EXHIBIT 2.2
DATED 8 SEPTEMBER 2004
(1) CASH AMERICA INTERNATIONAL, INC
(2) H&T FINANCE LIMITED
AGREEMENT
For the sale and purchase
of the entire issued share capital of Xxxxxx & Xxxxxxxx
Limited
Eversheds LLP
Cloth Xxxx Xxxxx
Xxxxxxxxx Xxxxxx
Xxxxx XX0 0XX
Tel +44 (0) (0) 000 000 0000
Fax +44 (0) (0) 000 000 0000
CONTENTS
CLAUSE PAGE
1 INTERPRETATION........................................................ 1
2 SALE AND PURCHASE..................................................... 6
3 COMPLETION............................................................ 6
4 GUARANTEES............................................................ 6
5 WARRANTIES............................................................ 7
6 LIMITATION ON CLAIMS.................................................. 8
7 RESTRICTIVE COVENANTS................................................. 10
8 ANNOUNCEMENTS......................................................... 12
9 COSTS................................................................. 13
10 INTEREST.............................................................. 13
11 NOTICES............................................................... 13
12 ASSIGNMENT............................................................ 14
13 GENERAL............................................................... 15
14 SERVICE OF PROCESS.................................................... 16
15 GOVERNING LAW AND JURISDICTION........................................ 17
16 COUNTERPARTS.......................................................... 17
SCHEDULES
1 The Vendor............................................................ 18
2 Details of the Company................................................ 19
3 Non-Taxation Warranties............................................... 20
4 Taxation.............................................................. 50
5 Completion Arrangements............................................... 75
6 The Properties (To be finalised / confirmed).......................... 79
7 Limitations on Warranties............................................. 86
8 Adjustment of Consideration........................................... 91
THIS AGREEMENT is made on 8 SEPTEMBER 2004
BETWEEN:
(1) Cash America International, Inc of 0000 Xxxx 0xx Xxxxxx, Xx. Xxxxx, Xxxxx
00000, XXX ("the Vendor"); and
(2) H&T Finance Limited (registered number 5188120) whose registered office is
at Xxxxxxx Xxxxx, Xxxxxxx Xxxxxxx, Xxxxxx XX0 0XX, Xxxxxxx ("the
Purchaser").
OPERATIVE CLAUSES
1. INTERPRETATION
In this Agreement:
1.1 the following expressions have the following meanings unless inconsistent
with the context:
"ACCOUNTING DATE" 31 December 2003
"ACCOUNTS" the audited accounts of the Company for
the financial year which ended on the
Accounting Date, comprising in each case
a balance sheet, a profit and loss
account, notes, directors' and auditors'
reports
"ASSOCIATED COMPANY" any company, not being the Company,
which at the relevant time is:
(a) a holding company of the Vendor; or
(b) a subsidiary or subsidiary
undertaking of the Vendor; or
(c) a subsidiary or subsidiary
undertaking of any such holding
company (other than the Vendor
itself);
the expressions "holding company",
"subsidiary" and "subsidiary
undertaking" having the meanings given
to them by CA 1985
1
"BUSINESS DAY" any day (other than a Saturday or
Sunday) on which banks are open in
London for normal banking business
"CA 1985" the Companies Xxx 0000
"CASH" cash in hand and at bank (including
accrued interest on any such cash) (on
current or deposit account) of the
Company as recorded in the nominal
ledger of the Company at Completion
including uncleared cheques received at
Completion including any amounts
representing shop floats in excess of
the sum of(pound)57,000 (such amount
representing an allocation
of(pound)1,000 per store for 57 stores)
"CERTIFICATES OF TITLE" the certificates given in respect of the
Freehold Properties and in the form
annexed to this Agreement
"COMPANY" Xxxxxx & Xxxxxxxx Limited (details of
which are set out in SCHEDULE 2)
"COMPLETION" completion of the sale and purchase in
accordance with CLAUSE 3
"COMPLETION ACCOUNTS" the accounts prepared in accordance with
PARAGRAPH 1 of SCHEDULE 7
"CONSIDERATION" the consideration for the sale of the
Shares as stated in PARAGRAPH 3.1 of
SCHEDULE 8
"CONTRACT" any agreement or commitment whether
conditional or unconditional and whether
by deed, under hand, oral or otherwise,
and any arrangement or understanding, in
each case whether legally binding or not
"DATA ROOM" the collection of documents, materials
and information held at the offices of
the Vendor's Solicitors and made
available for inspection to the
2
Purchaser and its advisers prior to
Completion as set out in the index in
the agreed terms
"DISCLOSURE LETTER" the letter having the same date as this
Agreement from the Vendor to the
Purchaser qualifying the Warranties
"ENCUMBRANCE" any mortgage, charge, pledge, lien,
assignment, option, restriction, claim,
right of pre-emption, right of first
refusal, third party right or interest,
other encumbrance or security interest
of any kind, or other preferential
arrangement having similar effect
"FREEHOLD PROPERTIES" means freehold properties short
particulars of which are set out at PART
I of SCHEDULE 6 and each and every part
of such freehold property
"ICTA" Income and Corporation Taxes Act 1988
"INDEBTEDNESS" the aggregate amount of the indebtedness
for borrowed money of the Company as at
Completion including bank or other third
party overdrafts and loan facilities and
any indebtedness repayable to the Vendor
and/or any Associated Company, together
with accrued interest and any redemption
costs associated with the repayment of
any relevant facilities, debt factoring
facilities, liabilities under bank
guarantees, acceptance or documentary
credits, debentures, loans, loan stocks,
bonds notes and bills of exchange, hire
purchase agreements and obligations
under finance leases, and discounted
debts and including amounts owed in
respect of Taxation (as defined in
SCHEDULE 4 but without prejudice to the
terms of SCHEDULE 4) and further
including the sum of(pound)109,000 (such
amount representing an agreed shortfall
in the sum of(pound)134,000 in the value
of the Freehold Properties due to
anticipated taxation liabilities
3
less an agreed transition cost
of(pound)25,000) but not including
amounts owed to trade creditors (which
may include sums owed to the Vendor or
any Associated Company in the ordinary
course of business up to a maximum of
(pound)20,000) of the Company in the
ordinary course of business
"LEASE" means the relevant leases or underleases
or licences brief particulars of which
are set out in PART II of SCHEDULE 6
under which the Leasehold Properties are
held
"LEASEHOLD PROPERTIES" means all leasehold or licensed
properties short particulars of which
are set out in PART II of SCHEDULE 6 and
each and every part of such properties
"PENSION SCHEMES" means (a) the Cash America Pension Plan
established on 11 February 1992; and (b)
a designated stakeholder compliant
arrangement provided by Norwich Union
"PROPERTIES" means both the Freehold Properties and
the Leasehold Properties, details of
which are set out in SCHEDULE 6
"PROVISIONAL CONSIDERATION" the consideration for the Shares of
(pound)43,692,903 as stated in CLAUSE 2
before the adjustments made in
accordance with the terms of SCHEDULE 8
"PURCHASER'S ACCOUNTANTS" Deloitte & Touche LLP of 000 Xxxxxx,
Xxxxxx XX0X 0XX (or such other firm as
the Purchaser may notify the Vendor)
"PURCHASER'S SOLICITORS" Eversheds LLP of Cloth Xxxx Xxxxx,
Xxxxxxxxx Xxxxxx, Xxxxx XX0 0XX
"RELEVANT CLAIM" any claim for breach of any of the
Warranties
"SENIOR MANAGEMENT" each director of the Company, Xxxx
Xxxxxxx (Secretary) and Xxxxxx X
Xxxxxxx, Xx
4
"SERVICE DOCUMENT" a writ, summons, order, judgement, claim
form, application or other process or
any document relating to or in
connection with any proceedings
"SHARES" all the issued shares in the capital of
the Company
"STOCK" merchandise of the Company held for
disposition and for sale as scrap
"TAXATION WARRANTIES" the warranties set out in PART 3 of
SCHEDULE 4
"TAX SCHEDULE" means the schedule attached as SCHEDULE
4 in relation to tax matters
"VENDOR'S ACCOUNTANTS" PricewaterhouseCoopers LLP of 0,
Xxxxxxxxxx Xxxxx, Xxxxxx XX0X 0XX (or
such other firm as the Vendor may notify
the Purchaser)
"VENDOR'S SOLICITORS" Xxxxx & XxXxxxxx of 000 Xxx Xxxxxx
Xxxxxx, Xxxxxx XX0X 0XX
"WARRANTIES" the warranties set out or referred to in
CLAUSE 5, SCHEDULE 3 and PART 3 of
SCHEDULE 4;
1.2 references to any statute or statutory provision include, unless the
context otherwise requires, a reference to the statute or statutory
provision as modified or re-enacted and in force from time to time prior
to Completion and any subordinate legislation made under the relevant
statute or statutory provision in force prior to Completion;
1.3 references to persons will include bodies corporate, unincorporated
associations and partnerships;
1.4 references to a document being "in the agreed terms" are to that document
in the form agreed and for the purposes of identification initialled by or
on behalf of the Vendor and the Purchaser;
1.5 references to the singular include the plural and vice versa;
1.6 references to clauses and Schedules are to clauses of and Schedules to
this Agreement, and references to paragraphs are to paragraphs in the
Schedule in which such references appear;
5
1.7 the Schedules form part of this Agreement and will have the same force and
effect as if expressly set out in the body of this Agreement;
1.8 the headings in this Agreement will not affect its interpretation; and
1.9 any phrase introduced by the term "include", "including", "in particular"
or any similar expression will be construed as illustrative and will not
limit the sense of the words preceding that term.
2. SALE AND PURCHASE
2.1 The Vendor will sell with full title guarantee, and the Purchaser will
buy, the Shares as set forth in SCHEDULE 1. The Shares will be sold free
of any Encumbrance and with all rights attached or accruing to them at or
after the date of this Agreement.
2.2 In consideration for the sale of the Shares the Purchaser shall pay to the
Vendor the Provisional Consideration but subject to adjustment after
Completion as provided in SCHEDULE 8.
3. COMPLETION
3.1 Completion will take place at the London offices of the Purchaser's
Solicitors immediately after the signing of this Agreement.
3.2 At Completion, the Vendor and the Purchaser will comply with the
provisions of SCHEDULE 5.
3.3 The Vendor's Solicitors are authorised to receive the part of the
Consideration which comprises cash on behalf of the Vendor and payment to
them will be a good and sufficient discharge to the Purchaser for such
part of the Consideration and the Purchaser will not be further concerned
as to the application of the moneys so paid.
3.4 The Purchaser will not be obliged to complete the purchase of any of the
Shares unless the purchase of all the Shares is completed simultaneously
and the Vendor will not be obliged to complete the sale of any of the
Shares unless the sale of all the Shares is completed simultaneously.
4. GUARANTEES
4.1 The Vendor will procure that on Completion the Company is released from
any guarantee, indemnity, counter-indemnity, letter of comfort or other
obligation given by the Company to any third party in respect of a
liability of any person other than the Company.
6
4.2 The Purchaser will procure that on Completion the Vendor or any Associated
Company is released from any guarantee, indemnity, counter-indemnity,
letter of comfort or other obligation given by the Vendor or any
Associated Company to any third party relating to bank or other third
party overdrafts and loan facilities in respect of a liability of the
Company and of which full particulars are contained in the Disclosure
Letter. The Purchaser undertakes to the Vendor that as soon as reasonably
practicable following Completion the Purchaser will use all reasonable
endeavours to obtain the release of each of the Vendor and any Associated
Company from any other guarantee, indemnity, counter-indemnity, letter of
comfort or other obligation given by the Vendor or any Associated Company
to any third party in respect of a liability of the Company and of which
full particulars are contained in the Disclosure Letter. Pending such
release, the Purchaser undertakes to indemnify the Vendor and any
Associated Company against all amounts paid by the Vendor or any
Associated Company to any third party pursuant to any such obligation (and
all costs incurred in connection with such obligation) arising after the
date of this Agreement save that this indemnity shall not extend to any
matter giving rise to a Relevant Claim or a Claim under PART 2 of SCHEDULE
4 or any other indemnity set out in this Agreement.
5. WARRANTIES
5.1 The Vendor warrants to the Purchaser in the terms of the Warranties.
5.2 Subject to CLAUSE 6.5, the Warranties are qualified by all facts and
matters fairly disclosed (as defined in CLAUSE 5.7 below) in the
Disclosure Letter. The provisions of section 6(2) of the Law of Property
(Miscellaneous Provisions) Xxx 0000 are hereby excluded.
5.3 The Vendor undertakes that following a breach of the Warranties specified
at PARAGRAPHS 10, 11.2, 11.3, 11.4, 12 - 14, 17 - 34, 36 AND 42 of
SCHEDULE 3 and at PART 3 of SCHEDULE 4 the Vendor will pay on demand to
the Purchaser (or as the Purchaser directs) a sum equal to the aggregate
of:
5.3.1 the amount by which the value of any asset of the Company (including
any asset warranted to exist which does not exist) is or becomes
less than the value it would have had if the breach of Warranty had
not occurred; and
5.3.2 the amount of any other loss or liability which the Company would
not have been subject to or which would not have incurred had the
breach of Warranty not occurred.
7
The Purchaser hereby acknowledges that the remedy set out in this clause
5.3 shall be the Purchaser's exclusive remedy in respect of any claim
relating to the Warranties specified herein and the Purchaser shall not be
entitled to make any claim for damages in respect of any such breach on
any other basis.
5.4 The Vendor waives and may not enforce any right which the Vendor may have
against the Company, or any director or employee of the Company, on which
or on whom the Vendor may have relied in agreeing to any term of this
Agreement or any statement in the Disclosure Letter save that the Vendor
does not waive and may enforce any such claim in respect of directors or
employees of the Company in the case of fraud or wilful default on the
part of any director or employee of the Company.
5.5 Each Warranty is to be construed independently and is not limited or
restricted by any other Warranty or any other term of this Agreement.
5.6 Unless otherwise specified, where any Warranty refers to the knowledge,
information, belief or awareness of the Vendor (or similar expression),
the Vendor will be deemed to have such knowledge, information, belief or
awareness as the Vendor would have obtained had the Vendor made all
reasonable enquiries into the subject matter of that Warranty of the
Senior Management.
5.7 Unless otherwise specified, where a reference is made to facts or matters
fairly disclosed (or similar expression) in the context of the Warranties
fairly disclosed means disclosed in such a manner and in such detail as to
enable the Purchaser reasonably to assess the impact of the facts or
matters on the Company.
5.8 The Purchaser hereby confirms to the Vendor that it is not, at the date
hereof, currently intending to make a Relevant Claim against the Vendor
following Completion.
6. LIMITATION ON CLAIMS
6.1 The Vendor will not be liable for any Relevant Claim unless:
6.1.1 the amount of the liability in respect of that Relevant Claim or the
aggregate amount of the liability in respect of a number of Relevant
Claims relating to the same matter exceeds (pound)5,000 AND the
amount of the liability in respect of that Relevant Claim or
Relevant Claims when aggregated with the amount of the liability in
respect of all other Relevant Claims exceeds
8
(pound)750,000 (in which event the Vendor will be liable for the
whole amount of such Relevant Claims and not merely the excess); and
6.1.2 the Vendor receives from the Purchaser written notice of the
Relevant Claim (stating in reasonable detail the nature of the
Relevant Claim and including so far as reasonably practicable an
estimate of the maximum amount of the Relevant Claim):
6.1.2.1 no later than 30 April 2006, in the case of a Relevant Claim
for breach of any of the Warranties contained in SCHEDULE 3;
and
6.1.2.2 within seven years after Completion, in the case of a
Relevant Claim for breach of any of the Warranties contained
in SCHEDULE 4.
PROVIDED THAT unless the parties are conducting bona fide
negotiations in respect of such Relevant Claim the liability of the
Vendor against which any Relevant Claim specified in such notice
shall have been made shall absolutely determine and cease (if such
Relevant Claim has not been previously satisfied, settled or
withdrawn) if legal proceedings in respect of the claim shall not
have been commenced against the Vendor by being both properly issued
and validly served on the Vendor within twelve months of the giving
of such notice.
6.2 The aggregate amount of the liability of the Vendor for all Relevant
Claims and any claims made pursuant to the Tax Schedule will not exceed an
amount equal to the Consideration.
6.3 CLAUSES 6.1 and 6.2 and SCHEDULE 7 will not apply in respect of a Relevant
Claim concerning PARAGRAPHS 1 (capital) and 2 (capacity) of SCHEDULE 3.
6.4 Notwithstanding any other provision of this Agreement, CLAUSES 6.1 and 6.2
and SCHEDULE 7 will not apply to exclude or limit the liability of the
Vendor to the extent that any Relevant Claim arises by reason of any fraud
by or on behalf of the Vendor.
6.5 The Vendor shall have no liability in respect of the Warranties to the
extent that the facts and matters giving rise to the Relevant Claim have
been fairly disclosed (as defined in CLAUSE 5.7) in the Disclosure Letter
or this Agreement or the Data Room provided that the Data Room and the
general disclosures contained within the
9
Disclosure Letter shall not qualify or be disclosed against the
Warranties at PARAGRAPH 4 of SCHEDULE 3.
6.6 The provisions of SCHEDULE 7 shall operate to limit the liability of
the Vendor under this Agreement.
7. RESTRICTIVE COVENANTS
7.1 In this clause:
"CONFIDENTIAL INFORMATION" means all information not publicly known,
used in or otherwise relating to the
Company's business, customers, or
financial or other affairs, including
information relating to:
(a) trade secrets, know-how, ideas,
computer systems and computer
software;
(b) future projects, business
development or planning, commercial
relationships and negotiations; and
(c) the marketing of goods or services
including customer names and lists,
sales targets and statistics
"RELEVANT CUSTOMER" means any person who at any time during
the period of twelve months immediately
preceding Completion was
(d) negotiating with the Company for
the supply by the Company of goods
or services; or
(e) a client or customer of the
Company; or
(f) in the habit of dealing with the
Company
"RELEVANT PRODUCTS means products or services which are
OR SERVICES" competitive with or of the type supplied
by the Company at any time during the
period of twelve months
10
immediately preceding Completion.
7.2 The Vendor undertakes to the Purchaser and the Company that the Vendor
will not, and will procure that no Associated Company will, (whether
alone or in conjunction with, or on behalf of, another person and
whether directly or indirectly), without the prior written consent of
the Purchaser:
7.2.1 for a period of two years immediately following Completion,
canvass, solicit or approach, or cause to be canvassed,
solicited or approached, any Relevant Customer for the sale or
supply of Relevant Products or Services;
7.2.2 for a period of two years immediately following Completion,
deal or contract with any Relevant Customer in relation to the
sale or supply of Relevant Products or Services;
7.2.3 for a period of two years immediately following Completion,
interfere, or seek to interfere, with the continuance of
supplies to the Company from any supplier who has been
supplying goods or services to the Company at any time during
the twelve months immediately preceding Completion if such
interference causes or would cause that supplier to cease
supplying, or materially reduce its supply of, those goods or
services;
7.2.4 within the United Kingdom, for a period of two years
immediately following Completion, solicit or entice away, or
endeavour to solicit or entice away, from the Company, any
person employed in a managerial, supervisory, technical or
sales capacity by, or who is or was a consultant (other than,
for the avoidance of doubt, Xxxx Xxxxxxx in respect of whom
the provisions of this clause shall not apply) to, the Company
at Completion or at any time during the period of twelve
months immediately preceding Completion where the person in
question either has Confidential Information or would be in a
position to exploit the Company's trade connections and for
the avoidance of doubt the Vendor confirms that it has no
arrangements in place to employ any such persons or
consultants outside the United Kingdom at the date of
Completion;
7.2.5 within the United Kingdom for a period of two years
immediately following Completion, be engaged, concerned,
connected with or interested in (except as the owner for
investment of securities in a company dealt in on a recognised
stock exchange and which confer not more than one per cent of
the votes which could be cast at a general meeting), any other
business which supplies Relevant Products or Services; or
11
7.2.6 without prejudice to any rights relating to passing off or
trade xxxx infringement (or similar rights in any territory),
for a period of two years immediately following Completion use
in connection with any business which is competitive with the
business of the Company any name (in whatever form) which
includes the name of the Company or any trading style or get
up which is confusingly similar to that used by the Company as
at Completion.
7.3 Except so far as required by law or, to the extent relevant, the
regulations of any stock exchange or listing authority or any other
governmental or regulatory organisation and in those circumstances only
after prior consultation with the Purchaser, the Vendor undertakes to
the Purchaser and the Company that the Vendor will not, and will
procure that no Associated Company will, at any time after Completion:
7.3.1 disclose any Confidential Information to any person except to
those authorised by the Company to know;
7.3.2 use any Confidential Information for their own purposes or for
any purposes other than those of the Company; or
7.3.3 cause or permit any unauthorised disclosure of any
Confidential Information.
7.4 Each of the undertakings set out in this clause is separate and
severable and enforceable accordingly, and if any one or more of such
undertakings or part of an undertaking is held to be against the public
interest or unlawful or in any way an unreasonable restraint of trade,
the remaining undertakings or remaining part of the undertakings will
continue in full force and effect and will bind the Vendor.
8. ANNOUNCEMENTS
8.1 No announcement or circular concerning the transactions contemplated by
this Agreement or any matter ancillary to it and no disclosure of the
terms of this Agreement will be made by the Vendor except with the
prior written approval of the Purchaser or by the Purchaser except with
the prior written approval of the Vendor.
8.2 CLAUSE 8.1 does not apply to any announcement, circular or disclosure
required by law, or to the extent relevant, the regulations of any
stock exchange or listing authority or any other governmental or
regulatory organisation, provided, if
12
practicable, that the party required to make it has first consulted and
taken into account the reasonable requirements of the other party.
9. COSTS
Except where expressly stated otherwise, each party to this Agreement
will bear such party's own costs and expenses relating to the
negotiation, preparation and implementation of this Agreement. The
Company will bear no part of such costs and expenses.
10. INTEREST
If either party hereto becomes liable to pay the other party or the
Company any sum pursuant to this Agreement, whether a liquidated sum or
by way of damages or otherwise, such party will be liable to pay
interest on such sum from the due date for payment at the annual rate
of 2 per cent above the base lending rate from time to time of Barclays
Bank Plc, accruing on a daily basis until payment is made, whether
before or after any judgment.
11. NOTICES
11.1 Any notice or other communication given in connection with this
Agreement will be in writing and will be delivered personally or sent
by pre-paid first class post (or air mail if overseas) or by fax to the
recipient's address set out in this Agreement or to any other address
which the recipient has notified in writing to the sender received not
less than seven Business Days before the notice was despatched.
11.2 A notice or other communication is deemed given:
11.2.1 if delivered personally, upon delivery at the address provided
for in this clause; or
11.2.2 if sent by prepaid first class post, on the second Business
Day after posting it; or
11.2.3 if sent by air mail, on the sixth Business Day after posting
it; or
11.2.4 if sent by fax, on completion of its transmission
provided that, if it is delivered personally or sent by fax on a day
which is not a Business Day or after 4 p.m. on a Business Day, it will
instead be deemed to have been given or made on the next Business Day.
13
11.3 The provisions of this clause will not apply, in the case of service of
court documents, to the extent that such provisions are inconsistent
with the Civil Procedure Rules.
12. ASSIGNMENT
12.1 This Agreement may not be assigned to any person, save that the
Purchaser may assign the benefit of, and any of its rights under, this
Agreement to:
12.1.1 any company or other entity (for the purposes of this CLAUSE
12 an "Associated Entity"), which at the relevant time is:
12.1.1.1 a holding company of the Purchaser;
12.1.1.2 a subsidiary or subsidiary undertaking of the
Purchaser; or
12.1.1.3 a subsidiary or subsidiary undertaking of any such
holding company (other than the Purchaser itself); or
12.1.1.4 any of The Rutland Partnership (LP 9572), Rutland
Fund A (LP 0000), Xxxxxxx Xxxx Avenue (LP 6900) or
Rutland CCLP (LP 6896) or any successor Rutland fund
entities,
the expressions "holding company", "subsidiary" and
"subsidiary undertaking" having the meanings given to them by
CA 1985;
12.1.2 or in favour of any person by way of security for borrowings
of the Purchaser and the same may be enforced by any
liquidator, administrator or receiver of the Purchaser or by
any other person entitled to enforce such security; or
12.1.3 any person whatsoever after 30 April 2006.
12.2 In the event that the Purchaser notifies the Vendor of a Relevant Claim
in accordance with clause 6.1.2 prior to 30 April 2006 and at any time
between the date hereof and the date on which such Relevant Claim has
been agreed or determined there is a Change of Control, no liability
shall attach to the Vendor in respect of such Relevant Claim unless
within 60 days of the later of (a) the date on which the Purchaser
notifies the Vendor of the Relevant Claim; or (b) the date on which the
Change of Control occurs, the Purchaser assigns such Relevant Claim to
an entity which is, and continues to be, until the date on which the
Relevant Claim is agreed or determined, an Associated Entity.
14
12.3 In the event that the Purchaser notifies the Vendor of a Relevant Claim
in accordance with clause 6.1.2 prior to 30 April 2006, notwithstanding
the provisions of clause 12.1.3, such Relevant Claim may not be
assigned to any person, save to an entity which is, and continues to
be, until the date on which such Relevant Claim is agreed or
determined, an Associated Entity or in accordance with clause 12.1.2.
For the purposes of this clause 12, "Change of Control" shall mean, in
respect of either the Purchaser or the Company (as the case may be),
any acquisition of shares which would enable a third party to exercise
more than 50% of the voting rights exercisable at general meeting of
the relevant company.
12.4 The Vendor may not assign the benefit of, or any of its rights under,
this Agreement.
12.5 This Agreement will be binding and enure for the benefit of successors
in title and permitted assigns of each of the parties and references to
the parties will be construed accordingly.
13. GENERAL
13.1 Unless otherwise provided, any outstanding obligation contained in this
Agreement will remain in force notwithstanding Completion.
13.2 Each party will do, or procure the doing of, all acts and things and
execute, or procure the execution of, all documents as any other party
reasonably considers necessary to give full effect to the terms of this
Agreement.
13.3 Failure or delay by any party in exercising any right or remedy under
this Agreement will not in any circumstances operate as a waiver of it,
nor will any single or partial exercise of any right or remedy in any
circumstances preclude any other or further exercise of it or the
exercise of any other right or remedy.
13.4 Any waiver of any breach of, or any default under, any of the terms of
this Agreement will not be deemed a waiver of any subsequent breach or
default and will in no way affect the other terms of this Agreement.
13.5 The rights and remedies expressly provided for by this Agreement will
not exclude any rights or remedies provided by law.
13.6 The Company has the right to enforce only CLAUSE 7 of this Agreement
and in accordance with the provisions of the Contracts (Rights of Third
Parties) Xxx 0000. Except as stated in this clause, the parties to this
Agreement do not intend that any of
15
its terms will be enforceable by virtue of the Contracts (Rights of
Third Parties) Xxx 0000 by any person not a party to it.
13.7 No variation of this Agreement will be valid unless it is in writing
and signed by or on behalf of each party to this Agreement but no
variation will require the consent of the Company.
13.8 Except as required by law, all payments by the Vendor pursuant to
CLAUSE 5.3 will be made free and clear of all deductions and
withholdings whether in respect of Taxation (as defined in SCHEDULE 4)
or otherwise. If any deduction or withholding is required by law to be
made from any payment by the Vendor pursuant thereto which is not
governed by the provisions of SCHEDULE 4 or if (ignoring any available
relief or allowance) the Purchaser is subject to Taxation in respect of
any such payment which is not governed by the provisions of SCHEDULE 4
then the Vendor will pay to the Purchaser such additional amount as is
necessary to ensure that the net amount received and retained by them
(after taking account of such deduction or withholding or Taxation) is
equal to the amount which they would have received and retained had the
payment in question not been subject to the deduction or withholding or
Taxation. The provisions of this CLAUSE 13.8 shall not apply, to the
extent that the deduction or withholding of Taxation would not have
arisen but for the assignment by the Purchaser of any of its rights
under this Agreement.
14. SERVICE OF PROCESS
14.1 The Vendor irrevocably agrees that any Service Document may be
sufficiently and effectively served on it by service on its agent, the
Vendor's Solicitors if no replacement agent has been appointed and
notified to the Purchaser pursuant to CLAUSE 14.4, or on the
replacement agent if one has been so appointed and notified to the
Purchaser.
14.2 Any Service Document served pursuant to this clause shall be marked for
the attention of:
14.2.1 The Litigation Partner, Xxxxx & XxXxxxxx, 000 Xxx Xxxxxx
Xxxxxx, Xxxxxx XX0X 0XX or such other address within England
as may be notified to the Purchaser by the Vendor; or
14.2.2 such other person as is appointed as agent for service
pursuant to CLAUSE 14.4 at the address notified pursuant to
CLAUSE 14.4.
16
14.3 Any document addressed in accordance with CLAUSE 14.2 shall be deemed
to have been duly served if:
14.3.1 delivered personally, upon delivery; or
14.3.2 sent by prepaid first class post, on the second Business Day
after posting it.
14.4 If the agent referred to in CLAUSE 14.1 (or any replacement agent
appointed pursuant to this CLAUSE 14.4) at any time ceases for any
reason to act as such the Vendor shall appoint a replacement agent to
accept service having an address for service in England and shall
notify the Purchaser of the name and address of the replacement agent;
failing such appointment and notification the Purchaser shall be
entitled by notice to the Vendor to appoint such a replacement agent to
act on the Vendor's behalf.
14.5 A copy of any Service Document served on an agent pursuant to this
CLAUSE 14 shall be sent by post to the Vendor at its address for the
time being for the service or notices and other communications under
CLAUSE 11, but no failure or delay in so doing shall prejudice the
effectiveness of service of the Service Document in accordance with the
provisions of CLAUSE 14.1.
15. GOVERNING LAW AND JURISDICTION
15.1 This Agreement will be governed by and construed in accordance with
English law.
15.2 The courts of England will have exclusive jurisdiction to settle any
dispute which arises out of or in connection with this Agreement and
the parties agree to submit to that jurisdiction.
15.3 The jurisdiction provisions contained in this clause are made for the
benefit of the Purchaser only, which accordingly retains the right to
bring proceedings in any other court of competent jurisdiction.
16. COUNTERPARTS
This Agreement may be executed in any number of counterparts each of
which when executed and delivered will be an original, but all the
counterparts will together constitute one and the same agreement.
17
SCHEDULE 1
THE VENDOR
NAME AND ADDRESS OF REGISTERED AND
BENEFICIAL OWNER NUMBER AND CLASS OF SHARES TO BE SOLD
Cash America International, Inc 15,000,002 ordinary shares of (Pound)1.00
of 0000 Xxxx 0xx Xxxxxx, Xx. Xxxxx, xxxx
Xxxxx 00000, XXX
Facsimile Number: 000-000-0000
18
SCHEDULE 2
DETAILS OF THE COMPANY
Name of Company : Xxxxxx & Xxxxxxxx Limited
Registered number : 02636684
Registered office : Xxxxx Xxxxx, Xxxxxxxx Xxx, Xxxxxx, Xxxxxx XX0
0XX
Date of incorporation : 9 August 1991
Authorised share capital : (Pound)15,250,000 divided into 15,250,000
ordinary shares of (Pound)1.00 each
Issued share capital : (Pound)15,000,002 divided into 15,000,002
ordinary shares of (Pound)1.00 each
Directors' full names : Xxxx Xxxxxxxx Xxxxxxxxx
Xxxxxx Xxx Xxxxxx
Xxxx Xxxxxx
Xxxxx Xxxx Xxxxxxx
Xxxx Xxxxxx Xxxxxxx
Xxxxx Xxxxxx Xxxxxxx
Secretary's full name : Xxxx Xxxxxxx
Accounting reference date : 31 December
Mortgages/charges over : Rent deposit deed dated 25 August 1992 between
Shares or Company's assets the Company (1) and Agra Limited (2).
Rent deposit deed dated 19 June 1992 between
Xxxx Xxxxx Xxxxxxx (1) and the Company (2).
19
SCHEDULE 3
NON-TAXATION WARRANTIES
1. SCHEDULES 1 & 2; CAPITAL
1.1 The information contained in SCHEDULES 1 and 2 is true, complete and
accurate in all respects.
1.2 The Shares are fully paid and are beneficially owned and registered as
set out in SCHEDULES 1 and 2 free from any Encumbrance or any claim to,
or Contract to grant, any Encumbrance.
1.3 The Company has not allotted or issued any share capital other than the
shares shown in SCHEDULES 1 and 2 as being issued.
1.4 No Contract has been entered into which requires or may require the
Company to allot or issue any share or loan capital and the Company has
not allotted or issued any securities which are convertible into share
or loan capital.
1.5 The Company has no interest, and it has not at any time during the
period of 6 years ending on the date of this Agreement had any
interest, in the share capital of any body corporate.
1.6 The Company does not have, and never has had, any subsidiary
undertakings (as defined in sections 258 to 260 CA 1985).
VENDOR
2. CAPACITY
The Vendor has full power to enter into and perform this Agreement and
this Agreement constitutes obligations binding on the Vendor in
accordance with its terms.
3. INSIDERS' INTERESTS
3.1 For the purpose of this PARAGRAPH 3:
"INSIDER" means the Vendor, any Associated Company, any
person who is or was at the relevant time a
director of the Company, or any person who is or
was at the relevant time connected (as defined
in
20
section 839 ICTA) with the Vendor, any
Associated Company or any such director.
3.2 There is not outstanding and there has not at any time during the
period of 3 years ending on the date of this Agreement been outstanding
any Contract to which the Company is or was a party and in which any
Insider is or was interested in any way whatsoever (excluding any
Contract of employment between the Company and any of its directors
fully, fairly and clearly disclosed in the Disclosure Letter).
3.3 No Insider has any interest, direct or indirect, in any trade or
business which competes or is likely to compete with the Company's
business.
4. INFORMATION SUPPLIED TO THE PURCHASER
4.1 The information set out in the document specified as number Folder B1,
8.2 in the Data Room index is true, complete and accurate in all
respects and is not misleading (whether by omission or otherwise).
4.2 True, complete and accurate copies of the following documents have been
provided in the Data Room:
4.2.1 the MoneyShop Franchise Agreement between the Company and Cash
Centres Limited date 8 July 2002, together with a side letter
relating to the same dated 19 June 2002; and
4.2.2 the Money Transfer Agency Agreement between the Company and MT
Consumer Services Limited (Western Union) dated 1 March 2003;
4.2.3 the credit agreement and pawn receipt in Folder B2, 20.2.1;
and
4.2.4 the credit agreement in Folder B2, 20.2.4.
ACCOUNTS AND RECORDS
5. THE ACCOUNTS
5.1 For the purposes of this paragraph:
"ACCOUNTING STANDARDS" means the statements of standard
accounting practice referred to in
section 256 CA 1985 issued by the
Accounting Standards Board or such
other body as may be prescribed by the
Secretary of State from time to time,
21
including the statements of standard
accounting practice formerly issued by
the Accounting Standards Committee and
since adopted by the Accounting
Standards Board, the Abstracts issued
by the Urgent Issues Task Force and any
financial reporting standards issued by
the Accounting Standards Board or such
other body referred to above.
5.2 The Accounts (a copy of which is attached to the Disclosure Letter):
5.2.1 show a true and fair view of the assets, liabilities and state
of affairs of the Company as at the Accounting Date and of the
profits (or losses) of the Company for the financial year
ended on that date;
5.2.2 have been prepared and audited in accordance with the
historical cost convention, with all applicable law and
Accounting Standards and (to the extent that no Accounting
Standard is applicable) with generally accepted accounting
principles and practices of the United Kingdom then in force;
and
5.2.3 have been prepared on bases and principles which are
consistent with those used in the preparation of the audited
statutory accounts of the Company for the three financial
years immediately preceding that which ended on the Accounting
Date.
5.3 Without prejudice to the generality of PARAGRAPH 5.2, the Accounts
attribute a value to Stock taken as a whole which is the lower of cost
or net realisable value as at the Accounting Date where cost:
5.3.1 in relation to unredeemed pledges means the original loan less
capital repayments plus any incremental remanufacturing costs;
and
5.3.2 in relation to other retail stock means the original purchase
price.
6. RECORDS
The Company's accounting records are up to date and, as far as the
Vendor is aware, comply with the provisions of sections 221 and 222 CA
1985 in all material respects. The Company's records and information
are exclusively owned by it and under its direct control.
22
7. PROFITS AND LOSSES
The profits or losses and value of net assets of the Company for the
three consecutive financial years ended on the Accounting Date as shown
in the Accounts (and by the previous audited accounts of the Company
delivered to the Purchaser) have not (except as disclosed in those
accounts) been rendered exceptionally high or low by the inclusion of
non-recurring items of income or expenditure, or by transactions
entered into otherwise than on normal commercial terms nor have they
been affected by any other factors rendering such profits or losses or
value of net assets for any such periods exceptionally high or low.
8. MANAGEMENT ACCOUNTS
Except as fairly disclosed in the Disclosure Letter, the management
accounts of the Company in respect of the period from the Accounting
Date to 31 July 2004, copies of which are attached to the Disclosure
Letter, have been prepared on principles consistent with those used in
the preparation of the Accounts and with reasonable skill and care and
provide statements of the Company's assets and liabilities as at 31
July 2004 which, taken as a whole, are not materially misleading or
inaccurate.
CHANGES SINCE THE ACCOUNTING DATE
9. GENERAL
Since the Accounting Date:
9.1 the business of the Company has been carried on in the ordinary and
usual course and in the same manner (including nature and scope) as in
the 12 months preceding the Accounting Date;
9.2 there has been no material adverse change in the financial or trading
position or prospects of the Company including any material adverse
change in respect of turnover, profits, margins of profitability,
liabilities (actual or contingent) or expenses (direct or indirect) of
the Company; and
9.3 there has been no material reduction in the value of the net assets of
the Company determined in accordance with the same accounting policies
as those applied in the Accounts (on the basis that each of the assets
of the Company is valued at a figure no greater than the value
attributed to it in the Accounts or, in the case of any assets acquired
by the Company after the Accounting Date, at a figure no greater than
cost).
