Exhibit 10.37
CONFIDENTIAL
SHARE SALE AND PURCHASE AGREEMENT
DATED FEBRUARY 2005
BG ENERGY HOLDINGS LIMITED
KEYSPAN C I LTD
KEYSPAN (UK) LIMITED
AND
PREMIER TRANSMISSION FINANCING PUBLIC LIMITED COMPANY
Relating to the Sale and Purchase of the
Entire Issued Share Capital of
Premier Transmission Limited
CONTENTS
Clause Page
1. Interpretation.......................................................................................1
2. Sale and Purchase of the Shares......................................................................8
3. Conditions Precedent.................................................................................8
4. Completion...........................................................................................9
5. Adjustment to Consideration.........................................................................10
6. Independent Accountants.............................................................................10
7. Loans and Guarantees................................................................................12
8. Warranties..........................................................................................12
9. Further Assurances and Indemnity....................................................................14
10. Confidentiality.....................................................................................15
11. Notices.............................................................................................16
12. Assignment..........................................................................................17
13. Whole Agreement.....................................................................................18
14. Governing Law.......................................................................................19
15. General.............................................................................................19
Schedule
1. Particulars of the Company..........................................................................20
2. Properties..........................................................................................21
3. Warranties..........................................................................................25
4. Limits on Warranty Claims...........................................................................39
5. Pre-Completion......................................................................................43
6. Completion..........................................................................................45
7. Initial Sum and Final Sum...........................................................................50
8. Completion Accounts.................................................................................51
Signatories
Documents to accompany this agreement:
1. Disclosure Letter
2. Agreed Forms of:
(a) Comfort Letter;
(b) Powers of Attorney;
(c) Secondment Agreement;
(d) Services Agreement;
(e) Site Services Agreement;
(f) Tax Deed; and
(g) Tax Loss Amount Receipt.
3. Accounts
THIS AGREEMENT is made on February 25, 2005
BETWEEN:
(1) BG ENERGY HOLDINGS LIMITED (registered number 03763515), a company
incorporated under the laws of England and Wales, whose registered office
is at 000 Xxxxxx Xxxxxx Xxxx Xxxxx, Xxxxxxx, Xxxxxxxxx XX0 0XX, Xxxxxx
Xxxxxxx (BGEH);
(2) KEYSPAN C I LTD (registered number 71191), a company incorporated under the
laws of the Cayman Islands, whose registered office is at Xxxxxx House, PO
Box 309GT, South Church Street, Xxxxxx Town, Grand Cayman, Cayman Islands
(KCIL);
(3) KEYSPAN (UK) LIMITED (registered number 03488649), a company incorporated
under the laws of England and Wales, whose registered office is at Jordans
Limited, 00 Xx Xxxxxx Xxxxxx, Xxxxxxx, XX0 0XX, Xxxxxx Xxxxxxx (K(UK)L);
and
(4) PREMIER TRANSMISSION FINANCING PUBLIC LIMITED COMPANY (registered number
NI053751), a company incorporated under the laws of Northern Ireland, whose
registered office is care of Xxxxxx Xxx Northern Ireland, Capital House, 0
Xxxxx Xxxxxx Xxxxxx, Xxxxxxx, XX0 0XX, Xxxxxx Xxxxxxx (the Purchaser).
BACKGROUND:
(A) BGEH is the owner of 50% of the issued share capital of the Company (as
defined below) (the BGEH Shares).
(B) KCIL is the owner of 24.5% per cent. of the issued share capital of the
Company (as defined below) (the KCIL Shares) and K(UK)L is the owner of 25.5% of
the issued share capital of the Company (as defined below) (the K(UK)L Shares).
(C) BGEH wishes to sell and the Purchaser wishes to purchase the BGEH Shares,
KCIL wishes to sell and the Purchaser wishes to purchase the KCIL Shares, and
K(UK)L wishes to sell and the Purchaser wishes to purchase the K(UK)L Shares, in
each case on the terms and subject to the conditions set out in this agreement.
IT IS AGREED as follows:
1. INTERPRETATION 1.1 In this agreement:
a means the number of days from and including 1 January 2005 to but
excluding the date of Completion;
Accounts means the audited balance sheet as at the Accounts Date and the
audited profit and loss statement for the year ended on that date
(including the notes and directors' report relating to the same), in each
case of the Company;
Accounts Date means 31 December 2004;
Actual Required Revenue shall have the meaning given to that term in the
Licence in force at the relevant time or, if no such term is defined in the
Licence in force at the relevant time, the meaning of any replacement term
that has equivalent effect to the meaning of that term at the date of this
agreement, as the case may be;
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Adjusted Payment Date has the meaning given in subclause 5.4;
Affiliate means, in relation to a Party, a Subsidiary of that Party or a
Holding Company of that Party or any other Subsidiary of that Holding
Company;
Appropriate Queen's Counsel means a Queen's Counsel of at least five years'
standing and experience in the field of commercial law;
Approved Sellers' Fees means the fees of the Sellers incurred in connection
with the sale and purchase of the BGEH Shares, the KCIL Shares and the
K(UK)L Shares, as approved in writing to the Seller by the Northern Ireland
Authority for Energy Regulation for payment by the Purchaser;
Approved Sellers' Fees Estimate means the Sellers' good faith estimate of
the Approved Sellers' Fees, being (pound)500,000;
Bank Facility means the credit agreement known as the "Premier Transco
(pound)63,000,000 Credit Agreement" and made between the Company, Royal
