EXHIBIT 4.28
CONFORMED COPY
DATED 27TH MARCH, 2003
MARCONI PLC
MARCONI CORPORATION PLC
E-A CONTINENTAL LIMITED
ANCRANE
MARCONI NOMINEES LIMITED
MARIPOSA TECHNOLOGY, INC.
SYSTEMS MANAGEMENT SPECIALISTS, INC.
METAPATH SOFTWARE INTERNATIONAL, INC.
MARCONI BONDING LIMITED
BRITISH SEALED BEAMS LIMITED
MARCONI ANSTY LIMITED
PHOTONIQA LIMITED
AND
YESLINK UNLIMITED
-----------------------------------
SCHEME IMPLEMENTATION DEED
------------------------------------
XXXXX & XXXXX
London
CONTENTS
CLAUSE PAGE
1. Definitions and Interpretation........................ 2
2. Non-Voting............................................ 10
3. Ancrane............................................... 11
4. Approvals............................................. 12
5. BAE................................................... 13
6. Service Contracts..................................... 13
7. Exchange of Global Bonds.............................. 14
8. Bondholder Confirmation Letter........................ 14
9. Eurobond Trustee...................................... 14
10. Finmeccanica Guarantee................................ 14
11. Lemelson Licence...................................... 14
12. IPR SPV............................................... 14
13. Litigation............................................ 15
14. Marconi Name.......................................... 15
15. plc Scheme Expenses................................... 16
16. Tax................................................... 17
17. Highrose Debt......................................... 18
18. Vat Group............................................. 18
19. Inter Company Balances................................ 18
20. Counter Indemnities and Waivers....................... 18
21. ESOP Escrow Agreement Release......................... 19
22. Security Power of Attorney............................ 19
23. plc Waivers........................................... 19
24. plc Undertaking....................................... 19
25. Statement and Waiver.................................. 20
26. plc Offices........................................... 20
27. Restructuring Implementation.......................... 20
28. Representations and Warranties........................ 20
29. Costs................................................. 21
30. Inadequacy of Damages................................. 21
31. Notices............................................... 21
32. Assignment............................................ 23
33. General............................................... 23
34. Entire Agreement...................................... 24
35. Third Parties......................................... 24
36. Governing Law and Jurisdiction........................ 24
SCHEDULES
1. EA-plc Deed of Assignment............................. 25
2. plc-Ancrane Deed of Assignment........................ 35
3. Special Resolution.................................... 45
4. BAE Deed of Novation.................................. 48
5. New Service Agreement................................. 56
6. Bondholder Confirmation Letter........................ 80
7. Finmeccanica Guarantee Deed of Novation............... 84
8. Lemelson Assumption Agreement and Consent............. 92
9. Surrender of Capital Losses........................... 96
10. Receivables Assignment Letter......................... 103
11. plc ESOP Release Deed................................. 107
12. Security Power of Attorney............................ 108
13. Statement and Waiver.................................. 110
14. Corp Covenant......................................... 213
15. Ancrane Deed of Assignment............................ 224
16. Corp Side Letter...................................... 235
Signatories.................................................... 238
THIS DEED is made on 27th March, 2003 and made BETWEEN:
(1) MARCONI PLC (registered number 3846429) whose registered office is at
New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (plc);
(2) MARCONI CORPORATION PLC (registered number 67307) whose registered
office is at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0
0XX (CORP);
(3) E-A CONTINENTAL LIMITED (registered number 725757) whose registered
office is at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0
0XX (EA CONTINENTAL);
(4) ANCRANE (registered number 4308188) whose registered office is at New
Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (ANCRANE);
(5) MARCONI NOMINEES LIMITED (registered number 3854422) whose registered
office is at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0
0XX (NOMINEES);
(6) MARIPOSA TECHNOLOGY, INC. whose principal office is c/o Marconi
Communications, Inc. 0000 Xxxxxxx Xxxxx, Xxxxxxxxxx, XX 00000 (DE corp.
ID no: 2704420 (MARIPOSA);
(7) SYSTEMS MANAGEMENT SPECIALISTS, INC. whose principal office is at 0
Xxxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxx Xxx, XX 00000 (DE corp. ID no:
0000000) (SMS);
(8) METAPATH SOFTWARE INTERNATIONAL, INC. whose principal office is at 0000
Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000 (XX corp. ID no:
2120461) (METAPATH);
(9) MARCONI BONDING LIMITED (registered number 3818628) whose registered
office is at Xxx Xxxxxxx Xxxx, X.X. Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx XX0
0XX (MARCONI BONDING);
(10) BRITISH SEALED BEAMS LIMITED (registered number 628256) whose
registered office is at 0 Xxxxxxxxx Xxxxxx, Xxxxxx X0X 0XX (XXX);
(11) MARCONI ANSTY LIMITED (registered number 409365) whose registered
office is at New Century Part, X.X. Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx XX0
0XX (ANSTY);
(12) PHOTONIQA LIMITED (registered number 332666) whose registered office is
at Xxx Xxxxxxx Xxxx, X.X. Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx XX0 0XX
(PHOTONIQA); and
(13) YESLINK UNLIMITED (registered number 3764144) whose registered office
is at Xxx Xxxxxxx Xxxx, X.X. Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx XX0 0XX
(YESLINK).
WHEREAS:
(A) On 29th August, 2002, Corp and, inter alios, plc concluded non-binding
indicative heads of terms detailing the principles for the proposed
Financial Restructuring (as defined below) of Corp and plc, amended by
a non-binding addendum signed on 13th December, 2002.
(B) The Financial Restructuring is, at the date of this Deed, subject to
certain consents and approvals before it can become effective and
binding on the Scheme Companies.
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(C) Under the Financial Restructuring it is proposed that plc will enter
into the plc Scheme with the plc Scheme Creditors constituting a
compromise between plc and the plc Scheme Creditors which will have the
effect of compromising all claims of plc Scheme Creditors against plc
as at the Record Date other than Excluded Claims in consideration for a
distribution of plc's assets.
(D) Under the Financial Restructuring it is proposed that Corp will enter
into the Corp Scheme with the Corp Scheme Creditors constituting a
compromise between Corp and the Corp Scheme Creditors which will have
the effect of compromising all claims of Corp Scheme Creditors against
Corp as at the Record Date other than Excluded Claims in consideration
for a distribution of cash, new equity and new debt securities of Corp.
In conjunction with the Corp Scheme, it is proposed to make changes to
Corp's capital structure, including the conversion and re-designation
of its current issued ordinary share capital into non-voting deferred
shares and the cancellation of those shares, and a reduction of its
share premium account to eliminate the deficit on the profit and loss
account that would otherwise be shown in its balance sheet as at 31st
March, 2003. This capital reduction is expected to take effect a few
days after the Corp Scheme becomes effective.
(E) In conjunction with the Financial Restructuring, the existing global
Yankee Bonds and global Eurobonds will be exchanged for Yankee Bonds in
definitive form and Eurobonds in individual global form, respectively,
as provided in clause 7.
(F) The parties to this Deed wish to document the understanding between
them with regard to implementing the Financial Restructuring and their
performance of certain obligations and undertakings on the terms, and
subject to the conditions, set out in this Deed.
(G) On or around the date of this Deed Corp, plc, HSBC, BCT and the ESOP
Banks entered into the ESOP Settlement Agreement. The ESOP Settlement
Agreement provides for the settlement of the various claims of the ESOP
Banks that entered into swap transactions relating to the ESOP on the
condition that the Corp Scheme becomes effective. In compliance with
the terms of the ESOP Settlement Agreement, Corp and plc wish to
provide releases in this Deed, subject to certain conditions being
satisfied.
(H) Each party to this Deed severally considers that, given the Group's
financial position, the entry by it into this Deed and all agreements
in relation to it including (in the case of plc), without limitation,
the Security Power of Attorney is in the best interests of it and its
creditors and members and that the exercise by each party of its
respective rights and the performance of its respective obligations
pursuant to this Deed would assist in the implementation of the
Financial Restructuring.
(I) It is the intention of the parties that this document be executed as a
deed.
IT IS AGREED in consideration of the promises and the mutual covenants and
agreements set out in this Deed, as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 In this Deed (unless otherwise specified):
ACCOUNT HOLDER LETTER means an account holder letter substantially in
the form set out in the Scheme Document;
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AFFILIATE means, in relation to a company, a body corporate in which it
has a direct or indirect interest as a shareholder of at least 25 per
cent. of the issued ordinary share capital;
ALBANY PARTNERSHIP means Albany Partnership Limited (registered number
3049168) whose registered office is at New Century Park, X.X. Xxx 00,
Xxxxxxxx, Xxxxxxxxxxxx XX0 0XX;
ANCRANE DEED OF ASSIGNMENT means the deed of assignment by way of
repayment of capital in specie substantially in the form set out in
Schedule 15;
BAE means BAE SYSTEMS plc (registered number 1470151);
BAE DEED OF NOVATION means the deed of novation substantially in the
form set out in Schedule 4 under which the BAE agreements (as set out
in the schedule to the deed of novation) will be novated by plc to Corp
with effect from the Effective Date;
BARCLAYS means Barclays Bank plc (registered number 1026167);
BCT means Xxxxxx Xxxxxxx Trustees Limited;
BONDHOLDER means any person with the ultimate economic interest in any
of the Bonds;
BONDHOLDER CONFIRMATION LETTER means the letter to be entered into by
way of a deed substantially in the form set out in Schedule 6;
BONDS means all or any of the Eurobonds and/or the Yankee Bonds;
BUSINESS DAY means any day on which banks are open for general business
in both London and New York;
CA means the Companies Xxx 0000;
CLAIM means any claim or right of action of any kind whatsoever or
howsoever arising (whether actual or contingent) whether arising under
common law, statute or otherwise and whether arising in the United
Kingdom or any other place (including for the avoidance of doubt any
claim in respect of a guarantee or indemnity);
CLAIM FORM means each or any of the claim forms to be completed by or
on behalf of a Scheme Creditor (or its duly authorised agent(s))
detailing its Scheme Claim(s) substantially in the form set out in the
Scheme Document;
CLEARSTREAM, LUXEMBOURG means Clearstream Banking, societe anonyme;
COMMISSIONERS means the Commissioners of Customs and Excise;
CORP COVENANT means the deed of indemnity substantially in the form set
out in Schedule 14 to be entered into by Corp, plc and Ancrane in
accordance with clause 16.6;
CORP LOAN means the loans from EA Continental to Corp in the amount of
L363,308,102;
CORP RECEIVABLE means the inter-company loan balances of approximately
L165,748,102 owing from plc to Corp, as evidenced by Group accounting
records;
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CORP SCHEME means the proposed scheme of arrangement in respect of Corp
pursuant to section 425 CA, the terms of which are set out in Part II
of the Scheme Document including any modifications, additions or
conditions approved or imposed by the Court;
CORP SCHEME CREDITORS means all Scheme Creditors of Corp;
CORP SCHEME MEETING means a meeting of a class of Corp Scheme Creditors
convened pursuant to an order of the Court;
CORP SPV means Regent Escrow Limited (registered number 4659445) whose
registered address is at New Century Park, XX Xxx 00, Xxxxxxxx,
Xxxxxxxxxxxx XX0 0XX;
CORP VAT GROUP means the Corp VAT group registered with the
Commissioners with registered number GB239 1370 65;
COURT means the High Court of England and Wales;
CREDITORS' COMMITTEE means the committee of Scheme Creditors
established and operated pursuant to the terms of the Corp Scheme or
plc Scheme, as appropriate;
CREDITORS' MEETING means a meeting of Scheme Creditors called pursuant
to the terms of the relevant Scheme;
DEFINITIVE HOLDER means any holder of a Yankee Bond in the definitive
form or the bearer by attornment of a Eurobond in individual global
form;
DESIGNATED RECIPIENT means a person specified in the valid Account
Holder Letter (or, in the case of Ancrane, in the Escrow and
Distribution Agreement) relating to a particular principal amount of
Bonds as being the recipient of any part of the First Initial
Distribution and of any further Distribution in respect of those Bonds
and includes, in the case of any cash distributed as part of any
Distribution made in respect of the Eurobonds, each person to whom such
cash is distributed through Euroclear or Clearstream, Luxembourg;
DISTRIBUTION has the meaning given to it in the respective Scheme;
DTC means Depositary Trust Company of New York;
EA-plc DEED OF ASSIGNMENT means the deed of assignment entered into on
or before the date of this Deed between Corp, plc and EA Continental,
in the form set out in Schedule 1 under which EA Continental assigned
the Corp Loan to plc and paid to plc the balance of the bank account
held with HSBC (account number 00000000), in consideration for which
plc released EA Continental from all obligations under the plc Loan;
EFFECTIVE DATE means the date upon which an office copy of the order of
the Court sanctioning the Corp Scheme shall have been delivered to the
Registrar of Companies for registration;
ESCROW AND DISTRIBUTION AGREEMENT means the agreement to be entered
into between (inter alios) Corp, the Supervisors, the Escrow Trustee
and Bank of New York (in its capacity as Yankee Bond Trustee and as
custodian and distribution agent) in the form set out in the
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Scheme Document, a condition precedent to the effectiveness of certain
obligations of which (insofar as it relates to the Schemes) is the
occurrence of the Effective Date;
ESCROW TRUSTEE means Corp Spv, who will be appointed under the terms of
the Escrow and Distribution Agreement, and any successor from time to
time;
ESOP means the Marconi employee share option plan;
ESOP BANKS means each of Barclays, Salomon Brothers International
Limited (registered number 1763297) and UBS AG (registered number
FC021146);
ESOP SETTLEMENT AGREEMENT means the settlement agreement between Corp,
plc, HSBC, BCT and the ESOP Banks dated on or around the date of this
Deed;
EUROBOND ISSUES means the E500,000,000 5.625 per cent. bonds due 2005
and the E1,000,000,000 6.375 per cent. bonds due 2010, both issued by
Corp and both guaranteed by plc;
EUROBONDS means all or any of the bonds comprising the Eurobond Issues;
EUROBOND TRUSTEE means The Law Debenture Trust Corporation p.l.c.
acting in its capacity as trustee of the Eurobonds;
EUROCLEAR means Euroclear Bank S.A./N.V. as operator of the Euroclear
System;
EXCLUDED CLAIMS shall in relation to the Corp Scheme have the same
meaning as that set out in the Corp Scheme and in relation to the plc
Scheme have the same meaning as that set out in the plc Scheme;
FINANCIAL RESTRUCTURING means the proposed financial restructuring of
the Scheme Companies pursuant to the Schemes as more particularly
described in the Scheme Document;
FINMECCANICA GUARANTEE means the guarantee in favour of Finmeccanica
S.p.A given by plc, under subclauses 12.1 to 12.6 of the Finmeccanica
Sale and Purchase Agreement, of the obligations of Marconi (Xxxxxx
Street) Limited under the Finmeccanica Sale and Purchase Agreement;
FINMECCANICA GUARANTEE DEED OF NOVATION means the novation and
amendment deed to be entered into between Corp, plc and Finmeccanica
S.p.A. substantially in the form set out in Schedule 7 under which the
Finmeccanica Guarantee and all of plc's other obligations under the
Finmeccanica Sale and Purchase Agreement will be novated by plc to Corp
with effect from the Effective Date;
FINMECCANICA SALE AND PURCHASE AGREEMENT means the agreement dated 2nd
August, 2002 between Finmeccanica S.p.A. (as purchaser), Marconi
(Xxxxxx Street) Limited (as seller) and plc (as guarantor) for the sale
by Marconi (Xxxxxx Street) Limited of all of the issued shares in
Marconi Mobile Holdings S.p.A.;
FIRST INITIAL DISTRIBUTION has the meaning given to it in the relevant
Scheme;
5
FUNDING LETTERS means the series of letter agreements that were, or may
have been, entered into by plc and certain Group Companies from
December 1999 onwards with respect to the burden of the costs of their
employees' participation in the ESOP;
GROUP means all the Group Companies;
GROUP COMPANY means plc or any company which is a Subsidiary, whether
directly or indirectly of plc or, as the context requires, of Corp;
GROUP RELIEF means losses or other amounts eligible for surrender under
Chapter IV of Part X of the Income and Corporation Taxes Xxx 0000;
HIGHROSE DEBT means the inter company loan of L23,404,000 from Ancrane
to Highrose;
HIGHROSE means Highrose Limited (registered number 4410334) whose
registered office is at New Century Park, XX Xxx 00, Xxxxxxxx,
Xxxxxxxxxxxx XX0 0XX;
HSBC means HSBC Bank plc (registered number 14259);
IPR ARRANGEMENTS means the assignment of Patents registered in the name
of US IP Opcos and UK IP Opcos to three special purpose vehicles as
more particularly set out in Part I, Section 2 (A.5) of the Scheme
Document;
LEMELSON AGREEMENT means the agreement between plc and Lemelson
Foundation Partnership, dated 1st December, 1999, under which the
Lemelson Foundation Partnership granted to plc a non-exclusive licence
in relation to certain licensed patents as described therein;
LEMELSON ASSUMPTION AGREEMENT AND CONSENT means the agreement to be
entered into in accordance with clause 11 under which plc transfers the
benefit and burden of the Lemelson Agreement to Corp substantially in
the form set out in Schedule 8;
LEMELSON FOUNDATION PARTNERSHIP means the Lemelson Medical, Education
and Research Foundation Limited Partnership;
LIABILITY or LIABILITIES means any liability or obligation of a person
whether it is present, future, prospective or contingent, whether or
not it is fixed or undetermined, whether or not it involves the payment
of money or performance of an act or obligation and whether it arises
at common law, in equity or by statute, in England and Wales or in any
other jurisdiction, or in any other manner whatsoever, but such
expression does not include any liability which is barred by statute or
is otherwise unenforceable under English law or arises under a contract
which is void or, being voidable, has been duly avoided;
LONDON STOCK EXCHANGE means the London Stock Exchange plc;
MCL means Marconi Communications Limited (registered number 703317)
whose registered office is at Xxx Xxxxxxx Xxxx, XX Xxx 00, Xxxxxxxx XX0
0XX;
NEW SERVICE AGREEMENT ARRANGEMENTS means the waiver letters and service
agreements for the Senior Management Team substantially in the form set
out in Schedule 5;
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PATENTS means all legal and beneficial ownership of patent
registrations and pending patent applications;
PERFORMANCE BONDING FACILITY means the L50 million committed
multicurrency revolving bonding facility agreement made available under
the Performance Bonding Facility Agreement;
PERFORMANCE BONDING FACILITY AGREEMENT means the L50 million committed
multicurrency revolving bonding facility agreement dated on or before
the Posting Date between Marconi Bonding (as applicant), Corp, HSBC (as
agent and security trustee), the original issuing banks named therein,
the original banks named therein and the original indemnifying
subsidiaries of Corp named therein;
plc-ANCRANE DEED OF ASSIGNMENT means the deed of assignment entered
into on or before the date of this Deed (but after the EA-plc Deed of
Assignment had been entered into between Corp, plc and Ancrane) in the
form set out in Schedule 2 under which plc assigned the Corp Loan to
Ancrane in consideration for the issue by Ancrane of one share to plc
for an amount equal to the market value of the Corp Loan on the date of
such assignment;
plc LOAN means the loan from plc to EA Continental in the amount of
L219,000,000;
plc RECEIVABLES means the aggregate amount of approximately L5,540,623
representing the inter-company balances owing to plc (as evidenced by
Group accounting records) as follows:
(a) an amount of L741,238 owed by Marconi Communications, Inc.;
(b) an amount of US$1,768,992 (equivalent to approximately
L1,101,284) owed by Marconi Software International, Inc.;
(c) an amount of L42,746 owed by Marconi Communications Optical
Networks Corp (Canada);
(d) an amount of L3,616,740 owed by SMS; and
(e) an amount of L38,615 owed by Marconi Communications Limited
(Canada);
plc SCHEME means the proposed scheme of arrangement in respect of plc
pursuant to section 425 CA, the terms of which are set out in Part III
of the Scheme Document including any modifications, additions or
conditions approved or imposed by the Court;
plc SCHEME CREDITORS means all Scheme Creditors of plc;
plc SCHEME EXPENSES has the meaning given to it in the plc Scheme;
plc SCHEME RESTRUCTURING CONSIDERATION means the assets of plc
distributed pursuant to the plc Scheme;
plc SHAREHOLDER RECORD DATE means the close of dealings in the plc
Shares on the last day of dealings in the plc Shares on the London
Stock Exchange;
plc SHARES means ordinary shares of 5 xxxxx each in the capital of plc;
7
plc SUBS means Ancrane, Ansty, Nominees, Photoniqa and Yeslink;
plc SUPERVISORS means the Supervisors of the plc Scheme;
POSTING DATE means the day the Scheme Document is posted to the Scheme
Creditors;
RECEIVABLES ASSIGNMENT LETTER means the letter of assignment
substantially in the form set out in Schedule 10 to be entered into as
a deed between Corp and plc under which plc will assign the plc
Receivables to Corp in consideration for a reduction in the Corp
Receivable;
RECORD DATE has the meaning given to it in the relevant Scheme;
REGISTRAR OF COMPANIES means the registrar or other officer performing
under CA the duty of registration of companies in England and Wales
including a deputy registrar;
SCHEME means either or both of the Corp Scheme and the plc Scheme as
appropriate including any modifications to either Scheme or both or
additions or conditions to either Scheme or both in each case as
approved or imposed by the Court;
SCHEME CLAIM means any claim or right which a person is, or may in any
circumstances become, entitled to bring or enforce against Corp or plc
(as appropriate) in respect of any Liability of Corp or plc (as
appropriate) in each and every case in existence as at the Record Date
or after that date by reason of any Liability incurred before that
date, other than Excluded Claims;
SCHEME COMPANY means either or both of Corp and plc as appropriate;
SCHEME CONSIDERATION means the consideration as defined under the Corp
Scheme or the plc Scheme or both, where appropriate;
SCHEME CREDITOR means a creditor of Corp or plc, as appropriate, in
respect of its Scheme Claim and where the Scheme Claim is in respect of
Bonds, should be construed in the manner set out under "Definitions and
Interpretation" set out in Part I of the Scheme Document;
SCHEME DOCUMENT means the scheme document (including the explanatory
statement and all appendices, schedules and annexures to it) to be
issued in connection with the Schemes (a draft of which has been marked
"Draft A" and signed by the parties for the purposes of
identification);
SCHEME MEETING means a meeting of Scheme Creditors convened pursuant to
the terms of the relevant Scheme;
SECURITY POWER OF ATTORNEY means the power of attorney to be granted by
plc to Corp and the directors and employees of Corp by way of security
for the performance of plc's obligations under, and pursuant to, this
Deed substantially in the form set out in Schedule 12;
SENIOR MANAGEMENT TEAM means Xxxxxxx Xxxxxx, Xxxxxxx Xxxxxxx, Xxxx
Xxxxxxxxx, Xxxxxxxx Xxx, Xxxxxx Xxxx, Xxxxx Xxxx, Xxxxxxx Surrey,
Xxxxxxxx Xxxxxx and Xxxx Xxxxxx;
SETTLEMENT PAYMENT means any payment to an ESOP Bank pursuant to the
ESOP Settlement Agreement;
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SPECIAL RESOLUTION means the special resolution to be passed in
accordance with clause 4 in the form or substantially in the form set
out in Schedule 3;
SUBSIDIARY has the meaning set out in section 736 CA;
STATEMENT AND WAIVER means the statement and waiver agreement
addressing intercompany balances to be entered into between Corp, plc
and certain Group Companies substantially in the form set out in
Schedule 13;
SUPERVISORS means the persons holding office as the supervisors of the
Corp Scheme or plc Scheme or both, as appropriate, from time to time;
TRUST DEEDS means the two trust deeds each dated 30th March, 2000
between Corp, plc and the Eurobond Trustee and constituting the
Eurobonds;
UK IP Opcos means all Marconi companies in the UK having legal or
beneficial title to Patents;
US IP Opcos means all Marconi companies in the US having legal or
beneficial title to Patents;
VAT means value added tax;
VATA means the Value Added Tax Xxx 0000;
VAT ELIGIBLE COMPANIES means each of the following companies;
(a) Marconi Ansty Ltd (registered number 4109365);
(b) Nominees (registered number 3854422);
(c) Photoniqa Ltd (registered number 4113791);
(d) Marconi (Xxxxxx Street) Ltd (registered number 4129430);
(e) Marconi (DGP 1) Ltd (registered number 3545378);
(f) Marconi (DGP 2) Ltd (registered number 3545363);
(g) Xxxxxxx XX Ltd (registered number 4459061);
(h) Marconi (Sixty Nine) Ltd (registered number 1403641);
(i) Marconi (Seventy) Ltd (registered number 500918);
(j) Layana Ltd (registered number 3901290); and
(k) Highrose (registered number 4410334),
which are eligible to be treated as members of the Corp VAT Group under
the provisions of section 43A VATA and which are neither members of an
existing VAT Group nor
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individually registered for VAT purposes with the Commissioners and VAT
ELIGIBLE COMPANY means any one of the VAT Eligible Companies;
VAT GROUP means a group of companies for VAT purposes under the
provisions of section 43 VATA;
YANKEE BONDS means all or any of the bonds comprising the Yankee
Issues;
YANKEE BOND TRUSTEE means Bank of New York, acting in its capacity as
trustee of the Yankee Bonds; and
YANKEE ISSUES means the US$900,000,000 7 3/4 per cent. bonds due 2010
and the US$900,000,000 8 3/8 per cent. bonds due 2030 both issued by
Corp and both guaranteed by plc.
1.2 In this Deed:
(a) references to a person include a body corporate and
unincorporated associations of persons; and
(b) references to an individual include his estate and personal
representatives.
1.3 In this Deed any reference, express or implied, to an enactment
includes references to:
(a) that enactment as re-enacted, amended, extended or applied by
or under any other enactment (before or after the signature of
this Deed);
(b) any enactment which that enactment re-enacts (with or without
modification); and
(c) any subordinate legislation made (before or after the
signature of this Deed) under that enactment, as re-enacted,
amended, extended or applied as described in paragraph (a)
above, or under any enactment referred to in paragraph (b)
above,
and "enactment" includes any legislation in any jurisdiction.
1.4 Subclauses 1.1 to 1.3 above apply unless the contrary intention
appears.
1.5 The headings in this Deed do not affect its interpretation.
2. NON-VOTING
2.1 Ancrane undertakes with effect from the date of this Deed that it will
not attend or vote at any of the Scheme Meetings or use any other
rights or powers available to it as a Corp Scheme Creditor, as a plc
Scheme Creditor or as a Bondholder to attend or vote at any of the
Scheme Meetings and shall not take any steps to canvass, solicit or
entice any other person, firm or company to attend and/or vote on its
behalf at any of the Scheme Meetings at which it is entitled to attend
and vote.
2.2 Ancrane agrees to support the Financial Restructuring and give full
force and effect to the Schemes and undertakes that it will not take
any action to hinder, frustrate, delay or oppose either of the Schemes
or make any application to the courts of any jurisdiction in order to
seek to challenge either of the Schemes.
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2.3 For the avoidance of doubt, nothing in subclauses 2.1 and/or 2.2 shall
prevent Ancrane:
(a) in its capacity as a Corp Scheme Creditor, from submitting a
Claim Form in respect of its Scheme Claim or Scheme Claims
under the Corp Scheme; or
(b) in its capacity as a plc Scheme Creditor from submitting a
Claim Form in respect of its Scheme Claim or Scheme Claims
under the plc Scheme.
2.4 Ancrane agrees that it shall as soon as possible and in any event on or
before 17th April, 2003 submit duly completed Claim Form or Claim Forms
(as applicable) in respect of all of its Scheme Claims as it may have
against plc and Corp.