23
10. SPECIFIC
Since the Accounting Date:
10.1 the Company has not acquired, or agreed to acquire, any single asset
having a value in excess of (Pound)20,000 or assets having an aggregate
value in excess of (Pound)50,000, other than in the ordinary course of
business;
10.2 the Company has not disposed of, or agreed to dispose of, any asset
having a value reflected in the Accounts in excess of (Pound)20,000 or
acquired since the Accounting Date other than in the ordinary course of
business;
10.3 no loan made by the Company which remains outstanding has become due
and payable in whole or in part to the Company other than in the
ordinary course of business;
10.4 the Company has not borrowed or raised any money or taken up any
financial facilities nor repaid any borrowing or indebtedness in
advance of its stated maturity other than in the ordinary course of
business;
10.5 the Company has not sold or agreed to sell a debt and no debt has been
released, deferred, subordinated or written off by the Company;
10.6 no dividend or other payment which is, or could be treated as, a
distribution for the purposes of Part VI ICTA or section 418 ICTA has
been declared, paid or made by the Company;
10.7 no resolution of the shareholders of the Company has been passed;
10.8 the Company has not changed its accounting reference date;
10.9 the Company has not assumed or, so far as the Vendor is aware,
incurred, or agreed to assume or incur, a liability, obligation or
expense (actual or contingent) for a value in excess of (Pound)20,000,
other than in the ordinary course of business;
10.10 no management or similar charge has become payable or been paid by the
Company to the Vendor or any Associated Company;
10.11 no share or loan capital has been allotted, issued, repaid or redeemed
or agreed to be allotted, issued, repaid or redeemed by the Company;
and
10.12 no payment has been made by the Company to, or benefit conferred
(directly or indirectly) by the Company on, the Vendor, any past or
present director of the
24
Company or any person who is or was at the relevant time connected (as
defined in section 839 ICTA) with the Vendor or any such director.
ASSETS
11. UNENCUMBERED TITLE; POSSESSION
11.1 Each asset included in the Accounts or acquired by the Company since
the Accounting Date (save for Stock disposed of in the ordinary course
of business) and each asset used by the Company or which the Company
holds out as being, or claims is, in the ownership of the Company is
legally and beneficially owned by the Company free from any Encumbrance
or any claim to, or Contract to grant, any Encumbrance;
11.2 Any asset of the Company having a book value in excess of (Pound)5,000
and which is not situated at the Property at Completion is specified in
the Disclosure Letter and the asset is clearly identified as an asset
of the Company.
11.3 As far as the Vendor is aware, the Company owns or is entitled to the
lawful use of each asset necessary for the carrying on of its business
in the manner in which it is currently carried on.
11.4 No registrable Encumbrance in favour of the Company is void or voidable
for want of registration.
12. DEBTORS
12.1 The Company has not made, or entered into any Contract to make, any
loan to, or other arrangement with, any person as a result of which it
is or may be owed any money, other than trade debts incurred in the
ordinary course of business and cash at bank.
12.2 The Company is not entitled to the benefit of any debt otherwise than
as the original creditor and the Company has not factored, deferred or
discounted any debt or agreed to do so.
13. STOCK
13.1 The Stock now held by the Company and not written off in the Accounts
is not obsolete.
13.2 Since the Accounting Date:
25
13.2.1 there has been no significant abnormal increase or reduction
of Stock; and
13.2.2 such of the Stock as is reflected in the Accounts which has
been realised was realised for an amount in aggregate no less
than the loans made in respect of such Stock.
13.3 The pledge loan balance recorded in the books of the Company is in
aggregate materially accurate and for the purposes of this warranty
"materially accurate" shall mean within (Pound)325,000 of the actual
aggregate amount of such balance.
14. PLANT ETC.
The plant and machinery, vehicles, fixtures and fittings, furniture,
tools and other equipment used in connection with the business of the
Company:
14.1 are in a reasonably good and safe state of repair and condition and
satisfactory working order and have been regularly maintained to a good
standard and in accordance with any safety regulations usually observed
in relation to them; and
14.2 are fully and accurately recorded in the plant register.
15. INTELLECTUAL PROPERTY RIGHTS
15.1 For the purpose of this paragraph and PARAGRAPH 16:
"INTELLECTUAL PROPERTY RIGHTS" means all patents, trade marks,
copyright, moral rights, rights to
prevent passing off, rights in designs,
know how and all other intellectual or
industrial property rights, in each
case whether registered or unregistered
and including applications or rights to
apply for them and together with all
extensions and renewals of them, and in
each and every case all rights or forms
of protection having equivalent or
similar effect anywhere in the world;
and
"SOFTWARE" means any form of computer program,
including applications software and
operating systems, whether in source or
object code form.
26
15.2 To the Vendor's knowledge, the Company owns or has a right to use, all
Intellectual Property Rights necessary to carry on the Company's
business in the manner carried on as at the date of this Agreement.
15.3 To the Vendor's knowledge, all of the Company's Intellectual Property
Rights which are registered or the subject of applications for
registration or which are unregistered trade marks are listed and
described in the Disclosure Letter.
15.4 To the Vendor's knowledge, in respect of registered Intellectual
Property Rights, all renewal fees have been duly paid, all steps
required for their maintenance have been taken and to the Vendor's
knowledge there are no grounds on which any person is or will be able
to seek cancellation, rectification or any other modification of any
registration.
15.5 To the Vendor's knowledge, there are, and have been, no proceedings,
actions or claims within the six years prior to the date of this
Agreement and none are pending or have been threatened, impugning the
title, validity or enforceability of the Company's Intellectual
Property Rights or claiming any right or interest in such Intellectual
Property Rights.
15.6 To the Vendor's knowledge, there is, and has been, no infringement
within the six years prior to the date of this Agreement of the
Company's Intellectual Property Rights and none is threatened.
15.7 To the Vendor's knowledge, the past and present activities of the
Company (including the processes, methods, Software, goods and services
used or dealt in by it, and the products or services manufactured or
supplied by it):
15.7.1 do not infringe and have not infringed within the six years
prior to the date of this Agreement any Intellectual Property
Rights of any third party; and
15.7.2 have not, and will not, result in a claim in respect of
Intellectual Property Rights against the Company including any
liability to any compensation under sections 40 and 41 of the
Patents Xxx 0000.
15.8 To the Vendor's knowledge there are no circumstances which would render
any current application for registration of the Company's Intellectual
Property Rights unacceptable to the relevant registry or other
authority or which would prevent any such application from proceeding
to grant and registration.
15.9 Complete and accurate copies of all written licences, sub-licences and
other agreements whereby the Company is licensed or otherwise
authorised to use the
27
Intellectual Property Rights of a third party (other than Intellectual
Property Rights subsisting in or relating to Software or Computer
Systems) or whereby the Company licenses or otherwise authorises a
third party to use Intellectual Property Rights of the Company (other
than Intellectual Property Rights subsisting in or relating to Software
or Computer Systems) are attached to the Disclosure Letter. To the
Vendor's knowledge, all of them are in full force and effect, no notice
having been given to terminate them, and the material obligations of
all parties in respect of them have been complied with and no disputes
have arisen in respect of them.
15.10 The Disclosure Letter contains a full list of domain names and other
electronic addresses in connection with the Internet or Worldwide Web
which are held by, registered on behalf of, or are or which are used in
respect of the Company.
16. COMPUTER SYSTEMS
16.1 For the purposes of this paragraph:
"COMPUTER SYSTEMS" means all computer hardware, Software,
microprocessors and any other items
that connect with any of them which in
each case are used in the Company's
business or are in the possession of
the Company;
"TOPS SOFTWARE LICENCE" the licence of the Intellectual
Property Rights in the TOPS Software
entered into between the Vendor and the
Company on Completion under the terms
of the Transitional Service Agreement;
"TOPS SOFTWARE" means the TOPS Epos software the
subject of the TOPS Licence; and
"TRANSITIONAL SERVICES means the agreement entered into
AGREEMENT" between the Vendor and the Company on
Completion for the provision by the
Vendor of IT services and deliverables.
16.2 Details of all material Software used by the Company to carry on the
Company's business in which the Intellectual Property Rights are owned
by a third party are set out in the Disclosure Letter. To the Vendor's
knowledge the licences of such Software are complied with in all
material respects in the operation of the business of the Company as at
that date of this Agreement and any restrictions in those licences
28
do not adversely affect the present conduct of the business of the
Company or any plans for its conduct currently under consideration as
at the date of this Agreement.
16.3 To the Vendor's knowledge, the Company has a disaster recovery plan in
respect of material Computer Systems.
16.4 To the Vendor's knowledge, the Company has procedures in place in
respect of the security of the material Computer Systems and data
stored on them.
16.5 To the Vendor's knowledge, the material Computer Systems (and each part
of each of them) have functioned consistently and accurately since
being installed (except for pre-planned maintenance shut downs).
16.6 To the Vendor's knowledge, the Company has a sufficient number of
employees who are technically competent and appropriately trained to
ensure the proper operation and use of the Computer Systems.
16.7 To the Vendor's knowledge, the data storage capability, functionality
and performance of each item of the material Computer Systems and the
Computer Systems as a whole are satisfactory for the Company's business
(as it is now conducted) as at the date of this Agreement.
16.8 The TOPS Software, in each case to the Vendor's knowledge:
16.8.1 is legally and beneficially owned by the Vendor free from any
Encumbrance, and the Vendor has the right to licence it
pursuant to the TOPS Software Licence; and
16.8.2 is capable of operating to materially the same performance and
functionality to which it operated in the twelve month period
prior to Completion.
PROPERTY
17. DETAILS OF THE PROPERTIES
17.1 The particulars of the Properties shown in SCHEDULE 6 are true,
complete and accurate in all material respects.
17.2 The Company has good title to the Properties.
17.3 So far as the Vendor is aware there is not, and so far as the Vendor is
aware has not been, in force any policy relating to defective title or
restrictive covenant indemnity.
29
17.4 So far as the Vendor is aware:
17.4.1 the Company does not own, is not in occupation of and is not
entitled to any estate or interest in any freehold or
leasehold property other than the Properties; and
17.4.2 the Company is not party to any uncompleted agreement to
acquire or dispose of any real property including the
Properties.
17.5 So far as the Vendor is aware and save as disclosed, except in relation
to the Properties, the Company has no current ongoing liability
(whether actual or contingent) in relation to any real property.
18. RIGHTS ENJOYED WITH THE PROPERTIES
18.1 So far as the Vendor is aware there are appurtenant to the Properties
all rights and easements reasonably necessary for their present use and
enjoyment, and in particular there is either access to the Leasehold
Properties from a highway maintainable at public expense or the Company
has the benefit of all necessary rights of way to and from such a
roadway.
19. OCCUPATION AND USE OF THE PROPERTIES
19.1 Except for any leases, tenancies or other rights of occupation to which
the Properties are subject, as disclosed in the Data Room so far as the
Vendor is aware the Company has vacant possession of the Properties and
so far as the Vendor is aware no other person has any current right to
possession or occupation of the Properties.
20. MATTERS AFFECTING THE PROPERTIES
20.1 So far as the Vendor is aware from its immediately available records
the Properties are free and clear of all Encumbrances.
20.2 So far as the Vendor is aware in relation to any Leasehold Property no
written notice has been received alleging any breach of covenant
contained in a Lease.
20.3 So far as the Vendor is aware no written notice materially affecting
the Properties has been received by the Company which remain
outstanding.
21. RATES AND OUTGOINGS
So far as the Vendor is aware the Properties are not subject to any
outgoings (save those of an immaterial nature and other than uniform
business rates, water charges and
30
other standard property terms and payments to the relevant water
company and, in the case of Leasehold Property, rent, service charge
and insurance premiums and other payments due under a Lease) whether of
a periodically recurring nature or otherwise, and whether payable by
the owner or occupier of the Properties.
22. COMPLIANCE WITH STATUTE
22.1 The Company has not so far as the Vendor is aware received from any
competent authority any written notice alleging that the Properties
breach the provisions of relevant legislation from time to time
(including the Offices Shops and Railway Premises Xxx 0000, the Town
and Country Planning Xxx 0000, the Public Health Acts 1936 to 1961, the
Fire Precautions Xxx 0000, the Health and Safety at Work etc Xxx 0000,
the Planning (Listed Buildings and Conservation Areas) Xxx 0000, the
Planning (Hazardous Substances) Xxx 0000, the Planning (Consequential
Provisions) Xxx 0000, the Planning and Compensation Xxx 0000, the
Sunday Trading Xxx 0000, the Disability Discrimination Xxx 0000 and the
Party Wall Act 1996) and regulations made under such legislation and
which are still outstanding.
23. LEASES AFFECTING THE PROPERTIES
The Data Room contains copies of all documents subsisting at the date
of the establishment of the Data Room relating to the Leases of the
Properties of which the Vendor has knowledge.
24. REPLIES TO ENQUIRIES
So far as the Vendor is aware, the replies and other disclosures given
by the Vendor's Solicitors to the Commercial Property Standard
Enquiries or the Purchaser's Solicitors' written enquiries by the
Vendor's Solicitors to the Purchaser's Solicitors attached as Schedule
3 to the Disclosure Letter concerning the Properties are complete, true
and accurate in all material respects.
25. NB: NOT USED.
ENVIRONMENTAL/HEALTH AND SAFETY (EHS) MATTERS
26. DEFINITIONS
For the purposes of PARAGRAPHS 26 to 30 inclusive:
"EHS LAW" means all applicable law (whether
criminal, civil or administrative),
common law, judgment, court
31
order, statute, statutory instrument,
regulation, directive, European Union
decision (insofar as legally binding),
by-law, treaty, government circular,
code of practice and guidance notes, or
instruction or decision of any
competent regulatory body in force at
Completion relating to EHS Matters
"EHS MATTERS" means all or any matters relating to
the pollution or protection of the
Environment or harm to or the
protection of human health and safety
or the health of animals and plants
"EHS PERMITS" means all or any permits, consents,
licences, approvals, certificates and
other authorisations required by EHS
Law for the operation of the business
of the Company or the condition or use
of the Property
"ENVIRONMENT" means any air (including air within
natural or man-made structures above or
below ground), water (including
territorial, coastal and inland waters,
ground water and water in drains and
sewers), and land (including surface
land, sub-surface land, seabed and
river bed under water)
"HAZARDOUS SUBSTANCE" means any matter, whether alone or in
combination with any other matter,
capable of causing harm to man or any
other living organism or damaging to
the Environment or public health or
welfare, including radioactive matter,
ozone depleting substances, and
genetically modified organisms.
27. EHS PERMITS
To the Vendor's knowledge at Completion, the Company has lawfully
obtained all EHS Permits which it is required by law to obtain and at
Completion each EHS Permit (true copies of which are attached to the
Disclosure Letter) is in full force and effect and the Company in all
material respects complies and has complied at all times in all
material respects with all conditions of each EHS Xxxxxx.
00
00. COMPLIANCE WITH EHS LAW
28.1 To the Vendor's knowledge, the Company and its officers, agents and
employees comply and have at all times complied in all material
respects with EHS Law.
28.2 The Company has not received any written notification from any relevant
authority alleging that the Company is in breach of EHS Law, or where
failure to comply with such notification would constitute a breach of
EHS Law or where compliance with such notification would be secured by
further proceedings by such relevant authority. To the Vendor's
knowledge, there are no circumstances at Completion which would give
rise to such a notification being received and the Vendor is not aware
of any intention on the part of any such authority to give such
notification.
29. LIABILITY
29.1 To the Vendor's knowledge, there are no facts or circumstances existing
at Completion which may give rise to any actual liability (whether
civil or criminal) on the part of the Company in relation to EHS
Matters.
29.2 The Company has not received any notice of any complaint or claim from
any person in respect of EHS Matters.
29.3 The Company is not and has not been engaged in any action, litigation,
arbitration or dispute resolution proceedings or subject to any
investigation under EHS Law or otherwise in relation to EHS Matters and
the Vendor is not aware of any such matters pending or being threatened
or of any circumstances or facts likely to give rise to any such
matters.
30. CONTAMINATION
30.1 To the Vendor's knowledge, all sites now or formerly owned or occupied
by the Company are at Completion free from any Hazardous Substance
which would give rise (on the relevant site) to any actual liability on
the part of the Company under EHS Law.
30.2 To the Vendor's knowledge, there are at Completion no circumstances
which are reasonably likely to require material expenditure (by the
Company) in cleaning up the Property in order to comply with EHS Law.
33
31. PACKAGING
To the Vendor's knowledge, the Company currently complies and has at
all times prior to Completion complied with the Producer Responsibility
Obligations (Packaging Waste) Regulations 1997.
EMPLOYEES
32. REMUNERATION AND EMPLOYEES
32.1 Full particulars of the identities, dates of commencement of employment
(or appointment to office), dates of birth, and remuneration, benefits
and emoluments (including any loan arrangement, bonus, commission,
profit sharing, share and other incentive schemes, and collective or
workforce agreements) of all the employees, workers and officers of the
Company are fully and accurately set out in the Disclosure Letter and
copies of the written service agreements or contracts of employment of
all employees Grade A - C and templates of the written contracts of
employment or particulars of employment statements of all other
employees (and all manuals, handbooks, rules, regulations and
statements of terms, conditions, policies, procedures and practices)
are attached to the Disclosure Letter.
32.2 There are no amounts owing to any present or former officers, workers
or employees of the Company, other than remuneration accrued (but not
yet due for payment) in respect of the calendar month in which this
Agreement is executed and none of them is entitled to accrued but
unpaid holiday pay or accrued but untaken holiday leave in respect of
the Company's previous holiday year.
32.3 All Contracts of employment between the Company and its directors and
employees are terminable by the Company by giving no more than three
calendar months' notice, and the Company is not contractually obliged
to make any payment as a consequence of the termination of any such
Contract.
32.4 The Company has not:
32.4.1 employed or engaged nor made any offers to employ or engage
any person:
32.4.1.1 since the Accounting Date; or
32.4.1.2 where such employment or engagement will take effect
after the date of this Agreement;
34
32.4.2 given or received notice to terminate the employment or
engagement of any person and no person has ceased to be
employed or engaged by the Company:
32.4.2.1 since the Accounting Date; or
32.4.2.2 where such notice has not yet expired; or
32.4.3 made, agreed or proposed or is party to any contractual
arrangement to make any change of terms and conditions of
employment or engagement of any of the employees of the
Company:
32.4.3.1 since the Accounting Date; or
32.4.3.2 where such change of terms and conditions has not yet
taken effect.
32.5 So far as the Vendor is aware there is no person previously employed or
engaged by the Company who now has or may have a statutory or
contractual right to return to work or to be re-instated or re-engaged
by the Company.
32.6 Full details of all employees who have been absent from work for a
continuous period of more than four weeks (whether on maternity leave,
unpaid leave, long-term sickness, secondment, authorised annual leave
or otherwise) in the 12 month period ending on the date of this
Agreement are contained in the Disclosure Letter.
32.7 The Company has not recognised, and, so far as the Vendor is aware, has
not done any act which might be construed as recognition of, a trade
union and the Company is not party to any agreement or understanding
with any trade union or organisation of employees or workers nor are
any steps being taken by employees, workers or other representatives to
ensure trade union recognition.
32.8 The Company is not involved, and has not during the 12 months prior to
the date of this Agreement been involved, in any strike, lock-out,
industrial or trade dispute or any negotiations with any trade union or
body of employees or workers.
32.9 The Company does not operate or intend to operate and has not operated
any short time working scheme or arrangement or any redundancy or
redeployment scheme or arrangement, whether formal or informal,
contractual or non-contractual, which provides for payments greater
than those required by statute or for notice periods greater than those
set out in contracts of employment or engagement.
35
32.10 The Company does not use the services of outworkers, agency or other
self-employed persons, contracted labour or agents.
32.11 So far as the Vendor is aware the Company has, in relation to all
present and former employees and workers, complied with all statutes,
regulations, orders and codes of conduct relating to employment and
relations with employees and trade unions and has maintained adequate
and suitable records, where required to do so by law, regarding the
service of each of its employees and has complied with all agreements
for the time being having effect as regards such relations or the
conditions of service of its employees (whether collectively or
individually).
33. PENSIONS
33.1 The Pension Schemes are the only arrangements to which the Company has
any liability for the purpose of providing benefits on retirement or
death.
33.2 The Vendor has supplied to the Purchaser documents containing full,
accurate and up to date details of the Pension Schemes and of the
Company's and its employees' obligations and liabilities under it.
33.3 The Pension Schemes are approved as exempt approved schemes (within the
meaning of the Income and Corporation Taxes Act 1988), and as far as
the Vendor is aware there is no reason why this approval could be
withdrawn.
33.4 The Company and the Pension Schemes comply and have at all times
complied with all legal and regulatory requirements (including equal
treatment and data protection requirements), relevant to the Pension
Schemes and the Company's participation in the Pension Schemes. The
Company complies and has at all times complied with any duty to
facilitate access to a stakeholder pension scheme (under section 3 of
the Welfare Reform and Pensions Act 1999).
33.5 No claim, dispute, complaint or investigation has arisen which relates
to the Pension Schemes or to the provision of retirement or death
benefits in respect of the Company's current and former employees, and
as far as the Vendor is aware there is no reason why any such claim,
dispute, complaint or investigation could arise.
33.6 All amounts payable by the Company to and in respect of the Pension
Schemes have been paid.
33.7 All death in service benefits under the Pension Schemes are insured.
36
33.8 All benefits under the Pension Schemes are calculated on a money
purchase basis only and there is no obligation on the Company or under
the Pension Schemes to provide any targeted level of benefits.
33.9 No liability has been or, as far as the Vendor is aware having made
enquiries of relevant parties, may be imposed on the Company under
section 144 of the Xxxxxxx Xxxxxxx Xxx 0000 or section 75 of the
Pensions Act 1995 as a debt due to any occupational pension scheme.
CONTRACTS
34. INSURANCE
34.1 To the Vendor's knowledge, the Company is, and has at all material
times been, adequately covered against accident, damage, injury, third
party loss, loss of profits and any other risk normally insured against
by persons carrying on the same classes of business as the Company.
34.2 All premiums due in relation to the Company's policies of insurance
have been paid, and to the Vendor's knowledge, nothing has been done or
omitted to be done which would make any policy of insurance of the
Company void or voidable or which might lead to any liability under
such insurance being avoided by the insurers or which is likely to
result in an increase in premium or which would release any insurer
from any of its obligations under any policy of insurance of the
Company.
34.3 No insurance claim is pending or outstanding and to the Vendor's
knowledge, there are no circumstances which might result in any such
claim.
34.4 Full particulars of the Company's insurances and of all claims made
against those insurances in the last 2 years are set out in or attached
to the Disclosure Letter.
35. FINANCING AND WORKING CAPITAL
35.1 The amount borrowed by the Company from its bankers does not exceed the
amount of the facility agreed with such bankers and the total amount
borrowed by the Company from whatever source does not exceed any
limitation on its borrowing contained in its articles of association or
in any Contract, debenture, loan stock deed or any other document.
35.2 The Company has not procured or (indirectly or directly) engaged in any
borrowing or financing not required to be reflected in its statutory
accounts.
37
35.3 Full and accurate details of all overdrafts, loans or other financial
facilities outstanding or available to the Company are set out in the
Disclosure Letter and copies of all documents relating to those
facilities are attached to the Disclosure Letter. Nothing has been done
or omitted to be done which might affect or prejudice the continuance
of any of those facilities in full force and effect; and no person who
provides any of those facilities has given any indication that it may
be withdrawn or its terms altered.
35.4 The Disclosure Letter contains details, correct in all material
respects at the date stated in it, of the credit or debit balances on
all the bank or deposit accounts of the Company. Since that date there
have been no payments out of any of those accounts except for routine
payments in the ordinary and usual course of the Company's business and
the balances on those accounts are not now substantially different from
the balances shown in the Disclosure Letter.
35.5 No indebtedness of the Company is due and payable and no security over
any of the assets of the Company is now enforceable. The Company has
not failed to comply with any notice from a creditor requiring any
payment to be made or seeking the enforcement of any security which it
may hold over the Company's assets.
35.6 No person has given any guarantee of or security for any overdraft,
loan, other financial facility granted to the Company or other
liability of the Company.
35.7 The Company has not applied for or received any grant, subsidy or
financial assistance from any government department or other body.
36. MATERIAL CONTRACTS
The Company is not, or has not been since the Accounting Date, a party
to, liable under or subject to any Contract either which cannot be
terminated at the absolute discretion of the Company within three
months and under which the Company will receive income or incur
expenditure in excess of (Pound)20,000 in any twelve month period and:
36.1 involves agency, distributorship, franchising, marketing rights,
information sharing, manufacturing rights, consultancy, servicing,
maintenance, inspection or testing;
36.2 involves partnership, joint venture, consortium, joint development,
shareholders or similar arrangements;
36.3 involves hire purchase, conditional sale, credit sale, leasing, hiring
or similar arrangements;
38
36.4 involves or is likely to involve any capital expenditure by the Company
or involves or is likely to involve an aggregate expenditure or receipt
in excess of (Pound)50,000 by the Company;
36.5 is incapable of complete performance in accordance with its terms
within 6 months after the date on which it was entered into;
36.6 is for the supply of goods by or to the Company on a sale or return
basis or on a consignment stock basis;
36.7 is for the supply of goods or services by or to the Company on terms
under which retrospective or future discounts, price reductions or
other financial incentives are given;
36.8 is for the supply of goods or services by or to the Company which is
not on the current standard terms and conditions on which the Company
normally contracts to buy or supply goods or services, copies of which
are attached to the Disclosure Letter;
36.9 involves the forward purchase or sale of any currency, commodity,
precious metal or other asset;
36.10 involves delegation of any power under a power of attorney or
authorisation of any person (as agent or otherwise) to bind or commit
the Company to any obligation;
36.11 restricts the freedom of the Company to carry on its business in any
part of the world or to use or exploit any of its assets, in each case
in such manner as it may think fit;
36.12 involves conditions, warranties, indemnities or representations given
in connection with a sale of shares or an undertaking or fixed assets;
36.13 is a guarantee, indemnity, surety or form of comfort in respect of the
obligations of a third party, under which any liability or contingent
liability is outstanding; or
36.14 is not on arm's length terms or is in any way otherwise than in the
ordinary and proper course of the Company's business.
37. CONSUMER CREDIT COMPLIANCE
37.1 For the purposes of the following paragraphs:
"CCA" means the Consumer Credit Xxx 0000 and
all associated and subsidiary
legislation, regulations and guidance
39
issued pursuant to its terms;
"CCA AGREEMENTS" means the Credit Agreements and the
Pawn Agreements and all or any of them;
"CREDIT AGREEMENTS" means the credit agreement(s) entered
into by the Company in the form(s)
provided in the Data Room at Folder B2
- 20.2.4;
"LOANS" means all and any financial
accommodation and loans advanced to
customers of the Company whether
through Credit Agreements, Pawn
Agreements or otherwise;
"PAWN AGREEMENTS" means the pawn agreement(s) entered
into by the Company in the form(s)
provided in the Data Room at Folder B2
- 20.2.1; and
"PLEDGE STOCKS" means the items of personal property
held by way of a pawn arrangement
pursuant to Pawn Agreements.
37.2 GENERAL
37.2.1 The CCA Agreements entered into by the Company constitute
legal obligations binding in all respects (without reference
to the Courts) on the parties to them under the CCA.
37.2.2 At all times during the existence of all or any of the CCA
Agreements the Company has held and still holds all requisite
licences under the CCA.
37.2.3 The Company has not assigned or granted any third party rights
to or over the CCA Agreements which are still current.
37.2.4 The Company complies (including without limitation in relation
to all correspondence and notices issued by or on behalf of
the Company) in all respects with all the relevant
requirements of CCA in respect of its past and current CCA
Agreements, the advertising and promotion of their
availability, their administration and enforcement.
37.2.5 None of the Company's business is introduced to it by credit
brokers or third parties.
37.3 THE LOANS
40
37.3.1 The Company is the legal and absolute beneficial owner of
every Loan free and clear of all mortgages, charges, liens,
financial encumbrances and equities.
37.3.2 All steps necessary to perfect the Company's title to the
Loans have been taken.
37.3.3 No Loan has been advanced on terms other than on and in
accordance with the terms of the applicable CCA Agreement.
37.3.4 Copies of the lending guidelines currently applied by the
Company are set out in the Disclosure Letter.
37.3.5 Each Loan constitutes the legal valid and binding obligation
of the customer who is party to it and the terms as to
repayment of principal and payment of interest are enforceable
(without the need to resort to any action under section 127
CCA).
37.3.6 The Company is not carrying on any unauthorised deposit taking
business contrary to the Financial Services and Markets Xxx
0000.
37.3.7 None of the CCA Agreements has been created to remedy a breach
of a previous or existing CCA Agreement and none constitute or
are in place of modifying agreements (as defined in the CCA).
37.3.8 The Company has not received notice of nor has it been
involved in any litigation or disputes relating to the Loans
including without limitation calling into question its title
to any Loan or its collection activities in relation to the
Loans.
37.3.9 No complaints from or correspondence with the Office of Fair
Trading, any Trading Standards Department, the Advertising
Standards Authority or any other consumer protection or
government body has been received or entered into by the
Company or on its behalf.
37.4 ADMINISTRATION OF LOANS
37.4.1 The Company keeps or causes to be kept in respect of each Loan
proper accounts, books and records showing all transactions,
payments and receipts relating to such Loan and all such
accounts books and records are complete and accurate in all
material respects and retained for periods of at least 6
years.
41
37.4.2 The Company is a member of the National Pawnbrokers
Association and at all times, to the Vendor's knowledge, has
complied in all material respects with its Code of Conduct and
the requirements of that Association and has not received any
complaints or allegations within the last three years of
non-compliance with its Code of Conduct or requirements.
37.4.3 The Company is a member of the British Cheque Xxxxxx'x
Association and at all times, to the Vendor's knowledge, has
complied in all material respects with its Code of Conduct and
the requirements of that Association and has not received any
complaints or allegations within the last three years of
non-compliance with its Code of Conduct.
37.4.4 No fraud has been perpetrated by the Company, any Associated
Company or any of their respective directors in connection
with the origination, completion or management of any Loan.
37.4.5 So far as the Vendor is aware, there has been no pattern of
fraudulent behaviour which has been perpetrated by the
employees or agents of the Company or any Associated Company
in connection with the origination, completion or management
of any Loan.
37.4.6 The Company has not received notice from the Office of Fair
Trading to the effect that any of its CCA Agreements are not
binding on the relevant customer by reason of the Unfair Terms
in Consumer Contracts Regulations 1999.
37.5 PAWN
37.5.1 All arrangements relating to the granting of Loans supported
by pawn comply in all respects with the requirements of the
CCA and all other appropriate legislation including the
limitation in relation to the form of pawn receipt to be
utilised for Pledge Stocks, the form of notice of intention to
sell for unredeemed items and the form of written advice given
to customers where non-redeemed Pledge Stocks have been sold.
37.5.2 No items of Pledge Stocks are held other than on terms set out
in the appropriate Pawn Agreement.
37.5.3 The Company's processes in relation to the Pledge Stocks where
a Loan is not repaid relating to the realisation of the
relevant Pledge Stocks are as set out in disclosure 37.5.3 of
the Disclosure Letter and these are the processes
42
that have been followed in all cases where Pledge Stocks have
been realised and/or sold by the Company.
37.5.4 The Company has not received any complaints or allegation that
its processes for instigating the sale and then selling any
Pledge Stock are unlawful, unfair or inappropriate.
37.5.5 The Company has no current, and during the last two years, has
had no material litigation or, so far as the Vendor is aware,
disputes relating to its entitlement to hold the Pledge Stocks
or the money realised on sale of any Pledge Stocks.
38. OTHER BUSINESS MATTERS
38.1 During the 12 months ending on the date of this Agreement there has
been no known substantial change in the basis or terms on which any
person is prepared to do business with the Company (apart from normal
price changes), and no substantial customer or supplier of the Company
(providing 5% or more of the Company's supplies or turnover in any
accounting year) has ceased or substantially reduced its business with
the Company, and no indication has been received by the Company or the
Vendor that there will or may be any such change, cessation or
reduction.
38.2 The Company does not carry on business under any name other than its
own corporate name or any other name specified in the Disclosure Letter
and there are no circumstances which might prevent the Company from
continuing to carry on business under such names.
38.3 During the 12 months ending on the date of this Agreement no code of
practice and no notice affecting prices has been issued by any
government department, association or similar body which relates to the
Company's business.
COMPLIANCE, DISPUTES
39. COMPANY LAW MATTERS
39.1 Compliance has been made with all legal requirements in connection with
the formation of the Company and all issues and grants of shares,
debentures, notes, mortgages or other securities of the Company.
39.2 The copy of the memorandum and articles of association of the Company
attached to the Disclosure Letter is true and complete and has embodied
in it or attached to it a copy of every resolution or agreement as is
referred to in section 380(4) CA 1985.
43
To the Vendor's knowledge, the Company has at all times carried on its
business and affairs in all respects in accordance with its memorandum
and articles of association and all such resolutions and agreements.
39.3 All returns, particulars, resolutions and other documents required to
be filed with or delivered to the Registrar of Companies by the Company
or any of its officers have been properly and correctly prepared in all
respects and so filed and delivered, and no such returns, particulars,
resolutions or other documents have been so filed or delivered during
the period of 14 days ending on the date of this Agreement.
39.4 The statutory books (including all registers and minute books) of the
Company have been properly kept and contain an accurate record of the
matters required to be dealt with in those books and no notice or
allegation that any of them is incorrect or should be rectified has
been received.
40. GENERAL LEGAL COMPLIANCE
40.1 The Company has obtained all necessary licences, consents, permits and
authorities (public and private) to enable it to carry on its business
effectively in the places and in the manner in which such business is
now carried on. All such licences, consents, permits and authorities
(copies of which are enclosed with the Disclosure Letter) are valid and
subsisting and have been complied with in all material respects and to
the Vendor's knowledge there is no reason why any of them should be
suspended, cancelled or revoked.
40.2 To the Vendor's knowledge, the Company has conducted its business in
accordance with all applicable legal and administrative requirements in
each relevant jurisdiction (including the Consumer Credit Xxx 0000, the
Data Protection Act 1998) and the E-Commerce (EC Directive) Regulations
2002.
40.3 To the Vendor's knowledge, none of the officers of the Company (during
the course of his duties in relation to the Company) has committed or
omitted to do any act or thing in material contravention of any law,
order, regulation or the like in the United Kingdom or elsewhere nor,
to the Vendor's knowledge have its agents or employees committed or
omitted to do any act or thing in material contravention of any law,
order, regulation or the like in the United Kingdom or elsewhere, so as
to result in a pattern of such behaviour.
40.4 To the Vendor's knowledge, there is not pending, or in existence, any
investigation or enquiry by, or on behalf of, any governmental or other
body in respect of the affairs of the Company.
44
40.5 To the Vendor's knowledge, the Company's assets do not include any
"criminal property" as defined by section 340(3) of the Proceeds of
Crime Act 2002 (but disregarding paragraph (b) of that definition),
save as disclosed in the Disclosure Letter expressly by reference to
this paragraph.
41. FAIR TRADING
41.1 To the Vendor's knowledge, no agreement, transaction, practice or
arrangement carried on or proposed to be carried on by the Company (or
by any person for whose acts or defaults the Company may be
contractually or vicariously liable), whether unilaterally or with
others, or to which the Company (or any such person) is or proposes to
become a party, and no state of affairs applicable to the Company (or
any such person):
41.1.1 is or ought to have been registered in accordance with the
provisions of the Restrictive Trade Practices Acts 1976 and
1977 ("the RTPA") or is or has been the subject of any
enquiry, investigation or proceeding under the RTPA or the
Resale Prices Xxx 0000;
41.1.2 is or has been the subject of an enquiry, investigation,
reference or report under the Fair Trading Act 1973 (or any
other legislation relating to monopolies or mergers) or the
Competition Xxx 0000;
41.1.3 infringes or falls within the scope of the offence created by
Section 188 of the Enterprise Xxx 0000;
41.1.4 infringes or falls within the scope of Chapter I of the
Competition Xxx 0000, or constitutes an abuse of dominant
position contrary to Chapter II of such Act or is or has been
the subject of any enquiry, request for information,
investigation or proceedings in respect of either of these
Chapters;
41.1.5 infringes or falls within the scope of Article 81 of the
treaty establishing the European Union (the "EC Treaty"), or
constitutes an abuse of dominant position contrary to Article
82 of the EC Treaty, or infringes or falls within the scope of
any regulation or other enactment made under Article 83 of the
EC Treaty, or is or has been the subject of any enquiry,
request for information, investigation or proceeding in
respect of any of those Articles;
41.1.6 infringes or falls within the scope of any other competition,
anti-restrictive trade practice, anti-trust or consumer
protection law or legislation applicable in the United Kingdom
or elsewhere and not specifically mentioned in this
45
paragraph or is or has been subject to any investigation,
request for information, notice or other communication by any
court, governmental or regulatory authority; or
41.1.7 contravenes the provisions of the Trade Descriptions Acts 1968
and 1972,
and there are no circumstances indicating that any such enquiry,
investigation, proceeding, reference or report relating to any such
matter is likely to be made.
41.2 The Company has not made or threatened to make any complaint against
any other person to any relevant authority under any law or legislation
referred to in this paragraph.
41.3 The Company has not given any assurance or undertaking to the
Restrictive Practices Court, the Office of Fair Trading, the Secretary
of State for Trade and Industry, the Competition Commission, the
Commission or Court of First Instance or Court of Justice of the
European Union, or any other court, person or body, and the Company is
not subject to any act, decision, regulation, order or other instrument
(statutory or otherwise) made by any of them relating to any matter
referred to in this paragraph.
