which must not be
unreasonably withheld or delayed.
5.2 TREATMENT OF CASH IN HAND
(a) At any time before Completion, the Seller may arrange for any
Cash in Hand held by the Company to be removed in any manner
selected by the Seller.
(b) Any Cash in Hand held by the Company as at the Effective Time,
will be included in the Completion Statement.
5.3 INTER COMPANY DEBT
The Buyer acknowledges that prior to Completion, the Seller will
procure that any Inter Company Debt owing to or by the Company is
satisfied or otherwise extinguished, including but not limited to
those Inter Company Debts listed in schedule 12. The Seller will
provide evidence to the Buyer of any such satisfaction of debt on or
prior to Completion.
5.4 STRATEGIC INVESTMENT PROGRAMME
The parties acknowledge that their respective entitlements to receive
the benefit of any amounts received under the SIP Scheme in respect of
the SIP Registrations, are set out in the Co-ordination Agreement.
6 AFTER COMPLETION
6.1 OBLIGATIONS RELATING TO TAXES OR DUTIES
After Completion, the Buyer must procure that the Company provides the
Seller with access to such employees and records of the Company as the
Seller reasonably requires to meet its obligations under any law
relating to Tax or Duty provided such access is exercised and
conducted in a manner to avoid unreasonable disruption to the conduct
of the Business and the activities and operations of the Company and
its employees.
6.2 CONSULTATION
If any Governmental Agency conducts an audit in relation to the
affairs of the Company relating to any period prior to the Completion
Date then the Buyer must procure that the Seller is promptly notified
of this and that the Seller is then regularly consulted with in
relation to the audit process until resolved.
6.3 INDEMNITY
The Seller indemnifies and holds the Buyer harmless from and against
all reasonable costs and expenses associated with the claim against
the Company described as the Footwear Import Group/Loscam Pallet
claim, details of which are
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contained in the Data Room (Footwear Import Group Folder, section 4.1,
document 100426).
7 WARRANTIES
(a) The Buyer gives the Buyer's Warranties in favour of the Seller on
and subject to the terms set out in the Co-ordination Agreement.
(b) The Seller gives the Seller's Warranties in favour of the Buyer
on and subject to the terms set out in the Co-ordination
Agreement.
8 LIMITATION OF LIABILITY
The Seller gives the Seller's Warranties in favour of the Buyer on and
subject to the limitations on liability set out in the Co-ordination
Agreement.
9 COMPETITION
9.1 UNDERTAKING
In consideration for the respective promises of the Seller and the
Buyer to each other in this agreement, the Seller undertakes to the
Buyer that it will not for a period of 5 years, 4 years, 3 years, 2
years or 1 year after the Completion Date in Australia.
(a) engage in any business or activity which is the same as or
substantially similar to or competitive with, the Business or any
material part of it;
(b) solicit, canvass, induce or encourage any person who was at any
time during the 6 months period ending on the Completion Date a
director, employee or agent of the Company to leave the
employment or agency of the Company;
(c) solicit, canvass, approach or accept any approach from any person
who was at any time during the 6 months period ending on the
Completion Date, a client or customer of the Company with a view
to obtaining the custom of that person in a business which is the
same as or substantially similar to or competitive with, the
Business; or
(d) interfere with the relationship between the Company and its
clients, customers, employees or suppliers.
9.2 ACQUISITION OF INTERESTS IN COMPETING BUSINESSES
Clause 9.1 does not prevent the Seller or any of its Related
Corporations from acquiring an interest, directly or indirectly, in a
business in competition with the Business in the area referred to in
that clause if:
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(a) the acquisition of the interest in the competing business occurs
as a result of or in conjunction with an acquisition of an
interest, directly or indirectly, in other assets;
(b) the value of the competing business is not more than 15% of the
value of the acquisition taken as a whole; and
(c) the Seller or the relevant Related Corporation uses its best
endeavours to dispose of the competing business or its interest
in the business within 12 months after its acquisition.
9.3 EXCLUSION FROM RESTRAINT
This clause 9 does not restrict the Seller or any of its Related
Corporations from:
(a) continuing to carry on any business (other than the Business)
carried on at the date of this agreement; or
(b) holding less than 5% of the issued share capital of a company
listed on a recognised Stock Exchange.
9.4 RELATED CORPORATIONS
The Buyer agrees that the provisions of this clause 9 only apply to
the Related Corporations of the Seller for so long as those entities
remain Related Corporations of the Seller.
9.5 SEVERABILITY
(a) If any of the several separate and independent covenants and
restraints in clause 9.1 are or become invalid or unenforceable
for any reason, then that invalidity or unenforceability will not
affect the validity or enforceability of any of the other
separate and independent covenants and restraints in clause 9.1.
(b) If any of the prohibitions or restrictions contained in this
clause 9 is judged to go beyond what is reasonable in the
circumstances and necessary to protect the goodwill of the
Company, but would be judged reasonable and necessary if any
activity were deleted or the period or area were reduced, then
the prohibitions or restrictions apply with that activity deleted
or that period or area reduced by the minimum amount necessary.
10 RELEASE OF GUARANTEES
(a) The Buyer must use its best endeavours to secure the release of
the Seller or any Related Corporation of the Seller from any
Guarantee or Encumbrance provided in relation to the Business,
effective from Completion.
(b) If the Buyer is unable to secure the release under clause 10(a),
then the Buyer must pay the Seller an amount equal to any Loss
which the Seller or any Related Corporation of the Seller pays,
suffers, incurs, or is liable for
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in relation to any Guarantee or Encumbrance referred to in clause
10(a) which relates to any act or omission of the Company after
Completion.
(c) In the case of the Guarantee provided in favour of the WorkCover
Authority of New South Wales (Authority), the Buyer agrees to
procure the replacement of that Guarantee by a Related
Corporation acceptable to the Authority and in accordance with
the requirements of the Authority, at or as soon as practicable
after Completion.