2.5 Corp undertakes with effect from the date of this Deed that it will not
attend or vote at any of the plc Scheme Meetings or use any other
rights or powers available to it as a plc Scheme Creditor to attend or
vote at the plc Scheme Meeting and shall not (except for the despatch
of the Scheme Document) take any steps to canvass, solicit or entice
any other person, firm or company to attend and/or vote on its behalf
at the plc Scheme Meeting at which it is entitled to attend and vote
provided that nothing in this subclause shall prevent Corp in its
capacity as a plc Scheme Creditor from submitting a Claim Form in
respect of its Scheme Claim under the plc Scheme.
2.6 Corp agrees that it shall as soon as possible and in any event on or
before 17th April, 2003 submit a duly completed Claim Form in respect
of its Scheme Claim against plc.
2.7 plc undertakes with effect from the date of this Deed that it will not
attend or vote at the Corp Scheme Meeting or use any other rights or
powers available to it as a Corp Scheme Creditor to attend or vote at
the Corp Scheme Meeting and shall not (except for the despatch of the
Scheme Document) take any steps to canvass, solicit or entice any other
person, firm or company to attend and/or vote on its behalf at the Corp
Scheme Meeting at which it is entitled to attend and vote provided that
nothing in this subclause shall prevent plc in its capacity as a Corp
Scheme Creditor from submitting a Claim Form in respect of its Scheme
Claim under the Corp Scheme.
2.8 Each of Mariposa, SMS, Metapath and BSB undertakes with effect from the
date of this Deed that it will not attend or vote at any of the Scheme
Meetings or use any other rights or powers available to it as a Corp
Scheme Creditor or as a plc Scheme Creditor to attend or vote at any of
the Scheme Meetings and shall not take any steps to canvass, solicit or
entice any other person, firm or company to attend and/or vote on its
behalf at any of the Scheme Meetings at which it is entitled to attend
and vote.
3. ANCRANE
3.1 On the date of this Deed:
(a) each of Corp, plc and EA Continental hereby confirms it has
entered into the EA-plc Deed of Assignment; and
(b) each of Corp, plc and Ancrane hereby confirms it has entered
into the plc-Ancrane Deed of Assignment.
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3.2 plc will procure that Ancrane will, and Ancrane shall, re-register as
an unlimited company pursuant to, and in accordance with, section 49 CA
before the Corp Scheme Meeting.
3.3 Subject to, and conditional upon, the re-registration of Ancrane as an
unlimited company, Ancrane undertakes and agrees that it shall on or
after 1st April, 2003 but before the Corp Scheme Meeting:
(a) effect a reduction of its existing share capital (including
its share premium account) to L100 to enable it to make a
repayment of capital in specie to plc in relation to any
proceeds it receives as set out in subclause 3.3(b) below; and
(b) make a repayment of capital in specie to plc of the beneficial
interest of the entirety of its rights, property and assets,
other than L100 and the benefit of the Corp Covenant, by way
of the Ancrane Deed of Assignment.
3.4 plc shall, and shall procure that any nominee holding any shares in
Ancrane on trust for it shall:
(a) procure that Ancrane complies with the undertakings given by
it in clause 3.3 above; and
(b) vote in favour of all shareholder resolutions submitted to the
shareholders of Ancrane pursuant to this clause 3, and
plc shall not, and shall procure that any nominee holding any shares in
Ancrane on trust for it shall not, without the consent of Corp,
instigate or take any action to rescind, vary, frustrate, delay or
amend any such shareholder resolutions passed by it pursuant to this
subclause 3.4.
4. APPROVALS
4.1 Before the Posting Date, Corp shall procure that:
(a) a board meeting of Corp is held at which it is resolved that
the Special Resolution is (and any other shareholder
resolutions which are, in the reasonable opinion of the Corp
board, necessary or desirable to give effect to the Corp
Scheme are) approved for submission to the shareholders of
Corp for approval at an extraordinary general meeting of Corp;
and
(b) such extraordinary general meeting of Corp to consider and
approve the Special Resolution (and any other shareholder
resolutions as referred to in (a) above) is held.
4.2 plc and Nominees shall consent in writing to each and every variation
of the rights attached to its shares in Corp which is, or may be,
involved in the passing and implementation of the Special Resolution
(or such other shareholder resolutions referred to in subclause 4.1).
4.3 Each of plc and Nominees shall vote in favour of the Special Resolution
and any other shareholder resolutions which are submitted to the
shareholders of Corp pursuant to subclause 4.1 above and shall not,
without the consent of Corp, instigate or take any action to rescind,
vary, frustrate, delay or amend the passing of the Special Resolution
or the carrying out of the actions approved in it (or the passing of
any other shareholder resolutions passed by it or the carrying out of
the actions approved therein) pursuant to this subclause 4.3.
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4.4 Neither plc nor Nominees shall instigate or take, and shall not direct
any other person to instigate or take, any action to:
(a) remove or appoint any director of Corp;
(b) give any directions by special resolution pursuant to article
93 of Corp's articles of association;
(c) pass any additional shareholder resolutions as shareholders of
Corp save as may be required pursuant to the direction of Corp
under subclause 4.1 or which are considered, in the reasonable
opinion of Corp, necessary or desirable to implement a Scheme;
(d) allot or issue or grant any rights to call for the allotment
or issue of any further shares of Corp, or transfer or grant
any rights to call for the transfer of shares of Corp, save as
may be required pursuant to the Special Resolution or such
other shareholder resolutions which may be considered, in the
reasonable opinion of Corp, necessary or desirable to
implement the Schemes;
(e) alter or amend the articles of association of Corp save as may
be required pursuant to the direction of Corp under subclause
4.1 or which are considered, in the reasonable opinion of
Corp, necessary or desirable to implement the Schemes;
(f) otherwise than pursuant to subclause 4.1 requisition an
extraordinary general meeting of Corp pursuant to section 368
CA;
(g) make any application under section 371(1)(b) CA; or
(h) in any way frustrate, delay or interfere with the performance,
approval or implementation of this Deed and/or the Schemes.
4.5 Each of Corp, plc and Nominees severally acknowledge that the
undertakings given by plc and Nominees are for the benefit of Corp and
Scheme Creditors.
5. BAE
Corp and plc shall enter into the BAE Deed of Novation and shall each
use all reasonable endeavours to procure that BAE enters into the BAE
Deed of Novation on or before the Record Date.
6. SERVICE CONTRACTS
Corp undertakes to procure that all members of the Senior Management
Team execute the New Service Agreement Arrangements by the Posting
Date, so that the waiver letters will be effective immediately before
the Effective Date and their new terms and conditions of employment
take effect on and from the Effective Date. The New Service Agreement
Arrangements may not contain terms relating to the individual members
of the Senior Management Team which are substantially more favourable
than those which apply at the date of this Deed.
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7. EXCHANGE OF GLOBAL BONDS
Corp and plc undertake to procure the issue of Yankee Bonds in
definitive form and Eurobonds in individual global form to the
Definitive Holders named in duly completed Account Holder Letters
submitted on or before 5.00pm (New York time) on 17th April, 2003. The
issue in exchange for all or part of the existing global Bonds will be
made at or about 9.00a.m. (London time) on 24th April, 2003.
8. BONDHOLDER CONFIRMATION LETTER
Each of Corp and plc undertake to enter into the Bondholder
Confirmation Letter on or prior to the Record Date.
9. EUROBOND TRUSTEE
9.1 Corp and plc confirm and agree that the arrangements relating to the
remuneration, costs, charges, expenses and liabilities of the Eurobond
Trustee contained in clause 11 of each of the Trust Deeds (including,
without limitation, the indemnity in clause 11.1.6 of each Trust Deed)
shall extend to the role of the Eurobond Trustee in the implementation
of the Schemes (including, without limitation, under or pursuant to the
Escrow and Distribution Agreement) and such arrangements are re-stated
jointly and severally by both Corp and plc as though such arrangements
were set out in full mutatis mutandis in this Deed. In addition, Corp
and plc shall pay to the Eurobond Trustee all reasonable additional
fees charged by the Eurobond Trustee in relation to its functions under
the Schemes, including all matters contemplated under the Escrow and
Distribution Agreement.
9.2 The other parties to this Deed acknowledge that the Eurobond Trustee
shall have no liability or any obligations whatsoever to any person
under or pursuant to this Deed.
10. FINMECCANICA GUARANTEE
Corp and plc shall enter into the Finmeccanica Guarantee Deed of
Novation and plc shall use all reasonable endeavours to procure that
Finmeccanica S.p.A. enters into the Finmeccanica Guarantee Deed of
Novation on or before the Record Date.
11. LEMELSON LICENCE
Corp and plc shall enter into, and shall use all reasonable endeavours
to procure that the Lemelson Foundation Partnership enters into, the
Lemelson Assumption Agreement and Consent on or before the Record Date.
12. IPR SPV
plc shall as soon as reasonably practicable provide all reasonable
assistance and information and undertake all reasonable acts and deeds
(including, without limitation, the execution of all necessary
documents) requested by Corp in preparing the IPR Arrangements before
the Effective Date. plc shall procure that the IPR Arrangements are
entered into by the relevant US IP Opco or UK IP Opco on or immediately
before the Effective Date.
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13. LITIGATION
13.1 Should Corp or plc become aware of anything which, in its reasonable
opinion, is likely to give rise to a claim or threat of litigation
against either Corp or plc that may affect the other entity or require
the other entity's assistance, it should inform the other entity in
writing of all relevant information as soon as reasonably practicable.
13.2 In the event that Corp or plc is threatened with litigation of the kind
described in subclause 13.1 above by a third party, both Corp and plc
will do everything reasonably practicable to assist the other to
investigate and defend the claim threatened. Without limitation, such
assistance shall include giving access to relevant documentation and
records in any form, making relevant staff available for interview and
giving explanations of information where appropriate. The party giving
such assistance shall be reimbursed all costs and expenses reasonably
incurred in providing such assistance.
13.3 Corp shall be entitled, by giving notice in writing to plc, to require
plc to take all such reasonable steps and proceedings as Corp may
reasonably consider necessary to defend or compromise any claim or
threat of litigation made by a third party against plc of the kind
described in subclause 13.1, or obtain any payment or relief in respect
of, or in connection with, any matter giving rise to a right of action
by plc against a third party. plc shall not admit liability or agree to
any compromise of a claim without the prior written consent of Corp,
such consent not to be unreasonably withheld or delayed.
14. MARCONI NAME
14.1 plc acknowledges that Corp is the legal and beneficial owner of the
"Marconi" name and it shall, and it shall procure that the plc Subs
shall, on or before the Effective Date assign to Corp such right, title
or interest which each of them has in or to the name "Marconi" and any
other corporate name that incorporates the name "Marconi" used by plc
and/or the plc Subs, together with any "Marconi" logo, trade xxxx, or
business or trade name or any derivation thereof (the RIGHTS). plc
shall from the date of such assignment, cease to use any corporate name
of the Corp Group (other than "Marconi plc") pursuant to the terms of
the Licence (as defined in clause 14.2)) and shall not thereafter use
any names, trade marks or logos that are confusing or similar to
Marconi or any other corporate name of the Corp Group (other than
"Marconi plc" pursuant to the terms of the Licence (as defined in
clause 14.2)).
14.2 Subject to subclauses 14.3 and 14.4, Corp grants to plc with effect
from the Effective Date a non-exclusive, non-transferable, royalty-free
licence to use the "Marconi" name in the form "Marconi plc" (the
LICENCE). plc covenants to use such name solely as its corporate name
and for no other purpose whatsoever save where such name is required to
be disclosed pursuant to the Business Names Act, 1985.
14.3 The Licence granted by Corp to plc pursuant to subclause 14.2 shall be
for an initial period of 12 months from the Effective Date and shall
continue thereafter until terminated in accordance with subclause 14.4
(the LICENCE TERM). plc shall have no right to sell, sub-license or
otherwise deal with the Rights with regard to any third party or any
Subsidiaries, Affiliates or any other connected parties of plc. Within
the Licence Term plc undertakes to propose a special resolution to
change its corporate name from Marconi plc at each and every general
meeting convened for the transaction of business until such resolution
is passed and to forthwith upon the passing of such resolution register
such resolution with the Registrar of Companies. plc shall in any event
on the expiry or termination of the Licence Term cease to
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use the "Marconi plc" name. plc shall keep Corp informed as to progress
with regard to changing its corporate name.
14.4 The Licence shall automatically terminate immediately upon the
occurrence of the earlier of:
(a) the registration with the Registrar of Companies of a
shareholders' resolution changing plc's company name as
required by, and in accordance with, subclause 14.3;
(b) the breach by plc or any plc Sub of any material term of this
Deed or the Licence;
(c) an order for plc's winding-up, administration or dissolution
being made; any liquidator, trustee in bankruptcy, judicial
custodian, compulsory manager, receiver, administrative
receiver, administrator or similar officer being appointed in
respect of plc or any of plc's assets; plc's directors or
other officers requesting the appointment of a liquidator,
trustee in bankruptcy, judicial custodian, compulsory manager,
receiver, administrative receiver, administrator or similar
officer; or any other analogous step or procedure being taken
in any jurisdiction; and
(d) save in connection with the plc Scheme, an acquisition of all
or substantially all of the assets of plc or a sale of all or
substantially all of its shares or a change of control of plc
where "control" means the ability to direct the affairs of
another whether by means of voting or contractual rights or
otherwise and whether directly or indirectly.
14.5 Any goodwill in the "Marconi" name that accrues after the Effective
Date shall accrue to, and for the benefit of, Corp.
15. PLC SCHEME EXPENSES
15.1 Corp and Marconi Bonding shall use commercially reasonable endeavours
to procure the issue by HSBC, by no later than 10 Business Days after
the Effective Date, of a letter of credit in favour of the plc
Supervisors for their drawing in relation to the plc Scheme Expenses
(the LETTER OF CREDIT) substantially in the form attached to the
Performance Bonding Facility Agreement.
15.2 The Letter of Credit shall:
(a) be issued by HSBC in its capacity as an issuing bank under,
and subject to the terms of, the Performance Bonding Facility;
(b) be in an amount of L2,000,000 or such lesser amount as
notified to Corp by the plc Supervisors in accordance with
subclause 15.4 below;
(c) have an initial expiry date no later than 15 months after the
Effective Date but, subject to the terms of the Performance
Bonding Facility, may be extended for any period of time up to
five years beyond the Effective Date upon written notice by
the plc Supervisors to HSBC; and
(d) have as a condition to any drawing that the plc Supervisors
certify to HSBC that they have consulted with the Creditors'
Committees and they consider the drawing to be necessary to
meet actual or potential plc Scheme Expenses and Excluded
Claims and
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that all other sources of funding available to them are
insufficient to meet the plc Scheme Expenses when they fall
due.
15.3 Corp and Marconi Bonding each agree to waive any right to reimbursement
or indemnification against plc or the plc Supervisors arising as a
result of any payment being made by Corp or Marconi Bonding (including
through any offset being made against any cash collateral provided for
the Letter of Credit) as a result of any drawings by the plc
Supervisors under the Letter of Credit or any sums provided by Corp
pursuant to subclause 15.5.
15.4 The plc Supervisors shall notify Corp immediately if before, on or
after the date upon which the Letter of Credit is issued, they are of
the view (acting reasonably) that the Letter of Credit is no longer
required or is required in a lesser amount. If any such notification is
made before the Letter of Credit has been issued, the amount of the
Letter of Credit to be issued shall be reduced accordingly. If any such
notification is made on or after the Letter of Credit has been issued,
the plc Supervisors and Corp shall notify HSBC accordingly and request
that the amount of the Letter of Credit in issue be reduced
accordingly.
15.5 In the event that Corp is unable to procure the issue of the Letter of
Credit, it undertakes to enter into a side letter with the plc
Supervisors within 20 Business Days after the Effective Date
substantially in the form set out in Schedule 16.
16. TAX
16.1 To the extent permitted by law, Corp agrees to surrender, or to procure
that one of its Subsidiaries surrenders, to Ancrane and plc Group
Relief required by Ancrane and plc for their accounting periods
beginning on or after 1st April, 2001 but before the Effective Date
subject to a maximum amount of L200,000,000 of Group Relief in
aggregate.
16.2 In relation to the surrender of capital losses between plc and Corp
Schedule 9 shall apply.
16.3 Pursuant to subclause 16.1, Corp will, and will procure that its
relevant Subsidiaries will, authorise, sign and submit to the Inland
Revenue all such notices of consent to the surrender of Group Relief
and all such other documents and returns, including any revised
notices, documents and returns, as may be necessary to secure that full
effect is given to such surrenders and comply with all procedural
requirements in respect of the giving of such consents.
16.4 Pursuant to subclause 16.1, plc and Ancrane will:
(a) authorise, sign and submit to the Inland Revenue all such
notices of claims for the surrender of Group Relief and all
such other documents and returns, including any revised
notices, documents and returns, as may be necessary to secure
that full effect is given to such surrenders and comply with
all procedural requirements in respect of the making of such
claims; and
(b) take such steps as Corp may reasonably require in order to
minimise the amount of Group Relief which Corp and its
subsidiaries are required to surrender to plc and Ancrane,
provided that Corp may not require plc and Ancrane to take any
step which would result in either of them having a liability
to corporation tax other than one in respect of which Corp is
liable to make a payment on their behalf to the Inland
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Revenue pursuant to the Corp Covenant and after taking account
of any steps which Corp may require them to take under the
Corp Covenant.
16.5 Corp and plc shall give each other such assistance and access to
information as is reasonably required in order to agree the tax affairs
for any period beginning on or before the Effective Date of Corp, plc
and any company which at or before the Effective Date is, or was, a
Subsidiary of Corp or plc.
16.6 Corp, plc and Ancrane undertake to enter into the Corp Covenant
substantially in the form set out in Schedule 14 after the Record Date
and on or before 1st April, 2003.
17. HIGHROSE DEBT
Ancrane and, to the extent that any rights in respect of the Highrose
Debt are transferred to it by Ancrane, plc hereby, with effect from the
Effective Date, release all of their claims, causes or rights of action
or proceedings whether at law or in equity in any jurisdiction
whatsoever, whether known or unknown to the parties, whether or not
presently known to the law and whether arising before, on or after the
date of this Deed against Highrose to the extent that they relate to
Highrose's obligations under the Highrose Debt, including the
obligation to repay the Highrose Debt (including accrued interest) and
shall waive all past, present or future rights it may have against
Highrose in connection with the same.
18. VAT GROUP
plc and Corp shall each procure that an application to the
Commissioners under section 43B VATA is made prior to the Record Date
for each VAT Eligible Company to become a member of the Corp VAT Group
with effect from the earliest date permitted by the Commissioners.
19. INTER COMPANY BALANCES
Corp and plc shall enter into the Receivables Assignment Letter before
the Record Date.
20. COUNTER INDEMNITIES AND WAIVERS
20.1 Corp shall indemnify plc on an after tax basis for any claims
(including related costs) against plc from MCL arising as a result of
any payment made by MCL with respect to the settlement of plc's
obligations under the contracts and termination of employment of Xxxxxx
Xxxxxx and Xxxxxxx Xxxx. In the event that Corp makes a payment under
the provisions of this subclause, it irrevocably and unconditionally
waives any right of counter indemnity or right of reimbursement or
other claims it may have against plc in respect of such payment,
whether arising under contract, operation of law or otherwise.
20.2 Corp and plc agree that invoices from various professional advisers
relating to the Financial Restructuring addressed and delivered to plc,
for work undertaken at the instruction and for the benefit of Corp,
were erroneously addressed to plc. Corp undertakes to meet the costs
and expenses specified in such invoices from certain of the parties
listed at Category 5 to Part III of Appendix 9 of the Scheme Document
and irrevocably and unconditionally waives any right of counter
indemnity or right of reimbursement or other claims it may have against
plc in respect of such payments, whether arising under contract,
operation of law or otherwise.
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20.3 Ancrane irrevocably and unconditionally waives any right of counter
indemnity, right of reimbursement or other claim it may have against
MCL arising as a result of it having paid L150,000 of professional
advisers' fees on behalf of MCL, whether arising under contract,
operation of law or otherwise.
21. ESOP ESCROW AGREEMENT RELEASE
21.1 Capitalised terms used but not defined in this clause 21 shall have the
same meaning as those set out and adopted in the ESOP Settlement
Agreement.
21.2 Immediately following payment by Corp to each Settling ESOP Bank of its
respective Settlement Payment in accordance with clause 2.1 of the ESOP
Settlement Agreement plc shall, by execution of a deed substantially in
the form set out in Schedule 11, unconditionally and irrevocably
release all of its claims, causes or rights of action or proceedings
against each Opco to the extent that they relate to (a) all or any of
the ESOP Contracts and/or (b) the Funding Letters and shall waive all
past, present or future rights it may have against each Opco in
connection with the same.
21.3 With effect from the date on which Corp releases its claims against BCT
under clause 3.2.1 of the ESOP Settlement Agreement, Corp hereby
unconditionally and irrevocably, releases any claim that it has against
plc arising from the funding of BCT in respect of the cash collateral
calls from UBS AG and Salomon Brothers International Limited and waives
all past, present or future rights it may have against plc in
connection with the same.
22. SECURITY POWER OF ATTORNEY
plc hereby undertakes to execute the Security Power of Attorney in the
form set out in Schedule 12 immediately after the execution of this
Deed.
23. plc WAIVERS
23.1 plc and the plc Subs irrevocably and unconditionally waive and release
each Corp Group Company from any Claim it may have against that Corp
Group Company and which arises out of, or is in relation to, any matter
or circumstance existing on or before the Effective Date other than any
Claim set out in the Statement and Waiver, that is expressed to
continue in existence, notwithstanding the terms of the Statement and
Waiver and any other Claim intended to be excluded by the terms of
either Scheme or contemplated by this Deed or the transactions
contemplated by this Deed (including for the avoidance of doubt any
Claim of Ancrane or plc against Corp arising out of the transactions
contemplated at Schedules 1, 2 and 15 hereto and Ancrane's holding of
Bonds).
23.2 plc agrees that the distribution of plc Scheme Consideration to plc
Scheme Creditors in respect of any guarantee or indemnity given by plc
of any other Group Company will not give rise, and no other payment by
plc in respect of a guarantee given by it will give rise, to any
counter indemnity or right of reimbursement or other claim by plc
against the relevant Group Company.
24. plc UNDERTAKING
plc will use reasonable endeavours to procure that any share options
issued by plc to employees of Metapath, Mariposa, Albany Partnership
Limited and SMS and their respective
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subsidiaries (the SHARE OPTIONS OR SHARE AWARDS) that are exercised (in
the case of Share Options) or which vest (in the case of Share Awards)
before the plc Shareholder Record Date will be satisfied from plc
shares held either by BCT as trustee of the Marconi Employee Trust or
held by Mourant & Co. Trustees Limited as trustee of the GEC Employee
Share Trust.
25. STATEMENT AND WAIVER
Corp and plc shall enter into the Statement and Waiver on or before the
Record Date and certain identified Group Companies shall accede to the
Statement and Waiver on or before the Effective Date.
26. PLC OFFICES
Corp consents to plc maintaining its registered office address as New
Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx XX0 0XX for a period of
up to 12 months from the date of this Deed. In addition Corp grants
(and undertakes to procure that its subsidiaries will grant, where
appropriate) plc a right to share such of Corp's office space at 000
Xxxxxx Xxxx, Xxxxxx XX0 0XX as plc may reasonably require, upon giving
Corp reasonable notice, for its day-to-day business and for its general
meetings as a bare licensee only for 36 months from the Effective Date.
27. RESTRUCTURING IMPLEMENTATION
Save as otherwise determined, from time to time by notice in writing
given by Corp to plc, Corp and plc hereby agree to, and will procure
that their direct and indirect Subsidiaries will (i) take all actions
and execute and deliver all such deeds or other documents as may from
time to time be either necessary or, in the determination of Corp
(acting reasonably), desirable, to implement and give effect to this
Deed and/or the Financial Restructuring in accordance with the
timetable set out in the Scheme Document or this Deed, including
(without limitation) the convening of meetings of creditors and/or
members, in accordance with the timetable set out in the Scheme
Document, or as soon as reasonably practicable thereafter, and (ii) not
in any way attempt to frustrate, delay or interfere with the
performance, approval or implementation of this Deed or the Schemes.
28. REPRESENTATIONS AND WARRANTIES
28.1 Each party to this Deed severally represents and warrants to the other
parties that:
(a) it has all requisite power and authority to execute and
deliver this Deed and to carry out the transactions
contemplated by, and perform its obligations under, this Deed,
including entering into any ancillary agreements pursuant to
this Deed and that it has taken all action necessary to
authorise such execution and delivery and the performance of
such obligations;
(b) the execution and delivery by it of this Deed, and the
performance by it of its obligations under it does not and
will not violate or conflict with any law, rule or regulation
applicable to it, any provisions of constitutional documents,
any order or judgement of any court or other agency or
government applicable to it nor require any registration,
filing, consent, approval, notice or other action to, with or
by, any governmental or other authority, court or regulatory
body, except as expressly provided in this Deed; and
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(c) this Deed constitutes legal, valid and binding obligations,
enforceable against it in accordance with its terms, except to
the extent that enforcement may be limited by bankruptcy,
insolvency, reorganisation, moratorium or other similar laws
relating to or limiting creditors' rights generally.
28.2 Each party severally represents and warrants to the other parties that
the entering into and performance of this Deed on its terms has been
approved and resolved at a duly constituted meeting of its board of
directors (which meeting also considered the entry into, and
performance of, this Deed on its terms) to be in the best interests of
it and its members, creditors and Bondholders (if any).
29. COSTS
Each party will be solely responsible for all costs and expenses
incurred by it in connection with the negotiation, preparation and
execution of this Deed and for its compliance with the terms of this
Deed.
30. INADEQUACY OF DAMAGES
Each of the parties acknowledges that Corp may be irreparably harmed by
any breach of the terms of this Deed and agrees that damages alone may
not be an adequate remedy for Corp for any breach of any provision of
this Deed. Accordingly if Corp requires either of the remedies of
injunction or specific performance or any combination thereof to
protect or enforce its rights under this Deed, it shall be entitled to
apply to the Court for such remedies without delay.
31. NOTICES
31.1 Any notice or other formal communication given under this Deed must be
in writing (which includes fax, but not email) and may be delivered or
sent by post or fax to the party to be served at its address appearing
in this Deed as follows:
Corp: plc:
New Century Park New Century Park
XX Xxx 00 XX Xxx 00
Coventry Coventry
Warwickshire CV3 1HJ Xxxxxxxxxxxx XX0 0XX
Fax: 000 0000 0000 Fax: 000 0000 0000
Attn: Company Secretary Attn: Company Secretary
Ancrane: Nominees:
New Century Park New Century Park
XX Xxx 00 XX Xxx 00
Coventry Coventry
Warwickshire CV3 1HJ Xxxxxxxxxxxx XX0 0XX
Fax: 000 0000 0000 Fax: 000 0000 0000
Attn: Company Secretary Attn: Company Secretary
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E-A Continental Mariposa
New Century Park 0000 Xxxxxxx Xxxxx
XX Xxx 00 Xxxxxxxxxx, XX 00000
Xxxxxxxx Xxxxxx Xxxxxx
Xxxxxxxxxxxx XX0 0XX Fax: x0 000 000 0000
Fax: 000 0000 0000 Attn: Xxxxx Xxxxx
Attn: Company Secretary
SMS Metapath
0 Xxxxxx Xxxxxx Xxxxx 0000 Xxxxx Xxxxxxx Xxxxxx
Xxxxx 000 Xxxxx 000
Xxxxx Xxx, XX 00000 Xxxxxxxxxx XX 00000
Xxxxxx Xxxxxx Xxxxxx Xxxxxx
Fax: Xxxxx Xxxxx Fax: Xxxx Xxxxxx
Attn: x0 000 000 0000 Attn: x0 000 000 0000
Marconi Bonding BSB
Xxx Xxxxxxx Xxxx 0 Xxxxxxxxx Xxxxxx
P.O. Box 53 London W1A 2AY
Xxxxxxxx
Xxxxxxxxxxxx XX0 0XX
Fax: 000 0000 0000 Fax: 000 0000 0000
Attn: Company Secretary Attn: Company Secretary
Ansty Photoniqa
New Century Park New Century Park
X.X. Xxx 00 X.X. Xxx 00
Coventry Coventry
Warwickshire CV3 1HJ Xxxxxxxxxxxx XX0 0XX
Fax: 000 0000 0000 Fax: 000 0000 0000
Attn: Company Secretary Attn: Company Secretary
Yeslink
Xxx Xxxxxxx Xxxx
X.X. Xxx 00
Xxxxxxxx
Xxxxxxxxxxxx XX0 0XX
Fax: 000 0000 0000
Attn: Company Secretary
or at such other address or fax number as it may have notified to the
other parties in accordance with this clause. Any notice or other
document sent by post shall be sent by prepaid first class post (if
within the United Kingdom) or by prepaid airmail (if elsewhere).