41.4 To the Vendor's knowledge, the Company is not in default or in
contravention of any article, act, decision, regulation, order or other
instrument or of any assurance or undertaking relating to any matter
referred to in this paragraph.
42. LITIGATION
42.1 Save in respect of the collection by the Company of less than
(pound)5,000 individually and of less than (pound)20,000 in aggregate
arising in the ordinary course of business neither the Company nor any
person for whose acts or defaults the Company may be contractually or
vicariously liable is involved (whether as claimant, defendant or
otherwise) in any civil, criminal, tribunal, arbitration,
administrative or other proceedings.
42.2 To the Vendor's knowledge, no civil, criminal, tribunal, arbitration,
administrative or other proceedings are pending or threatened by or
against or concern the Company and there are no facts or circumstances
likely to result in any such proceedings.
42.3 There is no outstanding or unsatisfied judgement, decree, order, award
or decision of a court, tribunal, arbitrator or governmental agency
against the Company and the Company is not party to any undertaking or
assurance given to a court, tribunal or any other person in connection
with the determination or settlement of any claim or proceedings.
46
43. DEFAULT
43.1 The Company has not manufactured, sold or supplied any product or
service which did not or does not comply in all respects with all
applicable laws, regulations, standards (including any British or
European Union standards) and customers' specifications or any
representation or contractual term expressly or impliedly made by the
Company or which is, was or will become defective or unsafe.
43.2 To the Vendor's knowledge, the Company is not in breach of any Contract
to which it is a party (including, for the avoidance of doubt, breach
of the procedures contained within the MoneyShop Franchise Agreement
with Cash Centres Limited), and no other party to any such Contract is
in breach of it. All agreements, rights, commitments, obligations,
arrangements and understandings to which the Company is a party are
valid and enforceable. The Vendor is not aware of any grounds for the
termination, rescission, avoidance or repudiation of any Contract by
the Company or any other party to any such Contract.
44. INSOLVENCY
44.1 No meeting has been convened at which a resolution will be proposed, no
petition has been presented, no order has been made and no resolution
has been passed for the winding-up of the Company or for the
appointment of any provisional liquidator. The Company has not called
any formal or informal meeting of all or any of its creditors.
44.2 No administrative receiver, receiver or receiver and manager has been
appointed of the whole or any part of the property, assets or
undertaking of any Group Member.
44.3 No administrator has been appointed in respect of any Group Member and
no steps or actions have been taken in connection with the appointment
of an administrator in respect of any Group Member.
44.4 No voluntary arrangement has been proposed or approved under Part I
Insolvency Act 1986 and no compromise or arrangement has been proposed,
agreed to or sanctioned under section 425 CA 1985 in respect of the
Company.
44.5 No distress, execution or other process has been levied on or applied
for in respect of any asset of the Company.
44.6 The Company has not stopped or suspended the payment of its debts or
received a written demand pursuant to section 123(1)(a) Insolvency Xxx
0000 and the Company
47
is not insolvent or unable to pay its debts within the meaning of
section 123 Insolvency Xxx 0000.
44.7 No disqualification order has at any time been made pursuant to the
provisions of the Company Directors Disqualification Xxx 0000 against
any former or current officer of the Company.
44.8 Neither the Company nor any of its directors has consulted a person
qualified to act as an insolvency practitioner under Part XIII of the
Insolvency Xxx 0000 with a view to minimising the potential loss to the
Company's creditors or otherwise in relation to any financial
difficulty of the Company.
44.9 The Company has not been a party to any transaction at an undervalue as
defined in section 238 of the Insolvency Xxx 0000 nor has it given nor
received any preference as defined in section 239 of the Insolvency Xxx
0000, in either case within the period of 2 years ending on the date of
this Agreement.
44.10 To the Vendor's knowledge, there are no facts in existence which are
likely to lead to any of the events or circumstances referred to in
this paragraph.
45. EFFECTS OF THE AGREEMENT
45.1 The execution of this Agreement and the observance and performance of
its provisions will not and is not likely to:
45.1.1 result in a breach of any Contract, law, regulation, order,
judgement, injunction, undertaking, decree or similar
imposition to or by which the Company is party or bound, or
entitle any person to terminate or avoid any Contract to which
the Company is party, or have any material effect on any such
Contract;
45.1.2 result in the loss or impairment of or any default under any
licence, authorisation or consent required by the Company for
the purposes of its business;
45.1.3 result in the creation, imposition, crystallisation or
enforcement of any Encumbrance whatsoever on any of the assets
of the Company;
45.1.4 result in any present or future indebtedness of the Company
becoming due and payable, or capable of being declared due and
payable, prior to its stated maturity date or in any financial
facility of the Company being withdrawn; or
48
45.1.5 adversely affect the Company's relationships with customers,
suppliers and employees.
There is no Contract to which the Company is party which depends on the
continuation of the connection (whether as shareholder or officer of
the Company or otherwise) of any person with the Company.
49
SCHEDULE 4
TAXATION
PART 1 - INTERPRETATION
46. INTERPRETATION
In this SCHEDULE 4:
46.1 the following expressions have the following meanings unless inconsistent
with the context:
"ACCOUNTS RELIEF" (g) any Relief which was treated as an
asset of the Company in the
Completion Accounts; and
(h) any Relief which was taken into
account in computing (and so
reducing or eliminating) any
provision for deferred tax which
appears in the Completion Accounts
or which would have appeared in the
Completion Accounts but for the
presumed availability of such Relief
"THE AUDITORS" the auditors for the time being of the
Company
"CAA" Capital Allowances Act 2001
"DISPUTE" any dispute, appeal, negotiations or other
proceedings in connection with a Tax Claim
"EVENT" any event, fact or circumstance whatsoever
including but not limited to:
(i) any transaction, action or omission
(whether or not the
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Company is party to it);
(j) the earning, receipt or accrual for
any Taxation purpose of any income,
profits or gains;
(k) the incurring for any Taxation
purpose of any loss or expenditure;
(l) the declaration, payment or making
of any dividend or other
distribution;
(m) the sale and purchase of the Shares
pursuant to this Agreement; and
(n) Completion
"FA" Finance Act
"FUTURE RELIEF" any Relief which arises wholly or mainly as
a result of any Event which has occurred or
occurs after Completion
"IHTA" Inheritance Tax Xxx 0000
"ITEPA" Income Tax (Earnings and Xxxxxxxx) Xxx 0000
"LIABILITY TO TAXATION" (o) any liability of the Company to make
an actual payment of Taxation
(whether or not the Company is
primarily so liable and whether or
not the Company has any right of
recovery against any other person);
and
(p) the use by the Company (in whole or
in part) of any Future Relief or
Accounts Relief to reduce or
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eliminate any liability of the
Company to make an actual payment of
Taxation (whether or not the Company
is primarily so liable and whether
or not the Company has any right of
recovery against any other person)
in respect of which the Vendor would
otherwise have been liable under
PARAGRAPH 2; and
(q) the loss by the Company (in whole or
in part) of any Accounts Relief
"PURCHASER GROUP MEMBER" Any company which is at any time is or has
been:-
(r) a holding company of the Purchaser;
(s) a subsidiary or subsidiary
undertaking of the Purchaser; or
(t) a subsidiary or subsidiary
undertaking of any holding company
of the Purchaser
"RELEVANT TAX CLAIM" any claim against the Vendor in respect of a
Liability to Taxation under paragraph 2
"RELIEF" (u) any relief, allowance, exemption,
set-off, deduction or credit
available from, against or in
relation to Taxation or in the
computation for any Taxation purpose
of income, profits or gains; and
(v) any right to a repayment of Taxation
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"RESTRICTED STOCK UNIT AWARD any agreement entered into by the Vendor
AGREEMENT" with any employee of the Company under which
awards of restricted stock units or other
securities are granted
"SAVING" the reduction or elimination of any
liability of the Company to make an actual
payment of corporation tax in respect of
which the Vendor would not have been liable
under PARAGRAPH 2, by the use of any Relief
arising wholly as a result of a Liability to
Taxation in respect of which the Vendor has
made a payment under PARAGRAPH 2
"TAXATION" (w) any tax, duty, impost or levy, past
or present, of the United Kingdom or
elsewhere, whether governmental,
state, provincial, local
governmental or municipal, including
income tax (including income tax
required to be deducted or withheld
from or accounted for in respect of
any payment under Part 11 ITEPA or
otherwise), corporation tax, ACT,
capital gains tax, inheritance tax,
VAT, customs and other import or
export duties, rates, stamp duty,
stamp duty land tax, stamp duty
reserve tax, national insurance and
social security contributions; and
(x) any fine, penalty, surcharge,
interest or other imposition
relating to any tax, duty, impost or
levy mentioned in PARAGRAPH (a) of
this definition (including any
interest or penalty in respect of
the underpayment of instalments
under the Corporation Tax
53
(Instalment Payments) Regulations
1998) or to any account, record,
form, return or computation required
to be kept, preserved, maintained or
submitted to any person for the
purposes of any such tax, duty,
impost or levy
"TAXATION AUTHORITY" any authority, whether of the United Kingdom
or elsewhere, competent to impose, assess or
collect Taxation, including but not limited
to the Board of Inland Revenue and the
Commissioners of Customs and Excise
"TAXATION STATUTE" any statute (and all regulations and other
documents having the force of law under such
statute) published, enacted, issued or
coming into force on or before the date of
this Agreement relating to Taxation
"TAX CLAIM" any notice, demand, assessment, letter or
other document issued, or action taken, by
or on behalf of any Taxation Authority and
the submission of any Taxation form, return
or computation from which, in either case,
it appears to the Purchaser that the Company
is or may be subject to a Liability to
Taxation or other liability in respect of
which the Vendor is or may be liable under
PARAGRAPH 2
"TCGA" Taxation of Chargeable Gains Xxx 0000
"TMA" Taxes Management Xxx 0000
"VAT" value added tax
"VATA" Value Added Tax Xxx 0000
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46.2 references to Events include Events which are deemed to have occurred
for any Taxation purpose and references to income, profits or gains
earned, received or accrued for any Taxation purpose include income,
profits or gains which are deemed to have been earned, received or
accrued for any Taxation purpose;
46.3 references to the loss of a Relief include the disallowance of a Relief
and the failure to obtain a Relief (whether as a result of the
surrender of the Relief to another company or otherwise);
46.4 any stamp duty which is charged on any document, or in the case of a
document which is outside the United Kingdom any stamp duty which would
be charged on the document if it were brought into the United Kingdom,
which is necessary to establish the title of the Company to any asset
or in the enforcement or production of which the Company is interested,
and any interest, fine or penalty relating to such stamp duty, will be
deemed to be a liability of the Company to make an actual payment of
Taxation.
PART 2 - TAX COVENANT
47. COVENANT
47.1 Subject to the provisions of this PART 2 of this SCHEDULE 4, the Vendor
covenants with the Purchaser to pay to the Purchaser an amount equal to
the amount of:
47.1.1 any Liability to Taxation which has arisen or arises as a
result of or in connection with any Event which occurred on or
before Completion, whether or not such Liability to Taxation
has been discharged on or before Completion; and
47.1.2 any Liability to Taxation which arises on, before or after
Completion as a result of the non payment of Taxation by the
Vendor or any person (other than the Company) which is or has
been connected for any Taxation purpose with the Vendor and
for which that person is primarily liable;
47.1.3 any Liability to Taxation which arises as a result of any
Event which occurs after Completion pursuant to a legally
binding obligation (whether or not conditional) entered into
by the Company on or before Completion otherwise than in the
ordinary course of business of the Company (but only to the
extent that such Liability to Taxation arises in respect of
income profits or gains which are deemed to have been earned,
received or accrued
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for Tax purposes (as opposed to any actual) income, profits or
gains earned, received or accrued for Tax purposes);
47.1.4 any Liability to Taxation which arises as a result of, in
respect of or by reference to or the disallowance or denial of
any relief, allowance or deduction claimed under Schedule 29
of Finance Xxx 0000 in respect of goodwill for the accounting
period ended on 31 December 2002;
47.1.5 any Liability to Taxation (including but not limited to PAYE,
employers and employees NICs and interest and penalties
thereon) which arises as a result of, in respect of or by
reference to any payments made by the Company on or before
Completion for the services of a security consultant provided
through the personal service company of such consultant; and
47.1.6 any reasonable costs, fees or expenses (including legal costs
on a full indemnity basis) properly incurred by the Company or
the Purchaser in connection with any Liability to Taxation or
other liability in respect of which the Vendor is liable under
this PART 2 of this SCHEDULE 4 or successfully taking any
action (including but not limited to legal proceedings) under
this Schedule 4.
47.2 The Vendor covenants with the Purchaser to pay to the Purchaser an
amount equal to the amount of any Liability to Taxation (including but
not limited to any income tax, employer's and employee's NICs and/or
their overseas equivalents for which the Company is liable under the
PAYE system or otherwise) which arises as a result of, in respect of,
or by reference to the grant, exercise, exchange or cancellation of any
share options where such options were granted to any employee of the
Company pursuant to any Restricted Stock Unit Award Agreement, at any
time on or before Completion.
48. QUANTIFICATION
For the purposes of PARAGRAPH 2 the amount of a Liability to Taxation
will be determined as follows:
48.1 the amount of a Liability to Taxation falling within PARAGRAPH (a) of
the definition of that expression in PARAGRAPH 1.1 will be the amount
of the actual payment of Taxation which the Company is liable to make;
56
48.2 the amount of a Liability to Taxation falling within PARAGRAPH (b) of
the definition of that expression in PARAGRAPH 1.1 will be the amount
of Taxation saved by the Company as a result of the use of the Future
Relief; and
48.3 the amount of a Liability to Taxation falling within PARAGRAPH (c) of
the definition of that expression in PARAGRAPH 1.1 will be:
48.3.1 the amount of Taxation which would have been saved by the
Company but for the loss of the Accounts Relief on the basis
of the rates of Taxation current at the date of the loss,
assuming for this purpose that the Company had sufficient
profits or was otherwise in a position actually to use the
Accounts Relief; or
48.3.2 if the Accounts Relief lost was a right to a repayment of
Taxation, the amount of the repayment of Taxation so lost.
49. EXCLUSIONS
49.1 The Vendor will not be liable under PARAGRAPH 2.1 or Part 3 of this
Schedule 4 in respect of a Liability to Taxation or other liability of
the Company to the extent to which:
49.1.1 such Liability to Taxation or other liability was satisfied or
discharged on or before Completion and the discharge of such
Liability to Taxation or other liability was reflected in the
Completion Accounts; or
49.1.2 specific provision was made in the Completion Accounts for
such Liability to Taxation or other liability; or
49.1.3 payment has already been made in respect of such Liability to
Taxation or other liability under this PART 2 or PART 3 of
this SCHEDULE 4; or
49.1.4 such Liability to Taxation or other liability would not have
arisen but for the making, changing, or coming into force of
any legislation (including but not limited to an increase in
rates of Taxation) or a change in the interpretation,
administration, or application by any relevant court or by any
Taxation Authority or in the published practice of any
Taxation Authority first enacted or announced after
Completion; or the withdrawal of any extra-statutory
concession after Completion with retrospective effect;
49.1.5 such Liability to Taxation would not have arisen or would have
been reduced or eliminated but for a change after Completion
in the accounting
57
policies or practices of the Purchaser or the Company (except
where such change is required to remedy any failure prior to
Completion of the Company to comply with United Kingdom
generally accepted accounting principles) or in the length of
any accounting period of the Company;
49.1.6 any Relief (other than a Future Relief or an Accounts Relief)
is available to, and can be used by, the Company to set
against, reduce or eliminate the Liability to Taxation such
that the Company has or will have no actual liability to make
a payment to a Taxation Authority in respect of the Taxation
to the extent of the use of the Relief;
49.1.7 such Liability to Taxation would not have arisen or would have
been reduced or eliminated but for the failure or omission
after Completion of the Purchaser or of the Company to claim
any Relief (other than Future Relief) where written notice of
the need to claim such Relief was given to the Purchaser by
the Vendor within 30 Business Days following Completion or, if
later, at least 30 Business Days prior to the expiry of any
time limit for the claiming of the relevant Relief;
49.1.8 such Liability to Taxation arises or is increased as a result
of the disclaimer by the Purchaser or the Company after
Completion of any Relief claimed by the Company before
Completion, and which was taken into account in the Completion
Accounts;
49.1.9 such Liability to Taxation or other liability would not have
arisen but for a voluntary act, transaction or omission of the
Company or the Purchaser after Completion:
49.1.9.1 otherwise than pursuant to a legally binding
obligation entered into by the Company on or before
Completion or imposed on the Company by any
legislation announced before Completion whether
coming into force before, on or after Completion; or
49.1.9.2 which the Purchaser was aware or ought reasonably to
have been aware would give rise to the Liability to
Taxation or other liability in question; or
49.1.9.3 otherwise than in the ordinary course of business of
the Company, or
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49.1.9.4 otherwise than at the written request of the Vendor
whether pursuant to this Agreement or otherwise.
49.2 The provisions of PARAGRAPHS 4.1.1, 4.1.2, 4.1.3 and 4.1.6 under this
PART 2 of this SCHEDULE 4 shall apply to limit the liability of the
Vendor under PARAGRAPH 2.2 of this SCHEDULE 4 in respect of a Liability
to Taxation of the Company. In addition, the Vendor will not be liable
under PARAGRAPH 2.2 of this SCHEDULE 4 in respect of a Liability to
Taxation of the Company to the extent that the Company or the Purchaser
has recovered from any person (including any officer or employee or
former officer or employee of the Company but excluding the Purchaser
and any Purchaser Group Member) any sum in respect of such Liability to
Taxation or to the extent that any corporation tax deduction is
available to the Company (except to the extent that such corporation
tax deduction is taken into account in preparing the Completion
Accounts) in respect of the grant or exercise of restricted stock units
under the Restricted Stock Unit Award Agreements or in respect of the
Liability to Taxation arising therefrom.
49.3 The Vendor will not be liable for any Relevant Tax Claim unless the
amount of the liability in respect of that Relevant Tax Claim or the
aggregate amount of the liability in respect of a number of Relevant
Tax Claims relating to the same matter exceeds (pound)5,000 AND the
amount of the liability in respect of that Relevant Tax Claim or
Relevant Tax Claims when aggregated with the amount of the liability in
respect of all other Relevant Tax claims exceeds (pound)50,000 (in
which event the Vendor will be liable for the whole amount of such
Relevant Claims and not merely the excess).
49.4 The provisions of clause 6.2 (financial cap) of the Agreement shall
apply to any liability of the Vendor under PARAGRAPH 2 of this SCHEDULE
4.
49.5 The liability of the Vendor under this PART 2 of SCHEDULE 4 shall cease
seven years after Completion except in respect of matters which have
been the subject of a claim within PARAGRAPH 7 of this SCHEDULE 4
unless the claim in question has arisen by reason of fraud, wilful
concealment, or dishonesty on the part of the Vendor or, prior to the
Completion date, on the part of the Company in which event there shall
be no contractual limit on the time period within which such claim may
be brought.
50. DEDUCTIONS FROM PAYMENTS
50.1 Except as required by law all payments by the Vendor under this PART 2
of this SCHEDULE 4 will be made free and clear of all deductions and
withholdings in respect of Taxation.
59
50.2 If any deduction or withholding is required by law to be made from any
payment by the Vendor under this PART 2 of this SCHEDULE 4 or if
(ignoring any available Relief) the Purchaser is subject to Taxation in
respect of any payment by the Vendor under this PART 2 of this SCHEDULE
4, the Vendor covenants with the Purchaser to pay to the Purchaser such
additional amount as is necessary to ensure that the net amount
received and retained by the Purchaser (after taking account of such
deduction or withholding or Taxation) is equal to the amount which it
would have received and retained had the payment in question not been
subject to the deduction or withholding or Taxation.
50.3 PARAGRAPHS 5.1 AND 5. 2 shall not apply to the extent that the
deduction or withholding would not have arisen but for the assignment
by the Purchaser of any of its rights under this Schedule.
51. DUE DATE FOR PAYMENT
51.1 The due date for the making of a payment by the Vendor under this PART
2 of this SCHEDULE 4 will be:
51.1.1 the date falling 5 Business Days after the Purchaser has
served notice on the Vendor demanding such payment; or
51.1.2 in any case involving a liability of the Company to make an
actual payment (whether or not a payment of Taxation), the
later of the date mentioned in PARAGRAPH 6.1.1 and the date
falling 5 clear Business Days before the last date upon which
the payment is required to be made to the person entitled to
the payment; or
51.1.3 in any case involving the loss of an Accounts Relief other
than the right to repayment of Taxation, the later of the date
mentioned in PARAGRAPH 6.1.1 and the date falling 5 clear
Business Days before the date on which the payment of Taxation
is or would be required to be made in respect of the
accounting period in which the Accounts Relief is lost.
51.2 If any payment required to be made by the Vendor under this PART 2 of
this SCHEDULE 4 is not made by the due date, ascertained in accordance
with PARAGRAPH 6.1, then such payment will bear interest in accordance
with the terms of CLAUSE 10 of this Agreement.
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52. CLAIMS PROCEDURE
52.1 If the Purchaser or the Company becomes aware of any matter which may
give rise to a Tax Claim it will as soon as reasonably practicable, and
in any event not more than 15 Business Days after the Purchaser becomes
so aware of that Tax Claim give notice to the Vendor (giving details,
to the extent available, of such Tax Claim, the due date for any
payment, and time limits for any appeal), provided that the giving of
such notice will not be a condition precedent to the liability of the
Vendor under PARAGRAPH 2.
52.2 Subject to PARAGRAPH 7.5 and provided that the Vendor indemnifies and
secures the Company, the Purchaser and all other Purchaser Group
Members to the reasonable satisfaction of the Purchaser against all
reasonable losses, costs, damages and expenses (including interest or
surcharge on overdue Taxation) which may be incurred thereby, the
Purchaser will procure that the Company, at the Vendor's cost and
expense, takes such action and gives such information and assistance in
connection with its Taxation affairs as the Vendor may reasonably and
promptly request to dispute, appeal against, settle or compromise any
Tax Claim, including applying to postpone (so far as legally possible)
the payment of any Taxation, but not including allowing the Vendor or
its advisors to undertake the conduct of the Dispute.
52.3 For the purposes of PARAGRAPH 7.2
52.3.1 the Purchaser shall, or shall procure that the Company shall,
promptly submit to the Vendor all material documents and
correspondence relating to the Tax Claim which it is proposed
be submitted to the relevant Taxation Authority in draft form
to the Vendor and the Vendor shall be afforded a reasonable
opportunity to comment thereon;
52.3.2 the appointment of professional advisers by the Company in
relation to the Tax Claim shall be subject to the approval of
the Vendor (such approval not to be unreasonably withheld or
delayed);
52.3.3 the Purchaser shall, or shall procure that the Company shall,
promptly incorporate all reasonable comments and suggestions
made by the Vendor and the Vendor's duly authorised agent and
promptly submit the relevant final documents/correspondence to
the relevant Taxation Authority; and
61
52.3.4 the Purchaser shall, or shall procure that the Company shall,
promptly deliver to the Vendor copies of all relevant
correspondence sent to or received from the relevant Tax
Authority.
52.4 Subject to PARAGRAPHS 7.5 AND 7.6, and to compliance by the Vendor with
PARAGRAPH 7.2 in relation to any Dispute, the Purchaser will not, and
will procure that the Company will not, without the prior written
consent of the Vendor, such consent not to be unreasonably withheld or
delayed:
52.4.1 transmit any communication (whether written or otherwise) to
any Taxation Authority;
52.4.2 agree, settle or compromise the relevant Tax Claim; or
52.4.3 agree any matter which is likely to affect the amount of the
relevant Tax Claim or any future Liability to Taxation.
52.5 The Purchaser will not be required to take or procure that the Company
will take any action mentioned in PARAGRAPH 7.2:
52.5.1 which it reasonably considers to be materially prejudicial to
the business or Taxation affairs of the Company or the
Purchaser or any other Purchaser Group Member; or
52.5.2 which involves contesting a Tax Claim beyond the first
appellate body (excluding the Taxation Authority which has
made the Tax Claim) in the jurisdiction concerned unless the
Vendor obtains (at the Vendor's cost and expense) the opinion
of Tax Counsel of at least 5 years' call that it is reasonable
in all circumstances to make such an appeal.
52.6 If the Vendor fails within 10 Business Days of the Purchaser giving
notice requiring the Vendor to do so) to inform the Purchaser of any
action which the Vendor wishes the Purchaser to procure the Company to
take under PARAGRAPH 7.2, the Purchaser will be entitled to procure
that the Company settles or compromises any Tax Claim on such terms as
it determines in its absolute discretion.
53. TIME LIMIT
53.1 The Vendor will not be liable under PARAGRAPH 2 in respect of a
Liability to Taxation or other liability of the Company unless within 7
years after Completion the Purchaser has given notice to the Vendor of
any Tax Claim whatsoever relating to
62
such Liability to Taxation or other liability, or of any Event which
may give rise to such a Tax Claim.
53.2 The time limit in PARAGRAPH 8.1 will not apply in any case involving
dishonest or fraudulent conduct on the part of the Vendor, any company
which has at any time been a member of the same group (as defined for
any Taxation purpose) as the Vendor or any person acting on behalf any
of the foregoing companies.
54. SAVINGS
54.1 If (at the Vendor's request and expense) the Auditors determine that
the Company has obtained a Saving, the Purchaser will offset such
Saving against any outstanding Claim of which it has given notification
to the Vendor.
54.2 To the extent that no Claim is outstanding the Purchaser will as soon
as reasonably practicable thereafter (and in any event within 10
Business Days of such determination by the Auditors) repay to the
Vendor the lesser of:
54.2.1 the amount of the Saving (as determined by the Auditors); and
54.2.2 the amount paid by the Vendor under PARAGRAPH 2 in respect of
the Liability to Taxation which gave rise to the Saving less
any part of that amount previously repaid to the Vendor under
any provision of this Agreement or otherwise;
54.3 The Company will be entitled to use in priority to any Relief which
gives rise to a Saving any other Relief available to it (including by
way of surrender by another company to it) to reduce or eliminate any
liability to make an actual payment of corporation tax but, subject
thereto, shall use its reasonable endeavours to use any Relief which
gives rise to a Saving as soon as reasonably practicable unless to do
so would be materially prejudicial to the Taxation affairs of the
Company or the Purchaser.
54.4 The Company will not obtain a Saving until the last date upon which it
would have been obliged to make the actual payment of corporation tax
which has been reduced or eliminated in order to avoid incurring
interest thereon.
54.5 In determining whether the Company has obtained a Saving, the Auditors
will act as experts and not as arbitrators and their determination will
(in the absence of manifest error) be conclusive and binding on the
parties.
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55. RECOVERY FROM OTHER PERSONS
55.1 If the Company recovers from any other person (including any Taxation
Authority but excluding the Purchaser, any other Purchaser Group Member
and any officer or employee of any such company) any amount which is
referable to a Liability to Taxation or other liability of the Company
in respect of which the Vendor has made a payment under PARAGRAPH 2,
the Purchaser will repay to the Vendor within 10 Business Days of the
receipt thereof the lesser of:
55.1.1 the amount so recovered (less any reasonable losses, costs,
damages and expenses incurred by the Company, the Purchaser or
any other member of the same group of companies as the
Purchaser as a result of the recovery of that amount); and
55.1.2 the amount paid by the Vendor under PARAGRAPH 2 in respect of
the Liability to Taxation or other liability in question less
any part of such amount previously repaid to the Vendor under
any provision of this Agreement or otherwise.
55.2 If the Purchaser becomes aware that the Company is entitled to recover
any amount mentioned in PARAGRAPH 10.1, the Purchaser will as soon as
reasonably practicable give written notice of that fact to the Vendor
and provided that the Vendor indemnifies and secures the Company, the
Purchaser and all other Purchaser Group Members to the reasonable
satisfaction of the Purchaser against all reasonable losses, costs,
damages and expenses which may be incurred thereby, the Purchaser will
procure that the Company, at the Vendor's cost and expense, takes such
action as the Vendor may reasonably and promptly request to effect such
recovery.
55.3 The action which the Vendor may request the Company to take under
PARAGRAPH 10.2 does not include:
55.3.1 any action which the Purchaser reasonably considers to be
materially prejudicial to the business or Taxation affairs of
the Company, the Purchaser or any Purchaser Group Member; or
55.3.2 allowing the Vendor to undertake the conduct of any action
necessary to effect recovery of the amount in question.
56. CORPORATION TAX RETURNS
56.1 Subject to this PARAGRAPH 11, the Purchaser shall have exclusive
conduct of all Taxation affairs of the Company after Completion.
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56.2 The Purchaser shall procure that the Company keeps the Vendor fully
informed of its Taxation affairs in respect of any accounting period
ended on or prior to Completion for which final agreement with the
relevant Taxation Authority of the amount of Taxation due from the
Company has not been reached and shall not submit any correspondence or
submit or agree any return or computation for any such period to any
Taxation Authority without giving the Vendor a reasonable opportunity
to make representations thereon and without the prior written consent
of the Vendor (such consent not to be unreasonably withheld or
delayed).
56.3 The Purchaser shall procure that the Company does not amend or withdraw
any return or computation or any claim, election, surrender or consent
made by the Company in respect of its accounting periods ended on or
before Completion without the prior written consent of the Vendor (such
consent not to be unreasonably withheld or delayed).
56.4 The Purchaser shall provide the Vendor with a copy of:
56.4.1 the Company's Tax returns and Tax computation for the
accounting period ended on 31 December 2003 and the accounting
period during which Completion occurs;
56.4.2 the Company's statement of account or receipt from the Inland
Revenue or other Taxation Authority confirming the final
amount of Tax paid for the accounting period ended on 31
December 2003 and the accounting period during which
Completion occurs; and
56.4.3 the Company's statutory accounts for the accounting period
ended on 31 December 2003 and the accounting period during
which Completion occurs.
56.5 The Purchaser agrees that it will not make a section 338(g) election
for the Company and will procure that the Company will not, until after
31 December 2004:
56.5.1 engage in any transaction that will result in a "dividend"
being distributed from the Company (for the avoidance of
doubt, nothing in this PARAGRAPH 11.5.1 shall prevent the
company from making a loan to the Purchaser at any time after
completion, so long as the loan is evidenced by a formal note,
has a set term and bears an arm's length rate of interest); or
56.5.2 change the Company's financial reporting year.
For the avoidance of doubt, the terms "section 338(g) election" is as
defined in the United States Internal Revenue Code of 1986, as amended.
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57. COUNTER COVENANT
57.1 The Purchaser hereby covenants with the Vendor to pay or to procure
that the relevant Purchaser Group Member pays to the Vendor by way of
adjustment to the Purchase Price, an amount equal to;
57.1.1 any Tax Liability arising after Completion for which the
Company or a Purchaser Group Member is liable but for which
the Vendor becomes liable as a result of the failure by the
Company or the relevant Purchaser Group Member to discharge
it; and
57.1.2 all reasonable costs and expenses properly incurred by the
Vendor in connection with any Tax Liability in respect of
which the Vendor can bring a claim under this paragraph 12 or
where the Vendor successfully takes any action to enforce
payment under this paragraph 12 in connection with the taking
of such action.
57.2 The provisions of paragraph 6 (due date for payment) and paragraph 7
(Claims procedure) shall apply to this paragraph 12 as if the same were
set out herein but replacing references to the Vendor with the
Purchaser (and vice versa) and making any other necessary
modifications.
57.3 The covenants contained in paragraph 12 shall not apply to a Tax
Liability to the extent that the Vendor is liable to make a payment
(and has not made such payment) in respect of that Tax Liability under
paragraph 2 of this Schedule 4.
58. GENERAL
All payments by the Vendor under this PART 2 of this SCHEDULE 4 will be
treated as repayments by the Vendor of the Consideration paid for the
Shares pursuant to this Agreement, provided that this PARAGRAPH 13 will
not operate in any way to limit the liability of the Vendor under this
PART 2 of this SCHEDULE 4.
PART 3 - TAX WARRANTIES
59. RETURNS, RECORDS, DISPUTES AND CLEARANCES
59.1 All notices, returns, computations, registrations, information and
payments which should have been made or supplied by the Company for any
Taxation purpose have been made within the requisite periods and are
up-to-date, correct and on a proper basis and none of them is, or so
far as the Vendor is aware is likely to be, the subject of any dispute
with any Taxation Authority.
66
59.2 The Company is not involved in any dispute with any Taxation Authority
and within the last three years has not been the subject of any
investigation or enquiry by any Taxation Authority (other than routine
questions), no Taxation Authority has indicated that it intends to
investigate the Taxation affairs of the Company and so far as the
Vendor is aware there are no circumstances which are likely to give
rise to any such investigation.
59.3 The Company has punctually supplied all information requested by any
Taxation Authority for any Taxation purpose.
59.4 All consents and clearances obtained by the Company from any Taxation
Authority remain valid and effective and any transaction for which any
such consent or clearance has been obtained has been carried into
effect (if at all) only in accordance with the terms of the relevant
consent or clearance, including the terms of the application for the
relevant consent or clearance.
59.5 The Company has not negotiated with or been granted by any Taxation
Authority any (in each case, material) dispensations, concessions,
arrangements and agreements (whether formal or informal) which are not
in accordance with the strict terms of the legislation and no action
has been taken by or on behalf of the Company which has had or is
likely to have the result of altering, prejudicing or in any way
disturbing any such concession, arrangement or agreement.
60. PENALTIES AND INTEREST
60.1 The Company has not within the period of 3 years ending on the date of
this Agreement paid, and is not liable to pay, any fine, penalty,
charge, surcharge or interest charged by virtue of any of the
provisions of any Taxation Statute nor are there any circumstances
which are likely to cause the Company to become liable to pay any fine,
penalty, charge, surcharge or interest.
61. TAXATION CLAIMS, LIABILITIES AND RELIEF
61.1 The Company has sufficient records to fulfil its obligations under all
Taxation Statutes and to enable it to make and complete returns for
Taxation purposes and to calculate the liability to Taxation or relief
arising:
61.1.1 in respect of or by reference to any Event on or before
Completion; or
61.1.2 on the disposal of any asset owned by it at Completion.
67
61.2 The Company has duly and properly made all Taxation claims,
disclaimers, elections and surrenders and given all notices and
consents and done all other things in respect of Taxation the making,
giving or doing of which was assumed to have been made for the purposes
of the Accounts, all such claims, disclaimers, elections, surrenders,
notices, consents and other things have been accepted as valid by the
relevant Taxation Authorities and none has been revoked or otherwise
withdrawn.
61.3 The Company is not, and will not become, liable to pay, or make
reimbursement or indemnity in respect of, any Taxation (or amounts
corresponding to any Taxation) payable by or chargeable on or
attributable to any other person, whether in consequence of the failure
by that person to discharge that Taxation within any specified period
or otherwise, where such Taxation relates to a profit, income or gain,
transaction, event, omission or circumstance arising, occurring or
deemed to arise or occur (whether wholly or partly) on or prior to
Completion.
62. DISTRIBUTIONS AND PAYMENTS
62.1 The Company has deducted and properly accounted to the appropriate
Taxation Authority for all amounts which it has been obliged to deduct
in respect of Taxation (whether under the PAYE system or otherwise),
has complied fully with all reporting requirements relating to all such
amounts and has (where required by the applicable Taxation Statute)
duly provided certificates of deduction of tax to the recipients of
payments from which deductions have been made.
62.2 The Company has not made or received any exempt distribution within the
meaning of section 213 ICTA, and has not at any time been a relevant
company in relation to an exempt distribution for the purposes of that
section or concerned in an exempt distribution for the purposes of
section 214 ICTA.
62.3 No rents, interest, annual payments, payments to a present or former
director or employee, or other sums paid or payable by the Company
since the Accounting Date, or which the Company is under an obligation
to pay, will be wholly or partially disallowable as deductions or
charges in computing the profits of the Company for the purposes of
corporation tax.
63. EMPLOYEE BENEFITS
63.1 The Company has properly operated the Pay As You Earn system ("PAYE"),
by making deductions, as required by the applicable Taxation Statute,
from all payments made (including notional payments), or treated as
made, to its directors, employees or officers or former directors,
employees or officers or any persons required to be
68
treated as such, and accounting to the Inland Revenue for all Taxation
so deducted and for all Taxation chargeable on the Company on benefits
provided for its directors, employees or officers, or former directors,
employees or officers.
63.2 No liability to national insurance contributions or obligation to
account for income tax under the PAYE system could fall on the Company
as a result of a chargeable event (within the meaning of Part 7 ITEPA)
before, at or after Completion in respect of securities and interests
in securities made available or securities options granted to an
employee or director prior to Completion.
63.3 The Disclosure Letter contains full details of all share incentive
schemes and profit sharing schemes and employee benefit trusts
established by the Company whether approved by the Inland Revenue or
not and the Company has complied with all statutory requirements in
respect of such schemes and trusts.
64. CLOSE COMPANIES
The Company is not and has never been, a close company as defined in
section 414 ICTA.
65. GROUP TRANSACTIONS
65.1 The Company is not and has not at any time been
65.1.1 a member of a group of companies as defined in section 170
TCGA with any other UK resident company; or
65.1.2 an associated company of any other UK resident company as
defined in section 774(4) ICTA; or
65.1.3 a member of a group or consortium with any other UK resident
company within the meaning of section 413 ICTA; or
65.1.4 a party to any such reconstruction as is described in section
343 ICTA.
66. TAX AVOIDANCE
The Company has not entered into or been a party to any scheme,
arrangement or transaction designed wholly or mainly or containing
steps or stages having no commercial purpose and designed wholly or
mainly for the purpose of avoiding or deferring Taxation or reducing a
liability to Taxation or amounts to be accounted for under the PAYE
system.