Bank of Canada Europe Ltd, the Royal Bank of Scotland plc and the
Industrial Bank of Japan Ltd (now Mizuho Corporate Bank Ltd);
BGE(UK) means BGE (UK) Limited of 00 Xxxxx Xxxx Xxxxxx, Xxxxxx, X00 0XX,
Xxxxxx Xxxxxxx;
BG means BG Group plc;
BG Group means BG and its Affiliates;
BGE(UK) Guarantee means the guarantee dated 30 May 1997 given by BG plc,
the obligations of BG plc as surety having been novated to BGEH by
agreement dated 8 and 9 December 1999, to BGE(UK) in relation to the
transportation of gas by BGE(UK) through a pipeline from Moffat to
Twynholm, Scotland;
BGEH Shares has the meaning given in recital (A);
BGI means BG International Limited, whose registered office is at 100
Thames Valley Xxxx Xxxxx, Xxxxxxx, Xxxxxxxxx XX0 0XX, Xxxxxx Xxxxxxx;
Business Day means a day (other than a Saturday or Sunday) on which banks
are generally open in London for normal business;
Comfort Letter means the comfort letter in the Agreed Form from Keyspan
Energy Development Corporation to the Purchaser;
Company means Premier Transmission Limited (further details of which are
set out in schedule 1);
Completion means completion of the sale and purchase of the Shares in
accordance with this agreement;
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Completion Accounts means the completion accounts to be prepared in
accordance with schedule 8;
Completion Longstop Date has the meaning given in subclause 3.2;
Conditions means the conditions precedent to the sale and purchase of the
Shares set out in clause 3;
Consideration has the meaning given in clause 2;
Daily Price Adjustment Amount means a multiplied by (pound)13,466.67;
Damages Payment has the meaning given in paragraph 7 of schedule 4;
Data Room means the documents set out in the index of data room documents
annexed to the Disclosure Letter;
Deeds of Servitude means those deeds of servitude granted in favour of the
Company and its successors as proprietors of the Scottish Benefited
Property in respect of the Scotland Northern Ireland Pipeline as listed the
section of the Data Room entitled "Deeds of Servitude (and various other
Scottish property documents)" in the Disclosure Letter, together with any
deed granted or agreement entered into to vary or supplement the same, and
Deed of Servitude shall be construed accordingly;
Disclosure Letter means the letter described as such of the same date as
this agreement from the Sellers to the Purchaser and duly acknowledged by
the Purchaser;
Encumbrance means any mortgage, charge (fixed or floating), pledge, lien,
option, right to acquire, assignment by way of security, trust arrangement
for the purpose of providing security or any other security interest of any
kind, including retention arrangements and any agreement to create any of
the foregoing;
Excess Recovery has the meaning given in paragraph 7 of schedule 4;
Final Sum means the amount described as such in paragraph 2 of Schedule 7;
Forecast Balance Sheet means a forecast balance sheet substantially
adopting the form of part 2 of schedule 8 and issued in accordance with
subclause 4.3;
Foreshore Easement Leases means the two lease agreements short particulars
of which are in part 2 of schedule 2;
Holding Company means in relation to a company or corporation, any other
company or corporation of which it is a Subsidiary;
Indemnitors has the meaning given in subclause 9.4;
Independent Accountants means such firm of chartered accountants as may be
appointed in accordance with clause 6;
Initial Sum means the amount described as such in paragraph 1 of schedule
7;
KCIL Shares has the meaning given in recital (B);
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K(UK)L Shares has the meaning given in recital (B);
Licence means any licence to convey gas (or to participate in the
conveyance of gas) granted to the Company under Article 8(1)(a) of the Gas
(Northern Ireland) Order 1996;
Material Adverse Change means, in the reasonable opinion of the Purchaser,
a material adverse change in the financial position or prospects of the
Company since the Accounts Date;
Net Indebtedness means:
(a) (pound)50,000; plus
(b) all indebtedness of the Company under the Bank Facility at Completion,
being the amount paid or procured to be paid by the Purchaser under
paragraph 2(a) of part 2 of schedule 6, expressed as a positive
number;
Offering Circular means the offering circular to be issued by the Purchaser
on or around 28 February 2005 in terms of which the Purchaser intends to
raise funds by the issue of guaranteed secured bonds;
Parties means the parties to this agreement and Party means any one of
them;
Powers of Attorney means the powers of attorney in the Agreed Form from
each of the Sellers in favour of the Purchaser;
PPL means Premier Power Limited of Ballylumford Power Station, Islandmagee,
Larne, County Xxxxxx, XX00 0XX, Xxxxxx Xxxxxxx;
Properties means the properties of the Company shortly described in parts 1
and 2 of schedule 2, and Property means any of them and includes every part
of each of them;
Property Indemnity has the meaning given in subclause 9.4;
Property Indemnity Description means the wording described as such set out
in part 4 of schedule 2;
Purchaser's Accountants means Ernst & Young LLP of Bedford House, 00
Xxxxxxx Xxxxxx, Xxxxxxx, XX0 0XX, Xxxxxx Xxxxxxx;
Purchaser's Solicitors means McGrigors of 0 Xxx Xxxxxx, Xxxxxx, XX0X 0XX,
Xxxxxx Xxxxxxx;
Purchaser's Technical Advisers means Xxxxxxx Xxxxxxxxxxx Limited of
Manchester Xxxxxxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxxxx, X0 0XX;
Rectification Execution has the meaning given in subclause 9.5;
Scotland Northern Ireland Pipeline means the cross-country and submarine
pipeline running in a continuous line between:
(a) the Company's land in Scotland at or near Twynholm, near Kircudbright
and the landfall at or near Portnaughan Bay in the District of
Wigtown; and
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(b) the last mentioned land and the Company's land in Northern Ireland at
the Islandmagee peninsula in the County of Antrim,
constructed in accordance with, amongst other documentation, a Pipeline
Construction Authorisation granted by The Secretary of State for Trade and
Industry in accordance with the Xxxxxxxxx Xxx 0000, a Works Authorisation
in accordance with the Petroleum and Submarine Pipelines Act 1975 and
authority under the Gas (Northern Ireland) Order 1977, and any subsequent
amending legislation, together with all or any ancillary apparatus
associated therewith and all wrapping and protective materials;