31.2 Any notice or other formal communication shall be deemed to have been
given:
(a) if delivered, at the time of delivery; or
22
(b) if posted, at 10.00 a.m. on the second Business Day after it
was put into the post; or
(c) if sent by fax, on the date of transmission, if transmitted
before 3.00 p.m. on any Business Day, and in any other case on
the Business Day following the date of transmission.
31.3 In proving service of a notice or other formal communication, it shall
be sufficient to prove that delivery was made or that the envelope
containing the communication was properly addressed and posted by
prepaid first class post or that the fax was properly addressed and
transmitted, as the case may be.
32. ASSIGNMENT
None of the parties to this Deed may assign any of their respective
rights or obligations under this Deed. This Deed is intended to bind
and inure to the benefit of the parties and their respective
successors, permitted assignees, administrators and representatives.
33. GENERAL
33.1 This Deed may be executed in one or more counterparts, each of which
will be deemed an original and all of which will constitute one and the
same Deed and any party may enter into this Deed by executing a
counterpart.
33.2 The agreements, representations, warranties and obligations of each of
the parties to this Deed are, in all respects, several and not joint.
33.3 For the sole benefit of Corp, time is of the essence in relation to any
obligation of plc, the plc Subs and EA Continental under this Deed.
33.4 The rights of each party under this Deed:
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of rights and remedies
provided by law; and
(c) may be waived only in writing and specifically.
33.5 A waiver (whether express or implied) by one of the parties of any of
the provisions of this Deed or of any breach of or default by the other
party in performing any of those provisions shall not constitute a
continuing waiver and that waiver shall not prevent the waiving party
from subsequently enforcing any of the provisions of this Deed not
waived or from acting on any subsequent breach of or default by the
other party under any of the provisions of this Deed.
33.6 In the event that any provision of this Deed is void and unenforceable
by reason of any applicable law, it shall be deleted and the remaining
provisions of this Deed shall continue in full force and effect, and if
required be so amended as necessary to give effect to the spirit of
this Deed so far as possible.
23
34. ENTIRE AGREEMENT
34.1 This Deed contains the whole agreement between the parties relating to
the transactions contemplated by this Deed and supersedes all previous
agreements between the parties relating to these arrangements and
transactions.
34.2 Each party acknowledges that in agreeing to enter into this Deed it has
not relied on any representation, warranty, collateral contract or
other assurance (except those set out in this Deed) made by or on
behalf of any other party before the signature of this Deed. Each party
waives all rights and remedies which, but for this subclause, might
otherwise be available to it in respect of any such representation,
warranty, collateral contract or other assurance.
34.3 Nothing in the preceding subclause limits or excludes any liability for
fraud.
35. THIRD PARTIES
With the exception of the rights of:
(a) the Scheme Creditors, Bondholders and Designated Recipients to
enforce the terms of clauses 2, 3, 4, 5, 6, 7, 8, 12, 17, 19,
21, 22, 23, 25 and 27;
(b) the Eurobond Trustee to enforce the terms of clause 9;
(c) the plc Supervisors to enforce the terms of clause 15 against
Corp and Marconi Bonding only; and
(d) MCL to enforce the terms of clause 20,
the benefit of which is hereby conferred upon them, no term of this
Deed is enforceable by a person who is not a party to this Deed under
the Contracts (Rights of Third Parties) Xxx 0000 or otherwise.
36. GOVERNING LAW AND JURISDICTION
This Deed will be governed by, and construed in accordance with,
English law. Each party irrevocably submits to the jurisdiction of the
English courts for all purposes relating to this Deed.
IN WITNESS of which this Deed has been executed as a deed and has been delivered
on the date which appears first on page 1.
24
SCHEDULE 1
EA-plc DEED OF ASSIGNMENT
DATED [ ] MARCH, 2003
E-A CONTINENTAL LIMITED
MARCONI CORPORATION PLC
AND
MARCONI PLC
----------------------
DEED OF ASSIGNMENT
-----------------------
XXXXX & XXXXX
London
25
CONTENTS
CLAUSE PAGE
1. Interpretation...................................... 27
2. Assignment and Payment.............................. 29
3. Consideration....................................... 30
4. Further Assurance................................... 30
5. Set-off and Counterclaim............................ 30
6. Representations and Warranties...................... 30
7. Assignor's Responsibility........................... 31
8. Indemnity........................................... 31
9. Changes to the Parties.............................. 31
10. Waivers and Remedies Cumulative..................... 31
11. Severability........................................ 31
12. Counterparts........................................ 32
13. Notices............................................. 32
14. Expenses............................................ 33
15. Stamp Duty.......................................... 33
16. Jurisdiction........................................ 33
17. Governing Law....................................... 33
Signatories.................................................. 34
26
THIS DEED is dated [ ] March, 2003
BETWEEN:
(1) E-A CONTINENTAL LIMITED (registered number 00725757) whose registered
office is at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0
0XX (the ASSIGNOR);
(2) MARCONI CORPORATION PLC (registered number 00067307) whose registered
office is at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0
0XX (CORP); and
(3) MARCONI PLC (registered number 03846429) whose registered office is at
New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (the
ASSIGNEE).
BACKGROUND:
(A) This Deed of Assignment has been entered into by the aforementioned
parties as part of the proposed financial restructuring of the Assignee
and Corp (the FINANCIAL RESTRUCTURING).
(B) As part of the Financial Restructuring, the Assignor has agreed to
assign the Assigned Rights to the Assignee and pay the balance of the
Assignor's Account to the Assignee, these assets being all the assets
of the Assignor, in consideration for which the Assignee has agreed to
release the Assignor from all obligations under the plc Loan.
IT IS AGREED as follows:
1. INTERPRETATION
1.1 DEFINITIONS
In this Deed:
ASSIGNED RIGHTS means all rights, title, interest, benefits and
obligations accruing to the Assignor under the Corp Loan, including,
without limitation, any right or entitlement of the Assignor to receive
cash, loan notes, shares or other consideration or payment as a
creditor of Corp as a result of the Financial Restructuring;
ASSIGNMENT means the assignment of the Assigned Rights under this Deed;
ASSIGNOR'S ACCOUNT means the balance of the account the Assignor has
with HSBC Bank plc, account number 00000000, which as at or about the
date of this Deed is in the amount of approximately L2,000,000;
BUSINESS DAY means any day other than Saturday, Sunday or any other day
which is a public holiday in England and Wales;
COMPLETION means the execution of this Deed by the parties set out
herein;
CORP LOAN means the loans from the Assignor to Corp in the amount of
L363,308,000;
27
CORP SCHEME means the proposed scheme of arrangement with the Corp
Scheme Creditors in respect of Corp pursuant to section 425 Companies
Act 1985 (including any modifications, additions or conditions approved
or imposed by the Court);
CORP SCHEME CREDITOR means a scheme creditor of Corp in respect of its
Scheme Claim;
EXCLUDED CLAIMS shall in relation to the Corp Scheme have the same
meaning as that set out in the Corp Scheme and, in relation to the plc
Scheme have the same meaning as that set out in the plc Scheme;
LIABILITY or LIABILITIES means any liability or obligation of a person
whether it is present, future, prospective or contingent, whether or
not it is fixed or undetermined, whether or not it involves the payment
of money or performance of an act or obligation and whether it arises
at common law, in equity or by statute, in England and Wales or in any
other jurisdiction, or in any other manner whatsoever, but such
expression does not include any liability which is barred by statute or
is otherwise unenforceable under English law or arises under a contract
which is void or, being voidable, has been duly avoided;
plc LOAN means the loan in the amount of L219,000,000 from the Assignee
to the Assignor;
plc SCHEME means the proposed scheme of arrangement in respect of plc
pursuant to section 425 Companies Xxx 0000, the terms of which are set
out in Part III of the Scheme Document (including any modifications,
additions or conditions approved or imposed by the Court);
RECORD DATE has the meaning given to it in the Corp Scheme or the plc
Scheme, as appropriate; and
SCHEME CLAIM means any claim or right which a person is, or may in any
circumstances become, entitled to bring or enforce against Corp or plc
(as appropriate) in respect of any Liability of Corp or plc (as
appropriate) in each and every case in existence as at the Record Date
or after that date by reason of any Liability incurred before that
date, other than Excluded Claims.
1.2 CONSTRUCTION
(a) In this Deed:
(i) references to a person include a body corporate and
unincorporated associations of persons;
(ii) references to an individual include his estate and
personal representatives; and
(iii) references to a party to this Deed include references
to the successors or assigns (immediate or
otherwise), of that party.
(b) In this Deed any reference, express or implied, to an
enactment includes references to:
(i) that enactment as re-enacted, amended, extended or
applied by or under any other enactment (before or
after the signature of this Deed);
28
(ii) any enactment which that enactment re-enacts (with or
without modification); and
(iii) any subordinate legislation made (before or after the
signature of this Deed) under that enactment, as
re-enacted, amended, extended or applied as described
in paragraph (a) above, or under any enactment
referred to in paragraph (b) above,
and "enactment" includes any legislation in any jurisdiction.
(c) In this Deed, unless the contrary intention appears, a
reference to a clause, subclause or schedule is a reference to
a clause, subclause or schedule to this Deed. The schedules
form part of this Deed.
(d) Subclauses 1.1 to 1.2(c) above apply unless the contrary
intention appears.
(e) The headings in this Deed do not affect its interpretation.
2. ASSIGNMENT AND PAYMENT
2.1 ASSIGNMENT
With effect from Completion and subject to the terms of this Deed, the
Assignor, with full title guarantee (in accordance with the Law of
Property (Miscellaneous Provisions) Act 1994), assigns to the Assignee
the Assigned Rights.
2.2 NOTICE AND ACKNOWLEDGEMENTS
(a) The Assignor notifies the Assignee, and the Assignee
acknowledges, that the Assignor shall not:
(i) be required to reimburse the Assignee for, or
otherwise be responsible for or assure the Assignee
against, any loss suffered by the Assignee in
consequence of the matters provided for in this Deed
(other than loss caused by the negligent or wilful
failure of the Assignor to perform or observe the
terms of this Deed); or
(ii) have any obligation to reacquire the Assigned Rights
or any part of the Assigned Rights.
(b) The Assignee agrees with effect from Completion to accept the
Assignment without recourse and to benefit from the
consideration the Assignor would have received (as original
lender) as a result of the Financial Restructuring.
(c) Corp acknowledges notice of the Assignment constituted by this
Deed and expressly consents to the Assignment.
2.3 PAYMENT
The Assignor will pay to the Assignee on Completion the balance of the
Assignor's Account.
29
3. CONSIDERATION
In consideration of the Assignment by the Assignor to the Assignee and
the payment provided for in Clause 2.3 of this Deed, the Assignee
releases the Assignor from all of its obligations under or in respect
of the plc Loan with effect from Completion.
4. FURTHER ASSURANCE
The Parties shall each take whatever action may be necessary:
(a) so that the Assignee may assume, to the fullest extent
permitted by the Corp Loan and in accordance with the
provisions of this Deed, all of the Assigned Rights with
effect from Completion;
(b) for the Assignor to be released from all obligations arising
after Completion under the Corp Loan in relation to the
Assigned Rights; and
(c) otherwise to implement the terms of this Deed,
including the execution of any further documents and the giving of any
notice, order or direction and the making of any registration which in
each case may be required.
5. SET-OFF AND COUNTERCLAIM
All payments shall be made without set-off or counterclaim on amounts
which are not due under this Deed.
6. REPRESENTATIONS AND WARRANTIES
6.1 Each party severally represents and warrants to the other parties that:
(a) it has all requisite power and authority to enter into and
perform, and has taken all necessary action to authorise the
entry into, performance and delivery of, this Deed and the
transactions contemplated by this Deed;
(b) this Deed constitutes legal, valid and binding obligations
enforceable against it in accordance with its terms; and
(c) all authorisations required or desirable in connection with
the entry into, performance, validity and enforceability of
this Deed and the transactions contemplated by this Deed have
been obtained or effected and are in full force and effect.
6.2 The Assignor represents to the Assignee that:
(a) OBLIGATIONS: At the date of this Deed it will, to the best of
its knowledge and belief, have performed and complied with all
obligations required to be performed or complied with by it in
relation to the Assigned Rights under the Corp Loan up to
Completion, and no rights, including rights of set-off, will
have arisen in respect of the Assigned Rights in favour of
Corp;
(b) RIGHTS ASSIGNABLE: The rights in respect of the Assigned
Rights are assignable in accordance with the provisions of
this Deed and the Corp Loan; and
30
(c) INDEBTEDNESS UNDER THE CORP LOAN: Corp is indebted to the
Assignor under the Corp Loan in the outstanding principal
amount of L365,308,000.
7. ASSIGNOR'S RESPONSIBILITY
Save as expressly provided in Clause 6 (Representations and Warranties)
the Assignor has not made and does not by this Deed make, and the
Assignee has not relied upon, any representation, warranty or condition
(expressed or implied) about, and the Assignor will have no
responsibility to the Assignee for, the effectiveness, validity or
enforceability of, the Corp Loan or other documentation delivered by
the Assignor to the Assignee or any of the terms, covenants or
conditions contained in the Corp Loan or other documentation or any
non-performance by any party to it or the financial condition of Corp
or any other person liable with respect to the Assigned Rights.
8. INDEMNITY
The Assignee agrees to indemnify the Assignor and the Assignor agrees
to indemnify the Assignee against any liabilities, obligations, losses,
damages, penalties, judgments, costs, expenses or disbursements of any
kind or nature which may be imposed on or incurred by the other party
as a consequence of failure by it duly and punctually to perform its
obligations, or breach by it of any of the representations and
warranties made by it, in this Deed.
9. CHANGES TO THE PARTIES
No party may assign, transfer, novate, encumber or dispose of any of
its interest in, its rights and/or obligations under this Deed without
the prior written consent of the other parties. However, after the
Assignee has performed its obligations in Clause 3 (Consideration) in
respect of the Assigned Rights, this Clause 9 shall not restrict the
Assignee from assigning, charging or pledging the whole or any part of
its rights, title and interest in the Assigned Rights to any third
party.
10. WAIVERS AND REMEDIES CUMULATIVE
The rights of each party under this Deed:
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights under the
general law; and
(c) may be waived only in writing and specifically.
Delay in exercising or non-exercise of any such right is not a waiver
of that right.
11. SEVERABILITY
If a provision of this Deed is or becomes illegal invalid or
unenforceable in any jurisdiction, that shall not affect:
(a) the validity or enforceability in that jurisdiction of any
other provision of this Deed; or
31
(b) the validity or enforceability in other jurisdictions of that
or any other provision of this Deed.
12. COUNTERPARTS
This Deed may be executed in any number of counterparts, each of which
will be deemed an original and all of which will constitute one and the
same Deed and any party may enter into this Deed by executing a
counterpart.
13. NOTICES
13.1 GIVING OF NOTICES
Subject to Clause 2.3 (Notice and acknowledgements), all notices or
other communications under or in connection with this Deed shall be
given in writing and, unless otherwise stated may be made by facsimile.
Any such notice will be deemed to be given as follows:
(a) if by letter, when delivered personally or on actual receipt;
and
(b) if by facsimile, when received in legible form.
However, a notice given in accordance with the above but received on a
non-working day or after business hours in the place of receipt will
only be deemed to be given on the next working day in that place.
13.2 ADDRESSES FOR NOTICES
The address and facsimile number of each party for all notices under or
in connection with this Deed are:
(a) in relation to the Assignee:
Xxx Xxxxxxx Xxxx, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 000 0000 0000
(b) in relation to Corp:
New Century Park, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 000 0000 0000
(c) in relation to the Assignor:
New Century Park, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
32
Fax Number: 000 0000 0000
or any other notified by that Party for this purpose to the other party
by not less than five Business Days' notice.
14. EXPENSES
Each party shall pay its own costs and expenses in connection with the
preparation, negotiation and execution of this Deed.
15. STAMP DUTY
The Assignee shall pay, and forthwith on demand indemnify each of the
other parties to this Deed against any liability it incurs in respect
of, any stamp, registration and similar tax which is or becomes payable
in connection with the entry into and performance of this Deed.
16. JURISDICTION
Each party to this Deed agrees, for the benefit of the Assignor, that
the courts of England shall have jurisdiction to settle any disputes in
connection with this Deed and, accordingly, submits to the jurisdiction
of the English courts.
17. GOVERNING LAW
This Deed is governed by, and construed in accordance, with English
law.
IN WITNESS of which this Deed has been executed as a deed and has been delivered
on the date which it appears first on page 1.
33
SIGNATORIES
EXECUTED as a Deed ) _________________________________
by MARCONI PLC ) Director
acting by [ ] and )
[ ] ) _________________________________
Director/Secretary
EXECUTED as a Deed ) _________________________________
by MARCONI CORPORATION ) Director
PLC acting by [ ] and )
[ ] ) _________________________________
Director/Secretary
EXECUTED as a Deed ) _________________________________
by E-A CONTINENTAL ) Director
LIMITED acting by [ ] )
and [ ] ) _________________________________
Director/Secretary
34
SCHEDULE 2
plc-ANCRANE DEED OF ASSIGNMENT
DATED [ ] MARCH, 2003
MARCONI PLC
MARCONI CORPORATION PLC
AND
ANCRANE
----------------------
DEED OF ASSIGNMENT
-----------------------
XXXXX & XXXXX
London
35
CONTENTS
CLAUSE PAGE
1. Interpretation........................... 37
2. Assignment and Payment................... 39
3. Consideration............................ 39
4. Further Assurance........................ 39
5. Set-off and Counterclaim................. 40
6. Representations and Warranties........... 40
7. Assignor's Responsibility................ 40
8. Indemnity................................ 40
9. Changes to the Parties................... 41
10. Waivers and Remedies Cumulative.......... 41
11. Severability............................. 41
12. Counterparts............................. 41
13. Notices.................................. 41
14. Expenses................................. 42
15. Stamp Duty............................... 42
16. Jurisdiction............................. 42
17. Governing Law............................ 43
Signatories....................................... 44
36
THIS DEED is dated [ ] March, 2003
BETWEEN:
(1) MARCONI PLC (registered number 03846429) whose registered office is at
New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (the
ASSIGNOR);
(2) MARCONI CORPORATION PLC (registered number 00067307) whose registered
office is at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0
0XX (CORP); and
(3) ANCRANE (registered number 04308188) whose registered office is at New
Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (the
ASSIGNEE).
BACKGROUND:
(A) This Deed of Assignment has been entered into by the aforementioned
parties as part of the proposed financial restructuring of the Assignor
and Corp (the FINANCIAL RESTRUCTURING).
(B) As part of the Financial Restructuring, the Assignor has agreed to
assign the Assigned Rights to the Assignee, in consideration for which
the Assignee has agreed to allot and issue the Ancrane Share to the
Assignor for an amount equal to the market value of the Corp Loan at
the date of such assignment.
IT IS AGREED as follows:
1. INTERPRETATION
1.1 DEFINITIONS
In this Deed:
ANCRANE SHARE means one ordinary share of L1.00 in the capital of the
Assignee;
ASSIGNED RIGHTS means all rights, title, interest, benefits and
obligations accruing to the Assignor under the Corp Loan, including,
without limitation, any right or entitlement of the Assignor to receive
cash, loan notes, shares or other consideration or payment as a
creditor of Corp as a result of the Financial Restructuring;
ASSIGNMENT means the assignment of the Assigned Rights under this Deed;
BUSINESS DAY means any day other than Saturday, Sunday or any other day
which is a public holiday in England and Wales;
COMPLETION means the execution of this Deed by the parties set out
herein;
CORP LOAN means the loans from the Assignor to Corp in the amount of
L363,308,000;
CORP SCHEME means the proposed scheme of arrangement with the Corp
Scheme Creditors in respect of Corp pursuant to section 425 Companies
Act 1985 (including any modifications, additions or conditions approved
or imposed by the court);
CORP SCHEME CREDITOR means a scheme creditor of Corp in respect of its
Scheme Claim;
37
EXCLUDED CLAIMS shall in relation to the Corp Scheme have the same
meaning as that set out in the Corp Scheme and, in relation to the plc
Scheme have the same meaning as that set out in the plc Scheme;
LIABILITY or LIABILITIES means any liability or obligation of a person
whether it is present, future, prospective or contingent, whether or
not it is fixed or undetermined, whether or not it involves the payment
of money or performance of an act or obligation and whether it arises
at common law, in equity or by statute, in England and Wales or in any
other jurisdiction, or in any other manner whatsoever, but such
expression does not include any liability which is barred by statute or
is otherwise unenforceable under English law or arises under a contract
which is void or, being voidable, has been duly avoided;
plc SCHEME means the proposed scheme of arrangement in respect of plc
pursuant to section 425 Companies Xxx 0000, the terms of which are set
out in Part III of the Scheme Document (including any modifications,
additions or conditions approved or imposed by the Court);
RECORD DATE has the meaning given to it in the Corp Scheme or the plc
Scheme, as appropriate; and
SCHEME CLAIM means any claim or right which a person is, or may in any
circumstances become, entitled to bring or enforce against Corp or plc
(as appropriate) in respect of any Liability of Corp or plc (as
appropriate) in each and every case in existence as at the Record Date
or after that date by reason of any Liability incurred before that
date, other than Excluded Claims.
1.2 CONSTRUCTION
(a) In this Deed:
(i) references to a person include a body corporate and
unincorporated associations of persons;
(ii) references to an individual include his estate and personal
representatives; and
(iii) references to a party to this Deed include references to the
successors or assigns (immediate or otherwise), of that party.
(b) In this Deed any reference, express or implied, to an enactment
includes references to:
(i) that enactment as re-enacted, amended, extended or applied by
or under any other enactment (before or after the signature of
this Deed);
(ii) any enactment which that enactment re-enacts (with or without
modification); and
(iii) any subordinate legislation made (before or after the
signature of this Deed) under that enactment, as re-enacted,
amended, extended or applied as described in paragraph (a)
above, or under any enactment referred to in paragraph (b)
above,
and "enactment" includes any legislation in any jurisdiction.
(c) In this Deed, unless the contrary intention appears, a reference to a
clause, subclause or schedule is a reference to a clause, subclause or
schedule to this Deed. The schedules form part of this Deed.
38
(d) Subclauses 1.1 to 1.2(c) above apply unless the contrary intention
appears.
(e) The headings in this Deed do not affect its interpretation.
2. ASSIGNMENT AND PAYMENT
2.1 ASSIGNMENT
With effect from Completion and subject to the terms of this Deed, the
Assignor, with full title guarantee (in accordance with the Law of
Property (Miscellaneous Provisions) Act 1994), assigns to the Assignee
the Assigned Rights.
2.2 NOTICE AND ACKNOWLEDGEMENTS
(a) The Assignor notifies the Assignee, and the Assignee acknowledges, that
the Assignor shall not:
(i) be required to reimburse the Assignee for, or otherwise be
responsible for or assure the Assignee against, any loss
suffered by the Assignee in consequence of the matters
provided for in this Deed (other than loss caused by the
negligent or wilful failure of the Assignor to perform or
observe the terms of this Deed); or
(ii) have any obligation to reacquire the Assigned Rights or any
part of the Assigned Rights.
(b) The Assignee agrees with effect from Completion to accept the
Assignment without recourse and to benefit from the consideration the
Assignor would have received (as original lender) as a result of the
Financial Restructuring.
(c) Corp acknowledges notice of the Assignment constituted by this Deed and
expressly consents to the Assignment.
3. CONSIDERATION
In consideration of the Assignment by the Assignor to the Assignee, the
Assignee will on Completion allot and issue the Ancrane Share to the
Assignor credited as fully paid with a share premium equal to the
market value of the Corp Loan as at Completion (less L1.00), such
Ancrane Share to rank pari passu in all respects with the ordinary
shares in the capital of the Assignee in issue at the date of the
allotment.
4. FURTHER ASSURANCE
The Parties shall each take whatever action may be necessary:
(a) so that the Assignee may assume, to the fullest extent
permitted by the Corp Loan and in accordance with the
provisions of this Deed, all of the Assigned Rights with
effect from Completion;
(b) for the Assignor to be released from all obligations arising
after Completion under the Corp Loan in relation to the
Assigned Rights; and
(c) otherwise to implement the terms of this Deed,
39
including the execution of any further documents and the giving of any
notice, order or direction and the making of any registration which in
each case may be required.
5. SET-OFF AND COUNTERCLAIM
All payments shall be made without set-off or counterclaim on amounts
which are not due under this Deed.
6. REPRESENTATIONS AND WARRANTIES
6.1 Each party severally represents and warrants to the other parties that:
(a) it has all requisite power and authority to enter into and
perform, and has taken all necessary action to authorise the
entry into, performance and delivery of, this Deed and the
transactions contemplated by this Deed.
(b) this Deed constitutes legal, valid and binding obligations
enforceable against it in accordance with its terms; and
(c) all authorisations required or desirable in connection with
the entry into, performance, validity and enforceability of
this Deed and the transactions contemplated by this Deed have
been obtained or effected and are in full force and effect.
6.2 The Assignor represents to the Assignee that:
(a) OBLIGATIONS: At the date of this Deed it will, to the best of
its knowledge and belief, have performed and complied with all
obligations required to be performed or complied with by it in
relation to the Assigned Rights under the Corp Loan up to
Completion, and no rights, including rights of set-off, will
have arisen in respect of the Assigned Rights in favour of
Corp; and
(b) RIGHTS ASSIGNABLE: The rights in respect of the Assigned
Rights are assignable in accordance with the provisions of
this Deed and the Corp Loan.
(c) INDEBTEDNESS UNDER THE CORP LOAN: Corp is indebted to the
Assignor under the Corp Loan in the outstanding principal
amount of L363,308,000.
7. ASSIGNOR'S RESPONSIBILITY
Save as expressly provided in Clause 6 (Representations and Warranties)
the Assignor has not made and does not by this Deed make, and the
Assignee has not relied upon, any representation, warranty or condition
(expressed or implied) about, and the Assignor will have no
responsibility to the Assignee for, the effectiveness, validity or
enforceability of, the Corp Loan or other documentation delivered by
the Assignor to the Assignee or any of the terms, covenants or
conditions contained in the Corp Loan or other documentation or any
non-performance by any party to it or the financial condition of Corp
or any other person liable with respect to the Assigned Rights.
8. INDEMNITY
The Assignee agrees to indemnify the Assignor and the Assignor agrees
to indemnify the Assignee against any liabilities, obligations, losses,
damages, penalties, judgments, costs, expenses or disbursements of any
kind or nature which may be imposed on or incurred by the
40
other party as a consequence of failure by it duly and punctually to
perform its obligations, or breach by it of any of the representations
and warranties made by it, in this Deed.