69
67. BASE VALUES AND ACQUISITION COSTS
67.1 If each of the capital assets of the Company owned at the Accounting
Date was disposed of for a consideration equal to the book value of
that asset in, or adopted for the purpose of, the Accounts, or in the
case of assets acquired since the Accounting Date, equal to the
consideration given on acquisition, no liability to corporation tax on
chargeable gains under the CAA would arise (and for this purpose there
will be disregarded any relief or allowance available to the Company
other than amounts falling to be deducted from the consideration
receivable under section 38 TCGA).
67.2 The Company does not own any wasting asset within the meaning of
section 44 TCGA which does not qualify in full for capital allowances
as described in section 47(1) TCGA.
68. CAPITAL GAINS
The Company has not at any time:
68.1 made a claim under sections 152 to 158 (inclusive) or 175 or 247 TCGA
which affects the amount of the chargeable gain or allowable loss which
would, but for such claim, arise or have arisen upon a disposal of any
asset;
68.2 been a party to, involved in, or connected with any disposal of assets
within the meaning of section 29 TCGA (value shifting) or any scheme or
arrangement such as are mentioned in section 30 TCGA (tax-free
benefits);
68.3 acquired or disposed of any asset or entered into any transaction or
arrangement whatsoever otherwise than by way of bargain at arm's length
or in respect of which there may be substituted for the actual
consideration given or received by the Company a different
consideration for any Taxation purpose;
68.4 acquired any policy of assurance or contract for a deferred annuity or
interest in any such policy or contract in circumstances such that a
chargeable gain could arise on disposal under section 210 TCGA;
68.5 transferred a trade carried on by it outside the United Kingdom through
a branch or agency in circumstances such that a chargeable gain could
be deemed to arise at a date after such transfer under section 140
TCGA; or
68.6 made any claim or election under section 161(3) TCGA (appropriation of
asset to trading stock).
70
69. CAPITAL ALLOWANCES
69.1 All capital expenditure incurred by the Company since the Accounting
Date and all capital expenditure which may be incurred by the Company
under any existing contract has qualified or will be capable of
qualifying for capital allowances.
69.2 The Company is not in dispute with any person as to the availability of
allowances under Chapter 14 Part 2 CAA and there are no circumstances
which are likely to give rise to such a dispute.
69.3 The Company does not own any assets which qualify or have ever
qualified for capital allowances under Part 3 CAA.
70. VAT: GENERAL
70.1 The Company:
70.1.1 is registered in the United Kingdom for VAT purposes and is
not registered or required to be registered for VAT or any
similar tax in any other jurisdiction;
70.1.2 maintains complete, correct and up-to-date business records
for the purposes of paragraph 6 of Schedule 11 of VATA and is
not in arrears with any VAT payment or return or in respect of
Intrastats or excise or customs duties, or liable to any
abnormal or non-routine payment of VAT, or any forfeiture or
penalty, or to the operation of any penal provision;
70.2 The Company:
70.2.1 has not within the period of 3 years ending on the date of
this Agreement been required by H M Customs & Excise to give
security for any reason and has not failed to comply in all
respects with all statutory requirements, orders, provisions,
directions or conditions relating to VAT;
70.2.2 has not within the 2 years ending on the date of this
Agreement been served with any penalty liability notice under
section 64 VATA or any surcharge liability notice under
section 59 VATA and has not been issued with any written
warning under section 76(2) VATA (failure to comply with a
regulatory provision);
70.2.3 has never been treated as, or applied for treatment as a
member of a group for VAT purposes under section 43 VATA and
no transaction has been
71
effected in consequence of which the Company is or may be held
liable for any VAT arising from supplies made by another
company and the Company has not been a party to any
transaction or arrangement as a result of which a direction
has been or may be given under Schedule 9A VATA
(anti-avoidance provisions for groups of companies);
70.2.4 does not have an interest in any assets to which Part XV of
the Value Added Tax Regulations 1995 (Capital Goods Scheme)
applies;
70.3 All supplies of goods and services made by the Company are taxable
supplies for the purposes of VATA, no goods or services supplied to the
Company, or goods imported by the Company, are or have been used
otherwise than for business purposes, the Company is able to obtain
credit as deductible input tax (as defined in section 24 VATA) for all
the VAT which it has incurred
70.4 The Company has not in the 3 years ending on Completion disposed of or
acquired any business or assets as a transfer of a going concern as
described in section 49 VATA or Article 5 of the Value Added Tax
(Special Provisions) Order 1995.
70.5 The Company has not received any supplies of the type described in
Schedule 5 VATA. (Services supplied were received), which would give
rise to a reverse charge under section 8 VATA.
70.6 The Company has not reclaimed input tax from HM Customs & Excise which
it will be obliged to repay under the provisions of Part XIXB Value
Added Tax Regulations 1995 (Repayment of input tax where consideration
not paid).
70.7 The Company has not received any Notices issued under Regulation 166A
of the Value Added Tax Regulations 1995 that have not been given effect
by the method laid down in Regulation 172D of those amended
Regulations.
71. VAT: PROPERTY TRANSACTIONS
71.1 The Company has not incurred any liability in respect of VAT (whether
to HM Customs and Excise or to any other person) by reason of the
provisions of paragraph 2(1) Schedule 10 VATA (Election to waive the
exemption) and there are no circumstances whereby the Company could
become so liable as a result of a person making an election under that
paragraph.
71.2 Neither the Company nor any relevant associate (within the meaning of
paragraph 3(7) Schedule 10 VATA) has made any election under paragraph
2(1) Schedule 10 VATA in respect of any land in, over or in respect of
which the
72
Company has any interest, right or licence to occupy and the Company is
not aware of any intention to make such an election.
71.3 The Company does not own the fee simple in any building or work such as
is referred to in Item 1(a) Group 1 Schedule 9 VATA the supply of which
would be standard rated.
72. STAMP DUTY AND STAMP DUTY RESERVE TAX
72.1 All documents to which the Company is a party and which are liable to
stamp duty and which confer any right upon the Company or on which the
Company may need to rely have been duly stamped and no document to
which the Company is a party and which confers any right upon the
Company or on which the Company may need to rely and which is outside
the United Kingdom would attract stamp duty if it were brought into the
United Kingdom and there is no liability to any penalty in respect of
such duty or circumstances which may give rise to such a penalty.
72.2 The Company has never incurred or otherwise been under a liability to
stamp duty reserve tax and there are no circumstances which may result
in it being so liable.
72.3 Within the 5 years ending on the date of this Agreement, the Company
has not made any claim for relief or exemption under section 42 FA
1930, section 151 FA 1995 or section 75, 76 or 77 FA 1986.
73. STAMP DUTY LAND TAX
73.1 Stamp duty land tax has been paid in full in respect of all land
transactions to which stamp duty land tax applies and in respect of
which the Company is the purchaser within the meaning of section 43(4)
FA 2003 and the Company has no liability or obligation (contingent or
otherwise) to submit a further land transaction return.
73.2 The Company has not claimed relief from stamp duty land tax under Part
1 (group relief) or Part 2 (reconstruction and acquisition relief) of
Schedule 7 FA 2003 where the Company was a purchaser in respect of a
land transaction for the purposes of FA 2003.
74. RESIDENCE AND OFFSHORE INTERESTS
74.1 The Company is and has at all times been resident only in the United
Kingdom for the purposes of all Taxation Statutes.
73
75. LOAN RELATIONSHIPS
There are no outstanding debts owed to or by the Company, or any
securities issued by the Company or which the Company owns or in which
it has an interest, which will not be repaid at Completion, other than
trade debts which fall within the exemption in section 251(1) TCGA and
which do not arise out of loan relationships of the Company for the
purposes of section 81(1) FA 1996.
76. QUARTERLY INSTALMENT PAYMENTS
The Company is obliged to pay corporation tax in quarterly instalments
under the provisions of Corporation Tax (Instalment Payments)
Regulations 1998 (SI 1998 No 3175) and section 59E TMA and has complied
in full with its obligations under such regulations.
77. TRANSFER PRICING
The Company has not undertaken, or agreed to undertake, any
transactions which are otherwise than on fully arm's length terms and
there are no circumstances which could cause any Taxation Authority to
make or require to be made any adjustment to the terms on which such
transaction is treated as taking place.
78. ACCOUNTS AND SUBSEQUENT EVENTS
The Accounts fully provide or reserve, in accordance with the accounting
policies set out in the notes included in the Accounts, for all Taxation
(including deferred tax for which the Company is or may be liable, or for which
it may be accountable, as at the Accounting Date.
74
SCHEDULE 5
COMPLETION ARRANGEMENTS
At Completion the following will take place:
1. ITEMS FOR DELIVERY
The following items will be produced and delivered by the Vendor:
SHARE TRANSFERS
1.1 An executed transfer of the Shares in favour of the Purchaser (or its
nominee(s)) together with the share certificate for the Shares (or in
the case of any lost certificate an indemnity satisfactory to the
Purchaser in relation to it).
1.2 Any waiver, consent or other document necessary to give the Purchaser
(or its nominee(s)) full legal and beneficial ownership of the Shares.
AUTHORISATIONS
1.3 A copy of a resolution of the board of directors (certified by a duly
appointed officer as true and correct) of the Company authorising the
execution of and the performance by the Company of its obligations
under each of the documents to be executed by it.
1.4 A power of attorney in the agreed terms by each registered holder of
the Shares which enables the Purchaser or its nominee to attend and
vote at general meetings of the Company.
RESIGNATIONS AND APPOINTMENTS
1.5 A letter of resignation in the agreed terms from each director of the
Company save for Xxxx Xxxxxx and Xxxx Xxxxxxx.
1.6 A letter of resignation in the agreed terms from the secretary of the
Company.
1.7 A copy of a letter to the Company from its auditors resigning from
office with effect from Completion and containing the statement
required by section 394 CA 1985, the original of the letter having been
deposited at the registered office of the relevant company.
75
COMPANY DOCUMENTATION
1.8 The certificate of incorporation, any certificate(s) of incorporation
on change of name, the common seal and the statutory books and
registers (which will be written up to but not including Completion) of
the Company.
1.9 All deeds and documents relating to the title of the Company to the
Property as listed in the index attached to the Disclosure Letter.
1.10 All cheque books in current use of the Company.
1.11 All papers, books, records, keys, credit cards and other property (if
any) of the Company which are in the possession or under the control of
the Vendor or any other person who resigns as an officer of the Company
in accordance with this Schedule.
FINANCIAL
1.12 A copy of the bank mandate of the Company and copies of bank statements
in respect of each account of the Company as at the close of business
on the last Business Day prior to Completion, together in each case
with a reconciliation statement prepared by the Vendor to show the
position at Completion (listing unpresented cheques drawn or received
by the Company and standing orders payable since the date of such bank
statements).
MISCELLANEOUS
1.13 All licences, certificates or other documents previously specified by
the Purchaser.
1.14 A deed in the agreed terms from the Vendor acknowledging that, subject
to clause 5.4, neither the Vendor nor any Associated Company has any
claim against the Company and that there is no agreement or arrangement
under which the Company has any actual, contingent or prospective
obligation to any such person.
1.15 Where any agreement or arrangement referred to in PARAGRAPH 1.14
previously existed, evidence of the release or termination of it in a
form satisfactory to the Purchaser.
76
2. CONVENING OF MEETINGS
2.1 The Vendor will procure that duly convened board meetings of the
Company are held at which:
2.1.1 the transfers referred to in PARAGRAPH 1.1 (subject to
stamping if not previously effected) are approved for
registration in the books of the Company;
2.1.2 the resignations of directors, secretary and auditors referred
to in each of PARAGRAPHS 1.5, 1.6 and 1.7 are accepted with
effect from the end of the relevant board meeting;
2.1.3 such persons as are nominated by the Purchaser as directors,
secretary and auditors of the Company are appointed with
effect from the end of the relevant board meeting;
2.1.4 all existing instructions to the bankers of the Company are
revoked and new instructions given to such bankers as the
Purchaser may nominate, in such form as the Purchaser directs;
2.1.5 the Company's execution of the employment contract and/or
letter of appointment in the agreed terms between each of Xxxx
Xxxxxx and Xxxx Xxxxxxx and the Company are approved and
authorised; and
2.1.6 the Company's execution of the TOPS Licence and the
Transitional Services Agreement in the agreed terms with the
Vendor are approved and authorised.
2.2 The Vendor will procure that a special resolution of the Company to
amend the memorandum and articles of association of the Company in the
agreed terms is passed as a written resolution.
3. CONTRACTS
3.1 The Vendor will use reasonable endeavours to procure that each of Xxxx
Xxxxxx and Xxxx Xxxxxxx will enter into contracts of employment in the
agreed terms with the Company.
3.2 The Vendor will enter into the TOPS Licence and the Transitional
Services Agreement in the agreed terms with the Company.
77
4. REPAYMENT OF MONIES OWED
The Vendor will repay, and will procure that each Associated Company
will repay, all amounts owed by the Vendor or company to the Company
whether due for payment or not.
5. PAYMENT OF CONSIDERATION
The Purchaser will pay the Provisional Consideration by electronic
funds transfer to the Vendor's Solicitors client account with National
Westminster Bank, PO Box 221, Connaught House, 00 Xxxxxxx, Xxxxxx XX0X
0XX, Sort Code 56-00-13, Account Number 00000000, Account Name: Xxxxx &
XxXxxxxx Client Account or by such other method as may be agreed
between the parties.
78
SCHEDULE 6
THE PROPERTIES
PART I - FREEHOLD PROPERTIES
TITLE NUMBER AND QUALITY OF TITLE (IF
DESCRIPTION TITLE HOLDER APPLICABLE) IF REGISTERED
----------- ------------ -------------------------
00 Xxxxxxxx Xxxx Xxxxxx, Xxxxxx, XX0 Xxxxxx & Xxxxxxxx Limited LN90791 - Title absolute
4RT
0 Xxxxxx Xxxxxx, Xxxxxxxx, XX00 0XX Xxxxxx & Xxxxxxxx Xxxxxxx XXX000000 - Title absolute
000 Xxxxxxxxx Xxxxx, Xxxxxxxxx XX0 0XX Xxxxxx & Xxxxxxxx Limited Unregistered
1 & 0 Xxxxxxxxxx Xxxxxx, Xxxxx, Xxxxxx & Xxxxxxxx Limited GLA100063
Glasgow G51 2DH
First Floor Pawnbroking Office, 4 Xxxxxx & Xxxxxxxx Limited GLA167408
Xxxxxx Xxxxxx, Xxxxxxx X00 0XX
79
PART II - LEASEHOLD PROPERTIES
TITLE NUMBER AND QUALITY
DESCRIPTION OF LEASEHOLD OF TITLE (IF APPLICABLE)
PROPERTY IF REGISTERED DATE OF LEASE PARTIES TO LEASE
-------- ------------- ------------- ----------------
Xxxxxx Xxxxx, 00 Xxxx Xxxxxx, 00/00/0000 Xxxxxx Life Linked Assurances
Barking Ltd (1)
H & T Ltd (2)
00 Xxxxx Xxxxxx, Xxxxxxxxxx 19/07/1996 Ravenseft Properties Ltd (1)
H & T Ltd (2)
00 Xxxxx Xxxxxx, Xxxxxxxxx, 23/12/2002 Xxxxxxxxx with Darwen Borough
Lancashire Council (1)
Francesco Xxxxx Xxxxxxxxxxx
(2)
97/99 Central Drive, 15/03/1989 Xx XX Xxxxxxx (1)
Blackpool, Lancashire
H & T Plc (2)
00 Xxxxxxx Xxxxxx, Xxxxxx 19/09/2002 Stylo Barratt Properties Ltd
(1)
Xpress Cash Ltd (2)
115 The Palatine, The Strand 30/11/1999 Ravenseft Properties Ltd (1)
Shopping Centre, Bootle
Xxxxxxx Xxxxxx Xxxxxxx (2)
Ground Floor, 575 Roman Road, 01/05/1996 Daejan Properties Ltd (1)
Xxxxxx, X0
H & T Ltd (2)
00 Xxxxx Xxxxxx, Xxxxxxxx 15/05/1998 Independent Ophthalmologist
Ltd (1)
H & T Ltd (2)
Ground Floor and Basement, 4 ESX146482 - Title absolute 10/05/1988 DSG Properties Plc (1)
Castle Square, Brighton
Match Menswear Ltd (2)
00 Xxxxx Xxx Xxxxxxxx, XXX000000 - Title absolute 07/11/2003 Xxxxxx Xxxx Xxxxxx and others
Edgware, Middlesex (1)
H & T Ltd (2)
58 Rushey Green Catford, 14/02/2003 Xxxx Xxxxxx Xxxxxx and Xxxxxx
Xxxxxx XX0 Xxxxxx (1)
80
H & T Ltd (2)
Ground Floor Shop and 04/05/1999 Xxxxxx Xxxxxx Xxxxxxx and
Basement, 00 Xxxxx Xxxx Xxxx, Xxxxx Xxxxxx Xxxxxxx (1)
Xxxxxx, XX0
H & T Ltd (2)
0/00 Xxxxxxxxx Xxxx, Xxxxxxx 04/02/1981 CT Xxxxxxx Ltd (1)
Junction, SW11
H & T Ltd (2)
Ground Floor, Rear Yard and 19/01/2000 Xxx Xxxxxx Nassim (1)
Shop Premises, 000 Xxxxxxx
Xxxxxx, Xxxxxx X0 H & T Ltd (2)
Unit 29, 30 and 31, In Shops, Retailer's Licence In Shops Centres Ltd (1)
Xxxxxxxxx 0, Xxxxxxx 16/09/2002
H & T Ltd (2)
00X Xxxxx Xxxxxx, Xxxxxxxx 15/06/1999 The Council of the City of
Coventry (1)
H & T Ltd (2)
Ground Floor Premises and 27/11/2003 Smartshield Ltd (1)
Shop, 299 Heathway, Dagenham
H & T Ltd (2)
00 Xxxxxxxxx Xxxx Xxxxxx, 00/00/0000 Xxxxxx Investments Ltd (1)
Xxxxxxx, Xxxxxx X0
H & T Ltd (2)
000 Xxxxxxxxxxxxx Xxxxxx, 21/08/2000 Stella Xxxx Xxxxxx (1)
Xxxxxx, West Midlands
H & T Ltd (2)
Ground Floor and Basement of 07/07/1997 Xxxxxxx Xxxxxx Xxxxxxx Xxxxx
000-000 Xxxxxxx, Xxxxxx and Xxxxxx Xxxxx (1)
H & T Ltd (2)
Xxxx 00 Xxxxxxxxx Xxxxxx 18/02/2003 Ossory Property Investments
Shopping Centre, Easterhouse, Ltd (1)
Glasgow
H & T Ltd (2)
259/261 Seven Sisters Road, 01/10/2001 Bridge Road Management Ltd (1)
Finsbury, London N4
Xxxxxxx Xxxx Organization Ltd
(2)
000 Xxxxx Xxx Xxxx, Xxxxxx, XXX000000 - Title absolute 09/12/1985 Xxxxxxx Xxxxxx Joosab (1)
Xxxxxx X00
H & T Plc (2)
81
169 High Street, Gillingham, 11/12/1996 Xxxxx Xxxxxx and Xxxxxxx
Xxxx Xxxxxx (1)
H & T Ltd (2)
Basement and First Floor 11A 29/01/1999 Sears Properties Netherlands
Bath Street, Glasgow BV (1)
H & T Ltd (2)
000 Xxxxx Xxxx, Xxxxxxx 14/09/2001 Xxxxxxxx Xxxxxx and Xxxxxx
Xxxxxx (1)
H & T Ltd (2)
Xxxx 0 Xxxxxxxx Xxxx, The Oak 06/10/2003 Oak Mall Greenock Ltd (1)
Mall, Greenock
H & T Ltd (2)
000x Xxxx Xxxxxx, Xxxxxxxxxxx, 26/09/2002 Xxxxxxx Pressland Ltd (1)
Xxxxxx X0
H & T Ltd (2)
Head Office, Level 7, Times 30/07/1999 Eagle Star Life Assurance
House, Throwley Way, Sutton, Company Ltd (1)
Surrey
H & T Ltd (2)
Xxxx 0, 00 Xxxx Xxxxxx, XXX00000 - Title absolute 08/07/1998 Charlwood Alliance Holdings
Hounslow, Middlesex Ltd (1)
H & T Ltd (2)
Ground Floor and Basement 12/03/1996 Torlork Singh (1)
00/00 Xxxxxxxxx Xxxx, Xxxxxx
H & T Ltd (2)
Unit 67 In Shops Centres Ltd, 14/02/2003 In Shops Centres Ltd (1)
Xxxxxxxxx Xxx, Xxxxxx
Xxxxxxxxx, X00 0XX H & T Ltd (2)
Ground Floor and Basement 281 XXX000000 - Title absolute 08/01/2004 Xxxxx Xxxxxx Ltd (1)
Xxxx Xxxx, Xxxxxx, Xxxxxx X00
H & T Ltd (2)
Xxxx 0 00/00 Xxxxxxxxxxx, 00/00/0000 Xxxxxxxxxxx Properties Ltd (1)
Liverpool, Greater Merseyside
Waynes Shoes Plc (2)
00 Xxxxxxxxxxx, Xxxxxxxxxxxx, 21/12/1988 Xxxxxx Xxxxxxx (1)
Cheshire
Halifax (NW) Ltd (2)
Xxxx 00 Xxxxxxx 00/00/0000 Xxxx Register Property
82
Shopping Centre, Newcastle-Upon-Tyne Investments Ltd (1)
H & T Ltd
00 Xxxxxxx Xxxx Xxxxxx, Xxxxxx 07/09/1988 Grantglen Ltd (1)
SE15
H & T Ltd (2)
00 Xxxxxx Xxx, Xxxxxx Xxxxxx 05/11/1998 The Mayor and Xxxxxxxxx xx
Xxxxxx, Xxxxxx, Xxxxxx X00 the London Borough of Tower
Hamlets (1)
H & T Ltd (2)
Ground Floor Shop and NGL775627 - Title absolute 04/05/1999 Xxxxxx Xxxxxx Xxxxxxx and
Xxxxxxxx, 00 Xxxxx Xxxxxx, others (1)
Xxxxxx XX0
H & T Ltd (2)
Xxxx 00 (X0), Xxxxxxxxx Xxxxx 00/00/0000 X Xxxxxx & Xxx (XX) Ltd (1)
III, The Medway City Estate,
Chatham, Rochester H & T Ltd (2)
Xxxx 00, Xxxxxxxxx III 10/03/2000 Xxxxxxxx Xxxxxxxxx Faldo Esq
Industrial Estate, Xxx Xxxxxx (1)
Xxxxxxx Road, Medway City,
Rochester, Kent H & T Ltd (2)
Unit 75 Riverside III, Medway 22/08/2003 Mr XX Xxxxx (1)
City Estate, Chatham,
Rochester H & T Ltd (2)
Xxxx 000, Xxxxxx Xxx Shopping 29/10/1999 Fordgate Midlands Properties
Centre, Runcorn, Cheshire Ltd (1)
Pawn Stop Ltd (2)
Xxxxxxx Xxxxxx Xxxxxxx (3)
Xxxx 0 Xxxxxxxxxx Xxxxxxxx Xxxx Pension Trustees Ltd (1)
Centre, Rutherglen
H & T Ltd (2)
Xxxx 00 Xxxxxxxxxx Xxx, 00/00/0000 Xxxxxxxx Properties Ltd and
Salford City Shopping Centre, Standbrook Properties Ltd (1)
Xxxxxxx, X0 0XX
Xpress Cash Ltd (2)
00/ 00X Xxxx Xxxxxx, Xxxxxx 04/01/1995 Sterling Estates (1)
H & T Ltd (2)
Ground Floor Lock-up Shop, 254 01/02/2001 MTD Property
Streatham
00
Xxxx Xxxx, Xxxxxxxxx, Xxxxxx Investment Ltd (1)
SW16
H & T Ltd (2)
000 Xxxxxxx Xxxxxx, Xxxxxxxxx 04/07/2000 Emma Xxxxxx Xxxxx (1)
Xpress Cash Ltd (2)
Xxxx Xxxxx (3)
Unit U44 The Arndale Centre, 10/11/1989 The Arndale Property Trust
Stretford, Greater Manchester Ltd (1)
H & T Plc (2)
Ground Floor and Basement, 196 17/03/1995 Cue Property Holdings
Lower Road, Surrey Quays, (Rotherhithe) Ltd (1)
Xxxxxx XX00
H & T Ltd (2)
Ground Floor Shop, 246 High 06/10/1995 Notepike Ltd (1)
Street, Sutton
H & T Ltd
00 Xxxxxxx Xxxx, Xxxxxxx, XX00 Registration pending - 03/08/2004 Rivercity Limited (1)
9PB provisional title number
allocated - TGL243199 Xxxxxx & Xxxxxxxx Ltd (2)
Ground Floor Premises forming WM710118 - Title Absolute 05/07/1990 WA Xxxxx (Estates) Ltd (1)
part of 00 Xxxxxxx, Xxxxxxx,
Xxxx Xxxxxxxx Mr GA Lycett and others
(trading as "Direct
Discount") (2)
000 Xxxx Xxxxxx, Xxxxxxxxxxx, 05/10/2000 Xxxxx Xxxxxxx Xxxxxxxx and
Xxxxxx X00 Xxxxxxx Xxxxxxxx Xxxxxxxx (1)
Xxxxxxx Xxxxxx Xxxxxx and
Xxxxxxx Xxxxxx (2)
Ground Floor and Basement, 391 01/10/1999 Xxxxxx Xxxxx Xxxxxx Xxxxxx (1)
Xxxxxxxx Xxxx, Xxxxxx XX00
H & T Ltd (2)
Ground Floor and Basement, 111 13/02/2004 Blackcap Ltd (1)
Xxxxx Xxxxx, Xxxxxxxx, Xxxxxx
XX0 H & T Ltd (2)
Ground Floor 1-3 Bellegrove 13/10/2003 Landmaster Properties Ltd (1)
Road, Xxxxxxx, Xxxx, XX00 0XX
H & T Ltd (2)
00 Xxxx Xxxx, Xxxxxxxxx Xxxxx, XXX000000 - Title absolute 09/12/1985 Haroon Abba (1)
00
Xxxxxx XX00 0XX H & T Plc (2)
00 Xxxx Xxxxxx, Xxx Xxxxxxx
Xxxxxxxx Xxxxxx, Xxxxx
22 Almondale South, Xxxxxxxxxx 16/08/2004 Ravenseft Properties Limited
(1)
H&T Ltd (2)
85
SCHEDULE 7
LIMITATIONS ON WARRANTIES
1. PARAGRAPH 4 shall apply in circumstances where the Vendor has paid to the
Purchaser an amount in respect of a Relevant Claim (other than a Relevant
Claim under the Taxation Warranties in which case PARAGRAPH 10 of SCHEDULE
4 shall apply) and subsequent to the making of such payment the Purchaser
or the Company recovers from some other person a sum which is referable to
that payment.
2. PARAGRAPH 5 shall apply in circumstances where the Vendor has paid to the
Purchaser an amount in respect of a Relevant Claim and subsequent to the
making of such payment the Purchaser or the Company becomes or shall
become entitled to recover from some other person a sum which is referable
to that payment.
3. PARAGRAPH 5 shall apply in circumstances where:
3.1 any claim is made by a third party against the Purchaser or the Company
which is reasonably likely to give rise to a Relevant Claim (other than a
Relevant Claim under the Taxation Warranties in which case PARAGRAPH 7 of
SCHEDULE 4 shall apply) by the Purchaser against the Vendor; or
3.2 the Purchaser or the Company is or is reasonably likely to be entitled to
make recovery from some other person of any sum in respect of any facts or
circumstances by reference to which the Purchaser has or is reasonably
likely to have a Relevant Claim (other than a Relevant Claim under the
Taxation Warranties in which case PARAGRAPHS 7 AND 10 of SCHEDULE 4 shall
apply) against the Vendor.
4. In the circumstances referred to in PARAGRAPH 1 above the Purchaser shall
reasonably promptly repay to the Vendor (less any reasonable costs and
expenses incurred in recovering the same) an amount equal to the amount
recovered or, if lower, the amount paid by the Vendor to the Purchaser.
5. The Purchaser shall:
5.1 notify the Vendor of any claim made against the Purchaser as referred to
in PARAGRAPH 2, or any right of recovery which is or is reasonably likely
be available as referred to in PARAGRAPHS 3.1 and 3.2 as soon as
reasonably practicable after the Purchaser becomes aware of the same
PROVIDED THAT a failure on the part of the Purchaser to notify the Vendor
in this manner shall not operate to prevent the Purchaser from bringing a
Relevant Claim in relation to any relevant facts or
86
circumstances save to the extent that such a failure to notify increases
the quantum of any such Relevant Claim; and
5.2 keep the Vendor informed of all material developments in relation to any
claim, or right of recovery, as referred to in PARAGRAPH 2; and
5.3 at the Vendor's cost provide such material information and documentation
(no matter how it is recorded or stored) as the Vendor shall reasonably
request in connection with any claim, or right of recovery, as referred to
in PARAGRAPH 2.
6. No liability shall attach to the Vendor in respect of any Relevant Claim
to the extent that a specific allowance, provision or reserve in respect
of the matter or thing giving rise to such Relevant Claim has been made in
the Accounts or the Management Accounts.
7. No liability shall attach to the Vendor in respect of any Relevant Claim
if and to the extent that the amount of such Relevant Claim is actually
recovered by the Purchaser under any of its policies of insurance provided
that the Purchaser is paid out in full under the relevant insurance
policy.
8. No liability shall attach to the Vendor in respect of any Relevant Claim
to the extent that such Relevant Claim would not have arisen (or the
amount of the Relevant Claim would not have been increased) but for a
change in legislation made after the date hereof or a change in the
interpretation of the law after the date hereof (whether or not such
change purports to be effective retrospectively in whole or in part) or if
such Relevant Claim would not have arisen (or the amount of the Relevant
Claim would not have been increased) but for any judgement delivered after
the date hereof.
9. No liability shall attach to the Vendor in respect of any Relevant Claim
to the extent that such Relevant Claim would not have arisen but for a
voluntary omission or a voluntary act outside the ordinary course of
business of the Purchaser occurring after Completion.
10. The Purchaser shall not be entitled to bring any Relevant Claim in respect
of any act or omission whatsoever carried out at the written request or
with the written approval of the Purchaser prior to Completion or which is
expressly authorised by this Agreement.
11. No liability shall attach to the Vendor in respect of any Relevant Claim
to the extent that the Relevant Claim is based upon a liability which is
contingent only or is otherwise not capable of being quantified unless and
until such liability ceases to be contingent and becomes an actual
liability or becomes capable of being quantified, as
87
the case may be provided that such Relevant Claim shall have been notified
to the Vendor in accordance with CLAUSE 6.
12. The Purchaser shall not be entitled to recover damages or otherwise obtain
payment, reimbursement, restitution or indemnity from the Vendor more than
once for the same loss or damage.
13. No liability shall attach to the Vendor in respect of any Relevant Claim
if and to the extent that the breach giving rise to such Relevant Claim is
capable of remedy (without cost or loss to the Purchaser) except to the
extent that the relevant breach remains unremedied (without such cost)
after the expiry of 30 days following receipt by the Vendor of notice from
the Purchaser giving reasonable particulars of the relevant breach and
requiring it to be so remedied and after such remedy by the Vendor the
Purchaser or the Company have not suffered a loss.
14. No liability shall attach to the Vendor in respect of any Relevant Claim
if and to the extent that the liability or other matter giving rise to
such Relevant Claim is primarily attributable to any act, event, omission
or default which occurred prior to 28 February 1992 unless such act,
event, omission or default was known or ought reasonably to have been
known to the Vendor at the date hereof.
15. Subject to the provisions of CLAUSE 12.2 and 12.3, the liability of the
Vendor in relation to a Relevant Claim shall cease and any subsisting
Relevant Claim shall be withdrawn upon the Company ceasing for any reason
to be an Associated Entity (as defined in CLAUSE 12) of the Purchaser.
16. In assessing any damages or other amounts recoverable pursuant to a
Relevant Claim there shall be taken into account the value of any direct
benefit accruing to the Purchaser in consequence of the matter or
circumstances giving rise to the Relevant Claim pursuant to which the
damages or such other amounts become recoverable, including, without
prejudice to the generality of the foregoing, any amount of any tax relief
actually obtained by the Purchaser and any amount by which any Tax for
which the Purchaser is assessed or made accountable is actually reduced or
extinguished as a direct consequence of such matter or circumstances.
17. Following a Relevant Claim (other than a Relevant Claim under the Taxation
Warranties in which case PARAGRAPH 7 of SCHEDULE 4 shall apply) being made
against the Vendor the Purchaser shall make available to accountants and
other professional advisers appointed by the Vendor copies of any material
relevant documentation (but, for the avoidance of doubt, excluding any
privileged documentation) as the Vendor may reasonably request (at the
Vendor's cost)
88
specifically in connection with such Relevant Claim PROVIDED THAT nothing
in this paragraph shall prevent or limit the Purchaser from commencing
legal proceedings against the Vendor in such manner and at such time as it
deems appropriate.
18. The Purchaser acknowledges and agrees that, save for the Warranties and
the documents referred to at PARAGRAPH 4 of SCHEDULE 3, it has not relied
in relation to the purchase of the Shares on, or been induced to enter
into this agreement by, any information (written or oral), statements or
warranties or representations of any description made, supplied or given
by or on behalf of the Vendor or the officers, agents, employees or
advisers of the Vendor in relation to the assets and liabilities of the
Company, their value or amount, or the businesses or affairs of the
Company or otherwise.
19. Without prejudice and subject to the provisions of PARAGRAPH 15, the
Purchaser irrevocably and unconditionally waives any right it might have
to claim damages for breach of any warranty not contained in this
Agreement.
20. The Purchaser further acknowledges and agrees that subject to the
provisions of CLAUSE 5.3 the only remedy available to it in respect of a
breach of any provision of this Agreement shall be for damages for breach
of contract and that the Purchaser shall have no claim or remedy in tort
in respect of such breach. The parties shall have no right to rescind this
Agreement.
21. Nothing in this Agreement shall affect the application of the common law
rules on mitigation in respect of any Relevant Claim. For the avoidance of
doubt, such common law rules on mitigation shall apply notwithstanding the
provisions of clause 5.3.
22. The Purchaser hereby waives and relinquishes any right of set-off or
counterclaim, deduction or retention which the Purchaser might otherwise
have in respect of any Relevant Claim or out of any payments which the
Purchaser may be obliged to make (or procure to be made) to the Vendor
pursuant to this Agreement.
23. Save in respect of the matters set out at PARAGRAPH 4 of SCHEDULE 3, the
Purchaser acknowledges and agrees that the only Warranties given in
relation to:
23.1 Intellectual Property Rights, Software, Computer Systems and information
technology are those set out in PARAGRAPHS 15 and 16 of SCHEDULE 3;
23.2 Property are those set out in PARAGRAPHS 17, 18, 19, 20, 21, 22, 23 and 24
of SCHEDULE 3;
89
23.3 Environment and EHS Matters are those set out in PARAGRAPH 26, 27, 28, 29,
30 and 31 of SCHEDULE 3;
23.4 the employment of any past or present employee of the Company are those
set out in PARAGRAPH 32 of SCHEDULE 3;
23.5 Pensions issues are those set out in PARAGRAPH 33 of SCHEDULE 3;
23.6 Contracts other than matters relating to consumer credit legislation
compliance are those set out in PARAGRAPH 34, 35, 36, 41, 43 and 45 of
SCHEDULE 3.
90
SCHEDULE 8
ADJUSTMENT OF CONSIDERATION
1. COMPLETION ACCOUNTS
1.1 The Vendor and the Purchaser will procure that after Completion,
Completion Accounts for the Company will be prepared and reported on in
accordance with the provisions of this SCHEDULE 8.
1.2 The Completion Accounts will consist of a statement showing the Cash and
the Indebtedness of the Company as at the close of business on the date of
Completion.
1.3 The Completion Accounts will be prepared (subject as otherwise provided),
in the order of priority shown in this paragraph 1.3:
1.3.1 in accordance with the definitions of "Cash" and "Indebtedness"
contained in CLAUSE 1 of this Agreement;
1.3.2 adopting the accounting policies and estimation techniques applied
for the purposes of the Accounts; and
1.3.3 in accordance with the historical cost convention and with
accounting principles generally accepted in the United Kingdom
(including Accounting Standards) in each case as at the Accounting
Date.
2. PROCEDURE
2.1 Forthwith after Completion the Vendor will provide to the Purchaser and,
where requested, the Purchaser's Accountants, upon request, with access
during normal working hours on any Business Day to those documents,
records and information within its possession or control which the
Purchaser or the Purchaser's Accountants may reasonably require for the
purpose of preparing the draft Completion Accounts.
2.2 Within 7 Business Days after the date of Completion the Purchaser will
prepare and deliver to the Vendor a final draft of the Completion
Accounts. For the avoidance of doubt once the draft Completion Accounts
have been delivered by the Purchaser it may not vary or amend the same.
2.3 The Vendor will review the draft Completion Accounts as delivered by the
Purchaser under this Schedule, such review to be completed within 7
Business Days of such delivery. The Vendor will notify the Purchaser by
one written notice within such period whether or not it accepts them as
complying with PARAGRAPH 1 of this Schedule. The Purchaser will ensure
that the Vendor and, where requested, the Vendor's Accountants, upon
request, are given access during normal working hours
91
on any Business Day to all documents, records and information they may
reasonably require to enable the Vendor to make its decision. If the
Vendor does not so notify the Purchaser within 7 Business Days of delivery
of the draft Completion Accounts then the Vendor will be deemed to have
accepted the draft Completion Accounts as complying with PARAGRAPH 1.