11 GUARANTEE AND INDEMNITY - SELLER
11.1 GUARANTEE
The Guarantor unconditionally and irrevocably guarantees to the Buyer
the due and punctual performance of the Seller's obligations under
this agreement.
11.2 INDEMNITY
The Guarantor indemnifies and holds the Buyer harmless from and
against all Loss incurred or suffered by the Buyer and all actions,
proceedings, claims or demands made against the Buyer as a result of
default by the Seller in the performance of any such obligation.
11.3 EXTENT OF GUARANTEE AND INDEMNITY
(a) This clause 11 applies:
(1) to the present and future obligations of the Seller under
this agreement; and
(2) to this agreement, as amended, supplemented, renewed or
replaced.
(b) The obligations of the Guarantor under this clause 11 extend to
any change in the obligations of the Seller as a result of any
amendment, supplement, renewal or replacement of this agreement.
(c) This clause 11 is not affected, nor are the obligations of the
Guarantor under this agreement released or discharged or
otherwise affected, by anything which, but for this provision,
might have that effect.
(d) This clause 11 applies:
(1) regardless of whether the Guarantor is aware of, or has
consented to, or is given notice of, any amendment,
supplement, renewal or replacement of any agreement to which
the Buyer and the Seller are a party or the occurrence of
any other thing; and
(2) irrespective of any rule of law or equity to the contrary.
11.4 CONTINUING GUARANTEE AND INDEMNITY
This clause 11 is a continuing obligation of the Guarantor despite any
settlement of account and remains in full force and effect until the
obligations of the Seller under this agreement have been performed.
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11.5 WARRANTIES OF THE GUARANTOR
The Guarantor represents and warrants to the Buyer that:
(a) it has the corporate power to enter into this guarantee and
indemnity and has taken all necessary action to authorise the
execution, delivery and performance of this agreement;
(b) the execution, delivery and performance of this guarantee and
indemnity will not violate any provision of:
(1) any law or regulation or any order or decree of any
Governmental Agency of the Commonwealth of Australia or any
state or territory;
(2) the constitution of the Guarantor; or
(3) any security agreement, deed, contract, undertaking or other
instrument to which the Guarantor is a party or which is
binding on it.
11.6 RIGHTS
The Guarantor waives any right it has of first requiring any of the
Buyer Group Companies to commence proceedings or enforce any other
right against the Seller or any of the Seller Group Companies or any
other person before claiming under this clause 11.
12 GUARANTEE AND INDEMNITY - BUYER
12.1 GUARANTEE
The Buyer Guarantor unconditionally and irrevocably guarantees to the
Seller the due and punctual performance of the Buyer's obligations
under this agreement.
12.2 INDEMNITY
The Buyer Guarantor indemnifies and holds the Seller harmless from and
against all Loss incurred or suffered by the Seller and all actions,
proceedings, claims or demands made against the Seller as a result of
default by the Buyer in the performance of any such obligation.
12.3 EXTENT OF GUARANTEE AND INDEMNITY
(a) This clause 12 applies:
(1) to the present and future obligations of the Buyer under
this agreement; and
(2) to this agreement, as amended, supplemented, renewed or
replaced.
(b) The obligations of the Buyer Guarantor under this clause 12
extend to any change in the obligations of the Buyer as a result
of any amendment, supplement, renewal or replacement of this
agreement.
page 14
(c) This clause 12 is not affected, nor are the obligations of the
Buyer Guarantor under this agreement released or discharged or
otherwise affected, by anything which, but for this provision,
might have that effect.
(d) This clause 12 applies:
(1) regardless of whether the Buyer Guarantor is aware of, or
has consented to, or is given notice of, any amendment,
supplement, renewal or replacement of any agreement to which
the Seller and the Buyer are a party or the occurrence of
any other thing; and
(2) irrespective of any rule of law or equity to the contrary.
12.4 CONTINUING GUARANTEE AND INDEMNITY
This clause 12 is a continuing obligation of the Buyer Guarantor
despite any settlement of account and remains in full force and effect
until the obligations of the Buyer under this agreement have been
performed.
12.5 WARRANTIES OF THE BUYER GUARANTOR
The Buyer Guarantor represents and warrants to the Seller that:
(a) it has the corporate power to enter into this guarantee and
indemnity and has taken all necessary action to authorise the
execution, delivery and performance of this agreement;
(b) the execution, delivery and performance of this guarantee and
indemnity will not violate any provision of:
(1) any law or regulation or any order or decree of any
Governmental Agency of the Commonwealth of Australia or any
state or territory;
(2) the constitution of the Buyer Guarantor; or
(3) any security agreement, deed, contract, undertaking or other
instrument to which the Buyer Guarantor is a party or which
is binding on it.
12.6 RIGHTS
The Buyer Guarantor waives any right it has of first requiring any of
the Seller Group Companies to commence proceedings or enforce any
other right against the Buyer or any of the Buyer Group Companies or
any other person before claiming under this clause 12.
13 SUPERANNUATION
13.1 MEMBERSHIP OF BUYER'S FUND
Within three months (or any longer period agreed between the Buyer and
the Seller) after the Completion Date, the Buyer will ensure that each
Member becomes a member of the Buyer's Fund in accordance with clause
13.2 with effect from the Completion Date on terms and conditions
which provide:
page 15
(a) in respect of the period after the Completion Date, benefits in
respect of each Member which in the aggregate are of amounts and
payable on conditions no less favourable than those that would
have been provided in respect of the Member under the governing
rules of the Seller's Fund in force on the Completion Date; and
(b) that the Accrued Benefit Value of each Member transferred to the
Buyer's Fund in accordance with clause 13.2 will be:
(1) a fully vested benefit equal to the Member's Accrued Benefit
Value and adjusted to take account of the earnings and
expenses of the Buyer's Fund after the date that the Accrued
Benefit Value is transferred to the Buyer's Fund;
(2) taken account of in another manner that complies with the
"successor fund" requirements of the Superannuation Industry
(Supervision) Xxx 0000 (where the transfer under clause 13.2
occurs by way of successor fund transfer), in which case the
requirements of clause 12.1(a) are deemed to be satisfied;
or
(3) taken account of in the Buyer's Fund in a manner agreed to
by the Member.