Scottish Benefited Property means that property that has the benefit of the
Deeds of Servitude being the dominant tenement described in each Deed of
Servitude as ALL and WHOLE that area or piece of ground in the Parish of
Anwoth and the former County of Stewartry of Kirkcudbright, (now Stewartry
District of the Dumfries & Xxxxxxxx Region) more particularly described in,
disponed by and coloured pink on the plan annexed to Disposition by Xxxx
Xxxxxxx Xxxxxxxxx Xxxxxx in favour of Premier Transco Limited dated 21 June
and recorded in the Division of the General Register of Sasines applicable
to the County of the Stewartry of Kircudbright on 3 July, both in 1995;
Secondment Agreement means the secondment agreement in the Agreed Form
between the Company and BGI;
Sellers means BGEH, KCIL and K(UK)L together, and Seller means any one of
them;
Sellers' Accountants means PricewaterhouseCoopers LLP of 0 Xxxxxxxxxx
Xxxxx, Xxxxxx, XX0X 0XX, Xxxxxx Xxxxxxx;
Sellers' Obligations means any obligations, covenants, representations,
warranties, indemnities or undertakings in this agreement that are
expressed to be made, undertaken or given by all of the Sellers (and not,
for the avoidance of doubt, any obligations, covenants, representations,
warranties, indemnities or undertakings in this agreement that are
expressed to be made, undertaken or given by any two of the Sellers or by
any Seller individually);
Sellers' Solicitors means Xxxxx & Overy LLP of Xxx Xxx Xxxxxx, Xxxxxx, XX0X
0XX, Xxxxxx Xxxxxxx;
Sellers' Warranties has the meaning given in clause 8;
Services Agreement means the services agreement in the Agreed Form between
the Company and BGI;
Shares means the BGEH Shares, the KCIL Shares and the K(UK)L Shares
together;
Site Services Agreement means the site services agreement in the Agreed
Form between the Company and PPL;
Subsidiary means a subsidiary within the meaning of section 736 of the
Companies Xxx 0000;
Supplementary Disclosure Letter means the letter described as such, being
the Disclosure Letter as supplemented at Completion, from the Sellers to
the Purchaser and duly acknowledged by the Purchaser;
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Swaps means the swap transactions that are the subject of and pursuant to
ISDA agreements dated 13 November 1998 between the Company and each of The
Royal Bank of Scotland plc and Royal Bank of Canada respectively;
Tax and Taxes and Taxation and Taxation Authority have the meanings given
in the Tax Deed;
Tax Deed means the Tax Deed in the Agreed Form;
Tax Loss Amount means (pound)2,698,637;
Tax Loss Amount Receipt means the acknowledgment and receipt letter in the
Agreed Form from the Company to BGEH acknowledging the full and final
settlement of all obligations of BG Group in respect of all surrenders of
tax losses by the Company to BG Group;
Tax Warranties has the meaning in paragraph 3 of schedule 4;
Technical Advisers' Report means the report entitled "Scotland to Northern
Ireland Due Diligence Report" prepared by the Purchaser's Technical
Advisers for, amongst others, Financial Guaranty Insurance Company;
Third Party Claim has the meaning given in paragraph 5 of schedule 4;
Third Party Sum has the meaning given in paragraph 7 of schedule 4;
UK GAAP means generally accepted accounting principles and practices in the
United Kingdom;
Uninfeft Recording has the meaning given in subclause 9.5;
Warranties means the warranties on the part of the Sellers or of any one of
them contained in schedule 3;
Warranty Claim means a claim by the Purchaser for any breach or alleged
breach of any of the Warranties;
Working Capital means all of the working capital of the Company as at
Completion as shown in the Completion Accounts; and
Working Capital Estimate means the Sellers good faith estimate of the
Working Capital.
1.2 In this agreement, any reference to:
(a) a Party shall be construed so as to include its successors in title,
permitted assigns and permitted transferees;
(b) a recital, clause, subclause, paragraph, subparagraph or schedule is a
reference to a recital, clause, subclause, paragraph, subparagraph or
schedule of this agreement;
(c) this agreement includes references to this agreement as amended or novated;
(d) a person includes any individual, firm, company, trust, unincorporated
association of persons, government, state or agency of a state or any joint
venture, association, trust or partnership (whether or not having separate
legal personality) or any other entity;
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(e) a company shall be construed so as to include any company, corporation or
other body corporate or other legal entity, wherever and however
incorporated or established;
(f) including and other cognate references shall be construed as not limiting
any general words or expressions in connection with which they are used;
(g) an Affiliate of a Seller shall exclude the Company;
(h) a document being in the Agreed Form shall be to the form of the document
that has been initialled for the purposes of identification or otherwise
identified as agreed prior to the execution of this agreement by or on
behalf of the Sellers and the Purchaser;
(i) (pound) is to the lawful currency from time to time of the United Kingdom;
(j) an enactment (which includes any legislation in any jurisdiction), whether
express or implied, includes references to:
(i) that enactment as amended, extended or applied by or under any other
enactment (before or after signature of this agreement);
(ii) any enactment which that enactment re-enacts (with or without
modification); and
(iii)any subordinate legislation made (before or after signature of this
agreement) under that enactment, as re-enacted, amended, extended or
applied as described in paragraph (i) above, or under any enactment
referred to in paragraph (ii) above,
except to the extent that any legislation or subordinate legislation
made or enacted after the date of this agreement would create or
increase the liability of a Seller under this agreement;
(k) times of the day are to local time in the relevant jurisdiction unless
otherwise stated; and
(l) any English legal term for any action, remedy, method or judicial
proceeding, legal document, legal status, court, official, enactment,
legislation or any legal concept or thing shall in respect of any
jurisdiction other than England be deemed to include what most nearly
approximates in that jurisdiction to the English legal term.