2.4 If the Vendor notifies the Purchaser of any objection pursuant to
PARAGRAPH 2.3 then:
2.4.1 the Vendor will or will procure that the Vendor's Accountants set
out in reasonable detail their reasons for such non-acceptance and
specify the adjustments that in their opinion should be made to the
draft Completion Accounts in order to comply with PARAGRAPH 1 and
provide supporting evidence for each such adjustment;
2.4.2 the Vendor and the Purchaser will use all reasonable endeavours to
procure that the Vendor's Accountants and Purchaser's Accountants
provide the Purchaser and the Purchaser's Accountants or the Vendor
and the Vendor's Accountants (as the case may be), upon request,
with access during normal working hours on any Business Day to all
such documents and working papers relating to their preparation of
the Completion Accounts or reasons for non-acceptance (as the case
may be) and proposed adjustments to the Completion Accounts referred
to in PARAGRAPH 2.4.1; and
2.4.3 the Vendor and the Purchaser will and where relevant, will procure
that the Vendor's Accountants and the Purchaser's Accountants
respectively use all reasonable endeavours to reach agreement upon
the adjustments needed to meet the objections of the Vendor or
Vendor's Accountants (as the case may be).
2.5 If the Vendor or the Vendor's Accountants and the Purchaser or Purchaser's
Accountants do not reach agreement within 14 days after service of the
Vendor's or Vendor's Accountants' notice of non-acceptance under PARAGRAPH
2.3 then the matter(s) in dispute will be referred to the decision of a
single independent chartered accountant or an independent firm of
chartered accountants (in either case, the "Independent Accountant") to be
agreed upon between them or (in default of such agreement) to be selected
(at the instance of either of them) by the President for the time being of
the Institute of Chartered Accountants in England and Wales. The
Independent Accountant (whose costs will be paid as the Independent
Accountant will direct) will act as expert (and not as arbitrator) and the
decision of the Independent Accountant shall (in the absence of manifest
error) be final and binding on the parties. It is the parties' intention
that the Independent Accountant will
92
perform his task within 20 Business Days if practicable and they shall
encourage him to do so.
2.6 The Vendor and the Purchaser will use all reasonable endeavours to provide
all such working papers, documents and other information as is requested
by the Independent Accountant and will procure that the Independent
Accountant is requested to state, when giving his decision on the
matter(s) referred to him, what adjustments (if any) need to be made to
the draft Completion Accounts in order that it will comply with PARAGRAPH
1.
2.7 If the Vendor and the Purchaser reach agreement on (or pursuant to
PARAGRAPH 2.3 the Vendors are deemed to have accepted) the Completion
Accounts, or if the Completion Accounts are finally determined at any
stage in the procedure set out in this PARAGRAPH 2, the Completion
Accounts as so agreed or determined will be the Completion Accounts for
the purposes of this Agreement and shall be final and binding on the
Purchaser and the Vendor and the amount of the Cash and Indebtedness shall
be such amount as reflected in the Completion Accounts.
2.8 Each of the Vendor and the Purchaser will pay its own costs and expenses
in connection with the preparation and agreement of the Completion
Accounts including, where applicable, any costs associated with
presentation of its case to the Independent Accountant (it being
acknowledged that the costs of the Independent Accountant will be dealt
with in accordance with PARAGRAPH 2.5 above).
3. ADJUSTMENT OF CONSIDERATION
3.1 When the Completion Accounts have become final and binding pursuant to
PARAGRAPH 2 the Consideration shall be calculated as follows:
Consideration = (pound)49,000,000 + A - B
where A is Cash at Completion; and B is Indebtedness at Completion.
3.2 The amount of any increase or reduction in the Provisional Consideration
by reference to the final Consideration figure referred to in PARAGRAPH
3.1 will be paid by the Purchaser (in the case of an increase to the
Provisional Consideration) or the Vendor (in the case of a reduction to
the Provisional Consideration), as the case may be, to the other, within
10 Business Days after the Completion Accounts have become final and
binding and any amount not paid when due shall carry interest in
accordance with CLAUSE 10 of this Agreement.
4. Provided PARAGRAPH 3 has been complied with in full the Purchaser will
have no claim against the Vendor under this Agreement in respect of any
liability or deficiency to the extent that such liability or deficiency is
taken into account in the
93
Completion Accounts but otherwise preparation and acceptance of the
Completion Accounts by the Purchaser will be without prejudice to any
claim which the Purchaser may have against the Vendor in respect of any
breach of the Warranties or under PART 2 of SCHEDULE 4.
5. All sums payable under this Schedule will be paid by electronic transfer
to the relevant party's bank account, which details shall be provided by
the relevant party to the other within 3 Business Days of the Completion
Accounts becoming final and binding.
94
SIGNED by Xxxxxx X. Xxxxxxx, Xx. )
duly authorised for and on behalf of )
CASH AMERICA INTERNATIONAL, INC )
in the presence of: )
Witness signature: /s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Address: 0000 X. 0xx Xxxxxx
Xxxx Xxxxx, XX 00000
Occupation: General Counsel
SIGNED by Xxxx Xxxxxxxxxx )
duly authorised for and on behalf of )
H&T FINANCE LIMITED in the presence of: )
Witness signature: /s/ Xxxx Xxxxxx
Name: Xxxx Xxxxxx
Address: Infirmary St, Leeds
Occupation: Solicitor
95
DATED 8 SEPTEMBER 2004
(1) CASH AMERICA INTERNATIONAL, INC
(2) GULDSKALEN D 409 AB, UNDER CHANGE OF NAME TO SVENSK PANTBELANING
HOLDINGS AB
AGREEMENT
For the sale and purchase
of the entire issued share capital of CAII Pantbelaning AB
and its subsidiaries
Eversheds LLP
Cloth Hall Court
CONTENTS
CLAUSE PAGE
1. INTERPRETATION ................................................................................. 1
2. SALE AND PURCHASE .............................................................................. 6
3. COMPLETION ..................................................................................... 7
4. GUARANTEES ..................................................................................... 8
5. WARRANTIES ..................................................................................... 8
6. LIMITATION ON CLAIMS ........................................................................... 9
7. RESTRICTIVE COVENANTS .......................................................................... 11
8. SPECIFIC INDEMNITIES ........................................................................... 13
9. ANNOUNCEMENTS .................................................................................. 15
10. COSTS ........................................................................................... 16
11. INTEREST ........................................................................................ 16
12. NOTICES ........................................................................................ 16
13. ASSIGNMENT ...................................................................................... 17
14. GENERAL ......................................................................................... 18
15. SERVICE OF PROCESS .............................................................................. 19
16. GOVERNING LAW AND JURISDICTION .................................................................. 20
17. COUNTERPARTS .................................................................................... 20
SCHEDULES:
SCHEDULE 1 The Vendor
SCHEDULE 1.1(a) Data Room Index
SCHEDULE 2 Details of the Group
SCHEDULE 2.2(b) A Note
SCHEDULE 2.2(c) B Note
SCHEDULE 3 Non-Taxation Warranties
SCHEDULE 4 Taxation
SCHEDULE 4.2 Parent Guarantee
SCHEDULE 5 Completion Arrangements
SCHEDULE 6 Leases
SCHEDULE 7 Limitations on Warranties
SCHEDULE 8 Adjustment of Cash Consideration
THIS AGREEMENT is made on 8 September 2004
BETWEEN:
(1) Cash America International, Inc of 0000 Xxxx 0xx Xxxxxx, Xx. Xxxxx, Xxxxx
00000, XXX ("the Vendor"); and
(2) Guldskalen D 409 AB (registered number 556663-7871) (under proposed change
of name to Svensk Pantbelaning Holdings AB, whose registered office is at
c/o Mannheimer Swartling Advokatbyra AB, Xxx 0000, XX-000 00 Xxxxxxxxx,
Xxxxxx ("the Purchaser").
OPERATIVE CLAUSES
1 INTERPRETATION
In this Agreement:
1.1 the following expressions have the following meanings unless inconsistent
with the context:
"A NOTE" the note to be issued by the Purchaser to
the Vendor on Completion pursuant to CLAUSE
2.2(b) in the form attached as SCHEDULE
2.2(b) to this Agreement
"ACCOUNTING DATE" 31 December 2003
"ACCOUNTS" the audited accounts of each Group Member,
including in the case of the Company its
audited consolidated accounts, for the
financial year which ended on the
Accounting Date, comprising in each case a
balance sheet, a profit and loss account,
notes, directors' and auditors' reports
(Sw. forvaltnings- och
revisionsberattelser)
"ACT" the Swedish Pawnbroking Act (Sw.
Pantbankslag (1995:1000))
"ASSOCIATED COMPANY" any company, not being a Group Member,
which at the relevant time is:
(a) a parent company of the Vendor; or
(b) a subsidiary; or
(c) a subsidiary of any such parent company
(other than the Vendor itself);
the expressions "parent company" (Sw.
moderforetag) and "subsidiary" (Sw.
dotterforetag) having the meanings given to
them by CA 1975
"B NOTE" the convertible debenture to be issued by
the Purchaser to the Vendor in connection
with Completion pursuant to CLAUSE 2.2(c)
and in the form and subject to the terms
and conditions attached as SCHEDULE 2.2(c)
to this Agreement.
"BUSINESS DAY" any day (other than a Saturday or Sunday)
on which banks are open in London and
Stockholm for normal banking business
"CA 1975" the Swedish Companies Act (1975:1385)
"CASH" cash in hand and at bank (including accrued
interest on any such cash) (on current or
deposit account) of the Group as recorded
in the nominal ledgers of the Group Members
at Completion including uncleared cheques
received at Completion including any
amounts representing shop floats in excess
of the sum of SEK 175,500 (such amount
representing an allocation of SEK 13,500
per store for 13 stores)
"CASH CONSIDERATION" the cash consideration for the sale of the
Shares as stated in CLAUSE 2.2 (a)
"COMPANY" CAII Pantbelaning AB (details of which are
set out in SCHEDULE 2)
"COMPLETION" Completion of the sale and purchase in
accordance with CLAUSE 3
"COMPLETION ACCOUNTS" the accounts prepared in accordance with
PARAGRAPH 1 of SCHEDULE 8
"CONSIDERATION" the consideration for the sale of the
Shares as stated in PARAGRAPH 2.2
"CONTRACT" any agreement or commitment whether
conditional or unconditional and whether by
deed, under hand, oral or otherwise, and
any arrangement or understanding
"COUNTY ADMINISTRATIVE The county administrative board(s) (Sw.
BORD(s)" lansstyrelsen) in Sweden
"DATA ROOM" the collection of documents, materials and
information held at the Stockholm offices
of the Vendor's Solicitors and made
available for inspection to the Purchaser
and its advisers prior to Completion as set
out in the index in the agreed terms,
SCHEDULE 1.1 (a).
"DISCLOSURE LETTER" the letter having the same date as this
Agreement from the Vendor to the Purchaser
qualifying the Warranties
"ENCUMBRANCE'" any mortgage, charge, pledge, lien,
assignment, option, restriction, claim,
right of pre-emption, right of first
refusal, third party right or interest,
other encumbrance or security interest of
any kind, or other preferential arrangement
having similar effect
"GROUP" the Company and each of its subsidiaries
(Sw. dotterforetag) (as defined in CA 1975)
"GROUP MEMBER" any company which is a member of the Group
at the date of this Agreement
"INDEBTEDNESS" the aggregate amount of the indebtedness
for borrowed money of the Group as at
Completion
including bank or other third party
overdrafts and loan facilities and any
indebtedness repayable to the Vendor and/or
any Associated Company, together with
accrued interest and any redemption costs
associated with the repayment of any
relevant facilities, debt factoring
facilities, liabilities under bank
guarantees, acceptance or documentary
credits, debentures, loans, loan stocks,
bonds notes and bills of exchange, hire
purchase agreements and obligations under
finance leases, and discounted debts and
including amounts owed in respect of
Taxation (as defined in SCHEDULE 4 but
without prejudice to the terms of SCHEDULE
4) but not including amounts owed to trade
creditors (which may include sums owed to
the Vendor or any Associated Companies in
the ordinary course of business up to a
maximum amount of SEK 268,000) of the Group
Members in the ordinary course of business
"INDEMNITY CLAIM" any claim under the specific indemnities in
CLAUSE 8.
"LEASE" the relevant leases or underleases or
licences for the Leased Real Property,
brief particulars of which are set out in
SCHEDULE 6
"LEASED PREMISES" all real property or other premises leased
by each Group Member, including any
installations and improvements thereon
"NOTES" the A Note and the B Note collectively
"PENSION SCHEMES" (a) the Swedish national basic pension; (b)
the Swedish ITP pension scheme according
to the collective bargaining agreement
applicable to the Group; (c) the
alternative ITP pension scheme provided to
Xxxxxx Xxxxx and Xxxxx Gislehed, (d) the
pension insurance with SEB Xxxxx Xxx
provided to Olle Fjordgren, and (e) the
Swedish occupational group life insurance
TGL.
"PROVISIONAL CASH the cash consideration for the Shares of
CONSIDERATION" SEK 191,496,902 as stated in CLAUSE 2(a)
before the adjustments made in accordance
with, the terms of SCHEDULE 7
"PURCHASER'S ACCOUNTANTS" Deloitte, Xxxxxxxxxx 00, 000 00 Xxxxxxxxx,
Xxxxxx (or such other firm as the Purchaser
may notify the Vendor)
"PURCHASER'S SOLICITORS" Eversheds LLP of Cloth Xxxx Xxxxx,
Xxxxxxxxx Xxxxxx, Xxxxx XX0 0XX
"RELEVANT CLAIM" any claim for breach of any of the
Warranties
"SEK" Swedish kroner, the lawful currency of
Sweden
"SENIOR MANAGEMENT" each board member of each Group Member, Xx.
Xxxx Fjordgren, Xx. Xxxxxx Xxxxx, Ms. Xxxxx
Gislahed, Xxxx Xxxxxxx (Secretary) and
Xxxxxx X Xxxxxxx, Xx
"SERVICE DOCUMENT" a writ, summons, order, judgement, claim
form, application or other process or any
document relating to or in connection with
any proceedings
"SHARES" all the issued, shares in the capital of
the Company
"STOCK" merchandise of each Group Member held for
disposition and for sale as scrap
"TAXATION WARRANTIES" the warranties set out in PART 3 of
SCHEDULE 4
"TAX SCHEDULE" means the schedule attached as SCHEDULE 4
in relation to tax matters
"VENDOR'S ACCOUNTANTS" PricewaterhouseCoopers, Xxxxxxxxx 00, 000
00, Xxxxxxxxx, Xxxxxx (or such other firm
as the Vendor may notify the Purchaser)
"VENDOR'S SOLICITORS" Xxxxx & XxXxxxxx of 000 Xxx Xxxxxx Xxxxxx,
Xxxxxx XX0X 6.JA
"WARRANTIES" the warranties set out or referred to in
CLAUSE 5, SCHEDULE 3 and PART 3 of SCHEDULE
4;
1.2 references to any statute or statutory provision include, unless the
context otherwise requires, a reference to the statute or statutory
provision as modified or re-enacted and in force from time to time prior
to Completion and any subordinate legislation made under the relevant
statute or statutory provision in force prior to Completion;
1.3 references to persons will include bodies corporate, unincorporated
associations and partnerships;
1.4 references to a document being "in the agreed terms" are to that document
in the form agreed and for the purposes of identification initialled by or
on behalf of the Vendor and the Purchaser;
1.5 references to the singular include the plural and vice versa;
1.6 references to clauses and Schedules are to clauses of and Schedules to
this Agreement, and references to paragraphs are to paragraphs in the
Schedule in which such references appear;
1.7 the Schedules form part of this Agreement and will have the same force and
effect as if expressly set out in the body of this Agreement;
1.8 the headings in this Agreement will not affect its interpretation; and
1.9 any phrase introduced by the term "include", "including", "in particular"
or any similar expression will be construed as illustrative and will not
limit the sense of the words preceding that term.
2. SALE AND PURCHASE
2.1 The Vendor will sell with full title guarantee, and the Purchaser will
buy, the Shares as set forth in SCHEDULE 1. The Shares will be sold free
of any Encumbrance and with all rights attached or accruing to them at or
after the date of this Agreement. The Vendor, and shall procure that all
Associated Companies, irrevocably and unconditionally waives any right it
might have to repayment under any and all conditional shareholders'
contributions made to any Group Member (whereby any and all conditional
shareholders' contributions made to Group Members by the
Vendor or any Associated Company shall be regarded as unconditional
shareholders' contributions (Sw. ovillkorade aktieagartillskott)).
2.2 In consideration for the sale of the Shares the Purchaser shall pay to the
Vendor the sum of SEK 285,296,902 (the "Consideration") to be paid by the
Purchaser as follows:
(a) SEK 191,496,902 in cash, which amount has reduced by SEK
502,727.80 (corresponding to the amount of underfunded pension
for Olle Fjordgren) and SEK 469,000 (corresponding to the
Vendor's agreed part of the transaction costs in connection
with this Agreement) for but subject to adjustment after
Completion as provided in SCHEDULE 8;
(b) SEK 80,400,000 (being the equivalent of(pound)6,000,000 on
Completion) by issuing the A Note to the Vendor on Completion;
(c) SEK 13,400,000, by issuing the B Note with the same nominal
amount to the Vendor on Completion. In consideration for the B
Note the Vendor shall pay to the Purchaser the sum of SEK
13,400,000 (Sw. vederlag) by way of set-off against the
Vendor's corresponding claim on the Purchaser under this
CLAUSE 2.2(c) amounting to SEK 13,400,000.
3. COMPLETION
3.1 Completion will take place at the offices of the Purchaser's Solicitors
immediately after the signing of this Agreement.
3.2 At Completion, the Vendor and the Purchaser will comply with the
provisions of SCHEDULE 5.
3.3 The Vendor's Solicitors are authorised to receive the part of the
Consideration which comprises cash on behalf of the Vendor and payment to
them will be a good and sufficient discharge to the Purchaser for such
part of the Consideration and the Purchaser will not be further concerned
as to the application of the moneys so paid.
3.4 The Purchaser will not be obliged to complete the purchase of any of the
Shares unless the purchase of all the Shares is completed simultaneously
and the Vendor will not be obliged to complete the sale of any of the
Shares unless the sale of all the Shares is completed simultaneously.
4. GUARANTEES
4.1 The Vendor will procure that on Completion each Group Member is released
from any guarantee, indemnity, counter-indemnity, letter of comfort or
other obligation given by each Group Member to any third party in respect
of a liability of any person other than the Group Member.
4.2 The Purchaser will procure that on Completion the Vendor or any Associated
Company is released from any guarantee, indemnity, counter-indemnity,
letter of comfort or other obligation given by the Vendor or any
Associated Company to any third party relating to bank or other third
party overdrafts and loan facilities in respect of a liability of a Group
Member and of which full particulars are contained in SCHEDULE 4.2,
Pending such release, the Purchaser undertakes to indemnify the Vendor and
any Associated Company against all amounts paid by the Vendor or any
Associated Company to any third party pursuant to any such obligation
(and all costs incurred in connection with such obligation) arising after
the date of this Agreement save that this indemnity shall not extend to
any matter giving rise to a Relevant Claim or a Claim under PART 2 of
SCHEDULE 4 or any other indemnity set out in this Agreement.
5. WARRANTIES
5.1 The Vendor warrants to the Purchaser in the terms of the Warranties.
5.2 Subject to CLAUSE 6.5, the Warranties are qualified by all facts and
matters fairly disclosed (as defined in CLAUSE 5.7 below) in the
Disclosure Letter.
5.3 The Vendor undertakes that following a breach of the Warranties the Vendor
will, subject to the limitations in CLAUSE 6 and SCHEDULE 7 compensate the
Purchaser or the Company (or as the Purchaser directs) and pay a sum equal
to the aggregate of:
5.3.1 the amount by which the value of any asset of the Group Member
(including any asset warranted to exist which does not exist) is or
becomes less than the value it would have had if the breach of
Warranty had not occurred; and
5.3.2 the amount of any other loss or liability which the Purchaser or
Group Member would not have been subject to or which would not have
incurred had the breach of Warranty not occurred.
The Purchaser hereby acknowledges that the remedy set out in herein this
CLAUSE 5.3 shall be the Purchaser's exclusive remedy in respect of any
Relevant Claim and
the Purchaser shall not be entitled to make any claim for damages in
respect of any such breach on any other basis.
5.4 The Vendor waives and may not enforce any right which the Vendor may have
against any Group Member, or any director or employee of any Group Member,
on which or on whom the Vendor may have relied in agreeing to any term of
this Agreement or any statement in the Disclosure Letter save that the
Vendor does not waive and may enforce any such claim in respect of
directors or employees of any Group Member in the case of fraud or wilful
default on the part of any director or employee of any Group Member.
5.5 Each Warranty is to be construed independently and is not limited or
restricted by any other Warranty or any other term of this Agreement.
5.6 Unless otherwise specified, where any Warranty refers to the knowledge,
information, belief or awareness of the Vendor (or similar expression),
the Vendor will be deemed to have such knowledge, information, belief or
awareness as the Vendor would have obtained had the Vendor made all
reasonable enquiries into the subject matter of that Warranty of the
Senior Management.
5.7 Unless otherwise specified, where a reference is made to facts or matters
fairly disclosed (or similar expression) in the context of the Warranties
fairly disclosed means disclosed in such a manner and in such detail as to
enable the Purchaser reasonably to assess the impact of the facts or
matters on the Group.
5.8 The Purchaser hereby confirms to the Vendor that it is not, at the date
hereof, currently intending to make a Relevant Claim against the Vendor
following Completion.
6. LIMITATION ON CLAIMS
6.1 The Vendor will not be liable for any Relevant Claim unless:
6.1.1 the amount of the liability in respect of that Relevant Claim or the
aggregate amount of the liability in respect of a number of Relevant
Claims relating to the same matter exceeds SEK 65,000 AND the amount
of the liability in respect of that Relevant Claim or Relevant
Claims when aggregated with the amount of the liability in respect
of all other Relevant Claims exceeds SEK 6,500,000 (in which event
the Vendor will be liable for the whole amount of such Relevant
Claims and not merely the excess); and
6.1.2 the Vendor receives from the Purchaser written notice of the
Relevant Claim (stating in reasonable detail the nature of the
Relevant Claim and including so far as reasonably practicable an
estimate of the maximum amount of the Relevant Claim):
6.1.2.1 no later than 30 April 2006, in the case of a Relevant Claim
for breach of any of the Warranties contained in SCHEDULE 3;
and
6.1.2.2 within seven years after Completion, in the case of a
Relevant Claim for breach of any of the Warranties contained
in SCHEDULE 4.
PROVIDED THAT unless the parties are conducting bona fide
negotiations in respect of such Relevant Claim the liability of the
Vendor against which any Relevant Claim specified in such notice
shall have been made shall absolutely determine and cease (if such
Relevant Claim has not been previously satisfied, settled or
withdrawn) if legal proceedings in respect of the claim shall not
have been commenced against the Vendor by being both properly issued
and validly served on the Vendor within twelve months of the giving
of such notice.
6.2 The aggregate amount of the liability of the Vendor for all Relevant
Claims, Indemnity Claims and any claims made pursuant to the Tax Schedule
will not exceed an amount equal to the Consideration.
6.3 CLAUSES 6.1 and 6.2 and SCHEDULE 7 will not apply in respect of a Relevant
Claim concerning PARAGRAPHS 1 (Capital) and 2 (Vendor Capacity) of
SCHEDULE 3.
6.4 Notwithstanding any other provision of this Agreement, CLAUSES 6.1 and 6.2
and SCHEDULE 7 will not apply to exclude or limit the liability of the
Vendor to the extent that any Relevant Claim arises by reason of any fraud
by or on behalf of the Vendor.
6.5 The Vendor shall have no liability in respect of the Warranties to the
extent that the facts and matters giving rise to the Relevant Claim have
been fairly disclosed (as defined in CLAUSE 5.7) in the Disclosure Letter
or this Agreement or the Data Room provided that the Data Room and the
general disclosures contained within the Disclosure Letter shall not
qualify or be disclosed against the Warranties at PARAGRAPH 4 of SCHEDULE
3.
6.6 The provisions of SCHEDULE 7 shall operate to limit the liability of the
Vendor under this Agreement.
7. RESTRICTIVE COVENANTS
7.1 In this CLAUSE 7:
"CONFIDENTIAL INFORMATION" means all information not publicly known,
used in or otherwise relating to the
Group's business, customers, or financial
or other affairs, including information
relating to:
(a) trade secrets, know-how, ideas,
computer systems and computer software;
(b) future projects, business development
or planning, commercial relationships
and negotiations; and
(c) the marketing of goods or services
including customer names and lists,
sales targets and statistics
"RELEVANT CUSTOMER" means any person who at any time during the
period of twelve months immediately
preceding Completion was
(d) negotiating with the Group for the
supply by the Group of goods or
services; or
(e) a client or customer of the Group; or
(f) in the habit of dealing with the Group
"RELEVANT PRODUCTS OR Means products or services which are
SERVICES" competitive with or of the type supplied by
the Group at any time during the period of
twelve months immediately preceding
Completion.
7.2 The Vendor undertakes to the Purchaser and the Group that the Vendor will
not, and will procure that no Associated Company will, (whether alone or
in conjunction
with, or on behalf of, another person and whether directly or indirectly),
without the prior written consent of the Purchaser;
7.2.1 for a period of two years immediately following Completion, canvass,
solicit or approach, or cause to be canvassed, solicited or approached,
any Relevant Customer for the sale or supply of Relevant Products or
Services;
7.2.2 for a period of two years immediately following Completion, deal or
contract with any Relevant Customer in relation to the sale or supply of
Relevant Products or Services;
7.2.3 for a period of two years immediately following Completion, interfere, or
seek to interfere, with the continuance of supplies to the Group Members
from any supplier who has been supplying goods or services to a Group
Member at any time during the twelve months immediately preceding
Completion if such interference causes or would cause that supplier to
cease supplying, or materially reduce its supply of, those goods or
services;
7.2.4 within Sweden, for a period of two years immediately following Completion,
solicit or entice away, or endeavour to solicit or entice away, from a
Group Member, any person employed in a managerial, supervisory, technical
or sales capacity by, or who is or was a consultant (other than, for the
avoidance of doubt, Xxxx Xxxxxxx in respect of whom the provisions of this
Clause shall not apply) to, a Group Member at Completion or at any time
during the period of twelve months immediately preceding Completion where
the person in question either has Confidential Information or would be in
a position to exploit the Group Member's or the Group's trade connections
and for the avoidance of doubt the Vendor confirms that it has no
arrangements in place to employ any such persons or consultants outside
Sweden at the date of Completion;
7.2.5 within Sweden for a period of two years immediately following Completion,
be engaged, concerned, connected with or interested in (except as the
owner for investment of securities in a company dealt in on a recognised
stock exchange and which confer not more than one per cent of the votes
which could be cast at a general meeting), any other business which
supplies Relevant Products or Services; or
7.2.6 without prejudice to any rights relating to passing off or trade xxxx
infringement (or similar rights in any territory), for a period of two
years immediately following Completion use in connection with any business
which is competitive with the business of the Group any name (in
whatever form) which includes the names of a Group Member or any
trading style or get up which is confusingly similar to that used by
a Group Member as at Completion.
7.3 Except so far as required by law or, to the extent relevant, the
regulations of any stock exchange or listing authority or any other
governmental or regulatory organisation and in those circumstances only
after prior consultation with the Purchaser, the Vendor undertakes to the
Purchaser and each Group Member that the Vendor will not, and will procure
that no Associated Company will, at any time after Completion:
7.3.1 disclose any Confidential Information to any person except to those
authorised by the Company to know;
7.3.2 use any Confidential Information for their own purposes or for any
purposes other than those of the Group; or
7.3.3 cause or permit any unauthorised disclosure of any Confidential
Information.
7.4 Each of the undertakings set out in this CLAUSE is separate and severable
and enforceable accordingly, and if any one or more of such undertakings
or part of an undertaking is held to be against the public interest or
unlawful or in any way an unreasonable restraint of trade, the remaining
undertakings or remaining part of the undertakings will continue in full
force and effect and will bind the Vendor.
8. SPECIFIC INDEMNITIES
8.1 Notwithstanding anything to the contrary stated in this Agreement or its
Schedules, the Vendor shall be responsible in full for and shall, in
accordance with this CLAUSE 8.1, indemnify and hold harmless the Purchaser
from and against any and all losses incurred by the Purchaser or by a
Group Member that result from or arise out of:
(a) The Shares not being beneficially owned by the Vendor free
from any Encumbrances and/or any lost share certificates
representing the Shares;
(b) The Restricted Stock Unit Program in relation to the Group
Members' employees;
(c) The alternative ITP pension scheme provided to Xxxxxx Xxxxx
and Xxxxx Gislehed; and
(d) Svensk Pantbelaning Service AB not having complied with the
requirements of Chapter 2 Section 9a of CA 1975 with respect
to Svensk Pantbelaning Service AB's acquisition of all the
shares in Murtrum AB.
8.2 CLAUSE 8.4 shall apply in circumstances where the Vendor has paid to the
Purchaser an amount in respect of an Indemnity Claim and subsequent to the
making of such payment the Purchaser or the Group Member recovers from
some other person a sum which is referable to that payment.
8.3 PARAGRAPH 8.6 shall apply in circumstances where the Vendor has paid to
the Purchaser an amount in respect of a Indemnity Claim and Subsequent to
the making of such payment the Purchaser or the Company becomes or shall
become entitled to recover from some other person a sum which is referable
to that payment.
8.4 In the circumstances referred to in CLAUSE 8.2 above the Purchaser shall
reasonably promptly repay to the Vendor (less any reasonable costs and
expenses incurred in recovering the same) an amount equal to the amount
recovered or, if lower, the amount paid by the Vendor to the Purchaser.
8.5 CLAUSE 8.6 shall apply in circumstances where:
8.5.1 any claim is made by a third party against the Purchaser or a Group
Member which is reasonably likely to give rise to an Indemnity Claim
by the Purchaser against the Vendor; or
8.5.2 the Purchaser or a Group Member is or is reasonably likely to be
entitled to make recovery from some other person of any sum in
respect of any facts or circumstances by reference to which the
Purchaser has or is reasonably likely to have an Indemnity Claim
against the Vendor.
8.6 The Purchaser shall:
8.6.1 notify the Vendor of any claim made against the Purchaser as
referred to in CLAUSE 8.3, or any right of recovery which is or is
reasonably likely be available, as referred to in CLAUSE 8.5.1 AND
8.5.2, as soon as reasonably practicable after the Purchaser becomes
aware of the same PROVIDED THAT a failure on the part of the
Purchaser to notify the Vendor in this manner shall not operate to
prevent the Purchaser from bringing an
Indemnity Claim in relation to any relevant facts or circumstances
save to the extent that such a failure to notify increases the
quantum of any such Indemnity Claim; and
8.6.2 keep the Vendor informed of all material developments in relation to
any claim, or right of recovery, as referred to in CLAUSE 8.3; and
8.6.3 at the Vendor's cost provide such material information and
documentation (no matter how it is recorded or stored) as the Vendor
shall reasonably request in connection with any claim, or right of
recovery, as referred to in CLAUSE 8.3.
8.7 No liability shall attach to the Vendor in respect of any Indemnity if and
to the extent that the amount of such Relevant Claim is actually recovered
by the Purchaser under any of its policies of insurance provided that the
Purchaser is paid out in full under the relevant insurance policy.
8.8 The Purchaser shall not be entitled to recover damages or otherwise obtain
payment, reimbursement, restitution or indemnity from the Vendor more than
once for the same loss or damage.
8.9 The Purchaser shall take all reasonable steps to mitigate losses under
this CLAUSE 8.
8.10 For the avoidance of any doubt SCHEDULE 7 and CLAUSE 6, subject to CLAUSE
6.2, which shall apply to Indemnity Claims, shall not apply to Indemnity
Claims.
9. ANNOUNCEMENTS
9.1 No announcement or circular concerning the transactions contemplated by
this Agreement or any matter ancillary to it and no disclosure of the
terms of this Agreement will be made by the Vendor except with the prior
written approval of the Purchaser or by the Purchaser except with the
prior written approval of the Vendor.
9.2 CLAUSE 9.1 does not apply to any announcement, circular or disclosure
required by law, or to the extent relevant, the regulations of any stock
exchange or listing authority or any other governmental or regulatory
organisation, provided, if practicable, that the party required to make it
has first consulted and taken into account the reasonable requirements of
the other party.
10. COSTS
Except where expressly stated otherwise, each party to this Agreement will
bear such party's own costs and expenses relating to the negotiation,
preparation and implementation of this Agreement. The Group will bear no
part of such costs and expenses.
11. INTEREST
If either party hereto becomes liable to pay the other party or the Group
any sum pursuant to this Agreement, whether a liquidated sum or by way of
damages or otherwise, such party will be liable to pay interest on such
sum from the due date for payment at the annual rate of 2 per cent above
the base lending rate from time to time of Barclays Bank Plc, accruing on
a daily basis until payment is made, whether before or after any judgment.
12. NOTICES
12.1 Any notice or other communication given in connection with this Agreement
will be in writing and will be delivered personally or sent by pre-paid
first class post (or air mail if overseas) or by fax to the recipient's
address set out in this Agreement or to any other address which the
recipient has notified in writing to the sender received not less than
seven Business Days before the notice was despatched.
12.2 A notice or other communication is deemed given;
12.2.1 if delivered personally, upon delivery at the address provided for
in this clause; or
12.2.2 if sent by prepaid first class post, on the second Business Day
after posting it; or
12.2.3 if sent by air mail, on the sixth Business Day after posting it; or
12.2.4 if sent by fax, on completion of its transmission
provided that, if it is delivered personally or sent by fax on a day which
is not a Business Day or after 4 p.m. on a Business Day, it will instead
be deemed to have been given or made on the next Business Day.
13. ASSIGNMENT
13.1 This Agreement may not be assigned to any person, save that the Purchaser
may assign the benefit of, and any of its rights under, this Agreement to:
13.1.1 any company or other entity (for the purposes of this CLAUSE 13 an
"Associated Entity"), which at the relevant time is:
13.1.1.1 a parent company of the Purchaser;
13.1.1.2 a subsidiary of the Purchaser; or
13.1.1.3 a subsidiary of any such parent company (other than the
Purchaser itself); or
13.1.1.4 any of The Rutland Partnership (LP 9572), Rutland Fund A
(LP 0000), Xxxxxxx Xxxx Avenue (LP 6900) or Rutland CCLP
(LP 6896) or any successor Rutland fund entities,
the expressions "parent company" and "subsidiary" a having the
meanings given to them by CA 1975;
13.1.2 or in favour of any person by way of security for borrowings of the
Purchaser and the same maybe enforced by any liquidator,
administrator or receiver of the Purchaser or by any other person
entitled to enforce such security; or
13.1.3 any person whatsoever after 30 April 2006.
13.2 In the event that the Purchaser notifies the Vendor of a Relevant Claim in
accordance with CLAUSE 6.1.2 prior to 30 April 2006 and at any time
between the date hereof and the date on which such Relevant Claim, has
been agreed or determined there is a Change of Control, no liability shall
attach to the Vendor in respect of such Relevant Claim unless within 60
days of the later of (a) the date on which the Purchaser notifies the
Vendor of the Relevant Claim; or (b) the date on which the Change of
Control occurs, the Purchaser assigns such Relevant Claim to an entity
which is, and continues to be, until the xxxx on which the Relevant Claim
is agreed or determined, an Associated Entity.
13.3 In the event that the Purchaser notifies the Vendor of a Relevant Claim in
accordance with CLAUSE 6.1.2 prior to 30 April 2006, notwithstanding the
provisions of CLAUSE 13.1.3, such Relevant Claim may not be assigned to
any person, save to an entity
which is, and continues to be, until the date on which such Relevant Claim
is agreed or determined, an Associated Entity or in accordance with CLAUSE
13.1.2.
For the purposes of this CLAUSE 13, "Change of Control" shall mean, in
respect of either the Purchaser or the Group (as the case may be), any
acquisition of shares which would enable a third party to exercise more
than 50% of the voting rights exercisable at general meeting of the
relevant company.
13.4 The Vendor may not assign the benefit of, or any of its rights under, this
Agreement.
13.5 This Agreement will be binding and enure for the benefit of successors in
title and permitted assigns of each of the parties and references to the
parties will be construed accordingly.
14. GENERAL
14.1 Unless otherwise provided, any outstanding obligation contained in this
Agreement will remain in force notwithstanding Completion.
14.2 Each party will do, or procure the doing of, all acts and things and
execute, or procure the execution of, all documents as any other party
reasonably considers necessary to give full effect to the terms of this
Agreement.
14.3 Failure or delay by any party in exercising any right or remedy under this
Agreement will not in any circumstances operate as a waiver of it, nor
will any single or partial exercise of any right or remedy in any
circumstances preclude any other or further exercise of it or the exercise
of any other right or remedy.
14.4 Any waiver of any breach of, or any default under, any of the terms of
this Agreement will not be deemed a waiver of any subsequent breach or
default and will in no way affect the other terms of this Agreement.
14.5 It is specifically agreed that no remedy under the Swedish Sale of Goods
Act (Sw. Koplagen 1990:931), as amended, shall be available to the
Purchaser.
14.6 No variation of this Agreement will be valid unless it is in writing and
signed by or on behalf of each party to this Agreement but no variation
will require the consent of any Group Member.
14.7 Except as required by law, all payments by the Vendor pursuant to CLAUSE
5.3 will be made free and clear of all deductions and withholdings whether
in respect of Taxation (as defined in SCHEDULE 4) or otherwise. If any
deduction or withholding
is required by law to be made from any payment by the Vendor pursuant
thereto which is not governed by the provisions of SCHEDULE 4 or if
(ignoring any available relief or allowance) the Purchaser is subject to
Taxation in respect of any such payment which is not governed by the
provisions of SCHEDULE 4 then the Vendor will pay to the Purchaser such
additional amount as is necessary to ensure that the net amount received
and retained by them (after taking account of such deduction or
withholding or Taxation) is equal to the amount which they would have
received and retained had the payment in question not been subject to the
deduction or withholding or Taxation. The provisions of this CLAUSE 14.7
shall not apply, to the extent that the deduction or withholding of
Taxation would not have arisen but for the assignment by the Purchaser of
any of its rights under this Agreement.