13.2 TRANSFER
The Seller must use its best endeavours to ensure that the trustee of
the Seller's Fund transfers each Member's Accrued Benefit Value from
the Seller's Fund to the Buyer's Fund (either on the basis of
obtaining the consent of each Member or on a "successor fund" basis in
accordance with the Superannuation Industry (Supervision) Act 1993).
13.3 CALCULATION OF ACCRUED BENEFIT VALUES
(a) CALCULATED BY SELLER'S ACTUARY
The Seller will use all reasonable endeavours to procure that the
Accrued Benefit Values of Members will be calculated by the
Seller's Actuary as at the Completion Date in accordance with
this clause 13.3 and the calculations of the Seller's Actuary
will be conclusive and binding on the parties.
(b) CALCULATION FOR ACCUMULATION BENEFITS
Where the whole of the normal retirement benefit to be provided
from the Seller's Fund in respect of a Member under the governing
rules of the Seller's Fund is calculated on the basis of the
accumulation of amounts paid or credited in respect of the Member
with interest or other earnings, the Member's Accrued Benefit
Value will be the total amount accumulated in respect of the
Member for that purpose under those governing rules as at the
Completion Date.
(c) CALCULATION FOR DEFINED BENEFITS
Where clause 13.3(b) does not apply to a Member, the Member's
Accrued Benefit Value as at the Completion Date will be
calculated in accordance
page 16
with the following formula (subject to a minimum of the benefit
which would have become payable to the Member from the Seller's
Fund had the Member voluntarily ceased to be an Employee while in
good health on the Completion Date):
[ABM X FAS X DF] + AC
Where:
ABM is the benefit multiple accrued in respect of the Member as
at the Completion Date in relation to the period before that
date for the purpose of calculating the normal retirement
benefit to be provided from the Seller's Fund if the Member
ceased to be an employee on attaining the normal retirement
date in terms of the governing rules of the Seller's Fund,
calculated using the defined benefit accrual rate or rates
applicable in respect of that period under those governing
rules and including any initial retirement benefit multiple
granted in respect of the Member upon the Member
transferring into the Seller's Fund from another fund or
benefit arrangement.
FAS is the Member's Final Average Salary (as defined in the
governing rules of the Seller's Fund) as at the Completion
Date.
DF is (1/1.03)/55-age/, where age denotes the Member's age at
the Completion Date (and where DF is 1 at age 55 or older).
AC is, to the extent that the retirement benefit of the Member
under the Seller's Fund is not calculated on a defined
benefit basis but on the basis of the accumulation of
amounts paid or credited in respect of the Member with
interest or other earnings, the total amount accumulated in
respect of the Member for that purpose under the governing
rules of the Seller's Fund as at the Completion Date.
13.4 PAYMENT OF ACCRUED BENEFIT VALUES
(a) The Seller will use all reasonable endeavours to ensure that on
or before the day which is 10 Business Days after the later of:
(1) the Transfer Date; and
(2) the date on which the Accrued Benefit Values of Members have
been calculated,
the trustee of the Seller's Fund pays the Accrued Benefit Values
of Members to the trustee of the Buyer's Fund, adjusted for
interest in respect of the period between the Completion Date and
the date the amount is paid at the rate which applies under the
governing rules of the Seller's Fund as at the date in clause
13.4(a)(2) for the purpose of determining relevant benefits which
are payable from the Seller's Fund.
page 17
(b) The interest payable under clause 13.4(a) accrues from day to
day.
(c) The Accrued Benefit Values and any interest payable under clause
13.4(a) will be paid in immediately available funds except to the
extent that the trustee of the Buyer's Fund agrees to accept
other assets in whole or partial satisfaction of those amounts
and, to the extent that the trustee of the Buyer's Fund agrees to
accept other assets, the calculation of the relevant amounts
under this clause 13.4 will be based on the value of those assets
as agreed between the trustee of the Seller's Fund and the
Buyer's Fund.
13.5 UNDERTAKINGS BY BUYER AND SELLER
(a) SELLER TO PROVIDE INFORMATION
The Seller will provide, and will use all reasonable endeavours
to ensure that the trustee of the Seller's Fund provides, to the
Buyer and to the trustee of the Buyer's Fund any information
reasonably required by them to give effect to this clause 13.
(b) NO ALTERATION TO BENEFITS
As from the date of this agreement the Buyer and the Seller will
use all reasonable endeavours to ensure that no action is taken,
discretion exercised or omission occurs which would:
(1) alter the level of benefits or contributions in respect of a
Member under the governing rules of the Seller's Fund from
the level applicable immediately before the date of this
agreement;
(2) alter the rights or liabilities of the Company under the
governing rules of the Seller's Fund from those which
existed immediately before the date of this agreement; or
(3) alter any Accrued Benefit Value,
except:
(4) to the extent reasonably necessary to secure or better
secure a concession or relief in respect of any duty or Tax
or to avoid a penalty, detriment or disadvantage under a law
affecting the Seller's Fund; or
(5) with the consent of the Buyer.
(c) LIMITATIONS CONCERNING THE COMPANY'S EMPLOYEES
The Buyer and the Seller will use all reasonable endeavours to
ensure that:
(1) no employee of the Company is admitted as a member of the
Seller's Fund after the Completion Date;
(2) the Seller and the Company comply with the governing rules
of the Seller's Fund at all material times after the date of
this agreement; and
(3) the Company permanently ceases to contribute to the Seller's
Fund in respect of each Employee on the Completion Date.
page 18
(d) COMPANY TO PROVIDE INFORMATION
The Buyer will provide and will ensure that, after the Completion
Date, the Company provides, and will use all reasonable
endeavours to ensure that the trustee of the Buyer's Fund
provides, to the Seller and to the trustee of the Seller's Fund
any information reasonably required by them to give effect to
clause 13.