1.3 Where any statement in schedule 3 or in the Disclosure Letter is qualified
by the expression "so far as the Sellers are aware" or "to the best of the
Sellers' knowledge, information and belief" or any similar expression, that
statement shall be deemed to be made on the actual knowledge of the Sellers
or either of them after having made due and careful enquiry of Xxxx Xxxxxx,
Xxxxx Xxxxxxx, Xxxxx Xxxxxx, Xxxxxxx Xxxxxxxx, Xxxx Xxxxx, Xxxx Xxxxx and
Xxxxx Xxxxx in order to establish the truth and accuracy of the statement.
1.4 Where there is any inconsistency between the definitions set out in this
clause 1 and the definitions set out in any clause or schedule, then for
the purposes of construing such clause or schedule, the definitions set out
in that clause or schedule shall prevail to the extent of the
inconsistency.
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1.5 The schedules form part of this agreement and references herein to this
agreement shall be construed accordingly.
1.6 In this agreement words importing the singular shall include the plural and
vice versa.
1.7 The headings in this agreement do not affect its interpretation.
1.8 Subclauses 1.1 to 1.7 shall apply unless the context otherwise requires.
1.9 Unless otherwise provided, BGEH shall be liable for 50 per cent. of each
Sellers' Obligation, KCIL shall be liable for 24.5 per cent. of each
Sellers' Obligation and K(UK)L shall be liable for 25.5 per cent. of each
Sellers' Obligation.
2. SALE AND PURCHASE OF THE SHARES
2.1 Subject to the Conditions being satisfied:
(a) BGEH shall sell and the Purchaser shall purchase the BGEH Shares;
(b) KCIL shall sell and the Purchaser shall purchase the KCIL Shares; and
(c) K(UK)L shall sell and the Purchaser shall purchase the K(UK)L Shares,
in each case with full title guarantee, free from Encumbrances and
together with all rights attaching to them.
2.2 The purchase price for the sale of the Shares shall be the Final Sum (the
Consideration).
2.3 The Parties acknowledge and agree that:
(a) 50 per cent. of the Consideration, plus (pound)300,000, shall be for
the BGEH Shares;
(b) 24.5 per cent. of the Consideration, minus (pound)150,000, shall be
for the KCIL Shares; and
(c) 25.5 per cent. of the Consideration, minus (pound)150,000, shall be
for the K(UK)L Shares.
3. CONDITIONS PRECEDENT
3.1 The sale and purchase of the Shares is conditional on:
(a) BGEH obtaining, on terms satisfactory to BGEH, a complete and
unconditional release of BGEH from all of BGEH's obligations under the
Foreshore Easement Leases;
(b) BGEH obtaining, on terms satisfactory to BGE(UK) and BGEH, a complete
and unconditional release of BGEH from all of BGEH's obligations under
the BGE(UK) Guarantee;
(c) the Company and BGI having executed the Services Agreement; (d) the
Company and PPL having executed the Site Services Agreement;
(e) the issue by the Purchaser of the bonds referred to in the Offering
Circular becoming unconditional (save to the extent that the issue
thereof is conditional on the completion of this agreement or on other
matters that are themselves conditional on the completion of this
agreement); and
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(f) no Material Adverse Change having occurred.
3.2 (a) The Sellers by joint agreement only may waive any of the Conditions at
paragraphs 3.1(a) and (b), and the Purchaser may waive any of the
Conditions at paragraphs 3.1(c), (d) and (e).
(b) Any waiver of a Condition shall be by written notice by each relevant Party
waiving the Condition to each other Party.
(c) Where any Condition is waived, such waiver shall be without liability to,
and no Party or Parties waiving a Condition may bring any claim under this
agreement against, any Party in respect of the subject matter of the
Condition being waived.
3.3 (a) The Purchaser shall use reasonable endeavours to procure (so far as it
is so able to procure) that the Conditions are satisfied on or before 2
April 2005 (or such other date as the Parties may agree) (the Completion
Longstop Date).
(b) The Condition at paragraph 3.1(f) shall be deemed to have been satisfied
for so long as the Purchaser has not notified the Seller of any Material
Adverse Change having occurred.
3.4 If any of the Conditions has not been satisfied or waived on or before the
Completion Longstop Date:
(a) except for this subclause 3.4, clauses 1 and 10, and the clauses after
clause 10, all of the clauses of this agreement shall lapse and cease to
have effect; but
(b) the lapsing of those provisions shall not affect any accrued rights or
liabilities of any Party.
4. COMPLETION
4.1 Completion shall take place at the offices of the Purchaser's Solicitors at
10.00 a.m. on the third Business Day after the date on which all of the
Conditions are satisfied or waived, or at such other place or at such other
time and on such other date as the Parties may agree.
4.2 Pending Completion (and whether or not the Conditions are satisfied or
waived), the provisions of schedule 5 shall apply.
4.3 Within five Business Days of their receipt from the Purchaser of a written
request, the Sellers shall provide to the Purchaser in writing:
(a) a Forecast Balance Sheet containing the Working Capital Estimate and
the Sellers' good faith estimate of the Net Indebtedness; and
(b) an estimate of the costs to the Company associated with the
termination of the Swaps.
4.4 At and from Completion, as specified in schedule 6:
(a) the Sellers or each specified Seller, as the case may be, shall do or
procure to be done those things set out in part 1 of schedule 6; and
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(b) the Purchaser shall do or procure to be done those things set out in
part 2 of schedule 6.
4.5 Subject to Completion and to BGEH complying with its obligation under
paragraph 2 of part 1 of schedule 6, with effect from Completion the
Purchaser acknowledges and agrees (on behalf of itself and the Company)
that the payment to the Company at or prior to Completion of the Tax Loss
Amount shall be in full and final settlement of all obligations of BG Group
in respect of all surrenders of tax losses by the Company to BG Group.
4.7 Subject to Completion, the Purchaser shall procure that it is registered in
the register of members of the Company as the registered legal owner of the
BGEH Shares, the KCIL Shares and the K(UK)L Shares as soon as reasonably
practicable following Completion.