15. SERVICE OF PROCESS
15.1 The Vendor irrevocably agrees that any Service Document may be
sufficiently and effectively served on it by service on its agent, the
Vendor's Solicitors if no replacement agent has been appointed and
notified to the Purchaser pursuant to CLAUSE 15.4, or on the replacement
agent if one has been so appointed and notified to the Purchaser.
15.2 Any Service Document served pursuant to this CLAUSE shall be marked for
the attention of:
15.2.1 The Litigation Partner, Xxxxx & XxXxxxxx, 000 Xxx Xxxxxx Xxxxxx,
Xxxxxx XX0X 0XX or such other address within England as may be
notified to the Purchaser by the Vendor; or
15.2.2 such other person as is appointed as agent for service pursuant to
CLAUSE 15.4 at the address notified pursuant to CLAUSE 15.4.
15.3 Any document addressed in accordance with CLAUSE 15.2 shall be deemed to
have been duly served if:
15.3.1 delivered personally, upon delivery; or
15.3.2 sent by prepaid first class post, on the second Business Day after
posting it.
15.4 If the agent referred to in CLAUSE 15.1 (or any replacement agent
appointed pursuant to this CLAUSE 15.4) at any time ceases for any reason
to act as such the Vendor shall appoint a replacement agent to accept
service having an address for service in England and shall notify the
Purchaser of the name and address of the replacement agent; failing such
appointment and notification the Purchaser shall be entitled by
notice to the Vendor to appoint such a replacement agent to act on the
Vendor's behalf.
15.5 A copy of any Service Document served on an agent pursuant to this CLAUSE
15 shall be sent by post to the Vendor at its address for the time being
for the service or notices and other communications under CLAUSE 12, but
no failure or delay in so doing shall prejudice the effectiveness of
service of the Service Document in accordance with the provisions of
CLAUSE 15.1.
16. GOVERNING LAW AND JURISDICTION
16.1 This Agreement will be governed by and construed in accordance with
Swedish law.
16.2 Subject to CLAUSE 16.3 and SCHEDULE 8, any dispute, controversy or claim
arising out of or in connection with this Agreement, or the breach,
termination or invalidity thereof, shall be settled by arbitration in
accordance with the Rules of the Arbitration Institute of the Stockholm
Chamber of Commerce. The arbitral tribunal shall be composed of three
arbitrators. The place of arbitration shall be Stockholm. The language to
be used in the arbitral proceedings shall be English.
16.3 The jurisdiction provisions contained in this CLAUSE are made for the
benefit of the Purchaser only, which accordingly retains the right to
bring proceedings in any other court of competent jurisdiction.
17 COUNTERPARTS
This Agreement may be executed in any number of counterparts each of which
when executed and delivered will be an original, but all the counterparts
will together constitute one and the same agreement.
SCHEDULE 1
THE VENDOR
NAME AND ADDRESS OF REGISTERED AND
BENEFICIAL OWNER NUMBER AND CLASS OF SHARES TO BE SOLD
Cash America International, Inc 1,000 ordinary shares of SEK 100 each
of 0000 Xxxx 0xx Xxxxxx,
Xx. Xxxxx, Xxxxx
00000, XXX
Facsimile Number: 000-000-0000
SCHEDULE 2
DETAILS OF THE COMPANY
Name of Company : CAII Pantbelaning Aktiebolag
Registered number : 556491-6061
Registered office : Xxxxxxxxxx 00, 0 xx.
XX- 000 00 XXXXXXXX
XXXXXX
Date of incorporation : 11 August 1994
Share capital according to by-laws : SEK 100,000 to SEK 400,000
Issued share capital : SEK 100,000 divided into
1,000 shares of SEK 100 each
Directors' full names : Xxxxxx, Xxxxxx R
Fjordgren, Xxxx Xxxxx
Xxxxx, Xxxx Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxx X (Chairman)
Financial Year : 01.01-31.12
Mortgages/charges over Shares or : N/A
Company's assets
DETAILS OF OTHER GROUP MEMBERS
Name of Group Member : Svensk Pantbelaning Service Aktiebolag
Registered number : 556627-7165
Registered office : Xxxxxxxxxx 00, 0 xx.
XX-000 00 XXXXXXXX
XXXXXX
Date of incorporation : 28 May 2002
:
Share capital according to by-laws : SEK 100,000 to SEK 400,000
Issued share capital : SEK 100,000 divided into
1,000 shares of SEK 100 each
Shareholder : Name and address Number and class
of shares held
CAII Pantbelaning AB
Vendevagen 90, 9 tr. 1,000
182 32 DANDERYD
SWEDEN
Directors' full names : Xxxxxxxx, Xxxxx X(Chairman)
Xxxxxx, Xxxxxx R
Fjordgren, Xxxx Xxxxx
Xxxxx, Xxxx Xxxxxx Xxxxxx
Financial Year : 01.01-31.12
Mortgages/charges over company : N/A
assets
Name of Group Member : Murtrum Aktiebolag
Registered number : 556430-2957
Registered office Xxxxxxxxxx 00, 0 xx.
XX-000 00 XXXXXXXX
XXXXXX
Date of incorporation : 12 August 1991
Share capital according to by-laws : SEK 100,000 to SEK 200,000
Issued share capital : SEK 100,000 divided into
1,000 shares of SEK 100 each
Shareholder : Name and address Number and class
of shares held
Svensk Pantbelaning
Service AB 1,000
Xxxxxxxxxx 00, 0 XX
000 00 XXXXXXXX
XXXXXX
Directors' full names Xxxxxxxx, Xxxxx X (Chairman)
Xxxxxx, Xxxxxx R
Fjordgren, Xxxx Xxxxx
Xxxxx, Xxxx Xxxxxx Xxxxxx
Financial Year 01.01-31.12
Mortgages/charges over company : N/A
assets
Name of Group Member : Aktiebolaget Svensk Pantbelaning
Registered number : 556011-8043
Registered office : Xxxxxxxxxx 00, 0 xx.
XX-000 00 XX XXXXXX
XXXXXX
Date of incorporation : 1 December 1913
Share capital according to by-laws : SEK 2,000,000 to SEK 8,000,000
Issued share capital SEK 4,000,000 divided into
4,000 shares of SEK 1,000 each
Shareholder : Name and address Number and class
of shares held
Murtrum AB
Vendevagen 90, 9 tr. 4,000
182 32 DANDERYD
SWEDEN
Directors' full names : Xxxxxxxx, Xxxxx X (Chairman)
Fjordgren, Olle Xxxxx
Xxxxxx, Xxxxxx X
Xxxxx, Xxxxxxx Xxxxxxxxx
Xxxxx, Xxxx Xxxxxx
Xxxxxxxx, Xxx Annelie Helena
Xxxxxxx, Xxxx A
Financial Year : 01.01-31.12
Mortgages/charges over company : N/A
assets
NON-TAXATION WARRANTIES - SCHEDULE 3
1. CAPITAL
1.1. The information contained in SCHEDULES 1 and 2 is true, complete and
accurate in all respects.
1.2. The Shares and the issued shares of each Group Member are fully paid and
are beneficially owned and registered as set out in SCHEDULES 1 and 2 free
from any Encumbrance or any claim to, or Contract to grant, any
Encumbrance.
1.3. No Group Member has allotted or issued any share capital other than the
shares shown in SCHEDULES 1 and 2 as being issued.
1.4. No Contract has been entered into which requires or may require any Group
Member to allot or issue any share or loan capital and no Group Member has
allotted or issued any securities which are convertible into share or loan
capital.
1.5. No Group Member has any interest, or has at any time during the period of
6 years ending on the date of this Agreement had any interest, in the
share capital of any body corporate.
2. VENDOR
2.1. CAPACITY
2.1.1. The Vendor has full power to enter into and perform this Agreement
and this Agreement constitutes obligations binding on the Vendor
in accordance with its terms.
2.2. INSIDERS' INTERESTS
For the purpose of this PARAGRAPH 2.2:
"INSIDER" means the Vendor, any Associated Company or
any person who is or was at the relevant
time a director of any Group Member.
2.2.1. There is not outstanding and there has not at any time during the
period of 3 years ending on the date of this Agreement been
outstanding any Contract to which any Group Member is or was a
party and in which any Insider is or was interested in any way
whatsoever (excluding any Contract of
employment between a Group Member and any of its directors fully,
fairly and clearly disclosed in the Disclosure Letter).
2.2.2. No Insider has any interest, direct or indirect, in any trade or
business which competes or is likely to compete with the Group's
business.
3. ACCOUNTS AND RECORDS
3.1. THE ACCOUNTS
For the purposes of this PARAGRAPH 3:
"ACCOUNTING STANDARDS" refers to (i) the accounting policies,
practices and methods consistent with those
used in the preparation of the Accounts and
(ii) to the extent such accounting policies,
practices and methods do not address a
particular matter, Swedish GAAP applied on a
basis consistent with the GAAP used in the
preparation of the Accounts
3.1.1. The Accounts (a copy of which is attached to the Disclosure
Letter):
(i) show a true and fair view of the assets, liabilities and state of
affairs of each Group Member as at the Accounting Date and of the
profits (or losses) of each Group Member and the Group for the
financial year ended on that date;
(ii) have been prepared and audited in accordance with applicable law and
Accounting Standards and (to the extent that no Accounting Standard is
applicable) with generally accepted accounting principles and practices
of Sweden then in force; and
(iii) have been prepared on bases and principles which are consistent with
those used in the preparation of the audited statutory accounts of each
Group Member for the three financial years immediately preceding that
which ended on the Accounting Date.
3.1.2. Without prejudice to the generality OF PARAGRAPH 3.1.1, the
Accounts attribute a value to Stock taken as a whole which is the
lower of cost or net realisable value as at the Accounting Date
where cost:
(i) in relation to unredeemed pledges means the original loan less capital
repayments plus any incremental remanufacturing costs; and
(ii) in relation to other retail stock means the original purchase price.
3.2. RECORDS
17.1 Each Group Member's accounting records are up to date and, as far as
the Vendor is aware, comply with applicable law and regulation in all
material respects. Each Group Member's records and information are
exclusively owned by it and under its direct control.
3.3. PROFITS AND LOSSES
17.2 The profits or losses and value of net assets of each Group Member
for the three consecutive financial years ended on the Accounting Date as
shown in the Accounts (and by the previous audited accounts of each Group
Member delivered to the Purchaser) have not (except as disclosed in those
accounts) been rendered exceptionally high or low by the inclusion of
non-recurring items of income or expenditure, or by transactions entered
into otherwise than on normal commercial terms nor have they been affected
by any other factors rendering such profits or losses or value of net
assets for any such periods exceptionally high or low.
3.4. MANAGEMENT ACCOUNTS
17.3 Except as fairly disclosed in the Disclosure Letter, the management
accounts of each Group Member in respect of the period from the Accounting
Date to 31 July 2004, a copy of which is attached to the Disclosure
Letter, have been prepared on principles consistent with those used in
the preparation of the Accounts and with reasonable skill and care and
provide statements of each Group Member's assets and liabilities as at 31
July 2004 which, taken as a whole, are not materially misleading or
inaccurate.
4. CHANGES SINCE THE ACCOUNTING DATE
4.1. GENERAL
4.1.1. Since the Accounting Date:
(i) the business of each Group Member has been carried on in the ordinary
and usual course and in the same manner (including nature and scope) as
in the 12 months preceding the Accounting Date;
(ii) there has been no material adverse change in the financial or trading
position or prospects of the Group including any material adverse
change in respect of
turnover, profits, margins of profitability, liabilities (actual or
contingent) or expenses (direct or indirect) of the Group; and
(iii) there has been no material reduction in the value of the net assets of
any Group Member determined in accordance with the same accounting
policies as those applied in the Accounts (on the basis that each of
the assets of each Group Member is valued at a figure no greater than
the value attributed to it in the Accounts or, in the case of any
assets acquired by each Group Member after the Accounting Date, at a
figure no greater than cost).
4.2. SPECIFIC
4.2.1. Since the Accounting Date:
(i) no Group Member has acquired, or agreed to acquire, any single asset
having a value in excess of SEK 270,000 or assets having an aggregate
value in excess of SEK675,000, other than in the ordinary course of
business;
(ii) no Group Member has disposed of, or agreed to dispose of, any asset
having a value reflected in the Accounts in excess of SEK 270,000 or
acquired since the Accounting Date other than in the ordinary course of
business;
(iii) no loan made by any Group Member which remains outstanding has become
due and payable in whole or in part to the Group Member other than in
the ordinary course of business;
(iv) no Group Member has borrowed or raised any money or taken up any
financial facilities nor repaid any borrowing or indebtedness in
advance of its stated maturity other than in the ordinary course of
business;
(v) no Group Member has sold or agreed to sell a debt and no debt has been
released, deferred, subordinated or written off by any Group Member;
(vi) no dividend has been declared, paid or made by any Group Member;
(vii) no resolution of the shareholders of any Group Member has been passed
(viii) no Group Member has changed its accounting reference date;
(ix) no Group Member has assumed or, so far as the Vendor is aware,
incurred, or agreed to assume or incur, a liability, obligation or
expense (actual or contingent) for a value in excess of SEK 270,000,
other than in the ordinary course of business;
(x) no management or similar charge has become payable or been paid by the
any Group Member to the Vendor or any Associated Company;
(xi) no share or loan capital has been allotted, issued, repaid or redeemed
or agreed to be allotted, issued, repaid or redeemed by any Group
Member; and
(xii) no payment has been made by any Group Member to, or benefit conferred
(directly or indirectly) by any Group Member on, the Vendor, any past
or present director of any Group Member.
5. ASSETS
5.1. UNENCUMBERED TITLE; POSSESSION
5.1.1. Each asset included in the Accounts or acquired by each Group
Member since the Accounting Date (save for Stock disposed of in
the ordinary course of business) and each asset used by a Group
Member or which a Group Member holds out as being, or claims is,
in the ownership of the Group Member is legally and beneficially
owned by the Group Member free from any Encumbrance or any claim
to, or Contract to grant, any Encumbrance;
5.1.2. Any asset of each Group Member having a book value in excess of
SEK 67,000 and which is not situated in the premises of any Group
Member at Completion is specified in the Disclosure Letter and the
asset is clearly identified as an asset of the Group Member.
5.1.3. As far as the Vendor is aware, each Group Member owns or is
entitled to the lawful use of each asset necessary for the
carrying on of its business in the manner in which it is currently
carried on.
5.1.4. No registrable Encumbrance in favour of any Group Member is void
or voidable for want of registration.
5.2. DEBTORS
5.2.1. No Group Member has made, or entered into any Contract to make,
any loan to, or other arrangement with, any person as a result of
which it is or may be owed any money, other than trade debts
incurred in the ordinary course of business and cash at bank.
5.2.2. No Group Member is entitled to the benefit of any debt otherwise
than as the original creditor and no Group Member has factored,
deferred or discounted any debt or agreed to do so.
5.3. STOCK
5.3.1. The Stock now held by each Group Member and not written off in the
Accounts is not obsolete.
5.3.2. Since the Accounting Date:
(i) there has been no significant abnormal increase or reduction of Stock;
and
(ii) such of the Stock as is reflected in the Accounts which have been
realised was realised for an amount in aggregate no less than the loans
made in respect of such Stock.
5.3.3. The pledge loan balance recorded in the books of each Group Member
is in aggregate materially accurate and for the purposes of this
warranty "materially accurate" shall mean within SEK 2,500,000 of
the actual aggregate amount of such balance.
5.4. PLANT ETC.
The plant and machinery, vehicles, fixtures and fittings, furniture,
tools and other equipment used in connection with the business of the
Group:
(i) are in a reasonably good and safe state of repair and condition and
satisfactory working order and have been regularly maintained to a good
standard and in accordance with any safety regulations usually observed
in relation to them; and
(ii) are fully and accurately recorded in the plant register.
6 INTELLECTUAL PROPERTY RIGHTS
6.1. For the purpose of this paragraph and PARAGRAPH 6:
"INTELLECTUAL PROPERTY RIGHTS" means all patents, trade marks, business
names, copyright, moral rights, rights to
prevent passing off, rights in designs,
know how and all other intellectual or
industrial property rights, in each case
whether registered or unregistered and
including applications or rights to apply
for them and together with all extensions
and renewals of them, and in each and
every case all rights or forms of
protection having equivalent or similar
effect anywhere in the world; and
"SOFTWARE" means any form of computer program,
including applications software and
operating systems, whether in source or
object code form.
6.2. To the Vendor's knowledge, each Group Member owns or has a right to use
all Intellectual Property Rights necessary to carry on the respective
Group Member's business in the manner carried on as at the date of this
Agreement.
6.3. To the Vendor's knowledge, all of the Company's Intellectual Property
Rights which are registered or subject to applications for registration or
which are unregistered trademarks are listed and described in the
Disclosure Letter.
6.4. To the Vendor's knowledge, in respect of registered Intellectual Property
Rights, all renewal fees have been duly paid, all steps required for their
maintenance have been taken and to the Vendor's knowledge there are no
grounds on which any person is or will be able to seek cancellation,
rectification or any other modification of any registration.
6.5. To the Vendor's knowledge, there are, and have been, no proceedings,
actions or claims within the six years prior to the date of this Agreement
and none are pending or have been threatened, impugning the title,
validity or enforceability of a Group Member's Intellectual Property
Rights, or claiming any right or interest in such Intellectual Property
Rights.
6.6. To the Vendor's knowledge, there is, and has been, no infringement within
the six years prior to the date of this Agreement of a Group Member's
Intellectual Property Rights, and none is threatened.
6.7. To the Vendor's knowledge, the past and present activities of the
respective Group Member (including the processes, methods, Software, goods
and services used or dealt in by it, and the products or services
manufactured or supplied by it):
(i) do not infringe and have not infringed within the six years prior to
the date of this Agreement any Intellectual Property Rights of any
third party; and
(ii) have not, and will not, result in a claim in respect of Intellectual
Property Rights against any Group Member.
6.8. To the Vendor's knowledge there are no circumstances which would render
any current application for registration of any Group Member's
Intellectual Property Rights unacceptable to the relevant registry or
other authority or which would prevent any such application from
proceeding to grant and registration.
6.9. Complete and accurate copies of all written licences, sub-licences and
other agreements whereby a Group Member is licensed or otherwise
authorised to use the Intellectual Property Rights of a third party (other
than Intellectual Property Rights subsisting in or relating to Software or
Computer Systems) or where the Company licenses or otherwise authorises a
third party to use Intellectual Property Rights of the Company are
attached to the Disclosure Letter. To the Vendor's knowledge, all of
them are in full force and effect, no notice having been given to
terminate them and the material obligations of all parties in respect of
them have been complied with and no disputes have arisen in respect of
them.
6.10. The Disclosure Letter contains a full list of domain names and other
electronic addresses in connection with the Internet or Worldwide Web,
which are held by, registered on behalf of, or are or which are used in
respect of the Group.
7 COMPUTER SYSTEMS
7.1. For the purposes of this PARAGRAPH 7:
"COMPUTER SYSTEMS" means all computer hardware, Software,
micro-processors and any other items
that connect with any of them which in
each case are used in a Group Member's
business or are in the possession of a
Group Member.
7.2. Details of all material Software used by the Group Members to carry on the
Group Member's business in which the Intellectual Property Rights are
owned by a third party are set out in the Disclosure Letter. To the
Vendor's knowledge, the licences of such Software are complied with in all
material respects in the operation of the business of the Company as at
the date of this Agreement and any restrictions in those licences do not
adversely affect the present conduct of the business of any Group Member
or any plans for its respective conduct currently under consideration as
at the date of this Agreement.
7.3. To the Vendor's knowledge, the Group has a disaster recovery plan for the
Group in respect of material Computer Systems.
7.4. To the Vendor's knowledge, each Group Member has procedures in place in
respect of the security of the material Computer Systems and data stored
on them.
7.5. To the Vendor's knowledge, the material Computer Systems (and each part of
each of them) have functioned consistently and accurately since being
installed, (except for pre-planned maintenance shut downs).
7.6. To the Vendor's knowledge, each Group Member has a sufficient number of
employees who are technically competent and appropriately trained to
ensure the proper operation and use of the Computer Systems.
7.7. To the Vendor's knowledge, the data storage capability, functionality and
perfonnance of each item of the material Computer Systems and the Computer
Systems as a whole are satisfactory for the business as presently
conducted.
8. LEASED PREMISES
8.1. No Group Member:
(i) owns any real property, is not in occupation of and is not entitled to
any estate or interest in any freehold property;
(ii) is a party to any uncompleted agreement to acquire or dispose of any
real property;
(iii) has any current ongoing liability (whether actual or contingent) in
relation to any real property.
8.2. SCHEDULE 6 contains a complete list and brief particulars of all Leases.
8.3. So far as the Vendor is aware there are appurtenant to the Leased Premises
all rights and casements reasonably necessary for their present use and
enjoyment.
8.4. All Leases are valid and effective in accordance with their respective
terms and are not subject to any Encumbrances that may restrict their
usage for the purposes for which they are currently used. Each Group
Member has vacant possession of its respective Leased Premises and no
other person has any current right to possession or occupation of the
Premises.
8.5. MATTERS AFFECTING THE LEASED PREMISES
In relation to any Leased Premises no written notice has so far as the
Vendor is aware been received by a Group Member alleging any breach of
covenant contained in a Lease.
8.6. COMPLIANCE WITH STATUTE
No Group Member has so far as the Vendor is aware been received from any
competent authority any written notice alleging that the current or
previous use by a Group Member of any of the Leased Premises, breach the
provisions of relevant legislation from time to time (including but not
limited to applicable zoning or building regulations and EHS Law) and
regulations made under such legislation and which are still outstanding.
8.7. LEASED PREMISES
17.4 The Data Room contains copies of all, not insignificant, documents
subsisting at the date of the establishment of the Data Room relating to
the Leased Premises of which the Vendor has knowledge.
9. ENVIRONMENTAL/HEALTH AND SAFETY (EHS) MATTERS
9.1. DEFINITIONS
9.1.1. For the purposes OF PARAGRAPH 9:
"EHS LAW" means all applicable law (whether criminal, civil or
administrative), common law, judgment, court order,
statute, statutory instrument, regulation, directive,
European Union decision (insofar as legally binding),
by-law, treaty, government
circular, code of practice and guidance notes, or
instruction or decision of any competent
regulatory body in force at Completion relating to
EHS Matters
"EHS MATTERS" means all or any matters relating to the pollution
or protection of the Environment or harm to or the
protection of human health and safety or the
health of animals and plants
"EHS PERMITS" means all or any permits, consents, licences,
approvals, certificates and other authorisations
required by EHS Law for the operation of the
business of each Group Member or the condition or
use of the Leased Real Property
"ENVIRONMENT" means any air (including air within natural or
man-made structures above or below ground), water
(including territorial, coastal and inland waters,
ground water and water in drains and sewers), and
land (including surface land, sub-surface land,
seabed and river bed under water)
"HAZARDOUS SUBSTANCE" means any matter, whether alone or in combination
with any other matter, capable of causing harm to
man or any other living organism or damaging to
the Environment or public health or welfare,
including radioactive matter, ozone depleting
substances, and genetically modified organisms.
9.2 EHS PERMITS
17.5 To the Vendor's knowledge at Completion, each Group Member has
lawfully obtained all EHS Permits which it is required by law to obtain
and at Completion each EHS Permit (true copies of which are attached to
the Disclosure Letter) is in full force and effect and each Group Member
in all material respects complies and has complied at all times in all
material respects with all conditions of each EHS Permit.
9.3. COMPLIANCE WITH EHS LAW
9.3.1. To the Vendor's knowledge, each Group Member and its officers,
agents and employees comply and have at all times complied in all
material respects with EHS Law.
9.3.2. No Group Member has received any written notification from any
relevant authority alleging that the Group Member is in breach of
EHS Law, or where failure to comply with such notification would
constitute a breach of EHS Law or where compliance with such
notification would be secured by further proceedings by such
relevant authority. To the Vendor's knowledge, there are no
circumstances at Completion which would give rise to such a
notification being received and the Vendor is not aware of any
intention on the part of any such authority to give such
notification.
9.4. LIABILITY
9.4.1. To the Vendor's knowledge, there are no facts or circumstances
existing at Completion which may give rise to any actual liability
(whether civil, administrative or criminal) on the part of any
Group Member in relation to EHS Matters.
9.4.2. No Group Member has received any notice of any complaint or claim
from any person in respect of EHS Matters.
9.4.3. No Group Member is or has been engaged in any action, litigation,
arbitration or dispute resolution proceedings or subject to any
investigation under EHS Law or otherwise in relation to EHS Matters
and the Vendor is not aware of any such matters pending or being
threatened or of any circumstances or facts likely to give rise to
any such matters.
9.5. CONTAMINATION
9.5.1. To the Vendor's knowledge, all sites (including Leased Real
Property) now or formerly owned or occupied or used by each Group
Member are at Completion free from any Hazardous Substance which
would give rise to any actual liability on the part of the Group
Member under EHS Law.
9.5.2. To the Vendor's knowledge, there are at Completion no circumstances
which are reasonably likely to require material expenditure (by any
Group Member) in cleaning up any real property in order to comply
with EHS Law.
10. EMPLOYEES
10.1. Full particulars of the identities, dates of commencement of employment
(or appointment to office), dates of birth, and remuneration, benefits and
emoluments (including any loan arrangement, bonus, commission, profit
sharing, share and other incentive schemes, and collective or workforce
agreements) of all the employees, workers and officers of each Group
Member are fully and accurately set out in the Disclosure Letter and
copies of templates of their written service agreements or contracts of
employment or particulars of employment statements (and all manuals,
handbooks, rules, regulations and statements of terms, conditions,
policies, procedures and practices) are attached to the Disclosure Letter.
10.2. There are no amounts owing to any present or former officers, workers or
employees of any Group Member, other than remuneration accrued (but not
yet due for payment) in respect of the calendar month in which this
Agreement is executed and none of them is entitled to accrued but unpaid
holiday pay or accrued but untaken holiday leave in respect of the
relevant Group Member's previous holiday year.
10.3. All Contracts of employment between each Group Member and its directors
(except for the general manager) and employees are terminable subject to
the restrictions in the Swedish Employment Protection Act (Sw: Lagen om
anstallningsskydd) by each Group Member by giving notice in accordance
with the notice periods stipulated by the Employment Protection Act, and
no Group Member is contractually obliged to make any payment as a
consequence of the termination of any such Contract.
10.4. No Group Member has:
10.4.1. employed or engaged or made any offers to employ nor engage any
person:
10.4.1.1. since the Accounting Date; or
10.4.1.2. where such employment or engagement will take effect after
the date of this Agreement;
10.4.2. given or received notice to terminate the employment or
engagement of any person and no person has ceased to be employed
or engaged by any Group Member:
10.4.2.1. since the Accounting Date; or
10.4.2.2. where such notice has not yet expired; or
10.4.3. made, agreed or proposed or is party to any contractual
arrangement to make any change of terms and conditions of
employment or engagement of any of the employees of any Group
Member:
10.4.3.1. since the Accounting Date; or
10.4.3.2. where such change of terms and conditions has not yet
taken effect.
10.5. So far as the Vendor is aware there is no person previously employed or
engaged by any Group Member who now has or may have a statutory or
contractual right to return to work or to be re-instated or re-engaged by
the relevant Group Member.
10.6. Full details of all employees who have been absent from work for a
continuous period of more than four weeks (whether on maternity leave,
unpaid leave, long-term sickness, secondment, authorised annual leave or
otherwise) in the 12 month period ending on the date of this Agreement
are contained in the Disclosure Letter.
10.7. No Group Member has recognised, and, so far as the Vendor is aware, has
done any act which might be construed as recognition of, a trade union
and no Group Member is party to any agreement or understanding with any
trade union or organisation of employees or workers nor are any steps
being taken by employees, workers or other representatives to ensure
trade union recognition.
10.8. No Group Member is involved, and has during the 12 months prior to the
date of this Agreement been involved, in any strike, lock-out, industrial
or trade dispute or any negotiations with any trade union or body of
employees or workers.
10.9. No Group Member operates or intends to operate and has operated any short
time working scheme or arrangement or any redundancy or redeployment
scheme or arrangement, whether formal or informal, contractual or
non-contractual, which provides for payments greater than those required
by statute or for notice periods greater than those set out in contracts
of employment or engagement or in the Employment Protection Act.
10.10. No Group Member uses the services of outworkers, agency or other
self-employed persons, contracted labour or agents.
10.11. So far as the Vendor is aware each Group Member has, in relation to all
present and former employees and workers, complied with all statutes,
regulations, orders and codes of conduct relating to employment and
relations with employees and trade unions and has maintained adequate and
suitable records, where required to do so by
law, regarding the service of each of its employees and has complied with
all agreements for the time being having effect as regards such relations
or the conditions of service of its employees (whether collectively or
individually).
11. PENSIONS
11.1. The Pension Schemes are the only arrangements to which the Group Members
have any liability for the purpose of providing benefits on retirement or
death.
11.2. The Vendor has supplied to the Purchaser documents containing full,
accurate and up to date details of the Pension Schemes and of the Group
Members' and their employees' obligations and liabilities under it.
11.3. The Group Members and the Pension Schemes comply and have at all times
complied with all legal and regulatory requirements (including equal
treatment and data protection requirements), relevant to the Pension
Schemes and the Group Members' participation in the Pension Schemes.
11.4. No claim, dispute, complaint or investigation has arisen which relates to
the Pension Schemes or to the provision of retirement or death benefits in
respect of the Group Members' current and former employees, and as far as
the Vendor is aware there is no reason why any such claim, dispute,
complaint or investigation could arise.
11.5. All amounts payable by the Group Members to and in respect of the Pension
Schemes have been paid.
11.6. All death in service benefits under the Pension Schemes are insured.
11.7. All benefits under the Pension Schemes are calculated on a money purchase
basis only and there is no obligation on the Group Members or under the
Pension Schemes to provide any targeted level of benefits.
11.8. No liability has been or, as far as the Vendor is aware having made
enquiries of relevant parties, may be imposed on the Group Members as a
debt due to any occupational pension scheme.
12. INSURANCE
12.1. To the Vendor's knowledge, each Group Member is, and has at all material
times been, adequately covered against accident, damage, injury, third
party loss, loss of profits and any other risk normally insured against by
persons carrying on the same classes of business as the Group Members.
12.2. All premiums due in relation to each Group Member's policies of insurance
have been paid, and to the Vendor's knowledge, nothing has been done or
omitted to be done which would make any policy of insurance of each Group
Member void or voidable or which might lead to any liability under such
insurance being avoided by the insurers or which is likely to result in an
increase in premium or which would release any insurer from any of its
obligations under any policy of insurance of each Group Member.
12.3. No insurance claim is pending or outstanding and to the Vendor's
knowledge, there are no circumstances which might result in any such
claim.
12.4. Full particulars of each Group Member's insurances and of all claims made
against those insurances in the last 2 years are set out in or attached to
the Disclosure Letter.
13. FINANCING AND WORKING CAPITAL
13.1. The amount borrowed by each Group Member from its bankers does not exceed
the amount of the facility agreed with such bankers and the total amount
borrowed by each Group Member from whatever source does not exceed any
limitation on its borrowing contained in its articles of association or in
any Contract, debenture, loan stock deed or any other document.
13.2. No Group Member has procured or (indirectly or directly) engaged in any
borrowing or financing not required to be reflected in its statutory
accounts.
13.3. Full and accurate details of all overdrafts, loans or other financial
facilities outstanding or available to each Group Member are set out in
the Disclosure Letter and copies of all documents relating to those
facilities are attached to the Disclosure Letter. Nothing has been done or
omitted to be done which might affect or prejudice the continuance of any
of those facilities in full force and effect; and no person who provides
any of those facilities has given any indication that it may be withdrawn
or its terms altered.
13.4. The Disclosure Letter contains details, correct in all material respects
at the date stated in it, of the credit or debit balances on all the bank
or deposit accounts of each Group Member. Since that date there have been
no payments out of any of those accounts except for routine payments in
the ordinary and usual course of each Group Member's business and the
balances on those accounts are not now substantially different from the
balances shown in the Disclosure Letter.
13.5. No indebtedness of any Group Member is due and payable and no security
over any assets of any Group Member is now enforceable. No Group Member
has failed to
comply with any notice from a creditor requiring any payment to be made or
seeking enforcement of any security which it may hold over any Group
Member's assets.
13.6. No person has given any guarantee of or security for any overdraft, loan,
other financial facility granted to any Group Member or other liability of
any Group Member.
13.7. No Group Member has applied for or received any grant, subsidy or
financial assistance from any government department or other body.
14. MATERIAL CONTRACTS
14.1. No Group Member has, an has not been since the Accounting Date, a party
to, liable under or subject to any Contract either which cannot be
terminated at the absolute discretion of the Group Member within three
months and under which the Group Member will receive income or incur
expenditure in excess of SEK 270,000 in any twelve month period and:
(i) involves agency, distributorship, franchising, marketing rights,
information sharing, manufacturing rights, consultancy, servicing,
maintenance, inspection or testing;
(ii) involves partnership, joint venture, consortium, joint development,
shareholders or similar arrangements;
(iii) involves hire purchase, conditional sale, credit sale, leasing, hiring
or similar arrangements;
(iv) involves or is likely to involve any capital expenditure by a Group
Member or involves or is likely to involve an aggregate expenditure or
receipt in excess of SEK 675,000 by a Group Member;
(v) is incapable of complete performance in accordance with its terms
within 6 months after the date on which it was entered into;
(vi) is for the supply of goods by or to the Group Member on a sale or
return basis or on a consignment stock basis;
(vii) is for the supply of goods or services by or to the Group Member on
terms under which retrospective or future discounts, price reductions
or other financial incentives are given;
(viii) is for the supply of goods or services by or to the Group Member which
is not on the current standard terms and conditions on which the Group
Member normally contracts to buy or supply goods or services, copies of
which are attached to the Disclosure Letter;
(ix) involves the forward purchase or sale of any currency, commodity,
precious metal or other asset;
(x) involves delegation of any power under a power of attorney or
authorisation of any person (as agent or otherwise) to bind or commit
the Group Member to any obligation;
(xi) restricts the freedom of the Group Member to carry on its business in
any part of the world or to use or exploit any of its assets, in each
case in such manner as it may think fit;
(xii) involves conditions, warranties, indemnities or representations given
in connection with a sale of shares or an undertaking or fixed assets;
(xiii) is a guarantee, indemnity, surety or form of comfort in respect of the
obligations of a third party, under which any liability or contingent
liability is outstanding; or
(xiv) is not on arm's length terms or is in any way otherwise than in the
ordinary and proper course of the Group Member's business.
15. PAWNBROKER COMPLIANCE
15.1. For the purposes of the following paragraphs:
"Loans" means all and any loans advanced to customers of the
Aktiebolaget Svensk Pantbelaning (shall be referred to
as "SP" in this clause 15);
"Pawn Books" means the pawn books (Sw. pantbocker) kept by SP;
"Pawn Tickets" means the pawn tickets (Sw. pantsedlar) issued by SP;
"Pledge Stocks" means the items of personal property held by way of a
pawn arrangement.
15.2. GENERAL
15.2.1. All outstanding transactions entered into the Pawn Books and all
Pawn Tickets constitute legal obligations binding in all respects
on SP and the customers of SP as limited by mandatory rules in the
Act.
15.2.2. At all times during the existence of all or any of the Loans SP
has held and still holds all requisite licences under the Act.
15.2.3. SP has not assigned or granted any third party rights to or over
any right deriving from any transaction with customers of SP.
15.3. THE LOANS
15.3.1. SP is the legal owner of every Loan free and clear of all
mortgages, charges, liens, financial encumbrances and equities.
15.3.2. All steps necessary to perfect SP's title to the Loans have been
taken.
15.3.3. No Loan has been advanced on terms other than on and in accordance
with the terms of the template pawn ticket provided the Data Room.
15.3.4. Each Loan constitutes the legal valid and binding obligation of
the customer who is party to it and the terms are enforceable.
15.3.5. No Group Member has received notice of nor has it been involved in
any litigation or disputes relating to the Loans including without
limitation calling into question SP's title to any Loan or its
collection activities in relation to the Loans.
15.3.6. No complaints from with any County Administrative Board or any
other government or consumer protection agency has been received
or entered into by SP or on its behalf.
15.4. ADMINISTRATION OF LOANS
15.4.1. SP keeps or causes to be kept in respect of the Loans proper Pawn
Books showing all transactions, payments and receipts relating to
Loans and all Pawn Books are complete and accurate in all material
respects and are retained for periods of at least, five years.
15.4.2. No fraud has been perpetrated by any of the Group Members'
respective directors in connection with the origination,
completion or management of any Loan.
15.4.3. So far as the Vendor is aware, there has been no pattern of
fraudulent behaviour which has been perpetrated by the employees
or agents of SP or any other Group Member in connection with the
origination, completion or management of any Loan.
15.5. PAWN
15.5.1. SP's processes in relation to the Pledge Stocks where a Loan is
not repaid relating to the realisation of the relevant Pledge
Stocks are in compliance with the Act.
15.5.2. SP has not received any complaints or allegation that its
processes for instigating the sale and then selling any Pledge
Stock are unlawful, unfair or inappropriate.
15.5.3. SP has no current, and during the last two years, has had no
material litigation or, so far as the Vendor is aware, disputes
relating to its entitlement to hold the Pledge Stocks or the money
realised on sale of any Pledge Stocks.
16. OTHER BUSINESS MATTERS
16.1. During the 12 months ending on the date of this Agreement there has been
no known substantial change in the basis or terms on which any person is
prepared to do business with each Group Member (apart from normal price
changes), and no substantial customer or supplier of each Group Member
(providing 5% or more of each Group Member's supplies or turnover in any
accounting year) has ceased or substantially reduced its business with
each Group Member, and no indication has been received by any Group Member
or the Vendor that there will or may be any such change, cessation or
reduction.