(e) BUYER'S FUND GOVERNING RULES
The Buyer will use all reasonable endeavours to ensure that the
governing rules of the Buyer's Fund contain provisions to the
extent necessary to give effect to clause 13.
(f) DEATH AND DISABILITY BENEFIT PROTECTIONS
(1) The Buyer will secure in respect of each Member a benefit on
his or her death or total and permanent disablement while
employed by the Buyer or the Company (as applicable) between
the Completion Date and the date he or she becomes a member
of the Buyer's Fund pursuant to clause 13.1.
(2) The amount of the benefit to be provided under clause
13.5(f)(1) must be at least equal to:
(A) the value of the benefit which would have been payable
from the Seller's Fund if the Member had died or become
totally and permanently disabled immediately before the
Completion Date,
less:
(B) amounts paid or payable to or in respect of the Member
from the Seller's Fund, as applicable, (whether as a
result of the Member's transfer to the Buyer's Fund or
the Member's death or total and permanent disablement).
(g) BUYER'S FUND TO BE A COMPLYING SUPERANNUATION FUND
The Buyer will use all reasonable endeavours to ensure that the
Buyer's Fund is a "complying superannuation fund" in terms of
Part IX of the Income Tax Assessment Act 1936 (as amended or
replaced from time to time).
page 19
SCHEDULE 1 - SHARE DETAILS
[Schedules 1 and 3-12 to be provided separately]
page 20
SCHEDULE 2 - WARRANTIES
PART 1 - BUYER'S WARRANTIES
1 BUYER AUTHORISED
The Buyer has taken all necessary action to authorise the execution,
delivery and performance of this agreement in accordance with its terms.
2 POWER TO BUY
The Buyer has full power to enter into and perform its obligations under
this agreement and can do so without the consent of any other person.
3 NO LEGAL IMPEDIMENT
So far as the Buyer is aware, the execution, delivery and performance by the
Buyer of this agreement comply with:
(a) each law, regulation, Authorisation, ruling, judgment, order or decree
of any Governmental Agency;
(b) the constitution or other constituent documents of the Buyer; and
(c) any Encumbrance or document which is binding on the Buyer.
4 NO LIQUIDATION OR WINDING-UP
The Buyer has not gone into liquidation nor passed a winding-up resolution
nor received or published a notice under sections 601AA or 601AB of the
Corporations Act.
5 NO PETITION
No petition or other process for winding-up has been presented or threatened
against the Buyer and there are no circumstances justifying such a petition
or other process.
6 NO WRIT OF EXECUTION
No writ of execution has issued against the Buyer.
page 21
7 NO RECEIVER OR ADMINISTRATOR
No receiver or receiver and manager or administrator of any part of the
undertaking or assets of the Buyer has been appointed.
8 KNOWLEDGE OF BUYER
Neither the Buyer nor any holding company (direct or indirect) of the Buyer
is aware of any matter or thing that at Completion constitutes a breach of
the Seller's Warranties.
page 22
PART 2 - SELLER'S WARRANTIES
1 AUTHORITIES
1.1 SELLER AUTHORISED
The Seller has taken all necessary action to authorise the execution,
delivery and performance of this agreement in accordance with its
terms and is validly existing and in good standing.
1.2 POWER TO SELL
The Seller has full power to enter into and perform its obligations
under this agreement and is able to sell and transfer the Shares being
sold by it under this agreement without the consent of any other
person and free of any pre-emptive rights, or rights of first refusal
or any other such rights which may restrict the transfer of the Shares
to the Buyer (except as disclosed in writing by the Seller).
1.3 NO LEGAL IMPEDIMENT
The execution, delivery and performance by the Seller of this
agreement complies with:
(a) each law, regulation, Authorisation, ruling, judgment, order or
decree of any Governmental Agency;
(b) the constitution or other constituent documents of the Seller;
and
(c) any Encumbrance or document which is binding on the Seller.
1.4 CORPORATE POWER
The Company:
(a) is validly existing and in good standing;
(b) is accurately described in part 4 of schedule 1;
(c) has full corporate power to own its properties, assets and
businesses and to carry on the Business; and
(d) has good and marketable title to all the assets included in the
Accounts.
1.5 CONSTITUTION
The copy of the constitution of the Company given to the Buyer is a
complete and accurate copy in all material respects.
1.6 CORPORATE NAME
The Company does not trade under a name other than its corporate name
(excluding trademarks or business names registered in a name other
than its corporate name).
page 23
2 COMPLIANCE WITH LAW
2.1 COMPLIANCE WITH LAW
The Company has complied in all material respects with all applicable
laws (whether applicable to the conduct of the Business, the assets of
the Business or the Properties) and no material contravention or
allegation of any material contravention of any applicable law is
known to the Seller.
2.2 AUTHORISATIONS
The Company holds all necessary material Authorisations required to
conduct the Business, use the assets of the Business and occupy the
Properties and has paid all fees due in relation to them and is not in
breach of any conditions under them where such breach would be likely
to have a material and adverse effect on the Business as currently
carried on.
3 SHARES AND CAPITAL
3.1 TITLE
The Seller is the legal and beneficial owner of the Shares being sold
by it under this agreement which are free of all Encumbrances and
other third party interests or rights.
3.2 ISSUED CAPITAL
The Shares are all the issued shares in the capital of the Company and
were validly issued by the Company.
3.3 FULLY PAID
The Shares are fully paid and no money is owing in respect of them.
3.4 ISSUE OF OTHER SECURITIES
The Company is not under any obligation to issue or allot, and has not
granted any person the right to call for the issue or allotment of or
exercise any option over, any shares or other securities of the
Company which is still current and subsisting.