5. ADJUSTMENT TO CONSIDERATION
5.1 The amount of the consideration for the sale of the Shares shall be
adjusted following Completion in accordance with this clause 5 and the
Completion Accounts.
5.2 (a) If the Final Sum is greater than the Initial Sum (such difference being
a Consideration Shortfall), the Purchaser shall pay to:
(i) BGEH in cash a sum equal to 50 per cent. of the Consideration
Shortfall;
(ii) KCIL in cash a sum equal to 24.5 per cent. of the Consideration
Shortfall; and
(iii)K(UK)L in cash a sum equal to 25.5 percent. of the Consideration
Shortfall; or
(b) if the Initial Sum is greater than the Final Sum (such difference being a
Consideration Excess):
(i) BGEH shall pay the Purchaser in cash a sum equal to 50 per cent. of
the Consideration Excess;
(ii) KCIL shall pay the Purchaser in cash a sum equal to 24.5 per cent. of
the Consideration Excess; and
(iii)K(UK)L shall pay the Purchaser in cash a sum equal to 25.5 per cent.
of the Consideration Excess.
5.3 Any payment to be made pursuant to this clause 5 shall be made on the day
(the Adjusted Payment Date) that is five Business Days following the day on
which the Completion Accounts are agreed or determined in accordance with
Schedule 8, together with interest on such payment (if applicable)
calculated at the rate of 6 per cent. per annum from (and including) the
Adjusted Payment Date to (but excluding) the date of actual payment, by
CHAPS or other electronic transfer for same day value to the relevant
accounts specified in schedule 6.
6. INDEPENDENT ACCOUNTANTS AND QUEEN'S COUNSEL
6.1 If and whenever any item in dispute relating to the Completion Accounts
falls to be referred, in accordance with the relevant provision of this
agreement, to Independent Accountants, it shall be referred to such firm of
chartered accountants:
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(a) as the Sellers and the Purchaser may agree in writing within five
Business Days after expiry of the period allowed by the relevant
provision of this agreement for the Sellers and the Purchaser to reach
agreement over the relevant item in dispute; or
(b) failing such agreement, as shall be appointed for this purpose on the
application of any of the Sellers or the Purchaser by the President of
the Institute of Chartered Accountants in England and Wales.
6.2 For the purpose of subclause 6.1, the Independent Accountants shall act on
the following basis:
(a) the Independent Accountants shall act as experts and not as
arbitrators;
(b) the items or items in dispute shall be notified to the Independent
Accountants in writing by one of the Sellers and/or the Purchaser
within 10 Business Days of the Independent Accountants' appointment;
(c) their terms of reference shall be as set out in the relevant schedule;
(d) the Independent Accountants shall decide the procedure to be followed
in the determination;
(e) each of the Sellers and the Purchaser shall provide (and, to the
extent they are reasonably able, shall procure that their respective
accountants, and the Purchaser shall procure that the Company,
provide) the Independent Accountants promptly with all information
which they reasonably require and the Independent Accountants shall be
entitled (to the extent they consider it appropriate) to base their
opinion on such information and on the accounting and other records of
the Company;
(f) the determination of the Independent Accountants shall (in the absence
of manifest error) be final and binding on the parties; and
(g) the costs of the determination, including fees and expenses of the
Independent Accountants, shall be borne equally as between the Sellers
on the one hand and the Purchaser on the other hand.
6.3 In the event that, for the purposes of any Warranty Claim, the Sellers and
the Purchaser are unable to agree whether or not, or the extent to which, a
relevant liability or obligation is, or would have been, capable of being
included in the Actual Required Revenue of the Company at the relevant
time, any Party may refer the matter to an Appropriate Queen's Counsel
appointed either by agreement between the Parties or, failing such
agreement, on the application of any Party for appointment by the President
of the Law Society of England and Wales for the time being (whose decision
shall be final and binding on the Parties).
6.4 For the purpose of subclause 6.3, the Appropriate Queen's Counsel shall act
on the following basis:
(a) the Appropriate Queen's Counsel shall act as expert and not as
arbitrator;
(b) the items or items in dispute shall be notified to the Appropriate
Queen's Counsel in writing by one of the Sellers and/or the Purchaser
within 10 Business Days of the Appropriate Queen's Counsel's
appointment;
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(c) the Appropriate Queen's Counsel shall decide the procedure to be
followed in the determination;
(d) each of the Sellers and the Purchaser shall provide, and the Purchaser
shall procure that the Company provide, the Appropriate Queen's
Counsel promptly with all information which he or she reasonably
requires and the Appropriate Queen's Counsel shall be entitled (to the
extent he or she considers it appropriate) to base his or her opinion
on such information and on the accounting and other records of the
Company;
(e) the determination of the Appropriate Queen's Counsel shall (in the
absence of manifest error) be final and binding on the Parties; and
(f) the costs of the determination, including fees and expenses of the
Appropriate Queen's Counsel, shall be borne as the Appropriate Queens
Counsel shall direct (provided that the costs of preparing and
presenting its case to the Appropriate Queen's Counsel shall be borne
by the relevant Party).
7. LOANS AND GUARANTEES
7.1 Each of the Sellers shall procure that, on or before Completion, all
indebtedness of it and its Affiliates to the Company is satisfied in full.
7.2 The Sellers shall procure that, on or before Completion, the Company is
released from all guarantees and indemnities given by it in respect of any
liability or obligation of a Seller or any of its Affiliates.
7.3 The Purchaser shall use reasonable endeavours to procure that, from
Completion, each Seller and each of its Affiliates is released from all
outstanding guarantees and indemnities given by it in respect of
obligations of the Company (full particulars of which are contained in the
Disclosure Letter) and, pending such release, the Purchaser shall indemnify
the relevant Seller and its Affiliates against all liabilities under each
such guarantee or indemnity arising from Completion.