16.2. No Group Member carries on business under any name other than its own
corporate name or any other name specified in the Disclosure Letter and
there are no circumstances which might prevent any Group Member from
continuing to carry on business under such names.
16.3. During the 12 months ending on the date of this Agreement no code of
practice and no notice affecting prices has been issued by any government
department, association or similar body which relates to any Group
Member's business.
17. COMPLIANCE, DISPUTES
17.1. COMPANY LAW MATTERS
17.1.1. Compliance has been made with all legal requirements in connection
with the formation of each Group Member and all issues and grants
of shares, debentures, notes, mortgages or other securities of
each Group Member.
17.1.2. The copy of the articles of association of each Group Member
attached to the Disclosure Letter is true, complete and up to
date. To the Vendor's knowledge, each Group Member has at all
times carried on its business and affairs in all respects in
accordance with its articles of association.
17.1.3. All annual reports, resolutions and other documents required to be
filed with or delivered to the Swedish Companies Registration
Office by each Group Member or any of its officers have been
properly and correctly prepared in all respects and so filed and
delivered, and no such annual reports, resolutions or other
documents have been so filed or delivered during the period of 14
days ending on the date of this Agreement.
17.1.4. The share ledger of each Group member has been properly kept and
contain an accurate record of the matters required to be dealt
with in the share ledger and no notice or allegation that it is
incorrect or should be rectified has been received.
18. GENERAL LEGAL COMPLIANCE
18.1. Each Group Member has obtained all necessary licences, consents, permits
and authorities (public and private) to enable it to carry on its business
effectively in the places and in the manner in which such business is now
carried on. All such licences, consents, permits and authorities (copies
of which are enclosed with the Disclosure Letter) are valid and subsisting
and have been complied with in all material respects and to the Vendor's
knowledge there is no reason why any of them should be suspended,
cancelled or revoked.
18.2. To the Vendor's knowledge, each Group Member has conducted its business in
accordance with all applicable legal and administrative requirements
(including but not limited to the Act, the Swedish Distance Contracts Act
(Sw: Lag (2000:274) om
konsumentskydd vid distansavtal och hemforsaljningsavtal), the Swedish
Market Practices Act (Sw: Marknadsforingslagen (1995:450)), the Swedish
Act governing trade with precious metals (Sw: Lag (1999:779) xx xxxxxx
med adelmetallarbeten), the Swedish Data Protection Act (Sw:
Personuppgiftslagen (1998:204) and the E-Commerce (EC Directive)
Regulations 2002.
18.3. To the Vendor's knowledge, none of the officers of any Group Member
(during the course of his duties in relation to the relevant Group Member)
has committed or omitted to do any act or thing in material contravention
of any law, order, regulation or the like in Sweden or elsewhere nor, to
the Vendor's knowledge has its agents or employees committed or omitted to
do any act or thing in material contravention of any law, order,
regulation or the like in the Sweden or elsewhere, so as to result in a
pattern of such behaviour.
18.4. To the Vendor's knowledge, there is not pending, or in existence, any
investigation or enquiry by, or on behalf of, any governmental or other
body in respect of the affairs of any Group Member.
18.5. To the Vendor's knowledge, the Group Member's assets do not include any
property deriving from a criminal acquisition as defined by chapter 9,
section 6 of the Swedish Penal Code (Sw: brottsbalken).
19. FAIR TRADING
19.1. To the Vendor's knowledge, no agreement, transaction, practice or
arrangement carried on or proposed to be carried on by any Group Member
(or by any person for whose acts or defaults any Group Member may be
contractually or vicariously liable), whether unilaterally or with others,
or to which any Group Member (or any such person) is or proposes to become
a party, and no state of affairs applicable to any Group Member (or any
such person):
19.1.1. is or has been the subject of an enquiry, investigation, reference
or report under the Swedish Competition Act (konkurrenslag
(1993:20)) (or any other legislation relating to anti-competitive
behaviour, monopolies or mergers);
19.1.2. infringes or falls within the scope of Section 6 of the Swedish
Competition Act, or constitutes an abuse of dominant position
contrary to Section 19 of such Act or is or has been the subject
of any enquiry, request for information, investigation or
proceedings in respect of either of these Sections;
19.1.3. infringes or falls within the scope of Article 81 of the treaty
establishing the European Union (the "EC Treaty"), or constitutes
an abuse of dominant position contrary to Article 82 of the EC
Treaty, or infringes or falls within the scope of any regulation
or other enactment made under Article 83 of the EC Treaty, or is
or has been the subject of any enquiry, request for information,
investigation or proceeding in respect of any of those Articles;
19.1.4. infringes or falls within the scope of any other competition,
anti-restrictive trade practice, anti-trust or consumer protection
law or legislation applicable in Sweden or elsewhere and not
specifically mentioned in this paragraph or is or has been subject
to any investigation, request for information, notice or other
communication by any court, governmental or regulatory authority;
or
19.2. No Group Member has made or threatened to make any complaint against any
other person to any relevant authority under any law or legislation
referred to in this paragraph.
19.3. No Group Member has given any assurance or undertaking to the Swedish
Competition Authority (Konkurrensverket), the Commission or Court of First
Instance or Court of Justice of the European Union, or any other court,
person or body, and no Group Member is subject to any act, decision,
regulation, order or other instrument (statutory or otherwise) made by any
of them relating to any matter referred to in this paragraph.
19.4. To the Vendor's knowledge, no Group Member is in default or in
contravention of any article, act, decision, regulation, order or other
instrument or of any assurance or undertaking relating to any matter
referred to in this paragraph.
20. LITIGATION
20.1. Save in respect of the collection by each Group Member of less than SEK
67,500 individually and of less than SEK 270,000 in aggregate arising in
the ordinary course of business neither any Group Member nor any person
for whose acts or defaults the relevant Group Member may be contractually
or vicariously liable is involved (whether as claimant, defendant or
otherwise) in any civil, criminal, tribunal, arbitration, administrative
or other proceedings.
20.2. To the Vendor's knowledge, no civil, criminal, tribunal, arbitration,
administrative or other proceedings are pending or threatened by or
against or concern any Group Member and there are no facts or
circumstances likely to result in any such proceedings.
20.3. There is no outstanding or unsatisfied judgement, decree, order, award or
decision of a court, tribunal, arbitrator or governmental agency against
any Group Member and no Group Member is party to any undertaking or
assurance given to a court, tribunal or any other person in connection
with the determination or settlement of any claim or proceedings.
21. DEFAULT
21.1. No Group Member has manufactured, sold or supplied any product or service
which did not or does not comply in all respects with all applicable laws,
regulations, standards (including any Swedish or European Union standards)
and customers' specifications or any representation or contractual term
expressly or impliedly made by any Group Member or which is, was or will
become defective or unsafe.
21.2. To the Vendor's knowledge, no Group Member is in breach of any Contract to
which it is a party, and no other party to any such Contract is in breach
of it. All agreements, rights, commitments, obligations, arrangements and
understandings to which any Group Member is a party are valid and
enforceable. The Vendor is not aware of any grounds for the termination,
rescission, avoidance or repudiation of any Contract by any Group Member
or any other party to any such Contract.
22. INSOLVENCY
22.1. No meeting has been convened at which a resolution will be proposed, no
petition has been presented, no order has been made and no resolution has
been passed for the winding-up of any of the Group Members or for the
appointment of any liquidator. No Group Member has called any formal or
informal meeting of all or any of its creditors.
22.2. No administrative receiver or manager has been appointed of the whole or
any part of the property, assets or undertaking of any Group Member.
22.3. No administrator has been appointed in respect of any Group Member and no
steps or actions have been taken in connection with the appointment of an
administrator in respect of any Group Member.
22.4. No voluntary arrangement has been proposed or approved under chapter 13 of
the Swedish Companies Act (Sw: Aktiebolagslagen (1975:1385)).
22.5. No distress, execution or other process has been levied on or applied for
in respect of any asset of any Group Member.
22.6. No Group Member has stopped or suspended the payment of its debts in
accordance with chapter 0, xxxxxxx 0 xx xxx Xxxxxxx Xxxxxxxxxx Xxx (Xx:
Konkurslagen) or received a written demand pursuant to chapter 2,
section 9 of the Swedish Insolvency Act and no Group Member is insolvent
or unable to pay its debts within the meaning of chapter 1, section 2 of
the Swedish Insolvency Act.
22.7. No disqualification order has at any time been made pursuant to the
provisions of the Swedish Trading Prohibition Act (Sw: Lagen (1986:436)
om naringsforhud) against any former or current officer of the Company.
22.8. No Group Member and none of its directors has consulted a person
qualified to act as an insolvency practitioner (Sw: rekonstruktor) under
chapter 2, section 11 of the Swedish Act on Company Reconstruction (Sw:
lag (1996:764) om foretagsrekonstruktion) with a view to minimising the
potential loss to the relevant Group Member's creditors or otherwise in
relation to any financial difficulty of such Group Company.
22.9. No Group Member has been a party to any transaction below market value
nor has any Group Member made any transactions which would be
recoverable pursuant to chapter 4, section 5 of the Swedish Insolvency
Act, in either case within the period of 2 years ending on the date of
this Agreement.
22.10. To the Vendor's knowledge, there are no facts in existence which are
likely to lead to any of the events or circumstances referred to in this
paragraph.
23. EFFECTS OF THE AGREEMENT
23.1. The execution of this Agreement and the observance and performance of
its provisions will not and is not likely to:
(i) result in a breach of any Contract, law, regulation, order, judgement,
injunction, undertaking, decree or similar imposition to or by which a
Group Member is party or bound, or entitle any person to terminate or
avoid any Contract to which a Group Member is party, or have any
material effect on any such Contract;
(ii) result in the loss or impairment of or any default under any licence,
authorisation or consent required by a Group Member for the purposes
of its business;
(iii) result in the creation, imposition, crystallisation or enforcement of
any Encumbrance whatsoever on any of the assets of a Group Member;
(iv) result in any present or future indebtedness of a Group Member becoming
due and payable, or capable of being declared due and payable, prior to
its stated maturity date or in any financial facility of the Group
Member being withdrawn; or
(v) adversely affect a Group Member's relationships with customers,
suppliers and employees.
23.2. There is no Contract to which any Group Member is a party which depends on
the continuation of the connection (whether as shareholder or officer of
the Group Member or otherwise) of any person with the Group Member.
SCHEDULE 4
TAXATION
SCHEDULE 4
TAXATION
PART 1 - INTERPRETATION
1. INTERPRETATION
In this SCHEDULE 4:
1.1 the following expressions have the following meanings unless inconsistent
with the context:
"THE AUDITORS" the auditors for the time being of the
Company
"DISPUTE" any dispute, appeal, negotiations or other
proceedings in connection with a Tax Claim
"EVENT" any event, fact or circumstance whatsoever
including but not limited to:
(a) any transaction, action or omission
(whether or not a Group Member is
party to it);
(b) the earning, receipt or accrual
for any Taxation purpose of any
income, profits or gains;
(c) the incurring for any Taxation
purpose of any loss or expenditure;
(d) the declaration, payment or
making of any dividend or other
distribution;
(e) the sale and purchase of the
Shares pursuant to this
Agreement; and
(f) Completion
"LIABILITY TO TAXATION" (a) any liability of a Group Member to
make an actual payment of Taxation
(whether or not the Group Member is
primarily so liable and whether or not
the Group Member has any right of
recovery against any other person);
and
(b) the use by a Group Member (in whole or
in part) of Losses Carried Forward to
reduce or eliminate any liability of
the Group Member to make an actual
payment of Taxation (whether or not
the Group Member is primarily so
liable and whether or not the Group
Member has any right of recovery
against any other person) in respect
of which the Vendor would otherwise
have been liable under PARAGRAPH 2;
and
(c) the forfeiture by a Group Member (in
whole or in part) of any Losses
Carried Forward
"LOSSES CARRIED FORWARD" Losses carried forward that, without
limitations, can be used to off-set
operating profits of the company
"PURCHASER GROUP MEMBER" Any company which is at any time is or has
been:-
(a) a holding company of the
Purchaser;
(b) a subsidiary or subsidiary undertaking
of the Purchaser; or
(c) a subsidiary or subsidiary undertaking
of any holding company of the
Purchaser
"RELEVANT TAX CLAIM" any claim against the Vendor in respect of a
Liability to Taxation, under paragraph 2
"RELIEF" (a) any relief, allowance, exemption,
set-off, deduction or credit available
from, against or in relation to
Taxation or in the computation for any
Taxation purpose of income,profits or
gains; and
(b) any right to a repayment of Taxation
"RESTRICTED STOCK UNIT any agreement entered into by the Vendor
AWARD AGREEMENT" with any employee of a Group Member under
which awards of restricted stock units or
which awards of restricted stock units or
other securities are granted
"SAVING" the reduction or elimination of any
liability of the Company to make an actual
payment of corporation tax in respect of
which the Vendor would not have been liable
under PARAGRAPH 2, by the use of any Relief
arising wholly as a result of a Liability to
Taxation in respect of which the Vendor has
made a payment under PARAGRAPH 2
"TAXATION" means, wherever arising, all direct and
indirect taxes, charges, fees, imposts,
withholdings, duties and other assessments
imposed by any authority,
including income (whether actual
or deemed), sales, use, transfer,
stamp, transaction, customs, real
estate, investment, value added,
withholding, employment, asset
holding, registration, preliminary
and deferred tax and social
security fees, together with any
interest, penalties, residual tax
charges, additions to tax or any
other additional amount imposed by
any authority.
"TAXATION AUTHORITY" any authority, whether of Sweden
or elsewhere, competent to impose,
assess or collect Taxation.
"TAXATION STATUTE" any statute (and all regulations
and other documents having the
force of law under such statute)
published, enacted, issued or
coming into force on or before the
date of this Agreement relating to
Taxation
"TAX CLAIM" any notice, demand, assessment,
letter or other document issued,
or action taken, by or on behalf
of any Taxation Authority and the
submission of any Taxation form,
return or computation from which,
in either case, it appears to the
Purchaser that a Group Member is
or may be subject to a Liability
to Taxation or other liability in
respect of which the Vendor is or
may be liable under PARAGRAPH 2
"VAT" value added tax
"VATA" the Swedish Value Added Tax Xxx
0000 (1994:200)
1.2 references to Events include Events which are deemed to have occurred
for any Taxation purpose and references to income, profits or gains
earned, received or accrued for any Taxation purpose include income,
profits or gains which are deemed to have been earned, received or
accrued for any Taxation purpose;
1.3 references to the loss of Losses Carried Forward include the
disallowance of Losses Carried Forward and the failure to use Losses
Carried Forward;
PART 2 - TAX COVENANT
2. COVENANT
2.1 Subject to the provisions of this PART 2 of this SCHEDULE 4, the Vendor
covenants with the Purchaser to pay to the Purchaser an amount equal to
the amount of:
2.1.1 any Liability to Taxation which has arisen or arises as a
result of or in connection with any Event which occurred on or
before Completion, whether or not such Liability to Taxation
has been discharged on or before Completion; and
2.1.2 any Liability to Taxation which arises on, before or after
Completion as a result of the non payment of Taxation by the
Vendor or any person (other than the Group) which is or has
been connected for any Taxation purpose with the Vendor and
for which that person is primarily liable;
2.1.3 any Liability to Taxation which arises as a result of any
Event which occurs after Completion pursuant to a legally
binding obligation (whether or not conditional) entered into
by a Group Member on or before Completion otherwise than in
the ordinary course of business of the Group Member (but only
to the extent that such Liability to Taxation arises in
respect of income profits or gains which are deemed to have
been earned, received or accrued for Tax purposes (as opposed
to any actual) income, profits or gains earned, received or
accrued for Tax purposes);
2.1.4 any Liability to Taxation which arises as a result of the
disallowance to offset profits against Losses Carried
Forward;
2.1.5 any Liability to Taxation which arises as a result of a Group
Members' dual tax residence on or before Completion;
2.1.6 any Liability to Taxation which arises as a result of the
Company being treated as not resident in Sweden for tax
purposes on or before Completion;
2.1.7 any Liability to Taxation which arises as a result of the
contemplated Election referred to in PARAGRAPH 1.5 OF SCHEDULE
5;
2.1.8 any Liability to Taxation arising by reference to income,
profits, or gains accrued on or before Completion as a result
of or in connection with the dissolution of any Group Member;
2.1.9 any Liability to Taxation arising as a result of or in
connection with any Group Member's membership of the Vendor's
Group at any time on or before Completion (including any Tax
for which another member of the Vendor's Group is primarily
liable), where such liability arises under United States
Treasury Regulations 1.1502-6 (or any similar provision of
state, local or foreign law);
2.1.10 any Liability to Taxation which arises as a result of tax
depreciation claimed on (non qualifying) artwork in assessment
year 2000 and tax depreciation claimed on costs for rebuilding
premises made under the provisions applicable for equipment
and machinery and any Liability to Taxation which arises as a
result of the tax deduction which has been claimed in relation
to the provision for inventory obsolescence;
2.1.11 any reasonable costs, fees or expenses (including legal costs
on a full indemnity basis) properly incurred by a Group Member
or the Purchaser in connection with any Liability to Taxation
or other liability in respect of which the Vendor is liable
under this PART 2 of this SCHEDULE 4 or successfully taking
any action (including but not limited to legal proceedings)
under this Schedule 4.
2.2 The Vendor covenants with the Purchaser to pay to the Purchaser an
amount equal to the amount of any Liability to Taxation which arises as
a result of, in respect of, or by reference to the grant, exercise,
exchange or cancellation of any share options where such options were
granted to any employee of a Group Member pursuant to any Restricted
Stock Unit Award Agreement, at any time on or before Completion;
3. QUANTIFICATION
For the purposes of PARAGRAPH 2 the amount of a Liability to Taxation
will be determined as follows:
3.1 the amount of a Liability to Taxation falling within PARAGRAPH (a) of
the definition of that expression in PARAGRAPH 1.1 will be the amount
of the actual payment of Taxation which the Group Member is liable to
make;
3.2 the amount of a Liability to Taxation falling within PARAGRAPH (b) of
the definition of that expression in PARAGRAPH 1.1 will be the amount
of Taxation saved by the Group Member as a result of the use of Losses
Carried Forward; and
3.3 the amount of a Liability to Taxation falling within PARAGRAPH (c) of
the definition of that expression in PARAGRAPH 1.1 will be the amount
of Taxation which would have been saved by the Group Member but for the
forfeiture of the Losses Carried Forward on the basis of the rates of
Taxation current at the date of the loss, assuming for this purpose
that the relevant Group Member had sufficient profits or was otherwise
in a position actually to use the Losses Carried Forward;
4. EXCLUSIONS
4.1 The Vendor will not be liable under PARAGRAPH 2 or Part 3 of this
Schedule 4 in respect of a Liability to Taxation or other liability of
a Group Member to the extent to which:
4.1.1 such Liability to Taxation or other liability was satisfied or
discharged on or before Completion and the discharge of such
Liability to Taxation or other liability was reflected in the
Completion Accounts; or
4.1.2 specific provision was made in the Completion Accounts for
such Liability to Taxation or other liability; or
4.1.3 payment has already been made in respect of such Liability to
Taxation or other liability under this PART 2 or PART 3 of
this SCHEDULE 4; or
4.1.4 such Liability to Taxation or other liability would not have
arisen but for the making, changing, or coming into force of
any legislation (including but not limited to an increase in
rates of Taxation) or a change in the interpretation,
administration, or application by any relevant court or by any
Taxation Authority or in the published practice of any
Taxation Authority first enacted or announced after
Completion; or the withdrawal of any extrastatutory
concession after Completion with retrospective effect;
4.1.5 such Liability to Taxation would not have arisen or would have
been reduced or eliminated but for a change after Completion
in the accounting policies or practices of the Purchaser or a
Group Member (except where such change is required to remedy
any failure prior to Completion of the Group Member to comply
with Swedish generally accepted accounting principles) or in
the length of any accounting period of a Group Member;
4.1.6 such Liability to Taxation or other liability would not have
arisen but for a voluntary act, transaction or omission of a
Group Member or the Purchaser after Completion:
4.1.6.1 otherwise than pursuant to a legally binding
obligation entered into by a Group Member on or
before Completion or imposed on a Group Member by any
legislation announced before Completion whether
coming into force before, on or after Completion; or
4.1.6.2 which the Purchaser was aware or ought reasonably to
have been aware would give rise to the Liability to
Taxation or other liability in question; or
4.1.6.3 otherwise than in the ordinary course of business of
a Group Member, or
4.1.6.4 otherwise than at the written request of the Vendor
whether pursuant to this Agreement or otherwise.
4.1.7 such Liability to Taxation reduces deferred tax liability of
the Company
4.2 The provisions of PARAGRAPHS 4.1.1, 4.1.2, and 4.1.3 under this PART 2
of this SCHEDULE 4 shall apply to limit the liability of the Vendor
under PARAGRAPH 2.2 of this SCHEDULE 4 in respect of a Liability to
Taxation of the Company. In addition, the Vendor will not be liable
under PARAGRAPH 2.2 of this SCHEDULE 4 in respect of a Liability to
Taxation of the Company to the extent that the Company or the Purchaser
has recovered from any person (including any officer or employee or
former officer or employee of the Company but excluding the Purchaser
and any Purchaser Group Member) any sum in respect of such Liability to
Taxation or to the extent that any corporation tax deduction is
available to the Company (except to the extent that such corporation
tax deduction is taken into account in preparing the Completion
Accounts) in respect of the grant or exercise of restricted stock units
under the Restricted Stock Unit Award Agreements or in respect of the
Liability to Taxation arising therefrom.
4.3 The Vendor will not be liable for any Relevant Tax Claim unless the
amount of the liability in respect of that Relevant Tax Claim or the
aggregate amount of the liability in respect of a number of Relevant
Tax Claims relating to the same matter exceeds SEK 65,000 AND the
amount of the liability in respect of that Relevant Tax Claim or
Relevant Tax Claims when aggregated with the amount of the liability in
respect
of all other Relevant Tax claims exceeds SEK 650,000 (in which event
the Vendor will be liable for the whole amount of such Relevant Claims
and not merely the excess).
4.4 The provisions of clause 6.2 (financial cap) of the Agreement shall
apply to any liability of the Vendor under PARAGRAPH 2 of this SCHEDULE
4.
4.5 The liability of the Vendor under this PART 2 of SCHEDULE 4 shall cease
seven years after Completion except in respect of matters which have
been the subject of a claim within PARAGRAPH 7 of this SCHEDULE 4
unless the claim in question has arisen by reason of fraud, wilful
concealment, or dishonesty on the part of the Vendor or, prior to the
Completion date, on the part of the Company in which event there shall
be no contractual limit on the time period within which such claim may
be brought.
5. DEDUCTIONS FROM PAYMENTS
5.1 Except as required by law all payments by the Vendor under this PART 2
of this SCHEDULE 4 will be made free and clear of all deductions and
withholdings in respect of Taxation.
5.2 If any deduction or withholding is required by law to be made from any
payment by the Vendor under this PART 2 of this SCHEDULE 4 or if
(ignoring any available Losses Carried Forward) the Purchaser is
subject to Taxation in respect of any payment by the Vendor under this
PART 2 of this SCHEDULE 4, the Vendor covenants with the Purchaser to
pay to the Purchaser such additional amount as is necessary to ensure
that the net amount received and retained by the Purchaser (after
taking account of such deduction or withholding or Taxation) is equal
to the amount which it would have received and retained had the payment
in question not been subject to the deduction or withholding or
Taxation.
5.3 PARAGRAPHS 5.1 AND 5. 2 shall not apply to the extent that the
deduction or withholding would not have arisen but for the assignment
by the Purchaser of any of its rights under this Schedule.
6. DUE DATE FOR PAYMENT
6.1 The due date for the making of a payment by the Vendor under this PART
2 of this SCHEDULE 4 will be:
6.1.1 the date falling 5 Business Days after the Purchaser has
served notice on the Vendor demanding such payment; or
6.1.2 in any case involving a liability of a Group Member to make an
actual payment (whether or not a payment of Taxation), the
later of the date mentioned in PARAGRAPH 6.1.1 and the date
falling 5 clear Business Days before the last date upon which
the payment is required to be made to the person entitled to
the payment; or
6.1.3 in any case involving the forfeiture of Losses Carried Forward
other than the right to repayment of Taxation, the later of
the date mentioned in PARAGRAPH 6.1.1 and the date falling 5
clear Business Days before the date on which the payment of
Taxation is or would be required to be made in respect of the
accounting period in which the Losses Carried Forward are
lost.
6.2 If any payment required to be made by the Vendor under this PART 2 of
this SCHEDULE 4 is not made by the due date, ascertained in accordance
with PARAGRAPH 6.1, then such payment will bear interest in accordance
with the terms of CLAUSE 11 of this Agreement.
7. CLAIMS PROCEDURE
7.1 If the Purchaser or the Company becomes aware of any matter which may
give rise to a Tax Claim it will as soon as reasonably practicable, and
in any event not more than 15 Business Days after the Purchaser becomes
so aware of that Tax Claim give notice to the Vendor (giving details,
to the extent available, of such Tax Claim, the due date for any
payment, and time limits for any appeal), provided that the giving of
such notice will not be a condition precedent to the liability of the
Vendor under PARAGRAPH 2.
7.2 Subject to PARAGRAPH 7.5 and provided that the Vendor indemnifies and
secures the Group, the Purchaser and all other Purchaser Group Members
to the reasonable satisfaction of the Purchaser against all reasonable
losses, costs, damages and expenses (including interest or surcharge on
overdue Taxation) which may be incurred thereby, the Purchaser will
procure that the Group Member, at the Vendor's cost and expense, takes
such action and gives such information and assistance in connection
with its Taxation affairs as the Vendor may reasonably and promptly
request to dispute, appeal against, settle or compromise any Tax Claim,
including applying to postpone (so far as legally possible) the payment
of any Taxation, but not including allowing the Vendor or its advisors
to undertake the conduct of the Dispute.
7.3 For the purposes of PARAGRAPH 7.2
7.3.1 the Purchaser shall, or shall procure that the Group Member
shall, promptly submit to the Vendor all material documents
and correspondence relating to the Tax Claim which it is
proposed be submitted to the relevant Taxation Authority in
draft form to the Vendor and the Vendor shall be afforded a
reasonable opportunity to comment thereon;
7.3.2 the appointment of professional advisers by the Group Member
in relation to the Tax Claim shall be subject to the approval
of the Vendor (such approval not to be unreasonably withheld
or delayed);
7.3.3 the Purchaser shall, or shall procure that the Group Member
shall, promptly incorporate all reasonable comments and
suggestions made by the Vendor and the Vendor's duly
authorised agent and promptly submit the relevant final
documents/correspondence to the relevant Taxation Authority;
and
7.3.4 the Purchaser shall, or shall procure that the Group Member
shall, promptly deliver to the Vendor copies of all relevant
correspondence sent to or received from the relevant Taxation
Authority.
7.4 Subject to PARAGRAPHS 7.5 AND 7.6, and to compliance by the Vendor with
PARAGRAPH 7.2 in relation to any Dispute, the Purchaser will not, and
will procure that the Group Member will not, without the prior written
consent of the Vendor, such consent not to be unreasonably withheld or
delayed:
7.4.1 transmit any communication (whether written or otherwise) to
any Taxation Authority;
7.4.2 agree, settle or compromise the relevant Tax Claim; or
7.4.3 agree any matter which is likely to affect the amount of the
relevant Tax Claim or any future Liability to Taxation.
7.5 The Purchaser will not be required to take or procure that the Group
Member will take any action mentioned in PARAGRAPH 7.2:
7.5.1 which it reasonably considers to be materially prejudicial to
the business or Taxation affairs of the Group Member or the
Purchaser or any other Purchaser Group Member; or
7.5.2 which involves contesting a Tax Claim beyond the first
appellate body (excluding the Taxation Authority which has
made the Tax Claim) in the jurisdiction concerned unless the
Vendor obtains (at the Vendor's cost and
expense) the opinion of Tax Counsel of at least 5 years' call
that it is reasonable in all circumstances to make such an
appeal.
7.6 If the Vendor fails within 10 Business Days of the Purchaser giving
notice requiring the Vendor to do so) to inform the Purchaser of any
action which the Vendor wishes the Purchaser to procure the Group
Member to take under PARAGRAPH 7.2, the Purchaser will be entitled to
procure that the Group Member settles or compromises any Tax Claim on
such terms as it determines in its absolute discretion.
8. TIME LIMIT
8.1 The Vendor will not be liable under PARAGRAPH 2 in respect of a
Liability to Taxation or other liability of a Group Member unless
within seven years after Completion the Purchaser has given notice to
the Vendor of any Tax Claim whatsoever relating to such Liability to
Taxation or other liability, or of any Event which may give rise to
such a Tax Claim.
8.2 The time limit in PARAGRAPH 8.1 will not apply in any case involving
dishonest or fraudulent conduct on the part of the Vendor, any company
which has at any time been a member of the same group (as defined for
any Taxation purpose) as the Vendor or any person acting on behalf any
of the foregoing companies.
9. SAVINGS
9.1 If (at the Vendor's request and expense) the Auditors determine that
the Company has obtained a Saving, the Purchaser will offset such
Saving against any outstanding Claim of which it has given notification
to the Vendor.
9.2 To the extent that no Claim is outstanding the Purchaser will as soon
as reasonably practicable thereafter (and in any event within 10
Business Days of such determination by the Auditors) repay to the
Vendor the lesser of:
9.2.1 the amount of the Saving (as determined by the Auditors); and
9.2.2 the amount paid by the Vendor under PARAGRAPH 2 in respect of
the Liability to Taxation which gave rise to the Saving less
any part of that amount previously repaid to the Vendor under
any provision of this Agreement or otherwise;
9.3 The Company will be entitled to use in priority to any Relief which
gives rise to a Saving any other Relief available to it (including by
way of surrender by another company to it) to reduce or eliminate any
liability to make an actual payment of
corporation tax but, subject thereto, shall use its reasonable
endeavours to use any Relief which gives rise to a Saving as soon as
reasonably practicable unless to do so would be materially prejudicial
to the Taxation affairs of the Company or the Purchaser.
9.4 The Company will not obtain a Saving until the last date upon which it
would have been obliged to make the actual payment of corporation tax
which has been reduced or eliminated in order to avoid incurring
interest thereon.
9.5 In determining whether the Company has obtained a Saving, the Auditors
will act as experts and not as arbitrators and their determination will
(in the absence of manifest error) be conclusive and binding on the
parties.
10. RECOVERY FROM OTHER PERSONS
10.1 If a Group Member recovers from any other person (including any
Taxation Authority but excluding the Purchaser, any other Purchaser
Group Member and any officer or employee of any such company) any
amount which is referable to a Liability to Taxation or other liability
of the Group Member in respect of which the Vendor has made a payment
under PARAGRAPH 2, the Purchaser will repay to the Vendor within 10
Business Days of the receipt thereof the lesser of:
10.1.1 the amount so recovered (less any reasonable losses, costs,
damages and expenses incurred by the Group Member, the
Purchaser or any other member of the same group of companies
as the Purchaser as a result of the recovery of that amount);
and
10.1.2 the amount paid by the Vendor under PARAGRAPH 2 in respect of
the Liability to Taxation or other liability in question less
any part of such amount previously repaid to the Vendor under
any provision of this Agreement or otherwise.
10.2 If the Purchaser becomes aware that a Group Member is entitled to
recover any amount mentioned in PARAGRAPH 10.1, the Purchaser will as
soon as reasonably practicable give written notice of that fact to the
Vendor and provided that the Vendor indemnifies and secures the Group
Member, the Purchaser and all other Purchaser Group Members to the
reasonable satisfaction of the Purchaser against all reasonable losses,
costs, damages and expenses which may be incurred thereby, the
Purchaser will procure that the Group Member, at the Vendor's cost and
expense, takes such action as the Vendor may reasonably and promptly
request to effect such recovery.
10.3 The action which the Vendor may request a Group Member to take under
PARAGRAPH 10.2 does not include:
10.3.1 any action which the Purchaser reasonably considers to be
materially prejudicial to the business or Taxation affairs of
the Group, the Purchaser or any Purchaser Group Member; or
10.3.2 allowing the Vendor to undertake the conduct of any action
necessary to effect recovery of the amount in question.
11. CORPORATION TAX RETURNS
11.1 Subject to this PARAGRAPH 11, the Purchaser shall have exclusive
conduct of all Taxation affairs of the Company and its Group Members
after Completion with exclusion for any US federal or state Taxation
affairs of the Company for periods ending on or before Completion.
11.2 The Purchaser shall procure that the Group keeps the Vendor fully
informed of its Taxation affairs in respect of any accounting period
ended on or prior to Completion for which final agreement with the
relevant Taxation Authority of the amount of Taxation due from the
Group has not been reached and shall not submit any correspondence or
submit or agree any return or computation for any such period to any
Taxation Authority without giving the Vendor a reasonable opportunity
to make representations thereon and without the prior written consent
of the Vendor (such consent not to be unreasonably withheld or
delayed).
11.3 The Purchaser shall procure that a Group Member does not amend or
withdraw any return or computation or any claim, election, surrender or
consent made by the Group Member in respect of its accounting periods
ended on or before Completion without the prior written consent of the
Vendor (such consent not to be unreasonably withheld or delayed).
11.4 The Purchaser shall provide the Vendor with a copy of:
11.4.1 each Group Members' Tax returns and Tax computations for the
accounting period during which Completion occurs;
11.4.2 the Group Members' statements of accounts or receipts from the
Swedish Tax Agency or other Taxation Authority confirming the
final amount of Tax paid for the accounting period ended on 31
December 2003 and the accounting period during which
Completion occurs; and
11.4.3 the Group Members' statutory accounts for the accounting
period during which Completion occurs.
11.5 The Purchaser shall procure that, except as provided in Paragraph 1.5
of Schedule 5, a Section 338 Election will not be made for any Group
Member with respect to this transaction.
11.6 The Purchaser agrees that it will not make a section 338(g) election
for any subsidiary of the Company and will procure that no Group Member
will, until after 31 December 2004:
11.6.1 engage in any transaction that will result in a "dividend"
being distributed from any Group Member, except for a "group
contribution" that do not exceed amounts required to eliminate
losses of Group Members and the Purchaser (for the avoidance
of doubt, nothing in this paragraph 11.6.1 shall prevent any
Group Member from making a loan to the Purchaser at any time
after Completion, so long as the loan is evidenced by a formal
note, has a set term and bears arm's length rate of interest);
or
11.6.2 change the financial reporting year of any Group Member.
11.6.3 For the avoidance of doubt, the terms "section 338(g)
election" is as defined in the United States Internal Revenue
Code of 1986, as amended.
12. COUNTER COVENANT
12.1 The Purchaser hereby covenants with the Vendor to pay or to procure
that the relevant Purchaser Group Member pays to the Vendor by way of
adjustment to the Purchase Price, an amount equal to;
12.1.1 any Tax Liability arising after Completion for which a Group
Member is liable but for which the Vendor becomes liable as a
result of the failure by the Group Member or the relevant
Purchaser Group Member to discharge it; and
12.1.2 all reasonable costs and expenses properly incurred by the
Vendor in connection with any Tax Liability in respect of
which the Vendor can bring a claim under this paragraph 12 or
where the Vendor successfully takes any action to enforce
payment under this paragraph 12 in connection with the taking
of such action.
12.2 The provisions of PARAGRAPH 6 (due date for payment) and PARAGRAPH 7
(Claims procedure) shall apply to this PARAGRAPH 12 as if the same were
set out herein but replacing references to the Vendor with the
Purchaser (and vice versa) and making any other necessary
modifications.
12.3 The covenants contained in PARAGRAPH 12 shall not apply to a Tax
Liability to the extent that the Vendor is liable to make a payment
(and has not made such payment) in respect of that Tax Liability under
PARAGRAPH 2 of this SCHEDULE 4.
13. GENERAL
All payments by the Vendor under this PART 2 of this SCHEDULE 4 will be
treated as repayments by the Vendor of the Consideration paid for the
Shares pursuant to this Agreement, provided that this PARAGRAPH 13 will
not operate in any way to limit the liability of the Vendor under this
Part 2 of this SCHEDULE 4.
PART 3 - TAX WARRANTIES
14. RETURNS, RECORDS, DISPUTES AND CLEARANCES
14.1 All notices, returns, computations, registrations, information and
payments which should have been made or supplied by a Group Member for
any Taxation purpose have been made within the requisite periods and
are up-to-date, correct and on a proper basis and none of them is, or
so far as the Vendor is aware is likely to be, the subject of any
dispute with any Taxation Authority.
14.2 No Group Member is involved in any dispute with any Taxation Authority
and has not been the subject of any investigation or enquiry by any
Taxation Authority (other than routine questions), no Taxation
Authority has indicated that it intends to investigate the Taxation
affairs of any Group Member and so far as the Vendor is aware there are
no circumstances which are likely to give rise to any such
investigation.
14.3 Each Group Member has punctually supplied all information requested by
any Taxation Authority for any Taxation purpose.
14.4 All consents and clearances obtained by the Group Members from any
Taxation Authority remain valid and effective and any transaction for
which any such consent or clearance has been obtained has been carried
into effect (if at all) only in accordance with the terms of the
relevant consent or clearance, including the terms of the application
for the relevant consent or clearance.
14.5 The Group Members have not negotiated with or been granted by any
Taxation Authority any (in each case, material) dispensations,
concessions, arrangements and agreements (whether formal or informal)
which are not in accordance with the strict terms of the legislation
and no action has been taken by or on behalf of a Group Member which
has had or is likely to have the result of altering, prejudicing or in
any way disturbing any such concession, arrangement or agreement.
15. PENALTIES AND INTEREST
No Group Member has within the period of 3 years ending on the date of
this Agreement paid, and is not liable to pay, any fine, penalty,
charge, surcharge or interest charged by virtue of any of the
provisions of any Taxation Statute nor are there any circumstances
which are likely to cause a Group Member to become liable to pay any
fine, penalty, charge, surcharge or interest.