4 POSITION SINCE THE ACCOUNTS DATE
4.1 POST ACCOUNTS DATE
Since the Accounts Date the Company has not:
(a) entered into any material contract or arrangement outside the
ordinary course of trading or otherwise than on arm's length
terms;
(b) acquired or disposed of any assets other than on arm's length
terms in the ordinary course of business;
(c) created an Encumbrance over any of its assets;
page 24
(d) incurred any indebtedness or liability in the nature of
borrowings other than in the ordinary course of business;
(e) in the conduct of the Business made any material change to its
policy or practice as to the payment of creditors or collection
of trade receivables;
(f) engaged any new employee to fill a new role with an annual
remuneration package in excess of $120,000 or, except in the
ordinary course of the Business, terminated the employment of any
of its employees or changed in any material respect the terms of
employment (including remuneration);
(g) sold or agreed to sell any fixed asset with a value of more than
$250,000 or bought or committed to buy any fixed asset with a
value of more than $250,000;
(h) distributed or returned any capital to its members;
(i) paid any dividend to its members or paid any management fee or
similar amount;
(j) issued any shares, options or securities which are convertible
into shares in the Company;
(k) altered its constitution,
(l) incurred or undertaken any actual or contingent liabilities or
obligations (including Tax) except in the ordinary course of
business; or
(m) there has been no change in the accounting policies, practices
and principles of the Company,
except, in respect of the period between the date of this agreement
and Completion, if the Buyer has first consented in writing.
4.2 SUPPLIERS/CUSTOMERS
Since the Accounts Date:
(a) none of the following suppliers of the Business: Xxxxxx & Xxxxx,
Xxxxxx Hobba & Manton, Xxxxxx Xx, Zenith Media, Dow Chemical,
Xxxx XX, Ulee, Hewlett Packard, PT Goldindo Menawian and BASF
has:
(1) reduced the level of its supplies to the Company other than
in the ordinary course of business;
(2) indicated an intention to cease or reduce the volume of its
trading with the Company after Completion; or
(3) materially altered the terms on which it trades with the
Company; or
(b) none of the following customers of the Business: Kmart, Big W,
Myer/Xxxxx Bros, Target, Best & Less, Lowes Manhattan,
Woolworths, Payless Shoes, Xxxxxx Xxxxxx and Xxxxx Xxxxx has:
(1) reduced the level of its custom from the Company other than
in the ordinary course of business;
(2) indicated an intention to cease or reduce the volume of its
trading with the Company after Completion; or
page 25
(3) materially altered the terms on which it trades with the
Company.
5 TANGIBLE ASSETS
5.1 TITLE TO ASSETS
All material Tangible Assets are:
(a) (other than items under repair and stock-in-transit) in the
possession or under the control of the Company;
(b) the absolute property of the Company free of all Encumbrances,
other than the Tangible Assets subject to the Assets Leases.
5.2 ASSETS NOT OWNED
All material Tangible Assets which are used by the Company but are not
owned by the Company are used pursuant to the Assets Leases or other
arrangements entered into on arm's length terms in the ordinary course
of the Business.
5.3 PLANT AND EQUIPMENT
All Plant and Equipment listed in schedule 9 and currently in use in
the Business is:
(a) in good working order;
(b) capable of doing the job for which it is now being used; and
(c) in reasonable condition having regard to its age and fair wear
and tear.
6 ENCUMBRANCES
6.1 OWNERSHIP OF SHARES
As at Completion the Seller will be the legal and beneficial owner of
the Shares being sold by it under this agreement free of Encumbrances.
6.2 DISCHARGES BY COMPLETION
The Seller has not granted or created, or agreed to grant or create,
any Encumbrance in respect of the Shares being sold by it under this
agreement or the assets of the Company other than any which will be
discharged on or before Completion.
7 INTELLECTUAL PROPERTY RIGHTS
7.1 SCOPE
So far as the Seller is aware, the Company owns or has an enforceable
right to use all intellectual property rights needed to carry on the
Business in the places and in the manner currently carried on.
page 26
7.2 OWNERSHIP AND USE
(a) The Company is the legal and beneficial owner of all the
Intellectual Property Rights listed in parts 1 and 3 of schedule
4.
(b) The Company has, by way of a valid, binding and enforceable
licence from a third party, a lawful right to use in the places
and manner in which they are currently used by the Company in the
Business all the Intellectual Property Rights listed in part 2 of
schedule 4.
7.3 NO THIRD PARTY RIGHTS
So far as the Seller is aware, no person, other than the Company or a
licensee of the Company disclosed in part 3 of schedule 4 has any
right to any Intellectual Property Right listed in part 1 of schedule
4.
7.4 NO INFRINGEMENT
So far as the Seller is aware, the use by the Company of the
Intellectual Property Rights listed in schedule 4 does not breach or
infringe any Intellectual Property Right of any other person nor, so
far as the Seller is aware, are there any allegations that the Company
has infringed or is infringing the intellectual property rights of a
third party.
7.5 DISPUTES
The Company is not currently involved in any material dispute with any
third party in relation to the Intellectual Property Rights listed in
schedule 4.
7.6 ROYALTIES/FEES
Other than in respect of the Intellectual Property Rights set out in
part 2 of schedule 4, there are no material royalties, licence fees or
other similar fees payable by the Company in connection with the use
of any Intellectual Property Rights.
8 ASSETS LEASES
8.1 NATURE
The Assets Leases were entered into within the ordinary course of
business.
8.2 NO DEFAULT
The Company is not and, so far as the Seller is aware, no other party
to any Assets Lease is, in default under an Assets Lease where such
breach or default would be materially and adversely prejudicial to the
Company in carrying on the Business and the Company has received no
notice of any default of any Asset Lease.
8.3 VALIDITY
So far as the Seller is aware, each Asset Lease:
(a) is valid and subsisting;
(b) has not been amended or modified; and
(c) is not terminable by virtue of the sale of the Shares.
page 27
8.4 ASSETS LEASES USED IN THE BUSINESS
The Asset Leases constitute all the lease and hire purchase agreements
used in the Business by the Company.