9. CHANGES TO THE PARTIES
No party may assign, transfer, novate, encumber or dispose of any of
its interest in, its rights and/or obligations under this Deed without
the prior written consent of the other parties. However, after the
Assignee has performed its obligations in Clause 3 (Consideration) in
respect of the Assigned Rights, this Clause 9 shall not restrict the
Assignee from assigning, charging or pledging the whole or any part of
its rights, title and interest in the Assigned Rights to any third
party.
10. WAIVERS AND REMEDIES CUMULATIVE
The rights of each party under this Deed:
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights under the
general law; and
(c) may be waived only in writing and specifically.
Delay in exercising or non-exercise of any such right is not a waiver
of that right.
11. SEVERABILITY
If a provision of this Deed is or becomes illegal invalid or
unenforceable in any jurisdiction, that shall not affect:
(a) the validity or enforceability in that jurisdiction of any
other provision of this Deed; or
(b) the validity or enforceability in other jurisdictions of that
or any other provision of this Deed.
12. COUNTERPARTS
This Deed may be executed in any number of counterparts, each of which
will be deemed an original and all of which will constitute one and the
same Deed and any party may enter into this Deed by executing a
counterpart.
13. NOTICES
13.1 GIVING OF NOTICES
Subject to Clause 2.2 (Notice and acknowledgements), all notices or
other communications under or in connection with this Deed shall be
given in writing and, unless otherwise stated may be made by facsimile.
Any such notice will be deemed to be given as follows:
(a) if by letter, when delivered personally or on actual receipt;
and
(b) if by facsimile, when received in legible form.
41
However, a notice given in accordance with the above but received on a
non-working day or after business hours in the place of receipt will
only be deemed to be given on the next working day in that place.
13.2 ADDRESSES FOR NOTICES
The address and facsimile number of each party for all notices under or
in connection with this Deed are:
(a) in relation to the Assignor:
New Century Park, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 000 0000 0000
(b) in relation to Corp:
New Century Park, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 000 0000 0000
(c) in relation to the Assignee:
Xxx Xxxxxxx Xxxx, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 000 0000 0000
or any other notified by that Party for this purpose to the other party
by not less than five Business Days' notice.
14. EXPENSES
Each party shall pay its own costs and expenses in connection with the
preparation, negotiation and execution of this Deed.
15. STAMP DUTY
The Assignee shall pay, and forthwith on demand indemnify each of the
other parties to this Deed against any liability it incurs in respect
of, any stamp, registration and similar tax which is or becomes payable
in connection with the entry into and performance of this Deed.
16. JURISDICTION
Each party to this Deed agrees, for the benefit of the Assignor, that
the courts of England shall have jurisdiction to settle any disputes in
connection with this Deed and, accordingly, submits to the jurisdiction
of the English courts.
42
17. GOVERNING LAW
This Deed is governed by, and shall be construed in accordance with,
English law.
IN WITNESS of which this Deed has been executed as a deed and has been delivered
on the date which it appears first on page 1.
43
SIGNATORIES
EXECUTED as a Deed ) _________________________________
by MARCONI PLC ) Director
acting by [ ] and )
[ ] ) _________________________________
Director/Secretary
EXECUTED as a Deed ) _________________________________
by MARCONI CORPORATION ) Director
PLC acting by [ ] and )
[ ] ) _________________________________
Director/Secretary
EXECUTED as a Deed ) _________________________________
by ANCRANE ) Director
acting by [ ] and )
[ ] ) _________________________________
Director/Secretary
44
SCHEDULE 3
SPECIAL RESOLUTION
Company number
67307
THE COMPANIES XXX 0000
PUBLIC COMPANY LIMITED BY SHARES
RESOLUTION OF THE MEMBERS
OF
MARCONI CORPORATION PLC
(passed on - March, 2003)
At an extraordinary general meeting of the Company duly convened and held at
Xxxxx & Xxxxx, Xxx Xxx Xxxxxx, Xxxxxx XX0X 0XX on - March, 2003 the following
resolution was duly passed as a special resolution of the Company:
SPECIAL RESOLUTION
THAT :
(A) for the purpose of giving effect to the scheme of arrangement between
the Company and its Scheme Creditors (as defined in the said scheme of
arrangement) pursuant to section 425 of the Companies Xxx 0000 in
respect of which on 24th March, 2003 the Court directed that the
Company convene a meeting of its Scheme Creditors pursuant to the said
section and for the purpose of giving effect thereto in the form of
such scheme as circulated to Scheme Creditors pursuant to section 426
of the said Act or with or subject to any modification, addition or
condition approved or imposed by the Court (the SCHEME) and forthwith
and conditionally upon the Court making an order sanctioning the
Scheme:
(1) (a) the directors be generally and unconditionally
authorised, in accordance with section 80 of the
Companies Xxx 0000, to exercise all powers of the
Company to allot relevant securities (as defined for
the purposes of that section) up to a maximum nominal
amount of L69,100,000(1);
(b) this authority shall expire on the day five years
after the passing of this resolution;
(c) the Company may, before this authority expires, make
an offer or agreement which would or might require
relevant securities to be allotted after it expires;
and
(d) all previous authorities under section 80 of the
Companies Xxx 0000 shall cease
------------------------------------
(1) This should not be greater than the aggregate of (i) the nominal value
of the shares to be issued pursuant to the Scheme, (ii) the nominal
value of the shares to be issued under the warrants to be issued
pursuant to the Scheme, and (iii) the lesser of a sum equal to the
unissued equity share capital of the Company post-Scheme and a sum
equal to one third of the issued equity capital of the Company
post-Scheme.
45
to have effect; and
(2) (a) the directors be given power to allot for cash equity
securities (as defined for the purposes of section 89
of the Companies Act 1985) pursuant to the general
authority conferred on them by (1) above as if
section 89(1) of that Act did not apply to the
allotment but this power shall be limited to:
(i) the allotment of equity securities pursuant
to the terms of the Scheme;
(ii) the allotment of equity securities in
connection with an offer or issue to or in
favour of ordinary shareholders on the
register on a date fixed by the directors
where the equity securities respectively
attributable to the interests of all those
shareholders are proportionate (as nearly as
practicable) to the respective numbers of
ordinary shares held by them on that date
but the directors may make such exclusions
or other arrangements as they consider
expedient in relation to fractional
entitlements, shares represented by
depositary receipts, legal or practical
problems under the laws in any territory or
the requirements of any relevant regulatory
body or stock exchange; and
(iii) the allotment (other than under (i) or (ii)
above) of equity securities having a nominal
amount not exceeding in aggregate
L2,500,000;
(b) this power shall expire on the day five years after
the passing of this resolution;
(c) all previous authorities under section 95 of the
Companies Xxx 0000 shall cease to have effect;
(d) the Company may, before this power expires, make an
offer or agreement which would or might require
equity securities to be allotted after it expires;
(B) forthwith and conditionally upon the allotment of the new
ordinary shares to be allotted pursuant to the Scheme:
(1) clause 4 in the memorandum of association of the
Company be altered by the insertion immediately after
subclause 22 of the following new subclause 23:
"To establish, contribute to, maintain, advise or
assist schemes for the acquisition of shares in the
Company or its holding company to be held by or for
the benefit of employees, former employees and
directors of the Company or its holding company or
any subsidiary of the Company or any parent or
subsidiary undertaking of the Company (as defined in
the Companies Act 1985) and to set up trusts to
operate for and in accordance with such schemes"
and existing subclauses 23 and 24 be re-numbered as
subclauses 24 and 25 respectively;
(2) the regulations set out in the printed document
marked "A" submitted to the meeting and for the
purpose of identification initialled by the chairman
be adopted as the articles of association of the
Company in substitution for all existing articles of
association of the Company; and
46
(3) the 2,866,250,734 ordinary shares of 5 xxxxx each in
the capital of the Company held by Marconi plc and
the existing ordinary share of 5 xxxxx in the capital
of the Company held by Marconi Nominees Limited be
converted into and re-designated as non-voting
deferred shares of 5 xxxxx each (NON-VOTING DEFERRED
SHARES), such shares having the following rights and
being subject to the following restrictions. A
Non-Voting Deferred Share:
(a) does not entitle its holder to receive any
dividend or other distribution;
(b) does not entitle its holder to receive
notice of or to attend or vote at any
general meeting of the Company;
(c) entitles its holder on a return of capital
on a winding-up (but not otherwise) only to
repayment of the amounts paid up on that
share after payment in respect of each
ordinary share of the capital paid up on it
and the further payment of L10,000,000 on
each ordinary share; and
(d) does not entitle its holder to any further
participation in the capital of the Company;
and.
(C) forthwith and conditionally upon the conversion into and redesignation
of the existing ordinary shares as Non-Voting Deferred Shares under
paragraph (B)(3) of this resolution and the entry in the register of
members of the Company of the names of the persons to whom the new
ordinary shares to be allotted pursuant to the Scheme have been
allotted:
(1) the share capital of the Company be reduced by the
cancellation of the 2,866,250,735 Non-Voting Deferred Shares
referred to in paragraph (B)(3) of this resolution; and
(2) the share premium account of the Company (including the share
premium account, arising on the issue of the new ordinary
shares to be allotted pursuant to the Scheme) be cancelled.
____________________________
[ ]
Chairman
47
SCHEDULE 4
BAE DEED OF NOVATION
DATED MARCH, 2003
MARCONI PLC
AND
MARCONI CORPORATION PLC
AND
BAE SYSTEMS PLC
------------------------------------------
DEED OF NOVATION AND AMENDMENT
------------------------------------------
XXXXX & XXXXX
London
48
CONTENTS
PAGE
CLAUSE
1. Interpretation................................ 50
2. Effect........................................ 51
3. Novation...................................... 51
4. amendments.................................... 52
5. Compromise of Existing Tax Arrangements....... 52
6. Indemnity..................................... 53
7. General....................................... 53
SCHEDULE
1. The Agreements................................ 55
49
THIS DEED is made on [ ] March, 2003
BETWEEN:
(1) Marconi plc (registered number 3846429) whose registered office is at
New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (MARCONI);
(2) Marconi Corporation plc (formerly known as The General Electric
Company, p.l.c.) (registered number 67307) whose registered office is
at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX
(CORPORATION); and
(3) BAE SYSTEMS plc (formerly known as British Aerospace Public Limited
Company) (registered number 1470151) whose registered office is at 0
Xxxxxxx Xxxxxxx, Xxxxxx, XX0X 0XX (BAE).
WHEREAS:
(A) In 1999 Corporation and BAE entered into a series of agreements
relating to the merger of the Marconi Group's defence businesses with
BAE. Subsequently these agreements were novated from Corporation to
Marconi. Marconi entered into all other agreements in connection with
the merger.
(B) On 28th August 2002 Corporation and, inter alios, Marconi concluded
indicative non-binding heads of terms, subsequently amended by an
addendum dated 13 December 2002, setting out the principles for a
proposed restructuring of Corporation and Marconi (the RESTRUCTURING).
(C) Corporation wishes to assume all the rights, obligations, liabilities
and duties of Marconi in relation to the agreements set out in schedule
1 to this deed and all other agreements entered into between BAE and
Marconi which contain a reference to a "GEC Sub Potential Compensation
Amount" or a "BAE Sub Potential Compensation Amount" to be recognised
under the Payment Deed (the AGREEMENTS), insofar as any of the rights
exist, and the obligations and duties remain undischarged or
unfulfilled and, subject thereto, BAE wishes to release Marconi from
all such obligations, liabilities and duties.
This deed is supplemental to the Agreements.
THIS DEED WITNESSES as follows:
1. INTERPRETATION
1.1 Unless otherwise defined in this deed, words and expressions defined in
the Transactions Agreement or the Payment Deed (each as defined in
schedule 1) shall have the same meaning wherever used in this deed.
1.2 The following expressions shall mean:
EFFECTIVE DATE means the date on which an office copy of the Order of
Court sanctioning the scheme of arrangement under section 425 of the
Companies Xxx 0000 between Corporation and its scheme creditors (the
principal commercial terms of which are not materially different to
those set out in the draft of the Chairman's letter in the explanatory
statement initialled for
50
the purpose of identification by Xxxxx & Xxxxx and Linklaters) shall
have been delivered to the Registrar of Companies for registration.
OUTSTANDING REDUCTION AMOUNT means:
(i) in respect of the first Calculation Date falling after 29th
November 2002 an amount equal to US$18,600,000, and
(ii) in respect of any subsequent Calculation Date, the Outstanding
Reduction Amount for the immediately preceding Calculation
Date less the amount, if any, by which the GEC Sub Total for
the immediately preceding Calculation Date was reduced under
clause 5.1(b) of this deed.
NON-CONSOLIDATION ASSUMPTION has the meaning given to it in the Tax
Deed (as defined in schedule 1).
2. EFFECT
2.1 This deed shall take effect on the Effective Date.
3. NOVATION
3.1 Corporation undertakes to BAE and to Marconi to assume, satisfy,
discharge, perform or fulfil each obligation, liability and duty of
Marconi, whether present or future, actual or contingent, ascertained
or unascertained, as provided for in the Agreements to the extent that
any such obligation, liability or duty remains undischarged or
unfulfilled as if Corporation were named in the Agreements as a party
in place of Marconi.
3.2 BAE hereby agrees to release Marconi from each such obligation,
liability and duty referred to in clause 3.1 above.
3.3 BAE confirms and agrees that Corporation shall be entitled to all
rights and benefits of Marconi as provided for in the Agreements as if
Corporation were named in the Agreements as a party in place of Marconi
provided that BAE shall not have any greater obligation or liability
under any of the Agreements than it would have had if the Agreements
had not been novated pursuant to this clause 3 except to the extent
that such obligation or liability is greater than the obligation or
liability that it would have had only by reason of the scheme of
arrangement under section 425 of the Companies Xxx 0000 between Marconi
and its scheme creditors (the SCHEME).
3.4 Marconi confirms and agrees that it waives, and shall not make any
claim or commence any proceedings or take any other action in respect
of, any such rights or benefits as are referred to in clause 3.3 above
and agrees to release BAE from each obligation, liability and duty of
BAE to Marconi as provided for in the Agreements provided that nothing
in this deed shall operate as a release or discharge of any obligation,
liability or duty of BAE in respect of any act or default on the part
of BAE before the Effective Date.
3.5 Other than as amended by this deed, the Agreements shall continue in
full force and effect.
51
4. AMENDMENTS
4.1 BAE and Corporation also agree that, in addition to the novation of the
Agreements as set out in clause 3 above:
(i) the definition of "GEC Sub" in clause 1.2 of the Payment Deed
(as amended by the Amendment to the Transactions Agreement (as
defined in schedule 1)) shall be amended by deleting the words
"Marconi Ansty Limited (incorporated in England and Wales with
number 4109365)" and replacing them with the words "Marconi
Communications Limited (incorporated in England and Wales with
number 703317)"; and
(ii) clause 27.11 of the Transactions Agreement shall be amended by
deleting the words "Marconi Ansty Limited (incorporated in
England and Wales with number 4109365)" and replacing them
with the words "Marconi Communications Limited (incorporated
in England and Wales with number 703317)".
5. COMPROMISE OF EXISTING TAX ARRANGEMENTS
5.1 BAE and Corporation further agree that:
(a) no amount should be recognised, in respect of any Calculation
Date on or after 30th November, 2001 as a GEC Sub Potential
Compensation Amount or a BAE Sub Potential Compensation Amount
to the extent that such amount has been taken account of in
the GEC Sub Potential Compensation Amounts in Marconi's
notices dated 18th October, 2002 and 26th November, 2002 or in
the BAE Sub Total in BAE's notice dated 6th December, 2002
(each of which are set out in schedule 2); and
(b) the amount of the GEC Sub Total for the first Calculation Date
falling after 29th November, 2002 and any subsequent
Calculation Date shall be reduced by the lower of:
(i) the Outstanding Reduction Amount; and
(ii) the aggregate of:
(A) any GEC Sub Potential Compensation Amounts
recognised at any time during the period to
which the relevant Calculation Date falling
after 29th November, 2002 relates, to the
extent that such GEC Sub Potential
Compensation Amounts: (1) are recognised
pursuant to clause 4 of the Tax Deed and
relate to US Federal tax in respect of the
year to 31st March, 2000; or (2) are
recognised pursuant to clause 3 of the Tax
Deed (under the Non-Consolidation Assumption
set out in the Tax Deed) and relate to US
Federal tax in respect of the eight months
to 29th November, 1999; and
(B) any amounts calculated pursuant to the
Payment Deed as if there were interest in
respect of any of the GEC Sub Potential
Compensation Amounts referred to in (A)
above.
52
5.2 The parties agree that the provisions of clause 5.1 above shall be in
full and final settlement of any claims the parties may have under the
Payment Deed in respect of any Calculation Date which occurred at any
time between 30th November, 2001 and 29th November, 2002 (inclusive)
and, for the avoidance of doubt, the provisions of clause 27.10 of the
Transactions Agreement, as incorporated into the Payment Deed by clause
9.1 of the Payment Deed shall not apply to this deed.
6. INDEMNITY
6.1 Subject to clauses 5 and 6.2 Corporation agrees to indemnify and keep
indemnified BAE and each member of the BAE group against all losses,
liabilities, costs and expenses (LOSSES) to the extent that they are
greater than the Losses which would have been incurred by BAE and each
member of the BAE group if clauses 3 and 4 of this deed had not been
entered into.
6.2 No indemnity is, or shall be, given by Corporation under clause 6.1 in
respect of any Losses incurred by BAE or any member of the BAE group to
the extent that they are only greater than the Losses which would have
been incurred by BAE or any member of the BAE group by reason of the
Scheme had clauses 3 and 4 of this deed not been entered into.
7. GENERAL
7.1 This deed may be executed in any number of counterparts, all of which
taken together shall constitute one and the same deed and any party may
enter into this deed by executing a counterpart.
7.2 A person who is not a party to this deed has no right under the
Contracts (Rights of Third Parties) Xxx 0000 to enforce any term of
this deed, nor of any of the Agreements (as novated and amended by this
deed).
7.3 Notices to Corporation in relation to the Agreements and this deed
shall be sent to The Company Secretary at New Century Park, XX Xxx 00,
Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX in the same manner as under the
provisions of the Transactions Agreement.
7.4 This deed is governed by, and shall be construed in accordance with,
English law. Each party submits to the jurisdiction of the English
courts for all purposes relating to this deed.
53
IN WITNESS of which this Deed has been executed and has been delivered on the
date which appears first on page 1.
EXECUTED as a Deed by ) ______________________________________
MARCONI PLC ) Director
acting by ) ______________________________________
and ) Director/Secretary
EXECUTED as a Deed by ) ______________________________________
MARCONI CORPORATION PLC ) Director
acting by ) ______________________________________
and ) Director/Secretary
EXECUTED as a Deed by ) ______________________________________
BAE SYSTEMS PLC ) Director
acting by ) ______________________________________
and ) Director/Secretary
54
SCHEDULE 1
THE AGREEMENTS
1. Transactions Agreement between The General Electric Company, p.l.c. and
British Aerospace Public Limited Company dated 27th April, 1999 (as
supplemented by a supplementary agreement entered into between The
General Electric Company, p.l.c. and British Aerospace Public Limited
Company dated 7th October, 1999) (the TRANSACTIONS AGREEMENT).
2. Payment Deed between The General Electric Company, p.l.c. and British
Aerospace Public Limited Company dated 27th April, 1999 (the PAYMENT
DEED).
3. Letter Agreement dated 2nd November, 2001 entered into between Marconi
plc and BAE SYSTEMS plc, amending the terms of the Transactions
Agreement and the Payment Deed (the AMENDMENT TO THE TRANSACTIONS
AGREEMENT).
4. General Deed of Covenant between Marconi plc and British Aerospace
Public Limited Company dated 29th November, 1999.
5. Deed of Undertaking and Guarantee between Marconi plc, The General
Electric Company plc and British Aerospace Public Limited Company dated
29th November, 1999.
6. Tax Deed of Covenant between Marconi plc and British Aerospace Public
Limited Company dated 29th November, 1999 (the TAX DEED).
7. EASAMS Agreement between Marconi plc and British Aerospace Public
Limited Company dated 29th November, 1999.
8. Services Agreement between Marconi plc and British Aerospace Public
Limited Company dated 29th November, 1999.
9. Technology Access Agreement between Marconi plc and British Aerospace
Public Limited Company dated 29th November, 1999.
10. Completion Accounts Agreement dated 11th February, 2000 between Marconi
plc and British Aerospace Public Limited Company.
11. Agreement dated 11th February, 2000 between Marconi plc and British
Aerospace Public Limited Company relating to the JORN Project.
55
SCHEDULE 5
NEW SERVICE AGREEMENT
FORM OF COVER LETTER
FOR NEW SERVICE AGREEMENTS
[ ] March, 2003
Dear [ ],
NEW SERVICE AGREEMENT WITH MARCONI CORPORATION plc (THE COMPANY)] [MARCONI
COMMUNICATIONS INC]
As part of the restructuring of the group and in particular the listing of [the
Company] [Marconi Corporation plc (the COMPANY)] on the stock exchanges in
London and New York, senior leaders are being provided with new employment
packages consisting of:
(i) a revised service agreement; and
(ii) an award over shares in the Company under the new Senior Management
Share Plan (the MANAGEMENT PLAN).
The purposes of the new package are to provide
- terms and conditions of employment appropriate to the new, more stable
situation in which the Company will be post restructuring; and
- a significant level of incentive and reward for delivering value to the
Company's new shareholders (currently its creditors).
I am, therefore, pleased to provide you, as one of [the Company's] [the Marconi
group's] key executives, with a revised service agreement and details of the
Management Plan. The service agreement is very closely based on your existing
one. [Your employer will not change and] there will be no effect on the existing
start date for your period of continuous employment.
Although signed at this stage, your new service agreement will only become
effective on the Effective Date (defined at the end of this letter) and any
award or entitlement under the Management Plan will be granted on the later of
the Effective Date (defined below) and the First Initial Distribution.
You should read both the new service agreement and the enclosed summary of the
Management Plan carefully. I have also set out in this letter some of the more
important revisions to your terms and conditions of employment, together with
details of your award under the Management Plan.
56
1. AWARD UNDER THE MANAGEMENT PLAN
As mentioned above, you will be granted an option over [ ] shares
in the Company under the Management Plan. These will vest in five
tranches, subject to the achievement of the milestones described in the
attached summary. The proportion vesting at each milestone will be as
follows:
Milestone 1 20%
Milestone 2 10%
Milestone 3 20%
Milestone 4 20%
Milestone 5 30% or 20% - R&E
This vesting schedule has been enhanced in consideration of your
waiving the final payment due under the Retention and Emergence Plan
(see paragraph 2 below).
2. PAYMENTS UNDER THE RETENTION AND EMERGENCE PLAN (the R&E PLAN)
(i) As consideration for the new arrangements, you agree that the
final payment due to be made to you under the R&E Plan is
waived.
(ii) If:
(a) within the period of eighteen months commencing on
the Effective Date, [the Company] [Marconi
Communications Inc] elects (with or without notice)
to terminate your employment by making a payment to
you in lieu of notice (under clause 16.2(a) or (b) of
the new service agreement) or (within the same
period) [the Company] [Marconi Communications Inc]
gives you notice to terminate your employment (under
clause 2.4(a) of the new service agreement); and
(b) on the expiry of your notice period (or the notice
period which would have applied if the Company had
not made a payment in lieu of notice) no rights have
vested to you under the Management Plan and none are
due to vest subject only to time-based vesting
conditions under the Management Plan,
then a payment of [ ] per cent. of your basic salary will be
paid to you on the later of the date of termination of your
employment or, if that date occurs prior to the end of the
notice to which you would have been entitled under clause
2.4(a) of the new service agreement, if a payment in lieu had
not been made (the NOTIONAL NOTICE PERIOD), the end of the
Notional Notice Period.
(iii) You agree that the penultimate payment under the R&E Plan will
not be made to you until seven working days after the
Effective Date (provided that your employment has not been
terminated under clause 16.4 (termination for cause).
(iv) Nothing in this letter will oblige [the Company] [Marconi
Communications Inc] to make any payment to you under paragraph
(ii) if [the Company] [Marconi Communications Inc] terminates
your employment under clause 16.4 (termination for cause).
57
3. BONUS ARRANGEMENTS
(i) By agreeing to the new arrangements, you will also waive your
entitlement to payments earned in the first two quarters under
the 2002/03 Senior Management Incentive Plan.
(ii) The provisions of this paragraph (ii) will last for eighteen
months starting on the Effective Date. As mentioned above, in
addition to any entitlement under clause 16.2 of the service
agreement (which relates to the Company making a payment in
lieu of contractual notice), if:
(a) within eighteen months commencing on the Effective
Date[the Company][Miranda Communications Inc.] elects
(with or without notice) to terminate your employment
by making a payment to you in lieu of notice (under
clause 16.2(a) or (b) of the new service agreement)
or (within the same period) [the Company][Miranda
Corporation Inc.] terminates your employment by
giving notice (under clause 2.4(a) of the new service
agreement); and
(b) on the expiry of the notice period or the Notional
Notice Period (each being on EXPIRY DATE), no rights
have vested to you under the Management Plan and none
are due to vest subject to purely time-based vesting
conditions.
then within seven working days after the Expiry Date [the
Company] will pay you an amount equal to the entitlement to
payments earned in the first two quarters under the 2002/2003
Senior Management Incentive Plan (in total [ ] of your basic
salary) which you waived under paragraph (i) above. For your
rights under the Management Plan on termination of employment,
you should refer to the enclosed rules of the Management Plan.
Nothing in this letter will oblige [the Company] [Marconi
Communications Inc.] to make any payment to you under this paragraph
(ii) if [the Company] [Marconi Commincations Inc.] terminates your
employment under clause 16.4 (termination for cause).
You should also be aware that your award under the Management Plan is
intended to provide your total variable compensation during the life of
the Management Plan; it is not therefore currently anticipated that you
will participate in any cash bonus plan operated within the new group
until there are no outstanding but unvested option under the Management
Plan. Clause 5 of the service agreement has been amended to reflect
these arrangements.
4. PAYMENT IN LIEU OF NOTICE CLAUSE
As it is intended that your variable compensation for at least the next
three years will be provided by the Management Plan, the terms of the
payment in lieu of notice clause have been changed by the removal of
any element relating to bonus from that payment.
You should, of course, also review the terms of the Management Plan for
your rights under it on termination of employment.
58
5. CHANGE OF CONTROL PROTECTION
Clause 16.6 of the new service agreement, sets out a new entitlement
following a change of control. In summary the amendments are:
(i) the restructuring does not constitute a change of control;
(ii) the definition of change of control has been shortened;
(iii) for the same reasons as relate to the payment in lieu of
notice (see paragraph 5 above), any payment made under this
clause will no longer include any element relating to bonus;
and
(iv) there is no longer a reference to share scheme rights, as
these are dealt with in the Management Plan itself.
Again, you should review the terms of the Management Plan for your
rights under it in the event of change of control and/or the
termination of your employment.
The summary of the change of control provision set out above should not
be relied upon in place of reading clause 16 of your service agreement
in full.
[6. MARCONI COMMUNICATIONS LIMITED'S GUARANTEE
Owing to the uncertainty as to how the restructuring would operate,
Marconi Communications Limited (MCL) was included as a guarantor of
your employer's obligations under your current service agreement.
Following the restructuring, the reason for that guarantee will no
longer exist and MCL will not, therefore, be a party to the new
contract.
As the new service agreement will preserve your continuity of
employment, the Company will accept responsibility for obligations to
you both before and after the restructuring. You are, therefore, being
asked to release MCL from any liability (past, present or future) under
your service agreement, although such release would only operate once
the new service agreement becomes effective.]
By reference to the Contract (Rights of Third Parties) Xxx 0000, it is intended
that the changes made to the R&E Plan shall be made for the benefit of Marconi
plc and Marconi Communications Limited.