16. TAXATION CLAIMS, LIABILITIES AND RELIEF
16.1 Each Group Member has sufficient records to fulfil its obligations
under all Taxation Statutes and to enable it to make and complete
returns for Taxation purposes and to calculate the liability to
Taxation;
16.1.1 in respect of or by reference to any Event on or before
Completion; or
16.1.2 on the disposal of any asset owned by it at Completion.
16.2 Each Group Member has duly and properly made all Taxation claims,
disclaimers, elections and surrenders and given all notices and
consents and done all other things in respect of Taxation the making,
giving or doing of which was assumed to have been made for the purposes
of the Accounts, all such claims, disclaimers, elections, surrenders,
notices, consents and other things have been accepted as valid by the
relevant Taxation Authorities and none has been revoked or otherwise
withdrawn.
16.3 No Group Member is, and will not become, liable to pay, or make
reimbursement or indemnity in respect of, any Taxation (or amounts
corresponding to any Taxation) payable by or chargeable on or
attributable to any other person, whether in consequence of the failure
by that person to discharge that Taxation within any specified period
or otherwise, where such Taxation relates to a profit, income or gain,
transaction, event, omission or circumstance arising, occurring or
deemed to arise or occur (whether wholly or partly) on or prior to
Completion.
17. DISTRIBUTIONS AND PAYMENTS
17.1 Each Group Member has deducted and properly accounted to the
appropriate Taxation Authority for all amounts which it has been
obliged to deduct in respect of Taxation, has complied fully with
all reporting requirements relating to all such amounts and has
(where required by the applicable Taxation Statute) duly provided
certificates of deduction of tax to the recipients of payments from
which deductions have been made.
17.2 No rents, interest, annual payments, payments to a present or former
director or employee, or other sums paid or payable by a Group
Member since the Accounting Date, or which a Group Member is under
an obligation to pay, will be wholly or partially disallowable as
deductions or charges in computing the profits of the Group Member
for the purposes of corporation tax.
18. EMPLOYEE BENEFITS
18.1 Each Group Member has properly made deductions, as required by the
applicable Taxation Statute, from all payments made (including
notional payments), or treated as made, to its directors, employees
or officers or former directors, employees or officers or any
persons required to be treated as such, and accounting to the
Taxation Authority for all Taxation so deducted and for all Taxation
chargeable on the Group Member on benefits provided for its
directors, employees or officers, or former directors, employees or
officers.
18.2 No liability to social security contributions or obligation to
deduct preliminary tax could fall on a Group Member as a result of a
chargeable event before, at or after Completion in respect of
securities and interests in securities made available or securities
options granted to an employee or director prior to Completion.
18.3 The Disclosure Letter contains full details of all share incentive
schemes and profit sharing schemes and other employee benefits by
each Group Member and all Group Members have complied with all
statutory requirements in respect of such schemes and benefits.
19. TAX AVOIDANCE
No Group Member has entered into or been a party to any scheme,
arrangement or transaction designed wholly or mainly or containing
steps or stages having no commercial purpose and designed wholly or
mainly for the purpose of avoiding or
deferring Taxation or reducing a liability to Taxation or amounts to
be accounted for in respect of employees.
20. CAPITAL GAINS
No Group Member has at any time acquired or disposed of any asset or
entered into any transaction or arrangement whatsoever otherwise
than by way of bargain at arm's length or in respect of which there
may be substituted for the actual consideration given or received by
the Group Member a different consideration for any Taxation purpose.
21. CAPITAL ALLOWANCES
All depreciation made by each Group Member since the Accounting Date
and all depreciation that may be incurred by a Group Member under
any existing contract has qualified or will be capable of qualifying
for capital allowances.
22. VAT: GENERAL
22.1 The Group Members:
22.1.1 are registered for Swedish VAT purposes and are not
registered or required to be registered for VAT or any
similar tax in any other jurisdiction;
22.1.2 maintains complete, correct and up-to-date business records
for VAT and is not in arrears with any VAT payment or return
or in respect of Intrastats or excise or customs duties, or
liable to any abnormal or non-routine payment of VAT, or any
forfeiture or penalty, or to the operation of any penal
provision;
22.2 The Group Members:
22.2.1 have not within the period of six years prior to the year of
Completion failed to comply in any respect with all statutory
requirements, orders, provisions, directions or conditions
relating to VAT;
22.2.2 have never been treated as, or applied for treatment as
members of a group for VAT purposes under Chapter 6 a VATA
and no transaction has been effected in consequence of which
a Group Member is or may be held liable for any VAT arising
from supplies made by another company.
22.3 No goods or services supplied to the Group, or goods imported by the
Group, are or have been used otherwise than for business purposes.
22.4 The Group Members have not disposed of or acquired any business or
assets as a transfer of a going concern as described in Chapter 3,
section 25 of VATA.
23. VAT: PROPERTY TRANSACTIONS
23.1 The Group Members do not lease or sublease any premises to another
Group Member or a third party.
24. PAYMENT OF TAXATION
Each Group Member has paid to the appropriate Taxation Authorities
in due time all Taxation required to be paid by the Group Member
according to filed Taxation returns or according to orders to pay
issued by Taxation Authorities.
25. TRANSFER PRICING
No Group Member has undertaken, or agreed to undertake, any
transactions which are otherwise than on fully arm's length terms
and there are no circumstances which could cause any Taxation
Authority to make or require to be made any adjustment to the terms
on which such transaction is treated as taking place.
26. ACCOUNTS AND SUBSEQUENT EVENTS
26.1 Each Group Members' Accounts fully provide or reserve, in accordance
with the accounting policies set out in the notes included in the
Accounts, for all Taxation (including deferred tax for which a Group
Member is or may be liable, or for which it may be accountable) as
at the Accounting Date.
26.2 Each Group Members' Accounts contain adequate reserves or provision
for all unpaid Taxation related to the period before Completion and
thus none of the Group Members will be liable for any Taxation
exceeding the reserves contained in the Accounts, including
Completion Accounts, for any period ending on the date of Completion
and all fiscal periods prior thereto. The Completion Accounts will
accordingly contain reserves for Taxation related to the current
fiscal period.
SCHEDULE 5
COMPLETION ARRANGEMENTS
1. Completion
1.1 Completion shall take place on 7 September 2004 at the offices
of the Purchaser's Solicitors in London.
1.2 At Completion, the following events shall take place, which
shall be deemed to have taken place simultaneously:
(i) The Purchaser shall present a written approval from the County
Administrative Board in Stockholm approving the Purchaser as
purchaser of the Company and, indirectly, its subsidiary AB
Svensk Pantbelaning.
(ii) The Vendor shall present a signed application for annulment of
the lost share certificates in the Company in a form
satisfactorily to the Purchaser, which shall be registered
with the relevant court within seven (7) days from completion
SCHEDULE 1.2(ii).
(iii) Documents in the agreed form showing the authority to sign for
the Vendor, The Rutland Partnership (and others) ( referred to
as "Rutland" in this Schedule 5) and the Purchaser shall be
presented. Powers of attorney in the agreed form shall be
presented where the Vendor, Rutland or the Purchaser is unable
to attend in person at Completion.
(iv) The Agreement shall be duly executed by the Vendor and the
Purchaser.
(v) The Purchaser shall pay the Consideration to the Vendor by;
(a) effecting an electronic funds transfer of the Provisional
Cash Consideration by to the Vendor's Solicitors' client
account with National Westminister Bank X.X Xxx 000, Xxxxxxxxx
Xxxxx 00 Xxxxxxx, Xxxxxx XX0X 4 EJ, Sort Code 56-00-13,
Account Number 364 497 09 or by such other method as may be
agreed between the parties;
2(5)
(b) the issue and delivery to Vendor of the A Note following a
resolution by the board of directors of the Purchaser in
accordance with SCHEDULE 1.1(iii)(b); and
(c) the subscription, payment (with payment by way of set-off) and
delivery to Vendor of the B Note, following execution of the
Set-off Agreement attached in SCHEDULE 1.1 (iii)(c) hereto and
a resolution by the general meeting of shareholders of the
Purchaser, all in accordance with SCHEDULE 1.1 (iii)(c).
(vi) The Vendor shall procure that the board of directors of the
Company enters the Purchaser as owner of the Shares in the
share ledger (Sw: aktiebok) of the Company and cause the
Company to keep available its share ledger with the change of
ownership duly noted. The Vendor shall also present up-to-date
share ledgers of the other Group Members stating that no share
certificates have been issued by the board in the respective
other Group Members.
(vii) The Securities Holders' Agreement attached as SCHEDULE 1.1
(vii) hereto shall be duly executed.
(viii) The Vendor shall, to the extent requested by the Purchaser,
procure that the current board of directors and the auditor of
the Group Members set forth in SCHEDULE 1.1 (viii) shall
submit resignation letters in a form satisfactory to the
Purchaser with waivers of any claims such board directors may
have on the Group Members in the form set out in Schedule 1.1
(vii).
(ix) The Vendor shall, to the extent requested by the Purchaser,
cause the Group Members to issue general powers of attorney in
a form satisfactory to the Purchaser enabling the persons
appointed by the Purchaser to sign for and on behalf of the
Group Members, until any new directors and signatories of the
Group Members have been duly registered in the Companies
Register in the form set out in SCHEDULE 1.1 (ix).
(x) The Vendor shall cause all authorised powers of attorney
(other than those held by the officers of the Group Members,
if any,) to be revoked effective as of Completion.
(xi) The Vendor shall cause each Group Member to be released from
any guarantee, indemnity, counter-indemnity, letter of comfort
or other obligation
3(5)
given by such Group Member to any third party in respect of a
liability of any person other than a Group Member, as
applicable.
(xii) The Purchaser shall cause the Vendor to be released from the
parent guarantee, given by the Vendor to SEB as further
detailed in SCHEDULE 4.2 to the Agreement.
(xiii) The Vendor shall cause the repayment, and will procure that
each Associated Company will repay, all amounts owed by the
Vendor or any Associated Company to any Group Member whether
due for payment or not, as applicable.
(xiv) The Purchaser shall procure that extraordinary shareholders'
meetings are held in each Group Member in order to appoint new
board directors and auditors of each Group Member in
replacement of those appointed by the Vendor who resign at
Completion set forth in SCHEDULE 1.1 (xiv).
1.3 REGISTRATION OF THE ISSUE OF THE B NOTE
The Purchaser shall immediately following Completion file an
application for registration of the decision to issue the B
Note with the Companies Register.
1.4 CERTIFICATES AND DOCUMENTS
1.4.1 The Vendor shall immediately following Completion deliver to
the Purchaser all papers, books, records, keys, credit cards
and other property (if any) of each Group Member which are in
the possession or under the control of the Vendor or any other
person who resigns as an officer of any Group Member in
accordance with this Schedule.
1.4.2 Each party shall immediately following Completion deliver to
the other all certificates and other documents required to be
delivered by such party under this Agreement, and all such
further documents as such other party may reasonably require
in connection with Completion.
1.5 SECTION 338 ELECTION
(i) With respect to the acquisition of the Shares hereunder,
the Vendor and the Purchaser shall jointly make a timely
election provided for by Section 338(h)(10) of the Code
and Section 1.338(h)(10)-l of the
4(5)
United States Treasury regulations (and any comparable
election under state or local laws) (collectively, the
"Election"). To the extent possible, the Purchaser and
the Vendor agree to execute at Completion all forms of
any nature necessary to effectuate the elections
(including, but not limited to, United States Internal
Revenue Service Form 8023 (Elections Under Section 338
for Corporations Making Qualified Stock Purchases) and
Form 8883 (Asset Allocation Statement Under Section
338), and any similar forms under applicable state or
local law) (the "Section 338 Forms"), in the form set
out in SCHEDULE 1.5. If any Section 338 Forms are not
executed at Completion, Vendor and Purchaser shall as
promptly as practicable following Completion, cooperate
with each other and take all actions necessary and
appropriate (including filing such Section 338 Forms and
other documents as may be required) to effect and
preserve a timely Election in accordance with the
provisions of Section 338(h)(10) of the Code and Section
1.338(h)(10)-l of the United States Treasury regulations
(or any comparable provision of state or local tax law).
The Vendor and the Purchaser shall each cause the
Section 338 Forms to be duly executed by an authorized
person and shall duly and timely file the Section 338
Forms in accordance with applicable tax laws and in
accordance with this Agreement. On all filings with
United States federal and local taxing authorities, the
Vendor and the Purchaser shall report the acquisition by
the Purchaser of the Shares pursuant to this Agreement
consistent with the Elections and shall take no position
contrary thereto or inconsistent therewith in any United
States tax return, any discussion with or proceeding
before any United States taxing authority, or otherwise.
(ii) The Purchaser shall not make an election provided for by
Section 338(g) of the Code with respect to the deemed
purchase of shares of any Group Member other than the
Company as a result of the Election described in the
paragraph above.
(iii) The Vendor shall deliver an IRPTA Certificate to the
Purchaser stating that no Group Member is, or has been,
a so-called "U.S. real property holding corporation".
5(5)
(iv) The parties agree that all costs in relation to the
Section 338 Election described herein shall be borne by
the Vendor.
1.6 SHAREHOLDERS' MEETING
The Purchaser shall, subject to the auditor's approval,
procure that the retiring board members and alternates as well
as the managing director of each Group Member shall be
discharged from liability as members of the board and managing
director as regards the period of their offices up to and
including Completion, at the next annual general meeting of
shareholders, subject to the auditors of the Group Members not
recommending against such discharge.
SCHEDULE 6
THE LEASES
6 September 2004
BINDER B. 5.1.2
B.5.1.2.1 AB Svensk Pantbelaning - Miscellaneous
B.5.1.2.1.1 Future Operating Lease Commitment Schedule as of 021231
B.5.1.2.1.2 Future Operating Lease Commitment Schedule as of 011231
B.5.1.2.2 Gothenburg, Kommendorsgatan
B.5.1.2.2.1 Notice of Termination re Apartment at Kommendorsgatan, Dated 040324
B.5.1.2.2.2 Lease Contract Between Olle and Xxxxx Fjordgren and Pant Intressenter,
Dated 910109
B.5.1.2.3 Xxxxxxxxx, Xxxxxxxxxxxxxxx, 0xx Xxxxx
B.5.1.2.3.1 Letter from SEB Fastighetsforvaltning, Dated 010119
B.5.1.2.3.2 Lease Contract Between Xxxxx-Hansa Livforsakrings AB (publ) and
Svensk Pantbelaning AB, re Xxxxxxxxxxxxxxxx 0, xxx. 0000, Dated 981216
B.5.1.2.3.3 Lease Contract Between Xxxxx - Hansa Livforsakrings AB (publ) and
Svensk Pantbelaning AB, re Norrmalmsstorg 16, apt 0112, Dated 981216
B.5.1.2.4 Xxxxxxxxx, Xxxxxxxxxxxxxxx, 0xx Xxxxx and Basement
B.5.1.2.4.1 Lease Contract Between Xxxxx -Hansa Livforsakrings AB (publ)and
Svensk Pantbelaning AB, re Xxxxxxxxxxxxxxxx 0, xxx. 0000, Dated 981216
B.5.1.2.4.2 Lease Contract Between Xxxxx - Hansa Livforsakrings AB (publ) and
Svensk Pantbelaning AB, re Xxxxxxxxxxxxxxxx 0, xxx. 0000, Dated 991029
B.5.1.2.5 Orebro
B.5.1.2.5.1 Lease Contract Between Orebro Arbetareforening and AB
Svensk Pantbelaning, re Olaigatan 8-10, Orebro, Dated 030101
B.5.1.2.5.2 Lease Contract Between Orebro Arbetareforening u.p.a and Aktiebolaget
Svensk Pantbelaning, re Xxxxxxxxx 00, Xxxxxx, Dated 980720
B.5.1.2.6 Vasteras
B.5.1.2.6.1 Amendment to Lease Contract Between Nils Xxxx Xxxxxxxx Xxxxxx and AB
Pantbelaning, Dated 930225
B.5.1.2.6.2 Lease Contract Between Nils Xxxx Xxxxxxxx Xxxxxx and AB Pantbelaning,
re Xxxx Hahrs Gata 2, Vasteras, Dated 901210
B.5.1.2.7. Uppsala
B.5.1.2.7.1 Lease Contract Between HSB:s Brf Hasten and U-A Varubelaning AB re
Xxxxxxxxxxxxxxxxx 00, Xxxxxxx, Dated 891127
B.5.1.2.7.2 Letter from Upplands Boservice AB, Dated 980515
B.5.1.2.8 Stockholm City
B.5.1.2.8.1 Lease Contract Between Livforsakringsaktiebolaget Skandia (publ) and AB
Svensk Pantbelaning, re Xxxxxxxxx 0-00, Xxxxxxxxx, Dated 991005
B.5.1.2.8.2 Guarantee Issued by SEB, Dated 991122
B.5.1.2.9 Stockholm, St. Eriksgatan
B.5.1.2.9.1 Agreement Between Fastighets AB Danmark Nr 28 & Co, KB and AB
Pantbelaning, Dated 911018
B.5.1.2.9.2 Lease Xxxxxxxx Xxxxxxx XX Xx Xxxxxxx Xx 00 & Xx, XX and AB
Pantbelaning, re S:t Xxxxxxxxxx 00, Xxxxxxxxx, Dated 871021
B.5.1.2.10 Stockholm, Gotgatan
B.5.1.2.10.1 Lease Contract Between Hiby AB and AB Svensk Pantbelaning, re
Gotgatan 34,.Stockholm, Dated 011019
B.5.1.2.10.2 Amendment Agreement Between Hiby AB and AB Svensk Pantbelaning,
Dated 980424
8
6 September 2004
B.5.1.2.10.3 Lease Contract Between Hiby AB and AB Svensk Pantbelaning, re
Xxxxxxxx 00, Xxxxxxxxx, Dated 920210
B.5.1.2.11 Stockholm, Birger Jarlsgatan
8.5.1.2.11.1 Lease Contract Between Humlegarden Nybroviken AB and AB Svensk
Pantbelaning, re Birger Xxxxxxxxxx 00, Xxxxxxxxx, Dated 021003
B.5.1.2.11.2 Notice of Termination, Dated 011210
B.5.1.2.11.3 Lease Contract Between Humlegarden Nybroviken AB and AB Svensk
Pantbelaning, re Birger Xxxxxxxxxx 00, Xxxxxxxxx, Dated 990617
B.5.1.2.12 Sodertalje
B.5.1.2.12.1 Letter and Notice of Termination from Fastighets AB Karlavagnen, Dated
001217
B.5.1.2.12.2 Amendment Agreement Between Fastighets AB Karlavagnen and AB
Svensk Pantbelaning, Dated 011109
B.5.1.2.12.3 Letter and Notice of Termination from Fastighets AB Karlavagnen, Dated
001214
B.5.1.2.12.4 Lease Contract Between KB Xxxx/Fastighets AB Karlavagnen and AB
Svensk Pantbelaning, re Nygatan 16, Sodertalje, Dated 961104
B.5.1.2.13 Goteborg, Rosenlundsgatan
B.5.1.2.13.1 Amendment agreement Between Gamla Livforsakringsaktiebolaget SEB
Xxxxx Xxx (publ) and AB Svensk Pantbelaning, Dated 991027
B.5.1.2.13.2 Lease Contract Between Xxxxx - Hansa Omsesidig Livforsakring and AB
Svensk Pantbelaning, re Xxxxxxxxxxxxxxx 0, Xxxxxxxx, Dated 930526
B.5.1.2.14 Malmo, Ostergatan
B.5.1.2.14.1 Lease Contract Between Wihlborgs Fastigheter i Helsingborg AB and AB
Svensk Pantbelaning, re Xxxxxxxxxx 00-00, Xxxxx, Dated 990727
B.5.1.2.15 Malmo, Bergsgatan
B.5.1.2.15.1 Lease Contract Between Annakarin Svensson and AB Svensk Pantbelaning,
re Xxxxxxxxxx 0, Xxxxx, Dated 950116
B.5.1.2.16 Malmo, Andralundsvagen
B.5.1.2.16.1 Lease Contract Between Annakarin Svensson and AB Svensk Pantbelaning,
re Xxxxxxxxxxxxxxx 0, Xxxxx, Dated 000228
B.5.1.2.17 Danderyd, Vendevagen
B.5.1.2.17.1 Lease Contract Between Xxxxx Xxxxx Forsakrings AB/Svenska
Akeriforbundet and CA II Pantbelaning AB, re Vendevagen 90, apt 0164,
Danderyd, Dated 001031
B.5.1.2.17.2 Lease Contract Between Xxxxx Xxxxx Forsakrings AB/Svenska
Akeriforbundet and CA II Pantbelaning AB, re Vendevagen 90, apt 1003,
Danderyd, Dated 001031
B.5.1.2.17.3 Lease Contact Between Xxxxx Xxxxx Forsakrings AB/Svenska
Akeriforbundet and CA II Pantbelaning AB, re Garage, Danderyd, Dated
031229
B.5.1.2.17.4 Lease Contract Between Xxxxx Xxxxx Forsakrings AB/Svenska
Akeriforbundet and CA II Pantbelaning AB, re Garage, Danderyd,
Dated 001031
B.5.1.2.17.5 Notice of Termination, Dated 031216
B.5.1.2.18 Stockholm, Gotgatan, Gullmarsplan
B.5.1.2.18.1 Lease Contract Between Hiby AB and Svensk Pantbelaning AB, re
Xxxxxxxx 00, xxx 0000, Xxxxxxxxx, Dated 030306
B.5.1.2.18.2 Amendment Agreement Between Gamla Livforsakringsaktiebolaget SEB
Xxxxx Xxx (publ) and AB Svensk Pantbelaning, Dated 030228
9
6 September 2004
B.5.1.2.19 Stockholm, Gullmarsplan
B.5.1.2.19.1 Lease Contract Between Gullmars Fastighetsforvaltning HB and Svensk
Pantbelaning AB, re Xxxxxxxxxxxx 0-0, Xxxxxxxxx, Dated 030228
B.5.1.2.20 Stockholm, "Auction Hall"
B.5.1.2.20.1 Agreement of Transfer of Lease Contract Between AMF Pension and
Svensk Pantbelaning AB, re Xxxxxxxxx 00, Xxxxxxxxx, Dated 040223
10
SCHEDULE 7
LIMITATIONS ON WARRANTIES
1. PARAGRAPH 4 shall apply in circumstances where the Vendor has paid to the
Purchaser an amount in respect of a Relevant Claim (other than a Relevant Claim
under the Taxation Warranties in which case PARAGRAPH 10 of SCHEDULE 4 shall
apply) and subsequent to the making of such payment the Purchaser or the Group
Member recovers from some other person a sum which is referable to that payment.
2. PARAGRAPH 5 shall apply in circumstances where the Vendor has paid to the
Purchaser an amount in respect of a Relevant Claim and subsequent to the making
of such payment the Purchaser or the Company becomes or shall become entitled to
recover from some other person a sum which is referable to that payment.
3. PARAGRAPH 5 shall apply in circumstances where:
3.1 any claim is made by a third party against the Purchaser or a Group Member
which is reasonably likely to give rise to a Relevant Claim (other than a
Relevant Claim under the Taxation Warranties in which case PARAGRAPH 7 OF
SCHEDULE 4 shall apply) by the Purchaser against the Vendor; or
3.2 the Purchaser or a Group Member is or is reasonably likely to be entitled
to make recovery from some other person of any sum in respect of any facts
or circumstances by reference to which the Purchaser has or is reasonably
likely to have a Relevant Claim against (other than a Relevant Claim under
the Taxation Warranties in which case PARAGRAPH 7 and 10 OF SCHEDULE 4
shall apply) the Vendor.
4. In the circumstances referred to in PARAGRAPH 1 above the Purchaser shall
reasonably promptly repay to the Vendor (less any reasonable costs and
expenses incurred in recovering the same) an amount equal to the amount
recovered or, if lower, the amount paid by the Vendor to the Purchaser.
5. The Purchaser shall:
5.1 notify the Vendor of any claim made against the Purchaser as referred to
in PARAGRAPH 1, or any right of recovery which is or is reasonably likely
be available, as referred to in PARAGRAPHS 3.1 and 3.2, as soon as
reasonably practicable after the Purchaser becomes aware of the same
PROVIDED THAT a failure on the part of the Purchaser to notify the Vendor
in this manner shall not operate to prevent the Purchaser from bringing a
Relevant Claim in relation to any relevant facts or
circumstances save to the extent that such a failure to notify increases
the quantum of any such Relevant Claim; and
5.2 keep the Vendor informed of all material developments in relation to any
claim, or right of recovery, as referred to in PARAGRAPH 2; and
5.3 at the Vendor's cost provide such material information and documentation
(no matter how it is recorded or stored) as the Vendor shall reasonably
request in connection with any claim, or right of recovery, as referred to
in PARAGRAPH 2.
6. No liability shall attach to the Vendor in respect of any Relevant Claim
to the extent that a specific allowance, provision or reserve in respect
of the matter or thing giving rise to such Relevant Claim has been made in
the Accounts or the Management Accounts.
7. No liability shall attach to the Vendor in respect of any Relevant Claim
if and to the extent that the amount of such Relevant Claim is actually
recovered by the Purchaser under any of its policies of insurance provided
that the Purchaser is paid out in full under the relevant insurance
policy.
8. No liability shall attach to the Vendor in respect of any Relevant Claim
to the extent that such Relevant Claim would not have arisen (or the
amount of the Relevant Claim would not have been increased) but for a
change in legislation made after the date hereof or a change in the
interpretation of the law after the date hereof (whether or not such
change purports to be effective retrospectively in whole or in part) or if
such Relevant Claim would not have arisen (or the amount of the Relevant
Claim would not have been increased) but for any judgement delivered after
the date hereof.
9. No liability shall attach to the Vendor in respect of any Relevant Claim
to the extent that such Relevant Claim would not have arisen but for a
voluntary omission or a voluntary act outside the ordinary course of
business of the Purchaser occurring after Completion.
10. The Purchaser shall not be entitled to bring any Relevant Claim in respect
of any act or omission whatsoever carried out at the written request or
with the written approval of the Purchaser prior to Completion or which is
expressly authorised by this Agreement.
11. No liability shall attach to the Vendor in respect of any Relevant Claim
to the extent that the Relevant Claim is based upon a liability which is
contingent only or is
otherwise not capable of being quantified unless and until such liability
ceases to be contingent and becomes an actual liability or becomes capable
of being quantified, as the case may be provided that such Relevant Claim
shall have been notified to the Vendor in accordance with CLAUSE 6.
12. The Purchaser shall not be entitled to recover damages or otherwise obtain
payment, reimbursement, restitution or indemnity from the Vendor more than
once for the same loss or damage.
13. No liability shall attach to the Vendor in respect of any Relevant Claim
if and to the extent that the breach giving rise to such Relevant Claim is
capable of remedy (without cost or loss to the Purchaser) except to the
extent that the relevant breach remains unremedied (without such cost)
after the expiry of 30 days following receipt by the Vendor of notice from
the Purchaser giving reasonable particulars of the relevant breach and
requiring it to be so remedied and after such remedy by the Vendor the
Purchaser or the relevant Group Member have not suffered a loss.
14. No liability shall attach to the Vendor in respect of any Relevant Claim
if and to the extent that the liability or other matter giving rise to
such Relevant Claim is primarily attributable to any act, event, omission
or default which occurred prior to 28 February 1992 unless such act,
event, omission or default was known or ought reasonably to have been
known to the Vendor at the date hereof.
15. Subject to the provisions OF CLAUSE 12.2 and 12.3, the liability of the
Vendor in relation to a Relevant Claim in relation to a Group Member shall
cease and any such subsisting Relevant Claim shall be withdrawn upon such
Group Member, ceasing for any reason to be an Associated Entity (as
defined in CLAUSE 12) of the Purchaser.
16. In assessing any damages or other amounts recoverable pursuant to a
Relevant Claim there shall be taken into account the value of any direct
benefit accruing to the Purchaser in consequence of the matter or
circumstances giving rise to the Relevant Claim pursuant to which the
damages or such other amounts become recoverable, including, without
prejudice to the generality of the foregoing, any amount of any tax relief
actually obtained by the Purchaser and any amount by which any Tax for
which the Purchaser is assessed or made accountable is actually reduced or
extinguished as a direct consequence of such matter or circumstances.
17. Following a Relevant Claim (other than a Relevant Claim under the Taxation
Warranties in which case PARAGRAPH 7 of SCHEDULE 4 shall apply) being made
against the Vendor the Purchaser shall make available to accountants and
other professional advisers appointed by the Vendor copies of any material
relevant
documentation (but, for the avoidance of doubt, excluding any privileged
documentation) as the Vendor may reasonably request (at the Vendor's cost)
specifically in connection with such Relevant Claim PROVIDED THAT nothing
in this paragraph shall prevent or limit the Purchaser from commencing
legal proceedings against the Vendor in such manner and at such time as it
deems appropriate.
18. The Purchaser acknowledges and agrees that, save for the Warranties and
the documents referred to at PARAGRAPH 4 of SCHEDULE 3, it has not relied
in relation to the purchase of the Shares on, or been induced to enter
into this agreement by, any information (written or oral), statements or
warranties or representations of any description made, supplied or given
by or on behalf of the Vendor or the officers, agents, employees or
advisers of the Vendor in relation to the assets and liabilities of the
Group Members, their value or amount, or the businesses or affairs of the
Group Members or otherwise.
19. Without prejudice and subject to the provisions of PARAGRAPH 14, the
Purchaser irrevocably and unconditionally waives any right it might have
to claim damages for breach of any warranty not contained in this
Agreement.
20. The parties shall have no right to rescind this Agreement.
21. The Purchaser hereby waives and relinquishes any right of set-off or
counterclaim, deduction or retention which the Purchaser might otherwise
have in respect of any Relevant Claim or out of any payments which the
Purchaser may be obliged to make (or procure to be made) to the Vendor
pursuant to this Agreement.
22. Save in respect of the matters set out at PARAGRAPH 4 of SCHEDULE 3, the
Purchaser acknowledges and agrees that the only Warranties given in
relation to:
22.1 Intellectual Property Rights, Software, Computer Systems and Information
technology are those set out in PARAGRAPHS 6 AND 7 of SCHEDULE 3;
22.2 Property are those set out in PARAGRAPH 8 of SCHEDULE 3;
22.3 Environment and EHS Matters are those set out in PARAGRAPH 9 of SCHEDULE
3;
22.4 the employment of any past or present employee of any Group Member are
those set out in PARAGRAPH 10 of SCHEDULE 3;
22.5 Pensions issues are those set out in PARAGRAPH 11 of SCHEDULE 3;
22. Contracts other than matters relating to pawnbroker compliance are those
set out in PARAGRAPHS 12-14 of SCHEDULE 3.
SCHEDULE 8
ADJUSTMENT OF CASH CONSIDERATION
1. COMPLETION ACCOUNTS
1.1 The Vendor and the Purchaser will procure that after Completion,
Completion Accounts for the Group will be prepared and reported on in
accordance with the provisions of this SCHEDULE 8.
1.2 The Completion Accounts will consist of a statement showing the Cash and
the Indebtedness of the Group as at the close of business on the date of
Completion.
1.3 The Completion Accounts will be prepared (subject as otherwise provided),
in the order of priority shown in this paragraph 1.3:
1.3.1 in accordance with the definitions of "Cash" and "Indebtedness" contained
in CLAUSE 1 of this Agreement;
1.3.2 adopting the accounting and valuation principles applied for the purposes
of the Accounts; and
1.3.3 in accordance with the historical cost convention and with accounting
principles generally accepted in Sweden (including Accounting Standards)
in each case as at the Accounting Date.
2. PROCEDURE
2.1 Forthwith after Completion the Vendor will provide to the Purchaser and,
where requested, the Purchaser's Accountants, upon request, with access
during normal working hours on any Business Day to those documents,
records and information within its possession or control which the
Purchaser or the Purchaser's Accountants may reasonably require for the
purpose of preparing the draft Completion Accounts.
2.2 Within 7 Business Days after the date of Completion the Purchaser will
prepare and deliver to the Vendor a final draft of the Completion
Accounts. For the avoidance of doubt once the draft Completion Accounts
have been delivered by the Purchaser it may not vary or amend the same.
2.3 The Vendor will review the draft Completion Accounts as delivered by the
Purchaser under this Schedule, such review to be completed within 7
Business Days of such delivery. The Vendor will notify the Purchaser by
one written notice within such period whether or not it accepts them as
complying with PARAGRAPH 1 of this Schedule. The Purchaser will ensure
that the Vendor and, where requested, the Vendor's Accountants, upon
request, are given access during normal working hours on any Business Day
to all documents, records and information they may reasonably require to
enable the Vendor to make its decision. If the Vendor does not so notify
the Purchaser within 7 Business Days of delivery of the draft Completion
Accounts then the Vendor will be deemed to have accepted the draft
Completion Accounts as complying with PARAGRAPH 1.
2.4 If the Vendor notifies the Purchaser of any objection pursuant to
PARAGRAPH 2.3 then:
2.4.1 the Vendor will or will procure that the Vendor's Accountants set out in
reasonable detail their reasons for such non-acceptance and specify the
adjustments that in their opinion should be made to the draft Completion
Accounts in order to comply with PARAGRAPH 1 and provide supporting
evidence for each such adjustment;
2.4.2 the Vendor and the Purchaser will use all reasonable endeavours to procure
that the Vendor's Accountants and Purchaser's Accountants provide the
Purchaser and the Purchaser's Accountants or the Vendor and the Vendor's
Accountants (as the case may be), upon request, with access during normal
working hours on any Business Day to all such documents and working papers
relating to their preparation of the Completion Accounts or reasons for
non-acceptance (as the case may be) and proposed adjustments to the
Completion Accounts referred to in PARAGRAPH 2.4.1; and
2.4.3 the Vendor and the Purchaser will and where relevant, will procure that
the Vendor's Accountants and the Purchaser's Accountants respectively use
all reasonable endeavours to reach agreement upon the adjustments needed
to meet the objections of the Vendor or Vendor's Accountants (as the case
may be).
2.5 If the Vendor or the Vendor's Accountants and the Purchaser or Purchaser's
Accountants do not reach agreement within 14 days after service of the
Vendor's or Vendor's Accountants' notice of non-acceptance under PARAGRAPH
2.3 then the matter(s) in dispute will be referred to the decision of a
single independent chartered accountant or an independent firm of
chartered accountants (in either
case, the "Independent Accountant") to be agreed upon between them or (in
default of such agreement) to be selected (at the instance of either of
them) by the Chairman for the time being of the Swedish Institute of
Authorised Public Accountants. The Independent Accountant (whose costs
will be paid as the Independent Accountant will direct) will act as expert
(and not as arbitrator) and the decision of the Independent Accountant
shall (in the absence of manifest error) be final and binding on the
parties. It is the parties' intention that the Independent Accountant will
perform his task within 20 Business Days if practicable and they shall
encourage him to do so.
2.6 The Vendor and the Purchaser will use all reasonable endeavours to provide
all such working papers, documents and other information as is requested
by the Independent Accountant and will procure that the Independent
Accountant is requested to state, when giving his decision on the
matter(s) referred to him, what adjustments (if any) need to be made to
the draft Completion Accounts in order that it will comply with PARAGRAPH
1.
2.7 If the Vendor and the Purchaser reach agreement on (or pursuant to
PARAGRAPH 2.3 the Vendors are deemed to have accepted) the Completion
Accounts, or if the Completion Accounts are finally determined at any
stage in the procedure set out in this PARAGRAPH 2, the Completion
Accounts as so agreed or determined will be the Completion Accounts for
the purposes of this Agreement and shall be final and binding on the
Purchaser and the Vendor and the amount of the Cash and Indebtedness shall
be such amount as reflected in the Completion Accounts.
2.8 Each of the Vendor and the Purchaser will pay its own costs and expenses
in connection with the preparation and agreement of the Completion
Accounts including, where applicable, any costs associated with
presentation of its case to the Independent Accountant (it being
acknowledged that the costs of the Independent Accountant will be dealt
with in accordance with PARAGRAPH 2.5 above).
3. ADJUSTMENT OF CASH CONSIDERATION
3.1 When the Completion Accounts have become final and binding pursuant to
PARAGRAPH 2 the Cash Consideration shall be calculated as follows;
Cash Consideration = SEK 191,496,902 + A - B
where A is Cash at Completion; and B is Indebtedness at Completion.
3.2 The amount of any increase or reduction in the Provisional Cash
Consideration by reference to the final Cash Consideration figure referred
to in PARAGRAPH 3.1 will be paid by the Purchaser (in the case of an
increase to the Provisional Cash Consideration) or the Vendor (in the case
of a reduction to the Provisional Cash Consideration), as the case may be,
to the other, within 10 Business Days after the Completion Accounts have
become final and binding and any amount not paid when due shall carry
interest in accordance with CLAUSE 10 of this Agreement.
3.3 Provided PARAGRAPH 3 has been complied with in full the Purchaser will
have no claim against the Vendor under this Agreement in respect of any
liability or deficiency to the extent that such liability or deficiency is
taken into account in the Completion Accounts but otherwise preparation
and acceptance of the Completion Accounts by the Purchaser will be without
prejudice to any claim which the Purchaser may have against the Vendor in
respect of any breach of the Warranties or under PART 2 of SCHEDULE 4.
3.4 All sums payable under this Schedule will be paid by electronic transfer
to the relevant party's bank account, which details shall be provided by
the relevant party to the other within 3 Business Days of the Completion
Accounts becoming final and binding.
SIGNED by XXXXXX X. XXXXXXX XX. )
duly authorised for and on behalf of )
CASH AMERICA INTERNATIONAL, INC )
SIGNED by XXXX XXXXXXXXXX AND BENSLATTER )
duly authorised for and on behalf of )
GULDSKALEN D 409 AB