9 CONTRACTS
9.1 NATURE OF CONTRACTS
So far as the Seller is aware, part 1 of schedule 6 and parts 2 and 3
of schedule 4 contains details of all Contracts which:
(a) are not within the ordinary course of ordinary business of the
Business;
(b) are not on arm's length terms;
(c) are not capable of complete performance or termination without
payment of damages, within 12 months from the date of this
agreement;
(d) restrict the Company's freedom to carry on the Business in the
places and the manner in which it is currently carried on;
(e) are contracts (not being contracts for the purchase or sale of
Stock) which are expected to result in expenditure by the Company
of more than $1,000,000;
(f) are distribution or agency agreements;
(g) entitle the other party to terminate the contract or impose terms
less favourable to the Company due to the sale of the Shares.
9.2 NO DEFAULT
The Company is not and, so far as the Seller is aware, no other party
to any Contract is in default under such Contract where such breach or
default would be materially and adversely prejudicial to the Company
in carrying on the Business as currently carried on and there are no
grounds for rescission, avoidance or repudiation of any such Contract
where such rescission, avoidance or repudiation would be materially
and adversely prejudicial to the Seller in carrying on the Business as
currently carried on.
9.3 FOREIGN CURRENCY
Part 2 of schedule 6 contains a listing, which is accurate in all
material respects, of outstanding commitments of the Company relevant
to the Business as at the date stated in that schedule in relation to
foreign currency hedging contracts.
9.4 COPIES OF CONTRACTS
So far as the Seller is aware, the Data Room contained copies of all
Contracts which are material to the operation of the Business.
9.5 TAXES
All Taxes (including stamp duty or any similar tax) payable on all
transactions to which the Company is a party, or that the Company has
an interest in enforcing have been paid or are provided for in the
Accounts.
page 28
10 PROPERTIES
10.1 COMPANY'S INTEREST
The Company has no interest in real property which it uses in the
Business except for its interest in the Properties.
10.2 OCCUPATION AND USE
The Company has exclusive occupation and quiet enjoyment of the
Properties and the Company's use of the Properties, so far as the
Seller is aware, complies in all material respects with all acts,
regulations, planning schemes, developments, approvals, permits and
requirements (including zoning requirements) of any governmental
agency (not including in relation to Environmental Law, which this
warranty does not apply to). None of the Properties, so far as the
Seller is aware, is subject to any sub-lease, tenancy or right of
occupation by any other party.
10.3 NO BREACH
The Company has not received a notice of default in respect of any
Leased Property which remains outstanding and asserts non-compliance
with the lease of that property.
10.4 NO NOTICES
The Company has not received any notice from any third party in
respect of the Properties:
(a) in respect of the compulsory acquisition or resumption of any
part of any of the Properties; or
(b) asserting that the current use of the Properties breaches the
requirements of any relevant planning scheme; or
(c) which would be likely to have a materially adverse effect on the
use of the Properties in the Business as currently used.
10.5 ADVERSE RIGHTS
(a) So far as the Seller is aware, the Company is not in breach of or
in default under any covenant, easement or right affecting the
Freehold Properties which breach or default would have a
materially adverse effect on the use of the Freehold Properties
in the Business as currently used.
(b) Except for any matters indicated in documents of title provided
to the Buyer, none of the Freehold Properties are:
(1) affected by any rights of adverse possession, easements,
rights vested in any Governmental Agency, restrictive
covenants, rights of way, proposed roads or resumptions or
proposed drains, sewers or stormwater channels;
(2) affected by any leases, licenses or Encumbrances; or
(3) the subject of any claim notified to the Company that any
third party asserts an ownership interest in any of the
Freehold Properties, which, in any of the above cases, would
be likely to
page 29
have a material and adverse effect on the current use of the
Freehold Properties in the Business.
10.6 PROPERTY DETAILS
The particulars of the Properties set out in schedule 11 are true and
correct in all material aspects.
10.7 PROPERTY DISCLOSURE
Details of all material documentation pursuant to which the Properties
are owned, used or occupied by the Company have been provided to the
Buyer and there are no other documents, correspondence or other
material which have not been provided to the Buyer which would have a
material adverse affect on the interests of the Company in the
Properties.
10.8 DISPUTES
There are no material disputes claims or actions relating to any of
the Properties or their use including, but not limited to, disputes
with any adjoining or neighbouring owner with respect to boundary
walls or fences or with respect to any easement, right or means of
access to the Properties.
10.9 FREEHOLD PROPERTIES
In relation to the Freehold Properties:
(a) the Company is the registered holder and beneficial owner of the
Freehold Property;
(b) all rates, Taxes and levies (including land tax) applicable to
the Freehold Property have been paid; and
(c) the Company has not sold, agreed to sell, granted any option to
sell, lease or sublease or agreed to lease or sublease any of the
Freehold Property.
10.10 PROPOSED DISPOSAL
The Company is not a party to any outstanding agreement to acquire or
dispose of land or Properties or any interest in land or Properties.
10.11 PROPERTY LEASE DISCLOSURE
In relation to the Property Leases, particulars of which are set out
in part 2 of schedule 11:
(a) written copies of which have been provided to the Buyer, and are
so far as the Seller is aware, complete in all material aspects
recordings of their terms and there are no other agreements,
documents or understandings in relation to the Property Leases;
and
(b) so far as the Seller is aware, are current and enforceable.
10.12 TERMINATION NOTICE
No lessor under a Property Lease has served any notice to terminate
the Property Lease.
10.13 ASSIGNMENT
Neither the Company nor the Seller:
page 30
(a) has agreed to any assignment, subletting, parting with possession
or surrender of a Property Lease or any part of the property
leased; or
(b) has given any materially false or misleading information to an
authority having jurisdiction over property the subject of a
Property Lease.