Xxxxxx Xxxxx of Xxxxxx & Co. (solicitors) has been a party to the negotiation of
the arrangements described in this letter. His role has been to represent the
interests of the recipients of the new arrangements, independently of the
Company. Attached is a letter from Xxxxxx advising you of his views on the new
arrangements. Should you wish to take personal advice from Xxxxxx (at the
Company's expense), he can be contacted on 0121 213 2341. Alternatively, you may
choose to take advice from your own legal advisor. The Company will meet the
cost of you so doing, up to a maximum contribution of L400 (including VAT).
Finally, following the restructuring, Marconi plc will cease to be a group
company. You may nevertheless be asked to provide services in relation to that
company, as part of your job, until it is wound up. I mention this because the
new contract refers to your obligations to "Group Companies" and I wish to make
it clear that Marconi plc will still be treated as a group company,
notwithstanding its separation from the group, for some time after the
restructuring has been completed.
59
I should be grateful if you would sign the enclosed agreement on its last page
and return it to Xxxx Xxxxxx (undated) at New Century Park, Coventry. At the
same time as you return the signed agreement, please also return a signed and
dated counterpart of this letter also to Xxxx Xxxxxx to confirm your agreement
to its terms.
Please let me know if you have any questions.
Yours sincerely,
XXXX XXXXXXX
FOR AND ON BEHALF OF [MARCONI CORPORATION plc] [MARCONI COMMUNICATIONS INC]
The EFFECTIVE DATE is the date on which the Company files the Court order the
scheme of arrangement between the Company and its major creditors with the
Registrar of Companies (such scheme being made under section 425 of the
Companies Act 1985).
[On counterpart]
To: The Company, [Marconi plc, Marconi Corporation Limited, Marconi
Communications Inc.]
I have read and understood the above letter and agree to its terms and in
particular agree that:
(i) Marconi Communications Limited is released from its liabilities as
guarantor under my existing service agreement (but only when the new
service agreement becomes effective); and
(ii) I waive the final payment under the R&E Plan (but subject to paragraph
2 above) and agree to the timing of the payment of the penultimate
payment under the R&E Plan as described in paragraph 2;
(iii) the change of control provisions of clause 16 of my current service
agreement shall not be triggered by the Effective Date, as the terms of
my new service agreement (which expressly excludes the events leading
to the Effective Date from the definition of change of control) will
replace my current service agreement simultaneously with the occurrence
of the Effective Date; and
(iv) I agree to the substitution of my current service agreement by the new
service agreement attached to this letter (which I have also signed),
which I understand shall take effect immediately on the Effective Date.
Until such time, I agree that my employment shall continue to be
governed by my current service agreement (as amended by paragraph (ii)
above).
Signed: _________________________________
Print name: _____________________________
Date: ___________________________________
60
DATED [ ] MARCH, 2003
MARCONI CORPORATION PLC (1)
AND
[ ] (2)
-----------------------
SERVICE AGREEMENT
-----------------------
XXXXX & XXXXX
London
61
CONTENTS
CLAUSE PAGE
1. Definitions....................................... 63
2. Term and Job Description.......................... 64
3. Duties............................................ 64
4. Salary............................................ 65
5. Share Based Incentives............................ 65
6. Expenses.......................................... 65
7. Company Care...................................... 65
8. Pension........................................... 66
9. Insurance......................................... 66
10. Holiday........................................... 66
11. Sickness and Other Incapacity..................... 67
12. Other Interests................................... 67
13. Share Dealing and Other Codes of Conduct.......... 67
14. Intellectual Property............................. 68
15. Disciplinary and Grievance Procedures............. 69
16. Termination....................................... 69
17. Suspension and Gardening Leave.................... 75
18. Confidentiality................................... 76
19. Post-Termination Covenants........................ 76
20. Employee's Position as Director................... 78
21. Waiver of Rights.................................. 78
22. Data Protection................................... 78
23. Email and Internet Use............................ 79
24. Miscellaneous..................................... 79
62
SERVICE AGREEMENT
THIS AGREEMENT is made on March, 2003
BETWEEN
(1) MARCONI CORPORATION PLC (company registration number 67307) which has
its registered office at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxx
Xxxxxxxx XX0 0XX (the COMPANY); and
(2) [ ] of [ ] (the EMPLOYEE).
IT IS AGREED as follows:-
1. DEFINITIONS
1.1 In this Agreement the following expressions shall have the following
meanings:
BOARD means the board of directors of the Company or a duly constituted
committee of the board of directors of the Company;
EFFECTIVE DATE means the date on which the Company files the Court
order (under which the scheme of arrangement between the Company and
its major creditors has been made) with the Registrar of Companies
(such scheme being made under section 425 of the Companies Act 1985);
EMPLOYMENT means the Employee's employment in accordance with the terms
and conditions of this Agreement;
GROUP COMPANY means the Company and any holding company or subsidiary
of the Company, or any subsidiary of any such holding company or
subsidiary, with holding company and subsidiary having the meanings
given to them by section 736 Companies Xxx 0000;
PENSION PLAN means the GEC 1972 pension plan;
RECOGNISED INVESTMENT EXCHANGE has the meaning given to it by section
285 of the Financial Services and Markets Xxx 0000;
RESTRUCTURING shall mean the schemes of arrangement for the Company and
for Marconi plc under section 425 of the Companies Xxx 0000 and the
listing of the Company's shares on the London and New York Stock
Exchanges; and
WORKING HOURS has the meaning given to it by clause 3.2.
63
2. TERM AND JOB DESCRIPTION
2.1 The Employee shall be employed by the Company as [ ], or in such
other capacity, consistent with his status and seniority, to which he
may be lawfully assigned by the Company from time to time (his
POSITION).
2.2 The Employee will be assigned the usual and customary duties, executive
power and authority consistent with and as is necessary to discharge
the duties relevant to his Position. The Employee shall also perform
such other duties, not inconsistent with the duties of his Position, as
may be assigned to him by the Company from time to time.
2.3 The Employment shall begin on the Effective Date. For statutory
purposes, the Employee's period of continuous employment commenced on
[ ].
2.4 Subject to clauses 2.5 and 16, the Employment will continue until
terminated by either:
(a) the Company giving [ ] months' written notice to the
Employee; or
(b) the Employee giving [ ] months' written notice to the
Company.
2.5 The Employment will terminate automatically on the Employee's
[60th/62nd/65th] birthday.
3. DUTIES
3.1 During the Employment, the Employee will:
(a) diligently perform all such duties and exercise all such
powers as are usual, customary and consistent with and as are
necessary to discharge the duties of his Position, or are
lawfully and properly assigned to him from time to time by the
Company, whether such duties or powers relate to the Company
or any other Group Company;
(b) comply with all policies and procedures of, and all directions
lawfully and properly given to him by the Company;
(c) unless prevented by sickness, injury or other incapacity,
devote the whole of his time, attention and abilities during
his Working Hours to the business of the Company or any other
Group Company for which he is required to perform duties and
shall utilise his best efforts, skills and abilities in the
performance of the duties of his Position in a manner which
will faithfully and diligently further the business and
interests of the Company and any other Group Company;
(d) promptly provide the Company or any other Group Company, as
appropriate, with all such information as it may require in
connection with the business or affairs of the Company and of
any other Group Company for which he is required to perform
duties.
3.2 The Employee's Working Hours shall be the Company's normal business
hours for his normal place of work, together with such additional hours
as are required in the proper performance of his duties. The Employee
acknowledges that he has no entitlement to
64
additional remuneration for such further hours in excess of the
Company's normal business hours as the Employee may be required to work
in accordance with this clause 3.2.
3.3 The Employee agrees, in accordance with Regulation 5 of the Working
Time Regulations 1998 (the REGULATIONS), that the provisions of
Regulation 4(1) do not apply to the Employee, and that the Employee
shall give the Company three months' notice in writing if he wishes
Regulation 4(1) to apply to him.
3.4 The Employee's normal place of work is the Company's offices in [ ],
currently located at [ ] or such other location within a radius of
25 miles of [ ] as the Company may from time to time, upon
reasonable notice to the Employee, require the Employee to base
himself.
If the Company requests and the Employee agrees to change his normal
place of work by more than 25 miles, and it is necessary for the
Employee to relocate, the Company will reimburse, in accordance with
its Relocation Policy, expenses properly and reasonably incurred by the
Employee as a result of such relocation.
3.5 The Employee agrees to travel (both within and outside the United
Kingdom) as may reasonably be required for the proper performance of
his duties under the Employment.
4. SALARY
4.1 The Employee's current basic salary is L[ ] ([ ] thousand
pounds) (less any required statutory deductions). The salary will be
reviewed annually during the Employment with the first scheduled review
taking place on 1st July 2004. No salary review will be undertaken
after notice has been given by either party to terminate the
Employment. The Company is under no obligation to increase the
Employee's salary following a salary review, but will not decrease it
without the Employee's consent.
4.2 The Employee's salary will be inclusive of all fees and other
remuneration to which he may be or become entitled as an officer of the
Company or of any other Group Company.
5. SHARE BASED INCENTIVES
5.1 The Employee will be eligible to participate in the Marconi Corporation
Senior Management Share Option Plan subject to the rules of that plan
from time to time in force. All payments and awards under such plan are
non-pensionable.
6. EXPENSES
6.1 The Company will promptly reimburse (or procure the reimbursement of)
all out-of-pocket expenses properly and reasonably incurred by the
Employee in the course of his Employment subject to production of
receipts or other appropriate evidence of payment.
7. COMPANY CARE
7.1 During the Employment, the Employee will be eligible to participate in
the Marconi Car Scheme in accordance with the rules of the Marconi Car
Scheme from time to time in force. Subject to and in accordance with
the rules of the Marconi Car Scheme the Employee will be allocated a
monthly car allowance, currently L[ ]. The car allowance is
non-pensionable.
65
8. PENSION
8.1 The Employee will be eligible to participate in the Pension Plan
(subject to the trust deed and rules of the Pension Plan from time to
time in force). Full details of the Pension Plan are provided in the
booklet of the Pension Plan.
8.2 The Company has not applied for a contracting out certificate (as
referred to in section 7(1) of the Pension Schemes Act 1993).
8.3 The Employee will contribute 3% of basic annual salary up to a maximum
of 15% of the Earnings Cap to the Pension Plan.
8.4 Provided the Employee remains an active member of the Pension Plan, the
Company will contribute to a funded unapproved retirement benefits
scheme (FURBS) such that aggregate annual contributions (gross) will
equal [ ]% of the Employee's basic salary.]
8.5 The Company will provide the Employee with a death in service benefit
of a lump sum equal to four times' basic annual salary and a widow's
pension (as such benefits are set out in the explanatory letter dated
[ ].]
NB 8.4 AND 8.5 ARE FOR DC FURBS MEMBERS ONLY. THE ORIGINAL FURBS
WORDING FOR EACH EMPLOYEE WHO HAS A FURBS (AND IN PARTICULAR MESSRS
XXXXXXX AND XXXXXX) IS TO BE REINSTATED.
9. INSURANCE
9.1 During the Employment, the Employee will be eligible to participate in
the Company's private medical healthcare scheme for the benefit of
himself, spouse and dependants under the age of 21 subject to the rules
of the scheme from time to time in force.
9.2 The Company will provide the Employee with the facility to undergo
annual health screening at the Company's expense.
10. HOLIDAY
10.1 In the first year of the Employment the Employee will accrue holiday at
the rate of two days for each completed calendar month of service until
the end of the calendar year. Thereafter the Employee will be entitled
to [25] days' paid holiday each calendar year (plus bank and public
holidays in England).
10.2 Any untaken holiday entitlement may not be carried forward to a future
calendar year without the express permission of the Company. Subject to
clause 10.3 the Employee has no entitlement to be paid in lieu of
accrued but untaken holiday.
10.3 On termination of the Employment, the Employee's entitlement to accrued
holiday pay shall be calculated at two days per completed month of
service, commencing on 1 January that year. The balance of holiday not
taken will be paid in lieu on the basis that each day of paid holiday
is equivalent to 1/260 of the Employee's basic salary. If the Employee
has taken more working days' paid holiday than his accrued entitlement,
the Company is authorised to deduct the appropriate amount from his
final salary instalment (which deduction shall be
66
made on the basis that each day of paid holiday is equivalent to 1/260
of the Employee's basic salary).
11. SICKNESS AND OTHER INCAPACITY
11.1 Subject to the Employee's compliance with the Company's policy on
notification and certification of periods of absence from work, the
Employee will be entitled to payment under the Company's sickness
payment policy from time to time in force, a copy of which may be
obtained from the Company's human resources department.
11.2 The Employee will not be paid during any period of absence from work
(other than due to holiday, sickness, injury or other incapacity)
without the prior permission of the Company.
11.3 The Employee will undergo a medical examination by a doctor appointed
by the Company at any time (provided that the costs of all such
examinations are paid by the Company). The Company will be entitled to
receive a copy of any report produced in connection with all such
examinations and to discuss the contents of the report with the doctor
who produced it.
12. OTHER INTERESTS
12.1 Subject to clause 12.2, during the Employment the Employee will not
(without the Company's prior written consent) be directly or indirectly
engaged, concerned or interested in any other business activity, trade
or occupation. The Employee may engage in charitable and community
affairs outside the Employee's Working Hours provided that such
activities do not interfere with his duties and responsibilities under
this Agreement. Notwithstanding clause 3.1, the Employee may serve as a
non-executive director of a company other than a Group Company provided
that any such non-executive directorship is approved in advance by the
Chief Executive Officer of the Company or by the Chairman of the Board
and must be in accordance with the Company's policies and procedures
relating to serving as a non-executive director of a non-Group Company
as may be in effect from time to time.
12.2 Notwithstanding clause 12.1, the Employee may hold for investment
purposes an interest (as defined by Schedule 13 Companies Act 1985) of
up to five percent (5%) in any class of Securities whether or not
listed or dealt on a Recognised Investment Exchange, provided that the
Employee may not hold any class of Securities if the company that
issued the Securities carries on a business that is similar to or
competitive with any business for the time being carried on by the
Company or any Group Company unless the Employee obtains the prior
agreement of the Chairman of the Board or unless the Securities are
held through a collective investment vehicle (including, without
limitation, a personal equity plan, a unit investment trust or a mutual
fund) or constitute a direct holding in an investment club in the U.S.
in which the Securities constitute less than five percent (5%) of the
value of the vehicle or investment club or such holding does not or is
not likely or intended to conflict with or damage the commercial
interests of the Group or otherwise breach clause 12.1. For the
purposes of this clause 12.2, SECURITIES shall mean shares, stock,
debenture stock, loan stock, bonds, units of a collective investment
scheme and other securities of any description issued by a company.
13. SHARE DEALING AND OTHER CODES OF CONDUCT
13.1 The Employee will comply with all codes of conduct adopted from time to
time by the Company and any relevant Group Company and with all
applicable rules and regulations of
67
the UK Listing Authority and any other relevant regulatory bodies,
including the Model Code on dealings in securities, all of which are
available upon request from the company secretary of the Company.
14. INTELLECTUAL PROPERTY
14.1 In this clause INTELLECTUAL PROPERTY means inventions (whether
patentable or not, and whether or not patent protection has been
applied for or granted), improvements, developments, discoveries,
proprietary information, trade marks, trade names, logos, art work,
slogans, know-how, processes, designs (whether or not registrable and
whether or not design rights subsist in them), utility models, work in
which copyright may subsist (including computer software and
preparatory and design materials therefor), and all works protected by
rights or forms of protection of a similar nature or having equivalent
effect anywhere in the world.
14.2 Subject to the provisions of the Patents Xxx 0000 (PA 1977), the
Registered Designs Xxx 0000 and the Copyright Designs and Patents Xxx
0000 (CDPA 1988), if at any time in the course of or in connection with
the Employment the Employee makes or discovers or participates in the
making or discovery of any Intellectual Property relating to the
business of the Company or any Group Company, full details of the
Intellectual Property shall immediately be disclosed in writing by him
to the Company or the relevant Group Company, as applicable, and the
Intellectual Property shall be the absolute property of the Company or
the relevant Group Company, as applicable. For the avoidance of doubt,
the above requirement shall not apply to Intellectual Property made or
discovered by the Employee entirely in his own time without using the
equipment, supplies, facilities or trade secret information of the
Company or any Group Company, except for any Intellectual Property that
either (i) relates, at the time of making or discovery, to the business
of the Company or any Group Company, or actual or demonstrably
anticipated research and development of the Company or any Group
Company; or (ii) results from any work performed by the Employee for
the Company or any Group Company. At the request and expense of the
Company, the Employee shall give and supply all such information, data,
drawings and assistance as may be necessary or in the opinion of the
Company desirable to enable the Company to exploit the Intellectual
Property to the best advantage, and shall execute all documents and do
all things which may be necessary or in the opinion of the Company
desirable for obtaining patent or other protection for the Intellectual
Property in such parts of the world as may be specified by the Company
and for vesting the same in the Company or as it may direct.
14.3 In relation to the discovery or creation of Intellectual Property in
the course of his duties under this Agreement, the Employee irrevocably
appoints the Company to be his attorney in his name and on his behalf
to sign, execute or do any such instrument or thing and generally to
use his name for the purpose of giving to the Company (or its nominee)
the full benefit of the provisions of this clause, and in favour of any
third party a certificate in writing signed by any director or the
company secretary of the Company that any instrument or act falls
within the authority conferred by this clause shall be conclusive
evidence that such is the case.
14.4 If the Employee shall at any time make or discover or participate in
the making or discovery of any Intellectual Property which belongs to
the Company, the Employee shall not without the written consent of the
Company apply for patent or other protection for such Intellectual
Property either in the United Kingdom or elsewhere, and shall not do
anything which might adversely affect the Company's right to obtain
patent or other protection therefor.
68
14.5 The Employee hereby assigns to the Company or the relevant Group
Company as applicable by way of prospective assignment the copyright
and rights in designs (whether registered or unregistered) and any
other proprietary rights for the full terms thereof throughout the
world in respect of all copyright works and designs originated,
conceived or made by the Employee (except only those copyright works
and designs wholly unrelated, both directly and indirectly, to the
activities of the Company or any Group Company and those written,
originated, conceived or made wholly outside the Employment). The
Employee hereby expressly waives any and all of his moral rights and
rights of a similar nature (including the rights conferred by Sections
77, 80 and 84 of the CDPA 1988) in respect of all copyright works
created by the Employee and owned by the Company or the relevant Group
Company as applicable.
14.6 For the purposes of Section 39(1)(a) of the PA 1977, the course of the
normal duties of the Employee shall include the use of the equipment,
supplies, facilities, research, know-how, technology, trade secrets and
confidential information of the Company and any Group Company and the
Employee has a duty to use the same for the sole benefit of the Company
or Group Company (as appropriate) so that any invention made by the
Employee which in any way depends upon or was made or facilitated by
the use of the equipment, supplies, facilities, research, know-how,
technology, trade secrets or confidential information of the Company or
any Group Company shall belong to the Company or the relevant Group
Company as applicable. The Company and the Employee agree that the
nature of the duties and responsibilities of the Employee are and are
expected to continue to be such that the Employee has a special
obligation to further the interests of the Company's undertaking within
the meaning of Section 39(1)(b) of the PA 1977, and that all inventions
made by the Employee in the course of his duties do and shall belong to
the Company or the relevant Group Company as applicable.
14.7 Rights and obligations under this clause shall continue in force after
termination of this Agreement in respect of Intellectual Property made
or discovered during the Employee's Employment and shall be binding
upon the Employee's heirs, successors, assigns and representatives.
15. DISCIPLINARY AND GRIEVANCE PROCEDURES
15.1 There are currently no explicit disciplinary rules in force in relation
to the Employee, who is expected at all times to conduct himself in a
manner consistent with his senior status. The Employee will, however,
be subject to such disciplinary rules as the Company may from time to
time adopt.
15.2 If the Employee has any grievance in relation to the Employment
(including in relation to any disciplinary decision relating to the
Employee) he may raise it with his next in line manager, whose decision
shall be final.
16. TERMINATION
16.1 Either party may terminate the Employment in accordance with clause
2.4.
16.2 The Company may, in its sole discretion, also terminate the Employment
at any time by paying a sum in lieu of notice (the PAYMENT IN LIEU OF
NOTICE) which will be equal to the aggregate of the sums referred to in
clause 16.3 below which would be payable:
69
(a) (if no notice to terminate the Employment has been given under
clause 2.4(a)), for the period of notice to be given by the
Company under clause 2.4(a));
(b) (if notice to terminate has been given by the Company under
clause 2.4(a)), for the period which would constitute the
remainder of that notice period; or
(c) (if notice to terminate has been given by the Employee under
clause 2.4(b)), for the period which would constitute the
remainder of that notice period,
but in each case (if the expiry date of the period of notice occurs
after the Employee's date of retirement under clause 2.5) the period of
notice shall be reduced so that it is the remaining period of the
Employment until that retirement date. In each case, the period in
respect of which the Payment in Lieu of Notice is to be calculated
shall be the RELEVANT PERIOD.
16.3 The sums referred to in clause 16.2 shall be:
(a) the basic salary (calculated by reference to the Employee's
basic salary at the date of termination) which the Employee
would have been entitled to receive under this Agreement
during the Relevant Period; plus
(b) in relation to loss of pension benefits under the Pension
Plan, an amount equal to 166% of the amount certified by the
actuary to the Pension Plan as being equal to the cash
equivalent transfer value (calculated using actuarial methods
and assumptions consistent with those specified in Actuarial
Guidance Note GN11) of the additional pension benefits net of
any income tax payable by the Employee at his marginal rate,
which the Employee would have accrued if the Employment had
continued throughout the Relevant Period; [plus]
(c) [in relation to loss of pension benefits under the FURBS, an
amount equal to 100% of the aggregate contributions (gross)
which would have been paid by the Company in respect of the
FURBS in respect of the Employee during the Relevant Period.
For the avoidance of doubt, the Company's obligations under
this sub-clause shall be in addition to the Company's
obligations to make such contributions to unapproved pension
arrangements as are required under the explanatory letter
dated [ ] in respect of past service as at the leaving
date. ] [plus]]
For the purposes of [this sub-paragraph] [sub-paragraphs]
[(b)] [(c)], PENSION BENEFITS includes life assurance,
ill-health, early retirement and spouse pension benefits;
[plus]
(d) the cost to the Company of providing all the other benefits
(excluding pension, bonus and any amounts payable and shares
receivable under any share option or other incentive plan)
that the Employee would have been entitled to receive during
the Relevant Period or, if the Company in its absolute
discretion decides, a sum based on an estimated cost to the
Company of providing those benefits for that period which is
agreed to be 10% of the Employee's basic salary (calculated by
reference to the Employee's basic salary at the date of
termination) for the Relevant Period.
The Payment in Lieu of Notice shall be subject to such deductions as
may be required by law and shall be made in full and final settlement
of any claims the Employee may have against the Company or any Group
Company arising from the Employment or the termination thereof. As an
alternative to the Payment in Lieu of Notice being paid in a lump sum,
the
70
Company may pay the Payment in Lieu of Notice in equal monthly
instalments from the date on which the Employment terminates until the
end of the Relevant Period (the PAYMENT PERIOD) provided that if the
Employee commences full time employment with the expectation of
permanence during the Payment Period, the Company shall deduct from
instalments of the Payment in Lieu of Notice a sum equal to the salary
actually received by the Employee from such full time, permanent
employment attributable to the relevant month of the Payment Period.
The Employee is under a duty to inform the Company of any such
employment undertaken during the Payment Period. Any entitlement that
the Employee has or may have under any plan referred to under clause 5
and any future stock or other incentive plan shall be determined in
accordance with the rules of the relevant plan and shall not be
affected by the Employee's receipt of the Payment in Lieu of Notice.
16.4 The Company may terminate the Employment immediately and with no
liability to make any further payment to the Employee (other than in
respect of amounts accrued due at the date of termination) if the
Employee:
(a) commits any serious or repeated breach of his obligations
under this Agreement or his Employment;
(b) is guilty of gross misconduct;
(c) is guilty of wilful misconduct which brings or is likely to
bring himself or any Group Company into disrepute or which has
damaged the business or affairs of any Group Company; [or]
(d) is convicted of a criminal offence (other than a road traffic
offence not subject to a custodial sentence);
[WHERE APPROPRIATE......]
(e) [is disqualified from acting as a director of a company by
order of a competent court; or]
(f) [resigns the directorship of the Company or any Group Company
(other than with the explicit agreement of the Company).]
This clause shall not restrict any other right the Company may have
(whether at common law or otherwise) to terminate the Employment
summarily. Any delay by the Company in exercising its rights under this
clause shall not constitute a waiver of those rights.
16.5 The Company may terminate the Employment by giving [six][twelve]
months' notice to the Employee if the Employee is unable (whether due
to illness or otherwise) properly and effectively to perform his duties
under this Agreement for a period or periods totalling 130 working days
or more in any consecutive period of 12 months.
16.6 For the purposes of this clause 16.6:
CONTROL shall mean the power of any person whether alone or together
with any person acting in concert with him to control the composition
of the Board of the Company or otherwise to secure whether by means of
the holding of shares or the possession of a voting power in relation
to the Company or any other body corporate or by virtue of any powers
conferred by
71
the articles of association or any other document or agreement
regulating the Company or any other body corporate that the affairs of
the Company are conducted in accordance with the wishes of that person;
and
CHANGE OF CONTROL shall mean the acquisition by any person whether
alone or together with any person acting in concert with him of Control
of the Company but shall not mean an acquisition of Control of the
Company by another company the shares of which, immediately following
such an acquisition, are all held by the holders of the shares of the
Company immediately prior to such an acquisition in materially the same
proportion as they held shares in the Company immediately prior to such
an acquisition. For the avoidance of doubt, the Company and the
Employee shall continue to be bound by the terms of this Agreement
following a Change of Control; and
GOOD REASON means the occurrence of one or more of the following
events:
(i) failure to maintain the Employee in the Position, or a
substantially equivalent position, with the Company or any
Group Company (or any successor thereto by operation of law or
otherwise), as the case may be, which the Employee held
immediately prior to a Change of Control;
(ii) an adverse change of material consequence in the nature or
scope of the authorities, powers, functions, responsibilities
or duties attached to the Position which the Employee held
immediately prior to the Change of Control, or a reduction in
the aggregate of the Employee's basic annual salary and share
based incentives and other benefits received from the Company
or any Group Company, or the termination or denial of the
Employee's rights to employee benefits or a substantial
reduction in the scope or value thereof where such reduction
is not applied to other employees of a similar status and
seniority to the Employee.
(iii) a change in the scope of the business or other activities for
which the Employee was responsible immediately prior to the
Change of Control, which has rendered the Employee
substantially unable to carry out, has substantially hindered
the Employee's performance of, or has caused the Employee to
suffer a substantial reduction in, any of the authorities
powers, functions, responsibilities or duties attached to the
Position held by the Employee immediately prior to the Change
of Control;
(iv) the Company requiring the Employee to have his principal
location of work changed to any location that is in excess of
25 miles from the location thereof immediately prior to the
Change of Control without [his][her] prior written consent; or
(v) without limiting the generality or effect of the foregoing,
any material breach of this Agreement by the Company or any
successor thereto
in each case where the Employee has first notified the Company of any
such determination, act or failure to act, such notice to be in writing
and to describe in reasonable detail the determination, act or failure
to act, and where the Company has failed within 10 calendar days
following receipt of such notice to gain the Employee's agreement to
change any such determination or remedy any such act or failure to act.