8. WARRANTIES
8.1 BGEH warrants to the Purchaser that:
(a) except as fully and fairly disclosed in the Disclosure Letter, each of
the statements set out in part 1 of schedule 3 is true and accurate as
at the date of this agreement; and
(b) except as fully and fairly disclosed in the Supplementary Disclosure
Letter, each of the statements set out in part 1 of schedule 3 will be
true and accurate as at Completion, and for the purposes of this
paragraph (b) each of the statements set out in part 1 of schedule 3
shall be deemed to be repeated at Completion by reference to the facts
and circumstances then existing.
8.2 (a) K(UK)L warrants to the Purchaser that:
(i) except as fully and fairly disclosed in the Disclosure Letter, each of
the statements set out in part 2 of schedule 3 is true and accurate as
at the date of this agreement; and
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(ii) except as fully and fairly disclosed in the Supplementary Disclosure
Letter, each of the statements set out in part 2 of schedule 3 will be
true and accurate as at Completion, and for the purposes of this
subparagraph (ii) each of the statements set out in part 2 of schedule
3 shall be deemed to be repeated at Completion by reference to the
facts and circumstances then existing.
(b) K(UK)L warrants to the Purchaser that:
(i) except as fully and fairly disclosed in the Disclosure Letter, each of
the statements set out in part 3 of schedule 3 is true and accurate as
at the date of this agreement; and
(ii) except as fully and fairly disclosed in the Supplementary Disclosure
Letter, each of the statements set out in part 3 of schedule 3 will be
true and accurate as at Completion, and for the purposes of this
subparagraph (ii) each of the statements set out in part 3 of schedule
3 shall be deemed to be repeated at Completion by reference to the
facts and circumstances then existing.
8.3 BGEH and K(UK)L (on behalf of itself and KCIL) severally in equal
proportions warrant to the Purchaser that:
(a) except as fully and fairly disclosed in the Disclosure Letter, each of
the statements set out in part 4 of schedule 3 (the Sellers'
Warranties) is true and accurate as at the date of this agreement; and
(b) except as fully and fairly disclosed in the Supplementary Disclosure
Letter, each of the Sellers' Warranties will be true and accurate as
at Completion, and for the purposes of this paragraph (b) each
Sellers' Warranties shall be deemed to be repeated at Completion by
reference to the facts and circumstances then existing.
8.4 Each Seller agrees with the Purchaser, the Company and the Company's
employees (in the absence of fraud, dishonesty or wilful concealment by or
on behalf of the Company or its employees) to waive any rights or claims
which it may have in respect of any misrepresentation, inaccuracy or
omission in or from any information or advice supplied or given by the
Company or its employees in connection with the giving of the Warranties
and the preparation of the Disclosure Letter. This subclause 8.4 may be
enforced by the Company or any of its employees under the Contracts (Rights
of Third Parties) Xxx 0000, although the provisions of this subclause 8.4
may be varied or terminated by agreement between the Parties (which may
also release or compromise any liability in whole or in part) without the
consent of the Company or any of its employees.
8.5 The liability of the Sellers in connection with the Warranties shall be
subject to the limitations in subclause 1.9, together with those contained
in, and to the other provisions of, schedule 4, and any Warranty Claim
shall be subject to the provisions of subclause 1.9 and schedule 4.
8.6 Any payment made by the Sellers in respect of a breach of the Warranties or
under the Tax Deed shall, to the extent possible, be deemed to be a
reduction in the Consideration.
8.7 The Purchaser warrants to the Seller that:
(a) it is a corporation validly existing under Northern Irish law and has
been in continuous existence since incorporation;
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(b) it has the requisite power and authority to enter into and perform,
and has taken all necessary corporate action to authorise execution
and performance of, its obligations under this agreement;
(c) this agreement constitutes its valid and binding obligations; and
(d) the execution and delivery of this agreement by it and the performance
of its obligations hereunder have been duly authorised and will not
conflict with, contravene or result in a breach or default of any
organisational documents, resolution, legal requirement, governmental
order or decree, material agreement, licence, permit or consent by
which the Purchaser is bound.
9. FURTHER ASSURANCES AND PROPERTY INDEMNITY
9.1 In relation to the Company, the Sellers shall procure the convening of all
meetings, the giving of all waivers and consents and the passing of all
resolutions as are necessary under the Companies Xxx 0000, the Company's
articles of association or any agreement or obligation affecting it to give
effect to this agreement.
9.2 The Sellers shall use reasonable endeavours to procure that there is
recorded in the appropriate division of the General Register of Sasines or
registered in the Land Register of Scotland (as appropriate) Notices of
Title by the uninfeft proprietors referred to in the Disclosure Letter who
granted the Deeds of Servitude in favour of Premier Transco Limited (each
such recording being an Uninfeft Recording).
9.3 The Sellers shall use reasonable endeavours to procure that the registered
owner for the time being of the lands comprised in the Land Registry of
Northern Ireland Folio 21098 County Antrim shall execute a deed of
rectification in a form reasonably agreed by the Purchaser confirming and
granting the true and actual extent of the pipeline over the said lands by
reference to a revised accurate map and shall have the same registered at
the Land Registry of Northern Ireland against the aforementioned Folio
(such execution being the Rectification Execution).
9.4 Subject to the limitations and other provisions of subclause 9.5, BGEH and
K(UK)L (the Indemnitors) hereby undertake severally in equal proportions to
indemnify and keep the Purchasers indemnified from and against and in
respect of all losses that may be suffered or incurred after Completion by
the Company or the Purchaser arising by virtue of:
(a) there being no Uninfeft Recording; and/or
(b) there being no Rectification Execution,
(the Property Indemnity).