11 OFFERS OUTSTANDING
Any offer, tender or quotation made by the Company in respect of the
Business which is outstanding and capable of acceptance by a third
party, was made in the ordinary course of the Business.
12 SHAREHOLDINGS
The Company is not the holder or beneficial owner of any shares or
other securities in any company.
13 MEMBERSHIPS
The Company is not a member of any joint venture, partnership or
unincorporated association (other than a recognised trade
association).
14 EMPLOYEES
14.1 LIST OF EMPLOYEES COMPLETE
Schedule 8 contains a complete list of the Company's employees
employed in the Business as at the date indicated in the schedule and
the Buyer has been given all material details of their employment
benefits.
14.2 INCENTIVE SCHEMES
The Company has not agreed to any share incentive scheme, share option
scheme, bonus scheme, profit-sharing scheme or other employee
incentive scheme in respect of the Business or with any Employee which
has not been fairly disclosed to the Buyer.
14.3 SERVICE AGREEMENTS
The Company is not a party to any written employment or service
agreement with any Employee requiring the giving of more than three
months notice to the employee which has not been fairly disclosed to
the Buyer.
14.4 MANAGEMENT AGREEMENTS
The Company does not have any material agreement with any person for
the provision of consulting or management services in respect of the
Business which has not been fairly disclosed to the Buyer.
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14.5 DISPUTES
The Company is not involved in any material dispute with any employees
(past or present) and is not aware of any circumstances likely to give
rise to any dispute.
14.6 COMPLIANCE
The Company is not in breach in any material respect of any employment
contract with any Employee as at the date of this agreement.
14.7 COMPLIANCE
The Company has complied with and continues to comply with all
obligations arising under law, equity, statute (including occupational
health and safety, annual leave, long service leave, equal
opportunity, anti-discrimination, Taxation, superannuation, workers
compensation and industrial laws), award, enterprise agreement or
other instrument made or approved under any law with respect to its
past and present employees and contractors.
14.8 DISCLOSURE
Except as set out in the Data Room there are no awards, enterprise
agreements or other instruments made or approved under law which apply
to employees of the Company.
15 SUPERANNUATION
15.1 LIST OF SUPERANNUATION SCHEMES COMPLETE
The Seller's Fund and the External Funds are the only superannuation
schemes or pension arrangements to which the Company makes
contributions in respect of the Employees.
15.2 GOVERNING RULES OF THE SELLER'S FUND
Any copy of the governing rules of the Seller's Fund supplied to the
Buyer on or before the date of this agreement is a true and complete
copy.
15.3 FUNDING
The Company has paid all contributions due by it to the Seller's Fund
and each External Fund in respect of the Employees.
15.4 ACCRUED BENEFIT VALUES
16 THERE ARE SUFFICIENT ASSETS IN THE SELLER'S FUND TO SUPPORT THE TRANSFER OF
EACH EMPLOYEE'S ACCRUED BENEFIT VALUE.LITIGATION
16.1 NOT A PARTY TO ANY LITIGATION
The Company is not:
(a) a party to any material prosecution, litigation or arbitration
proceedings; or
(b) so far as the Seller is aware, subject to any material
administrative or governmental investigation,
page 32
and the Seller is not aware that any such proceeding or investigation
is threatened or pending.
16.2 NO CIRCUMSTANCES
There are no circumstances of which the Seller is aware which may give
rise to any proceeding or investigation referred to in warranty 16.1.
17 [NOT USED]
18 SOLVENCY
18.1 NO LIQUIDATION OR WINDING-UP
The Company has not gone into liquidation under the Corporations Act
nor been removed from the companies register.
18.2 NO PETITION
No petition or other process for winding-up has been presented or
threatened against the Company and there are no circumstances
justifying such a petition or other process.
18.3 NO WRIT OF EXECUTION
No writ of execution has issued against the Company.
18.4 NO RECEIVER OR ADMINISTRATOR
No receiver or statutory manager of any part of the Company's
undertaking or assets has been appointed.
18.5 PAYMENT OF DEBTS
The Company:
(a) has not stopped paying its debts as and when they fall due;
(b) is not insolvent within the meaning of the Corporations Act; and
(c) is not subject to voluntary administration the Corporations Act.
18.6 LIQUIDATION
The Seller has not gone into liquidation under the Corporations Act
nor been removed from the companies register.
18.7 PETITION
No petition or other process for winding-up has been presented or
threatened against the Seller and there are no circumstances
justifying such a petition or other process.
page 33
18.8 WRIT OF EXECUTION
No writ of execution has issued against the Seller.
18.9 RECEIVER MANAGER
No receiver or statutory manager of any part of the Seller's
undertaking or assets has been appointed.
19 INSURANCE
19.1 POLICIES
Those assets of the Company which are of an insurable nature are
insured by the Company against fire and other usual risks on a basis
which the Seller considers commercially prudent.
20 INFORMATION
20.1 WRITTEN INFORMATION
In relation to written information provided by the Seller to the Buyer
in relation to the sale of the Shares sold by it under this agreement:
(a) if that information comprised copies of documents, correspondence
or other materials the copies provided were, so far as the Seller
is aware, true and complete;
(b) if that information comprised historical data about the Business
prepared by the Seller or the Company, that data was, so far as
the Seller is aware, true and correct in all material respects.
20.2 ACCURACY
Each of the statements and all information set out, or referred to, in
the Disclosure Schedule, the schedules numbered 4 to 12 to this to
this agreement is complete and accurate in all material respects and
not misleading.
21 BUSINESS RECORDS
The Business Records are in the Company's possession or control and
will be maintained by the Company in accordance with its usual
practice pending Completion.
22 TAXES AND DUTIES
22.1 TAX PAID
Any Tax arising under any Tax Law payable in respect of any
transaction, income or asset of the Company which has become due for
payment has been paid.
page 34
22.2 SINCE ACCOUNTS DATE
The conduct of the Business since the Accounts Date will only give
rise to liability to Tax in the ordinary course of business.