72
16.7 If there is a Change of Control after the Restructuring has occurred
(and for the avoidance of doubt, the Restructuring itself does not
constitute a Change of Control) and within 12 months of the Change of
Control:
(a) the Company or any other Group Company gives notice to
terminate the Employment or terminates the Employment
otherwise than in accordance with clause 16.4 or 16.5 of this
Agreement (irrespective of whether the period of such notice
expires after the first anniversary of the Change of Control);
or
(b) the Employee terminates the Employment for a Good Reason,
the Company shall be obliged, within 7 days after the date on which the
Employment so terminates (the TERMINATION DATE), to pay to the Employee
as liquidated damages, a sum (THE LIQUIDATED SUM) equal to:
(i) the basic salary (calculated by reference to the Employee's
basic salary at the Termination Date) which the Employee would
have been entitled to receive under this Agreement during the
notice period referred to at clause 2.4 (a)] (the RELEVANT
PERIOD); plus
(ii) [the Employee's pension loss in respect of the arrangements in
clauses 8.1-8.2 which will be determined as an amount equal to
166% of the amount certified by the actuary to the relevant
scheme as being equal to the cash equivalent transfer value
(calculated using actuarial methods and assumptions consistent
with those specified in Actuarial Guidance Note GN11) of the
additional pension benefits net of any income tax payable by
the Employee at his marginal rate, which the Employee would
have accrued if the Employment had continued throughout the
Relevant Period[(iii) in relation to loss of pension benefits
under the FURBS, an amount equal to 100% of the aggregate
contributions (gross) which would have been paid by the
Company in respect of the FURBS in respect of the Employee
during the Relevant Period. For the avoidance of doubt, the
Company's obligations under this sub-clause shall be in
addition to the Company's obligations to make such
contributions to unapproved pension arrangements as are
required under the explanatory letter dated [ ] in respect
of past service as at the leaving date; [plus]];
(iii) For the purposes of sub-paragraphs (ii) [and (iii)] PENSION
BENEFITS shall also include life assurance, ill health, early
retirement and spouse pension benefits; [plus]; The Employee
shall have no entitlement to the Liquidated Sum if, prior to
the Change of Control, the Employee gives notice to terminate
the Employment
(iv) the cost to the Company of providing all the other benefits
(excluding pension, bonus and any amounts payable and shares
receivable under any share option or other incentive plan)
that the Employee would have been entitled to receive during
the Relevant Period or, if the Company in its absolute
discretion decides, a sum based on an estimated cost to the
Company of providing those benefits for that period which is
agreed to be 10% of the Employee's basic salary (calculated by
reference to the Employee's basic salary at the Termination
Date) for each year for which the other benefits are to be
provided.
16.8 The Liquidated Sum shall be subject to such deductions as may be
required by law and shall be in full and final settlement of any claims
the Employee has or may have against the
73
Company or any Group Company arising from the Employment or its the
termination. Any entitlement the Employee has or may have under any
plan referred to under clause 5 shall be determined in accordance with
the rules of the relevant plan and shall not be affected by the
Employee's receipt of the Liquidated Sum. In consideration for the
payment of the Liquidated Sum the Employee agrees to remain bound the
restrictions contained in clauses 18 and 19 of this Agreement.
16.9 To the extent that any payment required to be made under this clause
16.6 is not made within the period specified the Company shall be
liable for interest on such late payment at the rate of 150% of the
prime rate compounded monthly as posted by Lloyds TSB Bank plc from
time to time.
16.10 If the Termination Date falls during the period of 12 months
immediately prior to the Employee's date of retirement under clause
2.5, the Liquidated Sum shall be reduced pro-rata to the remaining
period of the Employment.
16.11 The Company shall reimburse the Employee for all reasonable costs
(including legal costs) incurred by him in calculating, agreeing and
being paid the Liquidated Sum.
16.12 The Employee shall have no entitlement to the Liquidated Sum if, prior
to the Change of Control, the Employee gives notice to terminate the
Employment.
16.13 On termination of the Employment for whatever reason (and whether in
breach of contract or otherwise) the Employee will:
(a) immediately deliver to the Company or the relevant Group
Company (as appropriate) all books, documents, papers,
computer records, computer data, credit cards, and any other
property relating to the business of or belonging to the
Company or any other Group Company which is in his possession
or under his control. The Employee is not entitled to retain
copies or reproductions of any documents, papers or computer
records relating to the business of or belonging to the
Company or any other Group Company;
(b) immediately resign from any office he holds with the Company
or any other Group Company (and from any related trusteeships)
without any compensation for loss of office. Should the
Employee fail to do so he hereby irrevocably authorises the
Company to appoint some person in his name and on his behalf
to sign any documents and do any thing to give effect to his
resignation from office; and
(c) immed Where notice of termination has been served by either
party (whether or not in accordance with the terms of this
Agreement), the Company shall be under no obligation to
provide work for or assign any duties to the Employee for the
whole or any part of the relevant notice period and may
require him immediately pay to the Company or, as the case may
be, any other Group Company all outstanding loans or other
amounts due or owed to the Company or any Group Company. The
Employee confirms that, should he fail to do so, the Company
is to be treated as authorised to deduct from any amounts due
or owed to the Employee by the Company (or any other Group
Company) a sum equal to such amounts.
16.14 It is acknowledged that the Employee may, during the Employment, be
granted rights upon the terms and subject to the conditions of the
rules from time to time in force of plans referred
74
to in clause 5 of this Agreement. If, on termination of the Employment,
whether lawfully or in breach of contract the Employee loses any of the
rights or benefits under such plan (including rights or benefits which
the Employee would not have lost had the Employment not been
terminated) the Employee shall not by reason of this Agreement (other
than, for the avoidance of doubt, under clauses 16.3 or 16.6) be
entitled, by way of compensation for loss of office or otherwise, to
any compensation for the loss of any rights under any such plan.
16.15 The Employee will not at any time after termination of the Employment
represent himself as being in any way concerned with or interested in
the business of, or employed by, the Company or any other Group
Company.
17. SUSPENSION AND GARDENING LEAVE
17.1 Where notice of termination has been served by either party (whether or
not in accordance with the terms of this Agreement), the Company shall
be under no obligation to provide work for or assign any duties to the
Employee for the whole or any part of the relevant notice period and
may require him:
(i) not to attend any premises of the Company or any other Group
Company; and/or
(ii) to resign with immediate effect from any offices he holds with
the Company or any other Group Company (and any related
trusteeships); and/or
(iii) to refrain from business contact with any customers, clients
or employees of the Company or any Group Company; and/or
(iv) to take any holiday which has accrued under clause 10 during
any period of suspension under this clause 17.1.
Such period of suspension shall not constitute a termination of the
Employment and the provisions of clause 12.1 shall remain in full force
and effect during any period of suspension under this clause 17.1. The
Employee will also continue to be bound by duties of good faith and
fidelity to the Company during any period of suspension under this
clause 17.1 and will undertake such duties as the Company may from time
to time require in accordance with clause 3.1.
Any suspension under this clause 17.1 shall be on full salary and
benefits (save that, if the Employee gives notice, the Employee shall
not be entitled to earn or be paid any bonus or commission during any
period of suspension). For the avoidance of doubt, if the suspension
occurs part way through a bonus year, the Employee shall be entitled to
be paid a bonus (if any) accruing at the end of the bonus year, pro
rated for that period of the bonus year he was not suspended.
The Company may appoint another individual to carry out the duties of
the Employee during any period that the Employee is suspended in
accordance with this clause 17.1.
The Employee acknowledges that the demands made by the Company in
accordance with the terms of this clause 17.1 shall not constitute a
breach of contract of any kind whatsoever nor shall the Employee have
any claim against the Company as a consequence of being required to
comply with this clause.
75
17.2 The Company may suspend the Employee from the Employment during any
period in which it is carrying out a disciplinary investigation into
any alleged acts or defaults of the Employee. Such suspension shall be
on full salary and benefits (save that the Employee shall not be
entitled to earn or be paid any bonus or commission during any period
of suspension unless the alleged acts or defaults prove to be
unfounded).
18. CONFIDENTIALITY
18.1 Save insofar as such information is already in the public domain the
Employee will keep secret and will not at any time (whether during the
Employment or thereafter) use for his own or another's advantage, or
reveal to any person, firm, company or organisation and shall use his
best endeavours to prevent the publication or disclosure of any
information which the Employee knows or ought reasonably to have known
to be confidential, concerning the business or affairs of the Company
or any other Group Company or any of its or their customers.
The restrictions in this clause shall not apply:
(a) to any disclosure or use authorised by the Company or required
by law or by the Employment; or
(b) so as to prevent the Employee from using his own personal
skill in any business in which he may be lawfully engaged
after the Employment is ended; or
(c) to prevent the Employee making a protected disclosure within
the meaning of Section 43A of the Employment Rights Xxx 0000.
19. POST-TERMINATION COVENANTS
19.1 For the purposes of clause 19, TERMINATION DATE shall mean the date of
the termination of the Employment.
19.2 The Employee covenants with the Company (for itself and as trustee and
agent for each other Group Company) that he shall not, whether directly
or indirectly, on his own behalf or on behalf of or in conjunction with
any other person, firm, company or other entity:
Solicitation of clients
(a) for the period of [ ] months following the Termination Date,
solicit or entice away or endeavour to solicit or entice away
from the Company or any Group Company any person, firm,
company or other entity who is, or was, in the twelve months
immediately prior to the Termination Date, a client of the
Company or any Group Company with whom the Employee had
business dealings during the course of his employment in that
twelve month period. NOTHING IN THIS CLAUSE 19.2(a) SHALL
PROHIBIT THE SEEKING OR DOING OF BUSINESS NOT IN DIRECT OR
INDIRECT COMPETITION WITH THE BUSINESS OF THE COMPANY OR ANY
GROUP COMPANY;
Dealings with clients
(b) for the period of [ ] months following the Termination Date,
have any business dealings with any person, firm, company or
other entity who is, or was, in the
76
twelve months immediately prior to the Termination Date, a
client of the Company or any Group Company with whom the
Employee had business dealings during the course of his
employment in that twelve month period. NOTHING IN THIS CLAUSE
19.2(b) SHALL PROHIBIT THE SEEKING OR DOING OF BUSINESS NOT IN
DIRECT OR INDIRECT COMPETITION WITH THE BUSINESS OF THE
COMPANY OR ANY GROUP COMPANY;
Enticement of employees
(c) for the period of [ ] months following the Termination
Date, solicit or entice away or endeavour to solicit or entice
away any individual person who is employed or engaged by the
Company or any Group Company either (a) as a director or in a
managerial or technical capacity; or (b) who is in possession
of confidential information belonging to the Company and/or
any Group Company and with whom the Employee had business
dealings during the course of his employment in the twelve
month period immediately prior to the Termination Date;
Competition
(d) for the period of [ ] months following the Termination
Date, carry on, set up, be employed, engaged or interested in
a business anywhere in the United Kingdom or any other
jurisdiction or locale in which any Group Company conducts
material activities which is or is about to be in competition
with the business of the Company or any Group Company with
which the Employee was involved at any time during the period
of twelve months immediately prior to the Termination Date.
THE PROVISIONS OF THIS CLAUSE 19.2(d) SHALL NOT, AT ANY TIME
FOLLOWING THE TERMINATION DATE, PREVENT THE EMPLOYEE FROM
HOLDING SHARES OR OTHER CAPITAL NOT AMOUNTING TO MORE THAN 5%
OF THE TOTAL ISSUED SHARE CAPITAL OF ANY COMPANY WHETHER
LISTED ON A RECOGNISED INVESTMENT EXCHANGE OR NOT AND, IN
ADDITION, SHALL NOT PROHIBIT THE SEEKING OR DOING OF BUSINESS
NOT IN DIRECT OR INDIRECT COMPETITION WITH THE BUSINESS OF THE
COMPANY OR ANY GROUP COMPANY.
19.3 If the Company has served notice pursuant to clause 2.4(a), the period
during which the restrictions referred to in clauses 19.2(a) to (d)
inclusive shall apply following the Termination Date shall be reduced
by the amount of time during which, if at all, the Company suspends the
Employee under the provisions of clause 17.1.
19.4 The Employee agrees that if, during either his employment with the
Company or the period of the restrictions set out in 19.2(a) to (d)
inclusive, he accepts an offer of employment or engagement, he will
provide a copy of clause 19 to the offeror as soon as is reasonably
practicable after accepting the offer.
19.5 The Employee will, at the request and expense of the Company, enter
into a separate agreement with any Group Company that the Company may
require under the terms of which he will agree to be bound by
restrictions corresponding to those contained in clauses 19.2(a) to (d)
inclusive (or such as may be appropriate in the circumstances).
19.6 For the purposes of applying the restrictions contained within this
clause 19, where the Employment is terminated within 12 months after a
Change of Control (other than in accordance with clause 16.4 or 16.5),
the term "Group Company" shall not include any company that was not a
Group Company immediately prior to the Change of Control.
77
20. EMPLOYEE'S POSITION AS DIRECTOR
20.1 The Employee's duties as a director of any Group Company are subject to
the articles of association of the relevant Group Company for the time
being.
21. WAIVER OF RIGHTS
21.1 If the Employment is terminated by either party and the Employee is
offered re-employment by the Company (or employment with another Group
Company) on terms no less favourable in all material respects than the
terms of the Employment under this Agreement, the Employee shall have
no claim against the Company in respect of such termination.
22. DATA PROTECTION
22.1 The Employee consents to the Company and any Group Company processing
data relating to him at any time (whether before, during or after the
Employment) for the following purposes:
(a) performing its obligations under the Agreement;
(b) the legitimate interests of the Company and any Group Company
including any sickness policy, working time policy,
investigating acts or defaults (or alleged or suspected acts
or defaults) of the Employee, security, management forecasting
or planning and negotiations with the Employee;
(c) processing in connection with any merger, sale or acquisition
of a company or business in which the Company or any Group
Company is involved or any transfer of any business in which
the Employee performs his duties;
(d) transferring data to countries outside the European Economic
Area for the purposes of operating the business of the Company
or any Group Company.
22.2 The Employee explicitly consents to the Company and any Group Company
processing sensitive personal data (within the meaning of the Data
Protection Act 1998) at any time (whether before, during or after the
Employment) for the following purposes:
(a) where the sensitive personal data relates to the Employee's
health, any processing in connection with the operation of the
Company's (or any Group Company's) sickness policy or any
relevant pension scheme or monitoring absence;
(b) where the sensitive personal data relates to an offence
committed, or allegedly committed, by the Employee or any
related proceedings, processing for the purpose of the
Company's or any Group Company's disciplinary purposes;
(c) for all sensitive personal data, any processing in connection
with any merger, sale or acquisition of a company or business
in which the Company or any Group Company is involved or any
transfer of any business in which the Employee performs his
duties; and
(d) for all sensitive personal data, any processing in the
legitimate interests of the Company or any Group Company.
78
23. EMAIL AND INTERNET USE
23.1 The Employee agrees to be bound by and to comply with the terms of the
Company's Acceptable Uses of IT Resources policy and any other
information technology, email and internet policy which the Company may
publish from time to time.
24. MISCELLANEOUS
24.1 This Agreement, together with the letter from the Company dated [ ]
dated, 2003 and any other documents referred to in clause 8 of this
Agreement, constitutes the entire agreement and understanding between
the parties, and supersedes all other agreements both oral and in
writing between the Company and any other Group Company and the
Employee relating to the subject matter hereof (other than those
expressly referred to herein). The Employee acknowledges that he has
not entered into this Agreement in reliance upon any representation,
warranty or undertaking which is not set out in this Agreement or
expressly referred to in it as forming part of the Employee's contract
of employment.
24.2 The Employee represents and warrants to the Company that he will not by
reason of entering into the Employment, or by performing any duties
under this Agreement, be in breach of any terms of employment with a
third party whether express or implied or of any other obligation
binding on him.
24.3 Any notice to be given under this Agreement to the Employee may be
served by being handed to him personally or by being sent by recorded
delivery first class post to him at his usual or last known address;
and any notice to be given to the Company may be served by being left
at or by being sent by recorded delivery first class post to its
respective registered office for the time being. Any notice served by
post shall be deemed to have been served on the day (excluding Sundays
and public or bank holidays) next following the date of posting and in
proving such service it shall be sufficient proof that the envelope
containing the notice was properly addressed and posted as a prepaid
letter by recorded delivery first class post.
24.4 Any reference in this Agreement to an Act of Parliament shall be deemed
to include any statutory modification or re-enactment thereof.
24.5 This Agreement is governed by, and shall be construed in accordance
with, the laws of England.
SIGNED for and on behalf of )
MARCONI CORPORATION PLC )
SIGNED as a DEED and )
DELIVERED by the )
EMPLOYEE in the presence of: )
79
SCHEDULE 6
BONDHOLDER CONFIRMATION LETTER
The Law Debenture Trust Corporation plc
Xxxxx Xxxxx
000 Xxxx Xxxxxx
Xxxxxx XX0X 0XX
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxx Xxxx
Xxx Xxxx 00000
XXX
- March, 2003
Dear Sirs,
BONDHOLDER CONFIRMATION
1. We refer to the deed entered into on - March, 2003 between, among
others, Marconi plc (plc), Marconi Corporation plc (CORP), Ancrane, E-A
Continental Limited and Marconi Nominees Limited (SCHEME IMPLEMENTATION
DEED). Except as otherwise provided in this letter, capitalised terms
in this letter shall have the meaning ascribed to them in the Scheme
Implementation Deed and where there is a conflict, the definition in
this letter shall prevail.
2. We also refer to the Trust Deeds dated 30th March, 2000 (each as
supplemented) between plc, Corp and The Law Debenture Trust Corporation
p.l.c. (the EUROBOND TRUSTEE) relating to Eurobonds issued by Corp and
guaranteed by plc (the TRUST DEEDS) and the Indenture dated 19th
September, 2000 (as supplemented) between plc, Corp and The Bank of New
York (the YANKEE BOND TRUSTEE) relating to Yankee Bonds issued by Corp
and guaranteed by plc (the INDENTURE).
3. In connection with the Scheme Implementation Deed and recognising that
certain creditors of Corp and plc have made it clear that the execution
of this letter by Corp and plc is a condition of their continued
support for the Financial Restructuring and notwithstanding:
(i) the provisions of clause 4.9 (Termination of guarantee) of the
Trust Deeds and Article 12.03 (Termination of guarantee) of
the Indenture;
(ii) a claim in respect of the Bonds being Admitted (as defined in
the Corp Scheme) in the Corp Scheme and any Distributions (as
defined in the Corp Scheme) being made in respect thereof; and
(iii) the cancellation of the Eurobonds and the Yankee Bonds (or any
of them) as a result of any Distribution (as defined in the
Corp Scheme) or other effect of the Corp Scheme or otherwise,
80
plc hereby:
(a) undertakes to the Eurobond Trustee, the Yankee Bond Trustee
and the Definitive Holders (as defined in the Corp Scheme)
that the guarantees given by plc in respect of Corp's
obligations under the Bonds shall remain in full force and
effect;
(b) guarantees to each Definitive Holder of a Eurobond mutatis
mutandis on the same terms as the guarantee given to the
Eurobond Trustee set out in clause 4 of each Trust Deed; and
(c) guarantees to each Definitive Holder of a Yankee Bond mutatis
mutandis on the same terms as the guarantee given to the
Yankee Bond Trustee set out in section 12 of the Indenture,
and Corp hereby undertakes to the Eurobond Trustee, the Yankee Bond
Trustee and the Definitive Holders that it will not deliver to the
Eurobond Trustee a certificate of the nature referred to in clause 4.9
(Termination of guarantee) of the Trust Deeds.
4. This deed may be executed in one or more counterparts, each of which
will be deemed an original and all of which will constitute one and the
same deed.
5. In the event that any provision of this deed is void and unenforceable
by reason of any applicable law, it shall be deleted and the remaining
provisions of this deed shall continue in full force and effect, and if
necessary be so amended as necessary to give effect to the spirit of
this deed so far as possible.
6. No amendment or waiver of any provision of this deed will be effective
unless it is in writing and signed by each of Corp, plc, the Eurobond
Trustee and the Yankee Bond Trustee.
7. With the exception of paragraph 3 of this deed, the benefit of which is
conferred upon each of the Definitive Holders who each have the right
to enforce its terms, no provision of this deed is enforceable by any
person who is not a party to this deed, under the Contracts (Rights of
Third Parties) Xxx 0000 or otherwise.
8. This deed will be governed by and construed in accordance with English
law.
IN WITNESS WHEREOF this deed has been executed as a deed poll by the parties to
it in favour of the Eurobond Trustee, the Yankee Bond Trustee and each
Definitive Holder and is intended to be and is hereby delivered on the date
stated above.
EXECUTED as a Deed ) ______________________________
by MARCONI PLC ) Director
acting by [ ] and ) ______________________________
[ ] ) Director/Secretary
EXECUTED as a Deed ) ______________________________
by MARCONI CORPORATION PLC ) Director
acting by [ ] and ) ______________________________
[ ] ) Director/Secretary
81
SCHEDULE 7
FINMECCANICA GUARANTEE DEED OF NOVATION
NOVATION AND AMENDMENT DEED
DATED MARCH, 2003
BETWEEN
MARCONI plc
MARCONI CORPORATION plc
MARCONI (XXXXXX STREET) LIMITED
AND
FINMECCANICA S.p.A.
IN RESPECT OF AN AGREEMENT FOR THE SALE AND PURCHASE
OF THE ENTIRE ISSUED SHARE CAPITAL OF MMH
DATED AS OF 2ND AUGUST 2002
XXXXX & OVERY
London
84
CONTENTS
PAGE
CLAUSE
1. Definitions and Interpretation...................................................................... 86
2. Representations and Warranties...................................................................... 87
3. Novation............................................................................................ 88
4. Agreement Amendment................................................................................. 88
5. Notices............................................................................................. 89
6. Counterparts........................................................................................ 89
7. Third Parties....................................................................................... 89
8. Governing Law....................................................................................... 89
SCHEDULE
1. Warranties.......................................................................................... 91
85
THIS DEED is made on 2003
BETWEEN:
(1) MARCONI plc, having its registered office at New Century Park, XX Xxx
00, Xxxxxxxx XX0 0XX, Xxxxxxx (EXISTING GUARANTOR);
(2) MARCONI CORPORATION plc, having its registered office at New Century
Park, XX Xxx 00, Xxxxxxxx XX0 0XX, Xxxxxxx (NEW GUARANTOR);
(3) MARCONI (XXXXXX STREET) LIMITED, having its registered office at New
Century Park, XX Xxx 00, Xxxxxxxx XX0 0XX, Xxxxxxx (MARCONI); and
(4) FINMECCANICA S.P.A., having its registered office at Xxxxxx Xxxxx
Xxxxxx 0, Xxxx, Xxxxx (the PURCHASER).
WHEREAS
(A) By an agreement dated 2nd August 2002 between the Existing Guarantor,
Marconi and the Purchaser (the AGREEMENT), Marconi agreed to sell and
transfer, and the Purchaser agreed to purchase, the MMH Shares. In
accordance with clause 12 of the Agreement, the Existing Guarantor
unconditionally and irrevocably (i) guaranteed to the Purchaser the
full, due and punctual payment and observation by Marconi of all its
obligations under the Agreement and the Share Purchase Documents to
which Marconi was a party and (ii) indemnified the Purchaser
immediately on demand against any cost, loss or liability suffered by
it if any obligation guaranteed by it is or becomes unenforceable,
invalid or illegal.
(B) The Marconi Corporate Restructuring (as defined in sub-clause 12.7 of
the Agreement) will be effected, as from the Effective Time, pursuant
to the New Guarantor Scheme (as such terms are defined below).
(C) In accordance with sub-clause 12.7 of the Agreement, the parties have
agreed that with effect from the Effective Time, the Existing Guarantor
(upon ceasing to be the ultimate parent company of the Marconi Group)
shall be released from, and the New Guarantor shall assume, the
Existing Guarantor's rights, obligations, duties and liabilities under
the Agreement, on the terms and subject to the conditions hereinafter
provided.
(D) The Existing Guarantor, the New Guarantor, Marconi and the Purchaser
have agreed to enter into this Deed novating and amending the
Agreement.
In consideration of the provisions and mutual covenants contained in this Deed
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged by each of the parties hereto,
IT IS AGREED AS FOLLOWS:
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
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In this Deed the following expressions shall have the following
meanings:
EFFECTIVE TIME means for the purposes of this Deed in relation to the
New Guarantor Scheme the date upon which an office copy of the order of
the High Court of England and Wales sanctioning that New Guarantor
Scheme shall have been delivered to the Registrar of Companies for
registration.
NEW GUARANTOR SCHEME means the proposed scheme of arrangement in
respect of the New Guarantor pursuant to section 425 of the Companies
Xxx 0000 (as amended) to be sanctioned on or around May 2003.
NOVATED AGREEMENT shall mean the AGREEMENT as novated, amended and
supplemented by this Deed.
REGISTRAR OF COMPANIES means the registrar or other officer performing
under the Companies Xxx 0000 (as amended) the duty of registration of
companies in England and Wales including a deputy registrar.
1.2 In this Deed, unless the contrary appears, a reference to:
(a) party is a party to this Deed;
(b) a person includes its successors and assigns;
(c) a provision of law is a reference to that provision as amended
or re-enacted; and
(d) a time of day is a reference to London time.
1.3 Unless the contrary intention appears a term defined in the Agreement
has the same meaning where used in this Deed.
1.4 The clause and sub-clause headings in this Deed are for convenience
only and are to be ignored in construing this Deed.
2. REPRESENTATIONS AND WARRANTIES
2.1 The New Guarantor represents and warrants to the Purchaser on the terms
set out in the Schedule to this Deed as at the Effective Time, by
reference to the circumstances then existing.
2.2 The Existing Guarantor warrants, for the benefit of the New Guarantor,
that save in relation to claims already notified to it by the
Purchaser, it is not aware of any claim (actual or threatened) by the
Purchaser against the Existing Guarantor under the Agreement.
2.3 In consideration for the representations and warranties given by the
New Guarantor in sub-clause 2.1 above, with effect from the Effective
Time, the parties agree that the New Guarantor shall have no liability
in respect of the Warranties given under paragraph 1 of schedule 4 of
the Agreement in respect of the Existing Guarantor.
2.4 The representations and warranties set out in sub-clause 2.1 above
shall survive the execution and delivery of this Deed.
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3. NOVATION
3.1 With effect from the Effective Time:
(a) the Existing Guarantor is released and discharged from its
obligations, duties and liabilities under the Agreement;
(b) the Existing Guarantor agrees that it has no rights under the
Agreement;
(c) the New Guarantor agrees to (i) assume the rights,
obligations, duties and liabilities of the Existing Guarantor
under the Agreement and (ii) perform all the obligations of
the Existing Guarantor under the Agreement in favour of the
Purchaser as if the New Guarantor had been a party to the
Agreement in place of the Existing Guarantor;
(d) the parties consent to and accept the assumption by the New
Guarantor of the Existing Guarantor's rights, obligations,
duties and liabilities under the Agreement and the release and
discharge of the Existing Guarantor from its obligations,
duties and liabilities under the Agreement;
(e) each of the other parties to the Novated Agreement agrees with
the New Guarantor to perform its obligations under the
Agreement (as amended and supplemented by this Deed) in favour
of the New Guarantor,
each of the foregoing events and agreements being conditional on, and
taking effect simultaneously with, the others.
3.2 With effect from the Effective Time, the New Guarantor hereby agrees
that all of the Purchaser's rights, claims, actions, demands and
proceedings whatsoever and howsoever arising out of or in respect of
the Share Purchase Documents, (including any such accrued rights which
have arisen against the Existing Guarantor prior to the Effective Time,
and any such rights arising against the New Guarantor after the
Effective Time) shall be enforceable by the Purchaser against the New
Guarantor.
3.3 Notwithstanding clause 3.1 above, the Existing Guarantor and the New
Guarantor are each released from any obligations under the Novated
Agreement to the extent that such obligations have been fully
performed, satisfied or otherwise fully complied with in accordance
with the Agreement by the Existing Guarantor as at the Effective Time.