9.5 (a) The Property Indemnity shall apply only:
(i) in terms of subclause 9.2, in respect of the subject matter of each
Uninfeft Recording until the Uninfeft Recording (and, for the purposes
of this subparagraph (i), the Property Indemnity shall no longer apply
in respect of the subject matter of an Uninfeft Recording once the
relevant Uninfeft Recording has been duly made); and
(ii) in terms of subclause 9.3, until the Rectification Execution.
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(b) The Property Indemnity shall not apply to the extent that any act, error,
omission or conduct of the Purchasers or the Company after Completion or
the respective servants, agents, contractors or others for whom they are
each responsible at law has caused or contributed to such claims, costs,
proceedings or demands (and, for the avoidance of doubt, such conduct of
the Purchaser or the Company shall include the bringing to the attention of
any third party the circumstance, act, error, omission, conduct or
eventuality giving rise to a claim under the Property Indemnity provided
that the inclusion in the Offering Circular of the Property Indemnity
Description shall not result in the Property Indemnity ceasing to apply
pursuant to this subclause 9.5).
(c) Neither the Purchasers nor the Company shall compromise or settle any
claims, costs, proceedings or demands relating to the losses referred to in
subclause 9.4 without the prior written consent of the Indemnitors, which
shall not be unreasonably withheld, and the Purchasers shall permit the
Indemnitors to defend the same in the name of the Purchasers or the
Company, at the Indemnitors expense.
(d) The Purchaser and the Company shall be bound and obliged to give reasonable
assistance to the Indemnitors, the reasonable and properly incurred costs
of such assistance being refundable by the Sellers, so as to allow the
Sellers fully to comply with the terms of subclauses 9.2 and 9.3, which
reasonable assistance shall include, but shall not be limited to, procuring
the exercise of, and exercising and enforcing in full, all statutory and
other legal rights that the Company has against the said uninfeft
proprietors or the said registered owner for the time being of the lands
comprised in the Land Registry of Northern Ireland Folio 21098 County
Antrim or other third parties or in relation to the relevant lands,
including the threatening of the exercise of such rights as aforesaid and
the Purchasers and the Company shall implement all reasonable directions
made by the Indemnitors with regard thereto and in so doing, will act at
all times as the agents of the Indemnitors with regard to such matters.
10. CONFIDENTIALITY
10.1 Neither the Purchaser nor any of the Sellers shall make (or permit any of
their respective Affiliates to make) any announcement concerning this sale
and purchase or any ancillary matter before, on or after Completion.
10.2 The Purchaser shall and shall procure that:
(a) it and each of its Affiliates shall keep confidential all information
provided to them by or on behalf of any of the Sellers or otherwise
obtained by or in connection with this agreement which relates to the
Company, the Seller or any of the Seller's Affiliates; and
(b) if, after Completion, the Company holds confidential information
relating to any of the Sellers or any of their Affiliates, it shall
keep that information confidential and, to the extent reasonably
practicable, shall return that information to the relevant Sellers or
destroy it, in each case without retaining copies.
10.3 Each of the Sellers shall and shall procure that:
(a) it and each of its Affiliates shall keep confidential all information
provided to them by or on behalf of the Purchaser or otherwise
obtained by or in connection with this agreement which relates to the
Purchaser or any of its Affiliates; and
15
(b) if, after Completion, it holds confidential information relating to
the Company, it shall keep that information confidential and, to the
extent reasonably practicable, shall return that information to the
Purchaser or destroy it, in each case without retaining copies.
10.4 Nothing in this clause 10 prevents any announcement being made or any
confidential information being disclosed:
(a) with the written approval of the other Parties, which, in the case of any
announcement, shall not be unreasonably withheld or delayed;
(b) to the extent required by law or any competent regulatory body, but a Party
required to disclose any confidential information shall promptly notify the
other Parties, where practicable and lawful to do so, before disclosure
occurs and co-operate with the other Parties regarding the timing and
content of such disclosure or any action which the other Parties may
reasonably elect to take to challenge the validity of such requirement; or
(c) in the Offering Circular, provided that the only announcement in relation
to the Property Indemnity and/or the subject matter thereof that may be
made in the Offering Circular shall be the Property Indemnity Description.
10.5 Nothing in this clause 10 prevents disclosure of confidential information
by any Party:
(a) to the extent that the information is in or comes into the public
domain other than as a result of a breach of any undertaking or duty
of confidentiality by any person; or
(b) to that Party's professional advisers, auditors or bankers, but before
any disclosure to any such person the relevant Party shall procure
that he is made aware of the terms of this clause 10 and shall use its
best endeavours to procure that such person adheres to those terms as
if he were bound by the provisions of this clause 10.
11. NOTICES
11.1 Any notice or other formal communication given under this agreement or the
Tax Deed must be in writing (which includes fax, but not email) and may be
delivered or sent by post or fax to the Party to be served at its address
appearing in this agreement as follows:
(a) to BGEH at: 000 Xxxxxx Xxxxxx Xxxx Xxxxx
Xxxxxxx
Xxxxxxxxx
XX0 0XX
Xxxxxx Xxxxxxx
Fax: 0000 000 0000
Attention: Company Secretary;
(b) to KCIL, care of K(UK)L at the same address, fax number and recipient
as K(UK)L;
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(c) to K(UK)L at
Jordans Limited
00 Xx Xxxxxx Xxxxxx
Xxxxxxx
XX0 0XX
Xxxxxx Xxxxxxx
Fax: x00 (0)000 000 0000
Attention: Xxxxxxxxx Xxxxxx; and
(d) to the Purchaser at: Xxxxxx Xxx Northern Ireland
Capital House
0 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx
XX0 0XX
Xxxxxx Xxxxxxx
Fax: 0000 00 0000 0000
Attention: Xxxx Xxxxxxxx,
or at such other address or fax number as it may have notified to the other
Parties in accordance with this clause 11. Any notice or other document
sent by post shall be sent by prepaid first class.