22.3 PROVISION IN ACCOUNTS
Adequate provision has been made in the Accounts for any Tax on the
Company which is payable or may become payable in respect of any
transaction or income occurring or arising before the Accounts Date
but which was unpaid as at the Accounts Date.
22.4 WITHHOLDING TAX
Any obligation of the Company under any Tax Law to withhold amounts at
source, including, but not limited to, withholding tax, has been
complied with.
22.5 RECORDS
The Company has maintained proper and adequate records to enable it to
comply with its obligations to:
(a) prepare and submit any information, notices, computations,
returns, declarations, elections and payments required in respect
of any Tax Law;
(b) prepare any accounts necessary for the compliance of any Tax Law;
and
(c) retain necessary records as required by any Tax Law.
22.6 RETURNS SUBMITTED
The Company has submitted any necessary information, notices,
computations, returns, declarations and elections to the relevant
Governmental Agency in respect of any Tax or any Duty relating to the
Company.
22.7 RETURNS ACCURATE
Any information, notice, computation, return, declaration or election
which has been submitted by the Company to a Governmental Agency in
respect of any Tax or Duty:
(a) discloses all material facts that should be disclosed under any
Tax Law; and
(b) has been submitted on time.
22.8 COPIES ACCURATE
All copies of any information, notices, computations, returns,
declarations or elections submitted by the Company in respect of any
Tax or Duty which have been supplied to the Buyer by the Seller are
true copies of the originals.
22.9 NO DISPUTES
The Company is not currently engaged in any dispute with any
Governmental Agency in respect of any Tax or Duty and is not aware of
any circumstances that may give rise to such a dispute.
page 35
23 SELLER'S KNOWLEDGE
The Seller is not aware of any matter or thing that is or may be
inconsistent with the Buyer's Warranties.
24 EFFECT OF SALE OF SHARES
24.1 CUSTOMERS/SUPPLIER RELATIONSHIPS
As far as the Seller is aware, the transfer of the Shares to the Buyer
under this agreement will not result in any supplier or customer of
the Company ceasing or being entitled to substantially reduce its
level of business with the Company.
24.2 EFFECT OF SALE
The entry into and performance of this agreement does not and will
not:
(a) result in the breach of any of the terms, conditions or
provisions of any agreement or arrangement to which the Company
is a party; or
(b) relieve any person from any obligation to the Company;
(c) result in the creation, imposition, crystallisation or
enforcement of any Encumbrance or other third party right or
interest on the Company, its assets or undertaking; or
(d) result in any indebtedness of the Company becoming due and
payable.
25 TRADE PRACTICES
So far as the Seller is aware, neither the Company nor any of its officers
or employees has, in the two years before Completion, committed or omitted
to do any act or thing the commission or omission of which is a material
contravention of the Trade Practices Actin Australia.
26 LIABILITY UNDER ASSET AND OTHER SALE AGREEMENTS
The Company will not have any obligations or liabilities (actual or
contingent) after Completion to:
(a) do any act, matter or thing; or
(b) pay any moneys under any indemnity,
under any agreement entered into prior to Completion for the sale or
purchase of any business interest, shares or partnership interest.
page 36
SCHEDULE 3 - DISCLOSURE SCHEDULE
The matters set out in this disclosure schedule constitute formal
disclosure to the Buyer of facts or circumstances which are, or may
be, inconsistent with the Seller's Warranties. The Seller gives no
representation as to the completeness or accuracy of the disclosures
in this schedule. While some disclosures have, for convenience, been
set against specific Seller's Warranties, they constitute disclosure
against any other Seller's Warranty to which they may apply.
Seller Warranty Number Matter Disclosed
page 37
SCHEDULE 4 - INTELLECTUAL PROPERTY RIGHTS
PART 1 - INTELLECTUAL PROPERTY RIGHTS OWNED BY THE COMPANY
PART 2 - LICENSES TO THE COMPANY TO USE INTELLECTUAL PROPERTY RIGHTS
PART 3 - LICENSES GIVEN BY THE COMPANY TO USE ITS INTELLECTUAL PROPERTY RIGHTS
page 38
SCHEDULE 5 - SUPERANNUATION FUNDS
page 39
SCHEDULE 6 - CONTRACTS
PART 1 - CONTRACTS
PART 2 - FOREIGN EXCHANGE CONTRACTS
page 40
SCHEDULE 7 - GUARANTEES
page 41
SCHEDULE 8 - EMPLOYEES
page 42
SCHEDULE 9 - PLANT AND EQUIPMENT
page 43
SCHEDULE 10 - ASSETS LEASES
page 44
SCHEDULE 11 - PROPERTIES
PART 1 - FREEHOLD PROPERTIES
PART 2 - LEASED PROPERTIES
page 45
SCHEDULE 12 - INTER COMPANY DEBTS
page 46
EXECUTED AS AN AGREEMENT:
Signed for and on behalf of
Pacific Dunlop Limited
by its duly authorised Attorney under Power
in the presence of:
/s/ Xxxx Xxxxxxxx /s/ Xxxxx Xxxxxxx
----------------------------------- -----------------------------------
Witness Attorney
Xxxx Xxxxxxxx Xxxxx Xxxxxxx
----------------------------------- -----------------------------------
Name (please print) Name (please print)
Signed sealed and delivered by
Pacific Brands Holdings Pty Ltd
in the presence of:
/s/ /s/
----------------------------------- -----------------------------------
Director Director
----------------------------------- -----------------------------------
Name (please print) Name (please print)
Signed for and on behalf of
PB Holdings NV
by its duly authorised Attorney under Power
in the presence of:
/s/ /s/
----------------------------------- -----------------------------------
Witness Attorney
----------------------------------- -----------------------------------
Name (please print) Name (please print)
/s/
-----------------------------------
Attorney
-----------------------------------
Name (please print)
page 47