4. AGREEMENT AMENDMENT
4.1 With effect from the Effective Time the Agreement will be amended as
follows:
(a) the expression "Marconi plc" wherever it appears in the
Agreement will be deleted and replaced with "Marconi
Corporation plc";
(b) where the context so permits, the expression "this Agreement"
wherever it appears in the Agreement shall be treated as
though it referred to the Novated Agreement;
(c) for the purposes of sub-clause 18.4 of the Agreement, the
address details for the New Guarantor shall be as follows:
88
Name of party Addressee Address Facsimile No. E-mail address
Marconi The Company 4th Floor, Regents x00 00 0000 Xxxx.Xxxxxx@
Corporation plc Secretary Place, 000 Xxxxxx Xx, 1395 xxxxxxx.xxx
Xxxxxx XX0 0XX,
Xxxxxxx
4.2 The parties agree that, with effect from the Effective Time the
Agreement is novated and constitutes an agreement between New Guarantor
(as guarantor), Marconi and the Purchaser on the terms and conditions
of the Novated Agreement. In particular, the New Guarantor shall
perform all the guarantee and indemnification obligations in favour of
the Purchaser under sub-clauses 12.1 to 12.6 of the Novated Agreement.
4.3 Save as amended hereby, the Agreement as novated remains in full force
and effect.
5. NOTICES
All notices under or in connection with this Deed will, unless
otherwise stated, be given in accordance with the Novated Agreement.
6. COUNTERPARTS
This Deed may be executed in any number of counterparts, and by the
parties on separate counterparts. Each counterpart shall constitute an
original of this Deed, and the counterparts together shall constitute
one and the same document.
7. THIRD PARTIES
A person who is not a party to this Deed has no rights under the
Contracts (Rights of Third Parties) Xxx 0000 to enforce any term of
this Deed, but this does not affect any right or remedy of a third
party which exists or is available apart from that Act.
8. GOVERNING LAW
This Deed shall be governed by and construed in accordance with English
law. Any disputes that may arise out of or in connection with this Deed
will settled by arbitration as provided in clause 28 of the Novated
Agreement.
IN WITNESS of which this deed has been executed and has been delivered on the
date stated at the beginning of this Deed.
89
EXISTING GUARANTOR
EXECUTED as a deed by ) _________________________________
Marconi plc ) Director
acting by ) _________________________________
and ) Director/Secretary
NEW GUARANTOR
EXECUTED as a deed by ) _________________________________
Marconi Corporation plc ) Director
acting by ) _________________________________
and ) Director/Secretary
MARCONI
EXECUTED as a deed by ) _________________________________
Marconi (Xxxxxx Street) Limited ) Director
acting by ) _________________________________
and ) Director/Secretary
PURCHASER
EXECUTED as a deed by ) _________________________________
Finmeccanica S.p.A ) Director
acting by ) _________________________________
and ) Director/Secretary
90
SCHEDULE 1
WARRANTIES
(a) The New Guarantor is duly incorporated and validly existing under the
laws of England, and has the requisite power and authority to enter
into and perform its obligations under this Deed and the Novated
Agreement.
(b) This Deed and the Novated Agreement constitute binding obligations of
the New Guarantor.
(c) The execution and delivery of this Deed, and the performance by the New
Guarantor of its obligations under this Deed and the Novated Agreement
will (or with the giving of notice or lapse of time or both would) not:
(i) result in a breach of any provision of the memorandum or
articles of association of the New Guarantor; or
(ii) result in a breach of any order, judgment or decree of any
court or governmental agency to which the New Guarantor is a
party or by which the New Guarantor is bound or of any other
contractual commitment to which the New Guarantor is a party.
(d) The New Guarantor has full knowledge of the Agreement and is fully
aware of its terms and conditions, in particular of the provisions
contained in sub-clauses 12.1 to 12.6 thereof which constitute the
Marconi Guarantee.
(e) The New Guarantor shall be immediately after the Effective Time, the
ultimate parent company of the Marconi Group and the company owning
(directly or indirectly as a result of its direct or indirect
shareholdings in the members of the Marconi Group) all or substantially
all of the assets of the Marconi Group.
(f) Each of Marconi and the Existing Guarantor have not assigned or
transferred any of their respective benefits or obligations under any
of the Share Purchase Documents to which they are a party.
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SCHEDULE 8
LEMELSON ASSUMPTION AGREEMENT AND CONSENT
DATED MARCH, 2003
MARCONI PLC
AND
MARCONI CORPORATION PLC
AND
LEMELSON MEDICAL, EDUCATION AND RESEARCH FOUNDATION, LIMITED
PARTNERSHIP
--------------------------------
ASSUMPTION AGREEMENT
AND CONSENT
--------------------------------
XXXXX & XXXXX
London
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THIS ASSUMPTION AGREEMENT AND CONSENT (AGREEMENT) is made as of
[ - ]March, 2003
BETWEEN:
(1) Marconi plc (registered number 03846429) whose registered office is at
Xxx Xxxxxxx Xxxx, XX Xxx 00, Xxxxxxxx, XX0 0XX. (the ORIGINAL
CONTRACTING PARTY);
(2) Marconi Corporation plc (registered number 00067307) whose registered
office is at Xxx Xxxxxxx Xxxx, XX Xxx 00, Xxxxxxxx, XX0 0XX. (the NEW
CONTRACTING PARTY); and
(3) Lemelson Medical, Education and Research Foundation, Limited
Partnership whose principal place of business is at Tahoe Boulevard
#1802, Incline Village, Nevada, U.S.A NV 89451 (the CONTINUING
CONTRACTING PARTY).
RECITALS:
(A) The Original Contracting Party and the Continuing Contracting Party
entered into an agreement dated 1st December 1999 (the ORIGINAL
AGREEMENT) in which the Continuing Contracting Party granted to the
Original Contracting Party a non-exclusive licence in relation to
Licensed Patents as defined and described in the Original Agreement.
(B) The Original Contracting Party wishes to be released and discharged
from the Original Agreement and the Continuing Contracting Party has
agreed to release and discharge the Original Contracting Party on the
terms of the New Contracting Party's undertaking to perform, discharge
and observe the terms of the Original Agreement in place of the
Original Contracting Party.
(C) This Agreement is supplemental to the Original Agreement.
In consideration of the matters described above, and of the mutual benefits and
obligations set forth in this Agreement, the parties agree as follows:
1. ASSUMPTION AND CONSENT
1.1 This Agreement shall have effect or be deemed to have effect from the
date of the Original Agreement (the EFFECTIVE DATE).
1.2 The New Contracting Party agrees to and undertakes to the Continuing
Contracting Party to accept and to perform, discharge and observe all
obligations and liabilities to be performed, discharged or observed by
the Original Contracting Party under the Original Agreement in every
way as if the New Contracting Party were named in the Original
Agreement in place of the Original Contracting Party with effect from
the Effective Date.
1.3 In consideration of the New Contracting Party's undertaking in
subclause 1.2 hereof, the Continuing Contracting Party fully and
completely releases and discharges the Original Contracting Party from
all claims, demands, duties, obligations and liabilities whatsoever in
respect of the Original Agreement arising whether before, on or after
the Effective Date. The Continuing Contracting Party consents to the
assignment of all duties, obligations and liabilities to the New
Contracting Party by the Original Contracting Party and the Continuing
Contracting Party accepts the liability of the New Contracting Party in
lieu of the liability of
93
the Original Contracting Party for all liabilities whether such
liabilities arose before, on or after the Effective Date.
1.4 The Continuing Contracting Party undertakes to the New Contracting
Party to perform, discharge and observe all such obligations and
liabilities on the part of the Continuing Contracting Party under the
Original Agreement, as amended and supplemented by this Agreement and
acknowledges that the New Contracting Party shall be entitled to the
rights and benefits of the Original Agreement, as amended and
supplemented by this Agreement as if the New Contracting Party were
named in the Original Agreement in place of the Original Contracting
Party with effect from the Effective Date.
1.5 The Original Agreement, as amended and supplemented by this Agreement,
shall continue in full force and effect.
2. GENERAL
2.1 This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same Agreement and
any party may enter into this Agreement by executing a counterpart.
2.2 This Agreement is governed by and shall be construed in accordance with
the law of the State of Nevada. Each party submits to the jurisdiction
of the State of Nevada for all purposes relating to this Agreement.
2.3 The Recitals are true and correct and are incorporated into this
Agreement as if fully set forth herein.
94
IN WITNESS of which this Agreement has been executed and has been delivered on
the date which appears first on page 1.
EXECUTED as an agreement by ) _________________________________
MARCONI PLC ) Director
acting by ) _________________________________
and ) Director/Secretary
EXECUTED as an agreement by ) _________________________________
MARCONI CORPORATION PLC ) Director
acting by ) _________________________________
and ) Director/Secretary
EXECUTED as an agreement by )
LEMELSON MEDICAL, EDUCATION AND RESEARCH )
FOUNDATION, LIMITED PARTNERSHIP _________________________________
Xxxxxxx Xxxxxxxx
Title: authorised representative
95
SCHEDULE 9
SURRENDER OF CAPITAL LOSSES
Corp and plc agree that this Schedule takes effect on the understanding between
them that they will act in good faith in the implementation of the provisions of
this Schedule in accordance with the principles on which it is based.
1. INTERPRETATION
In this Schedule:
Unless the contrary intention appears, words and expressions defined
elsewhere in this deed shall have the same meaning;
ACCOUNTING PERIOD means an accounting period as defined by s.12 Income
and Corporation Taxes Xxx 0000;
BUSINESS DAY means any day on which banks are open for general business
in London;
CHARGEABLE GAIN means any chargeable gain for the purposes of TCGA 1992
arising to the s.171A Transferee;
COMPLETION means, in respect of a 171A Transferee, completion of a Sale
of the shares of the s.171A Transferee (or, if the shares of the direct
or indirect parent of the s.171A Transferee are sold and not those of
the s.171A Transferee, the company whose shares are sold);
CONSIDERATION means amounts payable under paragraph 2.3;
CORP GROUP means the group of which Corp is, from time to time, a
member for the purposes of chargeable gains in accordance with s.170
TCGA 1992;
ELECTED SHARES means in relation to a s.171A Transferee, the Yeslink
Interco Shares to which the plc s.171A Election applies;
ELIGIBLE SUBSIDIARY means any company which satisfies the condition
that, had any of the Yeslink Interco Shares been transferred by plc to
that company immediately before the Yeslink Interco Disposal, s.171(1)
TCGA 1992 would have applied to that transfer;
FINAL DETERMINATION means for any accounting period of a company, if
the relevant s.171A Transferee's tax return has been agreed with the
Inland Revenue the agreement of that tax return, or, if no such
agreement has been reached, on the earlier of the following events:
(i) a determination being agreed by Corp and plc; or
(ii) the corporation tax return of such s.171A Transferee for such
period being submitted to the Inland Revenue and one of the
following events having occurred:
(a) such s.171A Transferee has received a binding notice
from the Inland Revenue that such tax return is final
and incapable of amendment;
96
(b) the Inland Revenue is precluded from serving a notice
of enquiry or further notice of enquiry (as the case
may be) into such tax return;
(c) any such enquiry has been finally determined by the
Inland Revenue's serving a closure notice on such
s.171A Transferee and (1) such s.171A Transferee has
amended such tax return in a manner which accords
with the conclusions stated in the closure notice and
the Inland Revenue has failed to make any further
amendments to that tax return within the time limit
allowed by law, (2) the Inland Revenue has amended
such tax return in a manner which accords with the
conclusions stated in the closure notice or such
s.171A Transferee has failed to appeal against such
amendments within the time limit allowed by law or
(3) no such amendments are required;
(d) such s.171A Transferee has either failed to appeal
within the time limit allowed by law against any
amendment to such tax return made by the Inland
Revenue or any such appeal has been finally
determined;
(e) the Inland Revenue is precluded from amending or
further amending (as the case may be) such tax
return; or
(f) an appeal has been made against an amendment of such
tax return, such appeal has been determined by the
relevant court or tribunal and (1) one party to that
appeal has notified the other that it will not appeal
against that decision, (2) an expert has determined
that there is no reasonable prospect of an appeal
against that decision succeeding, and for this
purpose "expert" means leading tax counsel of at
least ten years' standing appointed by mutual
agreement between Corp and plc or, failing such
agreement, by the Chairman of the International Bar
Association, or (3) such determination is a decision
of the highest court of appeal;
HOLDING COMPANY OF A TRADING SUBGROUP means a company which is a
holding company of a trading subgroup for the purposes of Schedule 7AC
TCGA 1992;
LOSSES means, in relation to a s.171A Transferee, the losses finally
agreed or determined (in accordance with paragraph 3) to be allowable
losses for the purposes of TCGA 1992, which arise to the s.171A
Transferee as a result of the Yeslink Interco Disposal being deemed to
be made in part by the s.171A Transferee;
NET ASSETS means the aggregate amount of the assets (disregarding the
value of any Losses) less the aggregate amount of the liabilities of
the s.171A Transferee as at Completion, and as certified in writing in
good faith by or on behalf of Corp;
plc s.171A ELECTION means a s.171A Election made by plc in accordance
with paragraph 2.1;
PRESCRIBED RATE means the rate of one per cent. per annum above the
base rate for the time being of Barclays Bank PLC;
PROFITS means the total profits of a s.171A Transferee which would be
chargeable to corporation tax for a Relevant Accounting Period;
97
RELEVANT ACCOUNTING PERIOD means, in relation to a s.171A Transferee,
an Accounting Period ending on or after 31st October, 2001 but on or
before the date on which the s.171A Transferee ceases to be a member of
the Corp Group, so that an Accounting Period should be treated as
ending immediately before it so ceases, if that would not otherwise be
the case;
RELEVANT AMOUNT means:
(a) the amount by which the Sale Consideration exceeds the Net
Assets of the s.171A Transferee (or, if the shares of the
direct or indirect parent of the s.171A Transferee are sold
and not those of the s.171A Transferee, the company whose
shares are sold), provided that
(b) if those Net Assets exceed L2.5m or the s.171A Transferee (or,
if the shares of the direct or indirect parent of the s.171A
Transferee are sold and not those of the s.171A Transferee,
the company whose shares are sold) is a Trading Company or the
Holding Company of a Trading Subgroup, the Relevant Amount is
the amount of the Losses available to the s.171A Transferee to
reduce a Chargeable Gain arising in a Subsequent Accounting
Period;
RELEVANT PERCENTAGE means 50 per cent, unless the Relevant Amount is
established in accordance with subparagraph (b) of the definition of
Relevant Amount, in which case it means 0.03 per cent;
s.171A means s.171A TCGA 1992;
s.171A ELECTION means a joint election under s.171A;
s.171A TRANSFEREE means a company which is an Eligible Subsidiary which
makes a plc s.171A Election in accordance with paragraph 2.1;
SALE means the sale by a Seller of the shares of a s.171A Transferee
(or the direct or indirect parent of a s.171A Transferee) to a company
which is not a member of the Corp Group;
SALE CONSIDERATION means consideration or value received by the Seller
whether directly or indirectly on the sale of the shares of a s.171A
Transferee (or the direct or indirect parent of a s.171A Transferee) to
a company which is not a member of the Corp Group, where Losses are
available to the relevant s.171A Transferee to reduce a Chargeable Gain
arising in a Subsequent Accounting Period;
SELLER means Corp or a subsidiary of Corp which sells the shares of a
s.171A Transferee (or the direct or indirect parent of a s.171A
Transferee) to a person which is not a member of the Corp Group;
SUBSEQUENT ACCOUNTING PERIOD means, in relation to a s.171A Transferee,
an Accounting Period commencing after 31st October, 2001 which is not a
Relevant Accounting Period, treating an Accounting Period as ending
immediately before it ceases to be a member of the Corp Group, if that
would not otherwise be the case;
TCGA 1992 means Taxation of Chargeable Gains Xxx 0000;
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TRADING COMPANY means a company which is a trading company for the
purposes of Schedule 7AC TCGA 1992;
YESLINK INTERCO DISPOSAL means the disposal by plc of the Yeslink
Interco Shares to a third party on 31st October, 2001;
YESLINK INTERCO SHARES means the shares of Yeslink Interco Limited
(registered number 03855625) which were in issue immediately prior to
the Yeslink Interco Disposal.
2. SURRENDER OF CAPITAL LOSSES
2.1 plc and Corp agree that a s.171A Election, or, as applicable, s.171A
Elections, will be made so that in aggregate fifty per cent of the
Yeslink Interco Shares shall be deemed under s.171A for the purposes of
corporation tax on chargeable gains to have been transferred to Corp
and/or such Eligible Subsidiary or Eligible Subsidiaries as Corp may
nominate immediately prior to the Yeslink Interco Disposal and that the
Yeslink Interco Disposal shall be deemed for those purposes to have
been made by that Eligible Subsidiary or Eligible Subsidiaries to the
extent, in each case, of the Elected Shares.
2.2 plc shall enter into each s.171A Election and Corp shall enter into, or
shall procure that each relevant Eligible Subsidiary enters into, the
relevant s.171A Election with plc and plc and Corp shall do, or, in the
case of an Eligible Subsidiary other than Corp, Corp shall procure that
each relevant Eligible Subsidiary does, all necessary things to ensure
that each s.171A Election is duly made in accordance with s.171A as
soon as reasonably practicable after the date of this Agreement and in
any event prior to 31st March, 2004.
2.3 Corp agrees to pay, or to procure that the relevant s.171A Transferee
(in the case of subparagraph (a)) or the relevant Seller (in the case
of subparagraph (b)) pays, to plc by way of consideration for plc
entering into the plc s.171A Elections:
(a) a sum equal to 0.33 per cent. of the amount by which a
Chargeable Gain arising to a s.171A Transferee is treated
under s.8(1) TCGA 1992 as reduced by any Losses or any part of
them; and
(b) a sum equal to the Relevant Percentage of the Relevant Amount.
2.4 Any payment due under paragraphs 2.3 and 2.5 shall be paid within five
Business Days of the later of:
(a) the fifth Business Day after the Corp Scheme becomes
effective; and
(b) either:
(i) in the case of a payment due under subparagraph
2.3(a), a Final Determination that the Chargeable
Gain has been reduced as referred to in that
subparagraph; or
(ii) in the case of a payment due under subparagraph
2.3(b), the fifth Business Day after the date on
which the Sale Consideration (or the relevant part of
the Sale Consideration) is received by the Seller.
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2.5 Consideration payable under:
(a) subparagraph 2.3(a) shall carry interest at the Prescribed
Rate from the later of:
(i) six months after the end of the accounting period of
the s.171A Transferee in which the Chargeable Gain
arose; and
(ii) the fifth Business Day after the Corp Scheme becomes
effective,
until the date of payment of the Consideration to plc
compounded annually;
(b) subparagraph 2.3(b) shall carry interest at the Prescribed
Rate from the fifth Business Day following the later of:
(i) the date (or, if relevant, dates) on which the Sale
Consideration (or the relevant part of the Sale
Consideration) is received by the Seller; and
(ii) the day on which the Corp Scheme becomes effective,
until the date of payment of the Consideration to plc
compounded annually.
3. CONDUCT OF CLAIMS
3.1 Corp and plc agree that:
(a) plc will promptly following the Effective Date seek to agree
the amount of the Losses with the Inland Revenue;
(b) where any computation, return, ancillary information,
statements, reports or accounts (each a DOCUMENT) is or are
required to be submitted for, or in respect of agreeing either
the amount of the Losses or, in the case of a submission by
plc, any matter which is relevant to the losses arising to plc
as a result of the Yeslink Interco Disposal, a draft shall be
submitted:
(i) in the case of a submission by Corp or a s.171A
Transferee, by Corp to plc (or such advisers as plc
shall nominate), or
(ii) in the case of a submission by plc, by plc to Corp
(or such advisers as Corp shall nominate),
at least 21 days before its intended submission to the Inland
Revenue, and plc and its advisers or, as the case may be, Corp
and its advisers shall be given access to all information
reasonably necessary to determine its accuracy. In addition,
Corp and plc shall keep each other informed of any
negotiations relating to the agreement of the amount of the
Losses or the relevant matter and before any agreement in
respect of the amount of the Losses or the relevant matter is
reached with the Inland Revenue, details of the proposed
agreement shall be given to plc or, as the case may be, Corp
at least 21 days before the proposed conclusion of such
agreement; and
(c) if, within 21 days of receiving any document or details of
negotiations or proposed agreements referred to in
subparagraph 3.1(b), plc makes any representations to Corp
100
or, as the case may be, Corp makes any representation to plc,
those representations shall, to the extent that they are
reasonable, be reflected in the document submitted to,
3.2 If the parties, having negotiated in good faith for a period of 30
days, fail to reach agreement as to whether representations made under
subparagraph 3.1(c) are reasonable, Corp or plc may refer the matter
for determination by a member of a firm of chartered accountants who is
also a member of the Chartered Institute of Taxation in the United
Kingdom (the EXPERT). The Expert shall be appointed either by agreement
between the parties or (if they do not agree within seven days of the
party wishing to make the reference notifying the other of the proposed
reference) on the application of either Corp or plc to the President
for the time being of the Chartered Institute of Taxation or (in the
absence of an appointment by the President for the time being of the
Chartered Institute of Taxation) on the application of either Corp or
plc to the President for the time being of the Law Society. The Expert
shall decide the matter in question as an expert (and not as an
arbitrator) and his decision shall be final, except in the case of
manifest error. Both parties shall make all relevant information
available to the Expert. The costs of the Expert shall be borne by the
parties in such proportions as the Expert considers to be fair and
reasonable in all the circumstances.
3.3 plc shall give Corp (and its advisers) such assistance and access to
information as Corp reasonably requires in order to prepare and submit
any document and conduct any negotiations in as far as they relate to
the amount of the Losses.
3.4 Corp agrees to give plc notice in writing if a s.171A Transferee
realises a Chargeable Gain in a Relevant Accounting Period which it is
intended should be reduced by any Losses or any part of them. Such
notice is to be given within three months of the end of the s.171A
Transferee's relevant accounting period (or, if relevant, promptly
after a change of intention, following which it is intended so to
reduce the Chargeable Gain).
3.5 Following a notice under paragraph 3.4 Corp shall:
(a) promptly give plc notice if the Chargeable Gain is not to be
reduced by the Losses or any part of them:
(b) at least annually, keep plc informed as to the agreement and
negotiation in relation to the Chargeable Gain in so far as it
is being sought to reduce it with Losses, but shall not be
required to disclose copies of, or details of, its returns,
supporting documentation or correspondence (written or
otherwise) with the Inland Revenue; and
(c) following Final Determination that the Chargeable Gain has
been reduced by the Losses or any part of them, give plc
written notice of the amount of such reduction together with
supporting evidence, such notice to be determinative of the
amount of the reduction, save in the case of manifest error.
4. AGREEMENT OF ATTRIBUTABLE CONSIDERATION
4.1 Corp agrees to give plc notice in writing if a Seller intends to
dispose, or has disposed, of the shares of a s.171A Transferee (or the
direct or indirect parent of a s.171A Transferee) in circumstances
which could give rise to a Relevant Amount.
101
4.2 Following the service of a notice under subparagraph 4.1, Corp and plc
shall use reasonable endeavours to agree the Relevant Amount and Corp
shall give plc such access as is reasonably necessary for plc to
determine the Relevant Amount.
5. RELATIONS BETWEEN THE PARTIES
5.1 Corp and plc agree that neither of them (and that each of them will
procure that none of their subsidiaries) will seek to interpret the
provisions of this Schedule in a manner which materially disadvantages
the other or is inconsistent with the principles on which it is based.
5.2 Corp agrees that it will not (and will use reasonable endeavours to
procure that none of its subsidiaries will) take any action the main
purpose of which is to minimise any payment to plc under this Schedule
other than with the prior written consent of plc.
102
SCHEDULE 10
RECEIVABLES ASSIGNMENT LETTER
[MARCONI PLC LETTERHEAD]
[-] March 2003
From: Marconi plc (plc)
0xx Xxxxx, Xxxxxxx Xxxxx
000 Xxxxxx Xxxx
Xxxxxx XX0 0XX
Fax: x00 00 0000 0000
Attention: Xxxxxxx Xxxxxxxx
To: Marconi Corporation plc (CORP)
0xx Xxxxx, Xxxxxxx Xxxxx
000 Xxxxxx Xxxx
Xxxxxx XX0 0XX
Fax: x00 00 0000 0000
Attention: Xxxxxxx Xxxxxxxx
and
The subsidiaries of Corp whose names and addresses are set out in the Schedule
to this letter (each an OPERATING COMPANY).
Dear Sirs
ASSIGNMENT OF RECEIVABLES
In consideration for the mutual covenants set out below, and for such other
valuable consideration, receipt of which is hereby acknowledged, it is agreed as
follows:
1. DEFINITIONS
In this letter:
CORP CLAIM means the L165,748,102 representing an amount owed by plc to
Corp as being the net amount of intra-group loans made between Corp and
plc, as evidenced by group accounting records;
TRADE RECEIVABLES means each of:
(a) the US$1,768,992 (equivalent to approximately L1,101,284) loan
balance owing to plc by Marconi Software International Inc. as
evidenced by group accounting records;
(b) the L45,631 trade receivable owing to plc by Systems
Management Specialists Inc. as evidenced by group accounting
records;
103
(c) the L387,377 trade receivable owing to plc by Marconi
Communications Inc., as evidenced by group accounting records;
(d) the L42,746 trade receivable owing to plc by Marconi
Communications Optical Networks Corp (Canada), as evidenced by
group accounting records;
(e) the L353,861 trade receivable owing to plc by Marconi
Communications Inc. (incurred when trading previously as Fore
Systems Inc.), as evidenced by group accounting records;
(f) the L38,615 trade receivable owing to plc by Marconi
Communications Limited (Canada), as evidenced by group
accounting records; and
(g) the US$5,736,273 (equivalent to approximately L3,571,109) loan
balance owing to plc by Systems Management Specialists Inc.,
as evidenced by group accounting records.
2. ASSIGNMENT
(a) With effect from the date of this letter plc hereby assigns to
Corp, with full title guarantee, all of its rights, title and
interest in and to the Trade Receivables and all proceeds of
the same (the ASSIGNMENT).
(b) As consideration for the Assignment, Corp agrees to reduce the
amount of the Corp Claim by L19,160,663, to an amount of
L146,587,439.
(c) Each Operating Company confirms its liability in relation to
the Trade Receivable expressed to be owing by it and
acknowledges and consents to the Assignment.
3. FURTHER ASSURANCE
The parties shall take whatever action may be necessary to implement
the terms of this letter including the execution of any further
documents and the giving of any notice, order or direction which in
each case may be required, so that Corp may assume, to the fullest
extent permitted by the provisions of this letter, all of the rights of
plc with respect to the Trade Receivables and the proceeds thereof.
4. COUNTERPARTS
This letter may be executed in any number of counterparts and all such
counterparts taken together shall be deemed to constitute one and the
same instrument.
5. GOVERNING LAW
This letter shall be governed by and construed in accordance with the
laws of England. Each party to this letter agrees that the courts of
England are to have exclusive jurisdiction to settle any disputes which
may arise out of or in connection with this letter.
Please confirm your agreement to the terms of this letter by signing below.
Yours faithfully
104
______________________________
For and on behalf of
MARCONI plc
We hereby agree to the above.
______________________________
For and on behalf of
MARCONI CORPORATION plc
______________________________
For and on behalf of
MARCONI COMMUNICATIONS INC.
______________________________
For and on behalf of
SYSTEMS MANAGEMENT SPECIALISTS INC.
______________________________
For and on behalf of
MARCONI SOFTWARE INTERNATIONAL INC.