11.2 Any notice or other formal communication shall be deemed to have been
given:
(a) if delivered, at the time of delivery;
(b) if posted, at 10.00 a.m. on the second Business Day after it was put
into the post; or
(c) if sent by fax, on the date of transmission if transmitted before 3.00
p.m. on any Business Day, and in any other case on the Business Day
following the date of transmission.
11.3 In proving service of a notice or other formal communication, it shall be
sufficient to prove that delivery was made or that the envelope containing
the communication was properly addressed and posted either by prepaid first
class recorded delivery post or that the fax was properly addressed and
transmitted, as the case may be.
12. ASSIGNMENT
12.1 The Purchaser may assign the benefit of this agreement and the Tax Deed to
any of its Affiliates and, if it does so:
(a) the assignee may enforce the obligations on the part of each of the
Sellers (including the Warranties) under this agreement, and on the
part of BGEH and K(UK)L under the Tax Deed, as if it had been named in
this agreement and in the Tax Deed as the Purchaser;
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(b) as between the Sellers and the Purchaser, each of the Sellers may
nevertheless enforce this agreement and the Tax Deed against the
Purchaser as if that assignment had not occurred;
(c) the assignment shall not in any way operate so as to increase or
reduce the respective rights and obligations on the part of the
Purchaser or its assignee on the one hand and the Sellers on the other
hand; and
(d) if the assignee ceases to be an Affiliate of the Purchaser, the
Purchaser shall procure that the benefit of this agreement and the Tax
Deed is re-assigned to the Purchaser or another of its Affiliates.
12.2 KCIL may assign the benefit of this agreement to K(UK)L and, if it does so,
K(UK)L may enforce the obligations on the part of the Purchaser (including
the Warranties) under this agreement as if it had been named in this
agreement as KCIL.
12.3 The Purchaser may assign, transfer or create a security interest in favour
of lenders to the Purchaser, any of the Purchaser's Affiliates or any
special purpose entity pursuant to any financing arrangements or
transactions entered into by the Purchaser or any of its Affiliates from
time to time over the Purchaser's rights and interests under this agreement
and the Tax Deed provided that the Purchaser remains primarily liable to
the Sellers for all of its obligations under this agreement and the Tax
Deed and provided further that the liability of the Sellers under this
agreement and the Tax Deed to the Purchasers is not as a result increased
to a level greater than it would have been in the absence of such security.
12.4 Except as permitted by this clause 12, none of the rights or obligations
under this agreement or the Tax Deed may be assigned or transferred without
the prior consent of all the other Parties (which consent shall not be
unreasonably withheld).
13. WHOLE AGREEMENT
13.1 This agreement and the Tax Deed contain the whole agreement between the
Sellers, on the one hand, and the Purchaser, on the other hand, relating to
the transactions contemplated by this agreement and supersedes all previous
agreements between the Sellers, on the one hand, and the Purchaser, on the
other hand, relating to these transactions.
13.2 As between the Sellers, on the one hand, and the Purchaser, on the other
hand, each Party:
(a) acknowledges that in agreeing to enter into this agreement it has not
relied on any representation, warranty, collateral contract, financial
projection or other assurance (except those set out in this agreement
and the Tax Deed) made by or on behalf of any other Party before the
signature of this agreement; and
(b) waives all rights and remedies which, but for this subclause 13.2,
might otherwise be available to it in respect of any such
representation, warranty, collateral contract, financial projection or
other assurance.
13.3 For the avoidance of doubt, nothing in or pursuant to schedule 5,- or in
schedule 8, the Forecast Balance Sheet or the Completion Accounts shall
constitute a representation, warranty, collateral contract, financial
projection or other assurance.
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13.4 Notwithstanding any provision in this agreement to the contrary, nothing in
this agreement shall limit or exclude any liability for fraud or for
fraudulent misrepresentation.
14. GOVERNING LAW
14.1 This agreement is governed by and shall be construed in accordance with
English law.
14.2 The English courts have non-exclusive jurisdiction to settle any dispute
arising out of or in connection with this agreement and the parties submit
to the non-exclusive jurisdiction of the English courts.
14.3 The parties waive any objection to the English courts on grounds that they
are an inconvenient or inappropriate forum to settle any such dispute.
14.4 The Purchaser irrevocably appoints the Purchaser's Solicitors as its agent
in England for service of process.
14.5 EACH PARTY WAIVES ANY RIGHT IT MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION IN CONNECTION WITH THIS AGREEMENT. THIS AGREEMENT MAY BE
FILED AS A WRITTEN CONSENT TO TRIAL BY COURT. 15. GENERAL
15.1 Each of the obligations, Warranties and undertakings set out in this
agreement (excluding any obligation which is fully performed at Completion)
shall continue in force after Completion.
15.2 Except as otherwise agreed in writing by the Parties, each Party shall pay
the costs and expenses incurred by it in connection with the entering into
and completion of this agreement.
15.3 The Purchaser shall be liable for any stamp duty payable in relation to the
purchase by it of the Shares.
15.4 This agreement may be executed in any number of counterparts. This has the
same effect as if the signatures on the counterparts were on a single copy
of this agreement.
15.5 The rights of each Party under this agreement:
(a) may be exercised as often as necessary; and
(b) may be waived only in writing and specifically; and
a delay in exercising or non-exercise of any such right is not a waiver of
that right.
15.6 Except as expressly stated in this agreement, a person who is not a Party
may not enforce any of its terms under the Contracts (Rights of Third
Parties) Xxx 0000.
AS WITNESS this agreement has been signed by the parties (or their duly
authorised representatives) on the date stated at the beginning of this
agreement.
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SIGNATORIES
Signed by )
for BG ENERGY HOLDINGS LIMITED ) ...................
Signed by )
for KEYSPAN C I LTD ) ...................
Signed by )
for KEYSPAN (UK) LIMITED ) ...................
Signed by )
for PREMIER TRANSMISSION FINANCING PUBLIC ) ...................
LIMITED COMPANY
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