______________________________
For and on behalf of
MARCONI COMMUNICATIONS OPTICAL NETWORKS CORP (CANADA)
______________________________
For and on behalf of
MARCONI COMMUNICATIONS LIMITED (CANADA)
105
SCHEDULE
OPERATING COMPANIES
MARCONI COMMUNICATIONS INC.
0000 Xxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
MARCONI COMMUNICATIONS OPTICAL NETWORKS CORP (CANADA)
0000 Xxxxx Xxxxxx Xxxxxxx
Xxxxxx, Xxxxxx, Xxxxxx X0X 0X0
SYSTEMS MANAGEMENT SPECIALISTS INC.
0 Xxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxx Xxx, XX 00000
Xxxxxx Xxxxxx
MARCONI SOFTWARE INTERNATIONAL INC.
0000 Xxxxx Xxxxxxx Xxxx.
Xxxxx 000
Xxxxxxxxxx, XX 00000
MARCONI COMMUNICATIONS LIMITED (CANADA)
0000 Xxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxx, Xxxxxx K2K 3O6
106
SCHEDULE 11
plc ESOP RELEASE DEED
[PLC HEADED PAPER]
[Date]
To: Each Opco
Dear Sirs
ESOP SETTLEMENT AGREEMENT DATED [ ] MARCH, 2003 ENTERED INTO BY MARCONI plc
(plc), MARCONI CORPORATION plc (CORP), HSBC BANK plc, BARCLAYS BANK plc, UBS AG,
SALOMON BROTHERS INTERNATIONAL LIMITED AND XXXXXX XXXXXXX TRUSTEES LIMITED (THE
ESOP SETTLEMENT AGREEMENT)
Capitalised terms used but not defined in this deed of release shall have the
same meaning as set out and adopted in the ESOP Settlement Agreement.
We refer to clause 3.1.1 of the ESOP Settlement Agreement and hereby
unconditionally and irrevocably release all of our claims, causes or rights of
action or proceedings whether at law or in equity in any jurisdiction
whatsoever, whether known or unknown to the parties, whether or not presently
known to the law and whether arising before, on or after the date of this letter
against each Opco to the extent that they relate to (a) all or any of the ESOP
Contracts and/or (b) the Funding Letters and shall waive all past, present or
future rights it may have against each Opco in connection with the same.
This letter is intended to be executed as a deed and shall be governed by
English law.
EXECUTED as a Deed by MARCONI ) _________________________________
PLC ) Director
acting by [ ] )
and [ ] _________________________________
Director/Secretary
107
SCHEDULE 12
SECURITY POWER OF ATTORNEY
THIS SECURITY POWER OF ATTORNEY is made on March, 2003 by Marconi plc
(registered number 3846429) whose registered office is at Xxx Xxxxxxx Xxxx, XX
Xxx 00, Xxxxxxxx XX0 0XX (the COMPANY).
The Company irrevocably and by way of security for the performance of the
Company's obligations (the OBLIGATIONS) under the Scheme Implementation Deed
made on March, 2003 (the SID) entered into between the Company, Marconi
Corporation plc, E-A Continental Limited, Ancrane, Marconi Nominees Limited and
others hereby appoints Marconi Corporation plc (registered number 67307) whose
registered office is at Xxx Xxxxxxx Xxxx, XX Xxx 00, Xxxxxxxx XX0 0XX (CORP) and
any officer or employee of Corp acting in his or her capacity as such officer or
employee and with or under the authority of Corp to be its true and lawful
attorney (together and separately, the ATTORNEY) with the full power (including,
but not limited to, the power to sub-delegate) and authority of the Company in
its name to:
(a) execute on the Company's behalf in whatever manner required any
document or thing lawfully necessary to effect the Obligations in such
form as the Attorney in its absolute discretion may reasonably deem
necessary or desirable;
(b) do or cause to be done all such acts and things as the Attorney in its
absolute discretion may reasonably deem necessary or desirable in order
to carry out and give effect to all of the Obligations; and
(c) do every other act or thing and execute all such deeds, documents and
certificates which the Attorney in its absolute discretion may
reasonably deem necessary, proper, or expedient for all or any of the
foregoing purposes (including, without limitation, to appoint corporate
representatives to attend meetings of Corp on behalf of the Company and
its nominee).
The Company undertakes to ratify whatever the Attorney may do in its name or on
its behalf in exercising the powers contained in this document and to indemnify
the Attorney against any loss incurred by him in connection with anything
lawfully done by him in the exercise or the purported exercise of the powers
contained in this document, save for any loss which would not have arisen but
for the negligence or fraud of the Attorney.
The Company declares that this power of attorney is given by way of security to
secure the performance of the Obligations by the Company and any matters
necessary, desirable, conducive or incidental thereto, and shall be irrevocable
and shall not be affected by the liquidation, receivership, the making of an
administration order or appointment of an administrative receiver or any other
equivalent event of or affecting the Company.
This security power of attorney shall be governed by and construed in accordance
with English law.
108
IN WITNESS of which this security power of attorney has been executed as a deed
and has been delivered on the date which first appears above.
EXECUTED as a Deed by ) _________________________________
MARCONI PLC ) Director
acting by [ ] )
and [ ] ) _________________________________
Director/Secretary
109
SCHEDULE 13
STATEMENT AND WAIVER
STATEMENT AND WAIVER OF INTER COMPANY
BALANCES
DATED [ ] MARCH, 2003
MARCONI PLC
MARCONI CORPORATION PLC
THE TRADING COMPANIES LISTED IN SCHEDULE 1
AND
THE NON-TRADING SUBSIDIARIES LISTED IN SCHEDULE 1
AND
THE DORMANT SUBSIDIARIES LISTED IN SCHEDULE 1
XXXXX & XXXXX
London
110
THIS AGREEMENT is made on March, 2003
BETWEEN:
(1) MARCONI PLC, (registered number 03846429) whose registered office is at
New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (plc);
(2) MARCONI CORPORATION PLC, (registered number 00067307) whose registered
office is at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0
0XX (CORP);
(3) THE TRADING COMPANIES whose names and addresses are set out in Part 1
of Schedule 1 (together with any person who accedes to this Agreement
as a trading company, each a TRADING COMPANY);
(4) THE NON-TRADING SUBSIDIARIES whose names and addresses are set out in
Part 2 of Schedule 1 (together with any person who accedes to this
Agreement as a non-trading company, each an NON-TRADING COMPANY); and
(5) THE DORMANT SUBSIDIARIES whose names and addresses are set out in Part
3 of Schedule 1 (together with any person who accedes to this Agreement
as a dormant company, each a DORMANT COMPANY).
WHEREAS:
(A) plc, Corp, each Trading Company, each Non-Trading Company and each
Dormant Company are members of the Group.
(B) On 29th August 2002, Corp and plc concluded with certain of their
creditors non-binding indicative heads of terms detailing the
principles for the proposed Financial Restructuring of Corp and plc.
These non-binding indicative heads of terms were amended by addenda
concluded on 13th December 2002.
(C) It is proposed that plc will enter into the plc Scheme with the plc
Scheme Creditors, constituting a compromise and arrangement between plc
and the plc Scheme Creditors which will have the effect of compromising
all of plc's creditors' claims against plc as at the Record Date (other
than certain excluded claims), in consideration for a distribution of
plc's assets.
(D) It is proposed that Corp will enter into the Corp Scheme with the Corp
Scheme Creditors, constituting a compromise and arrangement between
Corp and the Corp Scheme Creditors which will have the effect of
compromising all of Corp's creditors' claims against Corp as at the
Record Date (other than certain excluded claims), in consideration for
a distribution of cash, new equity and new debt securities of Corp.
(E) In order to facilitate an effective implementation of the Schemes it is
proposed that each Trading Company, each Non-Trading Company and each
Dormant Company confirms its existing inter-company claims against plc
and Corp and waives any other claims it may have against plc or Corp
arising from circumstances existing prior to the Effective Date. It is
111
further proposed that plc and Corp will give equivalent waivers in
favour of each Trading Company, each Non-Trading Company and each
Dormant Company.
(F) Each party to this Agreement severally considers that, given the
Group's financial position, the entry by it into this Agreement and all
agreements in relation thereto is in the best interests of it and its
stakeholders and that the exercise by each party of its respective
rights and the performance of its respective obligations pursuant to
this Agreement will assist in the successful implementation of the
Financial Restructuring.
(G) It is the intention of the parties that this document be executed as an
Agreement. Each Participating Company, Corp and plc agree to enter into
this Agreement in consideration of the respective mutual obligations
contained hereunder.
IT IS AGREED as follows:
1. INTERPRETATION
In this Agreement:
ACCESSION LETTER means an accession letter in substantially the form
set out in Schedule 4 (Accession Letter);
CLAIM means any claim or right of action of any kind whatsoever or
howsoever arising (whether actual or contingent), whether arising under
common law, statute or otherwise and whether arising in the United
Kingdom or any other place;
CORP SCHEME means a scheme of arrangement in respect of Corp pursuant
to section 425 of the Companies Act, 1985;
COURT means the High Court of Justice of England and Wales;
CREDITOR CONSENT means, in relation to any intra-group loan, that such
loan is permitted in accordance with:
(a) the letter of undertaking dated 25th April, 2002 from Corp and
plc to the co-ordination committee of Corp's syndicate banks,
as amended; and
(b) the letter of undertaking dated 30th May, 2002 from Corp and
plc to the ad-hoc committee of Corp's bondholders, as amended
including in each case any intra-group loan which is made with the
requisite consent of the respective creditor groups;
EFFECTIVE DATE means in relation to the Corp Scheme the date upon which
an office copy of the order of the Court sanctioning the Corp Scheme is
delivered to the Registrar of Companies for registration;
FINANCIAL RESTRUCTURING means the proposed financial restructuring of
the Corp and plc pursuant to the Schemes more particularly described in
the scheme document (together with the explanatory statements and all
appendices, schedules and annexures to it) to be issued in connection
with the Schemes;
112
MARCONI GROUP means plc and each of plc's Subsidiaries;
GROUP means plc and each of its Subsidiaries;
PARTICIPATING COMPANY means any Trading Company, any Non-Trading
Company or any Dormant Company;
plc SCHEME means a scheme of arrangement in respect of plc pursuant to
section 425 of the Companies Act, 1985;
plc SCHEME CREDITORS means all scheme creditors of plc;
RECORD DATE has the meaning given to it in the Corp Scheme or the plc
Scheme, as appropriate;
REGISTRAR shall have the meaning given in the Companies Xxx 0000;
SCHEME means either or both of the Corp Scheme and the plc Scheme as
appropriate including any modifications of either scheme or both or
additions or conditions to either Scheme or both in each case as
approved or imposed by the Court; and
SUBSIDIARY has the meaning set forth in section 736 of Companies Act,
1985 as amended by section 144 of the Companies Act, 1989.
1.2 Interpretation
(a) In this Agreement:
(i) references to a person include a body corporate and
unincorporated associations of persons;
(ii) references to an individual include his estate and
personal representatives; and
(iii) references to a party to this Agreement include
references to the successors or assigns (immediate
or otherwise), of that party.
(b) In this Agreement any reference, express or implied, to an
enactment includes references to:
(i) that enactment as re-enacted, amended, extended or
applied by or under any other enactment (before or
after the signature of this Agreement);
(ii) any enactment which that enactment re-enacts (with or
without modification); and
(iii) any subordinate legislation made (before or after the
signature of this Agreement) under that enactment, as
re-enacted, amended, extended or applied as described
in paragraph (i) above, or under any enactment
referred to in paragraph (ii) above,
and "enactment" includes any legislation in any jurisdiction.
113
(c) In this Agreement, unless the contrary intention appears, a
reference to a clause, subclause or schedule is a reference to
a clause, subclause or schedule to this Agreement. The
schedules form part of this Agreement.
(d) Paragraphs (a), (b) and (c) above apply unless the contrary
intention appears.
(e) The headings in this Agreement do not affect its
interpretation.
2. TARGET SUBSIDIARIES
2.1 Method of accession
Corp shall, and is hereby authorised by each other Participating
Company (other than plc) to, execute an Accession Letter, in respect of
any proposed Trading Company, Non-Trading Company or Dormant Company,
for itself and on behalf of each other Participating Company (other
than plc). Plc shall promptly execute any Accession Letter delivered to
it by Corp in respect of any proposed Trading Company, Non-Trading
Company or Dormant Company.
2.2 Each Accession Letter shall take effect from the date of its execution
by Corp, plc and the proposed Trading Company, Non-Trading Company or
Dormant Company, as applicable.
3. STATEMENT OF INTRA-GROUP LOANS
3.1 Intra-Group loans owed by Participating Companies
Corp and plc each confirms, to the best of its knowledge and belief,
that the loan balances set out opposite its name in Part 1 of Schedule
2 (Intra-group loans owed by Participating Companies) are all of the
loans which were owing to it by any Participating Company as at 31st
December, 2002.
3.2 Intra-Group loans owed by Corp and plc
Each Participating Company confirms, to the best of its knowledge and
belief, that the loan balances set out opposite its name in Part 2 of
Schedule 2 (Intra-group loans owed by Corp and plc) are all of the
loans which were owing to it by Corp or plc as at 31st December, 2002.
4. ACKNOWLEDGEMENT OF LIABILITIES
4.1 Acknowledgement by Corp and plc
Each of Corp and plc acknowledges and confirms its liability in respect
of:
(a) the loan balances set out in Part 2 of Schedule 2 (Intra-group
loans owed by Corp and plc) expressed to be owing by it;
(b) the trading and current account liabilities expressed to be
owing by it to each Participating Company in the management
accounts upon which the audited consolidated financial
accounts of plc as at 31st March, 2002 (in relation to each
Trading and each Non-Trading Company) and as at 30th
September, 2002 (in relation to each Dormant Company), have
been prepared, to the extent such trading and current account
liabilities remain outstanding;
114
(c) the other preserved Claims set out in Part 2 of Schedule 3
(Other Preserved Claims owed by Corp and plc) expressed to be
owing by it.
4.2 Acknowledgement by each Participating Company
Each Participating Company acknowledges and confirms its liability in
respect of:
(a) the loan balances set out in Part 1 of Schedule 2 (Intra-group
loans owed by Participating Companies) and expressed to be
owing by it;
(b) the trading and current account liabilities and expressed to
be owing by it to plc and/or Corp in the management accounts
upon which the audited consolidated financial accounts of plc
as at 31st March, 2002 (in relation to each Trading and
Non-Trading Company) and as at 30th September, 2002 (in
relation to each Dormant Company), have been prepared, to the
extent such trading and current account liabilities remain
outstanding; and
(c) the other preserved Claims set out in Part 1 of Schedule 3
(Other Preserved Claims owed by Participating Companies)
expressed to be owing by it.
5. WAIVER OF CLAIMS
5.1 Waiver by Corp and plc
(a) With effect from the Effective Date, each of Corp and plc
hereby unconditionally and irrevocably waives and releases
each Participating Company from any Claim which it may have
against that Participating Company and which arises out of or
in relation to any matter or circumstance existing on or prior
to the Effective Date.
(b) The waiver and release contained in paragraph (a) above shall
not apply in relation to:
(i) any intra-group loan owed by a Participating Company
to Corp and/or plc and set out in Part 1 of Schedule
2 (Intra-group loans owed by Participating
Companies), including interest accrued thereon at
such applicable commercial rate of interest agreed
between the parties;
(ii) any intra-group loan made to a Participating Company
by Corp on or after 1st January, 2003:
(A) in the ordinary and usual course of
business; or
(B) with Creditor Consent,
including interest accrued thereon at such applicable
commercial rate of interest agreed between the
parties;
(iii) any trading and current account liabilities owed by a
Participating Company to Corp and/or plc and detailed
in the management accounts upon which the audited
consolidated financial accounts of plc, as at 31st
March, 2002 (in relation to each Trading and
Non-Trading Company) and as at 30th September, 2002
(in relation to each Dormant Company), have been
115
prepared, to the extent such trading and current
account liabilities remain outstanding;
(iv) any trading and current account liabilities owed by a
Trading Company or a Non-Trading Company to Corp
and/or plc and incurred after 31st, March, 2002 in
the ordinary and usual course of that Trading
Company's or Non-Trading Company's (as the case may
be) business, to the extent such trading and current
account liabilities remain outstanding;
(v) any counter indemnity or equivalent reimbursement
obligation (which is written or is implied by law and
whether or not contingent) of a Participating Company
to Corp and/or plc under any financial guarantee or
indemnity (which is written or is implied by law) and
which is given by Corp and/or plc and is: (A) in
favour of any person which is not a member of the
Marconi Group (including the issuer of any
performance bond, bank guarantee or similar
instrument) and (B) in respect of any contractual
obligations of that Participating Company; provided
that where any payment has been made under such a
guarantee or indemnity on or before 31st March, 2002,
the resultant counter indemnity shall not be
preserved under this clause 5.1 (b) (v);
(vi) any counter indemnity or equivalent reimbursement
obligation (which is written or is implied by law and
whether or not contingent) of a Participating Company
to Corp and/or plc under any non-financial guarantee
or indemnity (which is contractual or implied by law)
and which is given by Corp and/or plc and is: (A) in
favour of any person which is not a member of the
Marconi Group; (B) in respect of any contractual or
implied by law obligations of that Participating
Company and (C) set out in Part 1 of Schedule 5
(non-financial guarantees and indemnities given by
Corp or plc); provided that where any payment has
been made under such a guarantee or indemnity on or
before 31st March, 2002, the resultant counter
indemnity shall not be preserved under this clause
5.1 (b) (vi); and
(vii) any other preserved Claims set out in Part 1 of
Schedule 3 (Other Preserved Claims owed by
Participating Companies) expressed to be owing by it
and each such Claim shall remain in full force and effect
notwithstanding the provisions of this Agreement.
5.2 Waiver by Participating Companies
(a) With effect from the Effective Date, each Participating
Company hereby unconditionally and irrevocably waives and
releases Corp and/or plc from any Claim which it may have
against Corp and/or plc and which arises out of or in relation
to any matter or circumstance existing on or prior to the
Effective Date.
(b) The waiver and release contained in paragraph (a) above shall
not apply in relation to:
(i) any intra-group loan owed by Corp and/or plc to a
Participating Company and set out in Part 2 of
Schedule 2 (Intra-group loans owed by Corp and plc),
116
including interest accrued thereon at such applicable
commercial rate of interest agreed between the
parties;
(ii) any intra-group loan made to Corp by a Participating
Company on or after 1st January, 2003:
(A) in the ordinary and usual course of
business;
(B) with Creditor Consent,
including interest accrued thereon at such applicable
commercial rate of interest agreed between the parties;
(iii) any trading and current account liabilities owed by
Corp and/or plc to a Participating Company and
detailed in the management accounts upon which the
audited consolidated financial accounts of plc, as at
31st March, 2002 (in relation to each Trading and
Non-Trading Company) and as at 30th September, 2002
(in relation to each Dormant Company), have been
prepared, to the extent such trading and current
account liabilities remain outstanding;
(iv) any trading and current account liabilities owed by
Corp and/or plc to a Trading Company or a Non-Trading
Company and incurred after 31st March, 2002 in the
ordinary and usual course of Corp's and/or plc's (as
the case may be) business, to the extent such trading
and current account liabilities remain outstanding;
(v) any counter indemnity or equivalent reimbursement
obligation (which is written or is implied by law and
whether or not contingent) of Corp and/or plc to a
Participating Company under any financial guarantee
or indemnity (which is written or is implied by law)
and which is given by such Participating Company and
is: (A) in favour of any person which is not a member
of the Marconi Group (including the issuer of any
performance bond, bank guarantee or similar
instrument) and (B) in respect of any contractual
obligations of Corp and/or plc; provided that where
any payment has been made under such a guarantee or
indemnity on or before 31st March, 2002, the
resultant counter indemnity shall not be preserved
under this clause 5.2 (b) (v);
(vi) any counter indemnity or equivalent reimbursement
obligation (which is written or is implied by law and
whether or not contingent) of Corp and/or plc to a
Participating Company under any non-financial
guarantee or indemnity (which is contractual or
implied by law) and which is given by such
Participating Company and is: (A) in favour of any
person which is not a member of the Marconi Group;
(B) in respect of any contractual or implied by law
obligations of Corp and/or plc and (C) set out in
Part 2 of Schedule 5 (non-financial guarantees and
indemnities given by Participating Companies);
provided that where any payment has been made under
such a guarantee or indemnity on or before 31st
March, 2002, the resultant counter indemnity shall
not be preserved under this clause 5.2 (b) (vi); and
117
(vii) any other preserved Claim set out in Part 2 of
Schedule 3 (Other Preserved Claims owed by Corp and
plc) expressed to be owing by it,
and each such Claim shall remain in full force and effect
notwithstanding the provisions of this Agreement.
6. POST-EFFECTIVE DATE CLAIMS
6.1 Claims by Corp and plc
Corp, plc and each Participating Company agree that nothing contained
in this Agreement shall constitute a waiver or release by Corp and/or
plc of any Claim it may have against any Participating Company and
which arises out of or in relation to any matter or circumstance
arising after the Effective Date and which did not arise out of any
matter or circumstance existing on or prior to the Effective Date. For
the avoidance of doubt, any Claim of Corp and/or plc against any
Participating Company arising out of or in relation to any matter or
circumstance arising after the Effective Date, in respect of any
contract or arrangement entered into or arising by operation of law
prior to the Effective Date shall not be affected by this Agreement.
6.2 Claims by Participating Companies
Corp, plc and each Participating Company agree that nothing contained
in this Agreement shall constitute a waiver or release by any
Participating Company of any Claim it may have against Corp and/or plc
and which arises out of or in relation to any matter or circumstance
arising after the Effective Date and which did not arise out of any
matter or circumstance existing on or prior to the Effective Date. For
the avoidance of doubt, any Claim a Participating Company may have
against Corp and/or plc arising out of or in relation to any matter or
circumstance arising after the Effective Date, in respect of any
contract or arrangement entered into or arising by operation of law
prior to the Effective Date, shall not be affected by this Agreement.
7. REPRESENTATIONS AND WARRANTIES
Corp, plc and each Participating Company severally represents and
warrants to each other party that:
(a) it has all requisite power and authority to execute and
deliver this Agreement and to carry out the transactions
contemplated by, and perform its obligations under, this
Agreement, and that it has taken all action necessary to
authorise such execution and delivery and the performance of
such obligations;
(b) the execution and delivery by it of this Agreement, and the
performance by it of its obligations hereunder does not and
will not violate or conflict with any law, rule or regulation
applicable to it, any provisions of constitutional documents,
any order or judgment of any court or other agency or
government applicable to it nor require any registration,
filing, consent, approval, notice or other action to, with or
by, any governmental or other authority, court or regulatory
body, except as expressly provided in this Agreement; and
118
(c) this Agreement constitutes legal, valid and binding
obligations, enforceable against it in accordance with its
terms, except to the extent that enforcement may be limited by
bankruptcy, insolvency, reorganisation, moratorium or other
similar laws relating to or limiting creditors' rights
generally.
8. COSTS
Each party will be solely responsible for all costs and expenses
incurred by it in connection with the negotiation, preparation and
execution of this Agreement and for its compliance with the terms of
this Agreement.
9. NOTICES
(a) Any notice given in connection with this Agreement must be in
English. Any other document provided in connection with this
Agreement must be in English or accompanied by a certified
English translation; in this case, the English translation
prevails unless the document is a statutory or other official
document.
(b) Any notice or other formal communication given under this
Agreement must be in writing (which includes fax, but not
email) and may be delivered or sent by post or fax to the
party to be served at its address set out below or, where a
party accedes to this Agreement in accordance with clause 2,
as set out in the relevant Accession Letter:
CORP PLC
New Century Park New Century Park
XX Xxx 00 XX Xxx 00
Coventry Coventry
Warwickshire CV3 1HJ Xxxxxxxxxxxx XX0 0XX
Attn: Company Secretary Attn: Company Secretary
Fax: 000 0000 0000 Fax: 000 0000 0000
or at such other address or fax number as it may have notified
to the other parties in accordance with this clause. Any
notice or other document sent by post shall be sent by prepaid
first class post (if within the United Kingdom) or by prepaid
airmail (if elsewhere).
(c) Any notice or other formal communication shall be deemed to
have been given:
(i) if delivered, at the time of delivery; or
(ii) if posted, at 10.00 a.m. on the second Business Day
after it was put into the post; or
119
(iii) if sent by fax, on the date of transmission, if
transmitted before 3.00 p.m. on any Business Day, and
in any other case on the Business Day following the
date of transmission.
(d) In proving service of a notice or other formal communication,
it shall be sufficient to prove that delivery was made or that
the envelope containing the communication was properly
addressed and posted either by prepaid first class post or by
prepaid airmail, as the case may be or that the fax was
properly addressed and transmitted, as the case may be.
10. ASSIGNMENT
None of the parties to this Agreement may assign any of their
respective rights or obligations under this Agreement. This Agreement
is intended to bind and inure to the benefit of the parties and their
respective successors, permitted assignees, administrators and
representatives. The agreements, representations, warranties and
obligations of each of the parties to this Agreement are, in all
respects, several and not joint.
11. GENERAL
(a) This Agreement may be executed in one or more counterparts,
each of which will be deemed an original and all of which will
constitute one and the same Agreement and any party may enter
into this Agreement by executing a counterpart.
(b) Time is not of the essence in relation to any obligation under
this Agreement unless:
(i) time is expressly stated to be of the essence in
relation to that obligation; or
(ii) one party fails to perform an obligation by the time
specified in this Agreement and the other party
serves a notice on the defaulting party requiring it
to perform the obligation by a specified time and
stating that time is of the essence in relation to
that obligation.
(c) The rights of each party under this Agreement:
(i) may be exercised as often as necessary;
(ii) are cumulative and not exclusive of rights and
remedies provided by law; and
(iii) may be waived only in writing and specifically.
(d) A waiver (whether express or implied) by one of the parties of
any of the provisions of this Agreement or of any breach of or
default by the other party in performing any of those
provisions shall not constitute a continuing waiver and that
waiver shall not prevent the waiving party from subsequently
enforcing any of the provisions of this Agreement not waived
or from acting on any subsequent breach of or default by the
other party under any of the provisions of this Agreement.
(e) In the event that any provision of this Agreement is void and
unenforceable by reason of any applicable law, it shall be
deleted and the remaining provisions of this
120
Agreement shall continue in full force and effect, and if
required be so amended as necessary to give effect to the
spirit of this Agreement so far as possible.
12. ENTIRE AGREEMENT
(a) Each party acknowledges that in agreeing to enter into this
Agreement it has not relied on any representation, warranty,
collateral contract or other assurance (except those set out
in this Agreement) made by or on behalf of any other party
before the signature of this Agreement. Each party waives all
rights and remedies which, but for this subclause, might
otherwise be available to it in respect of any such
representation, warranty, collateral contract or other
assurance.
(b) Nothing in this preceding subclause limits or excludes any
liability for fraud.
13. THIRD PARTIES
No term of this Agreement is enforceable by a person who is not a party
to this Agreement.
14. GOVERNING LAW AND JURISDICTION
This Agreement will be governed by and construed in accordance with
English law. Each party irrevocably submits to the jurisdiction of the
English courts for all purposes relating to this Agreement.
15. SERVICE OF PROCESS
Without prejudice to any other mode of service allowed under any
relevant law, each Participating Company (other than those incorporated
in England and Wales):
(a) irrevocably appoints Corp as its agent for service of process
in relation to any proceedings before the English courts in
connection with this Agreement; and
(b) agrees that failure by a process agent to notify it of the
process will not invalidate the proceedings concerned.
121
SCHEDULE 1
INITIAL PARTICIPATING COMPANIES
PART 1
INITIAL TRADING COMPANIES
1. Marconi plc
2. Marconi Corporation plc
PART 2
INITIAL NON-TRADING COMPANIES
[No companies]
PART 3
INITIAL XXXXXX COMPANIES
[No companies]
122
SCHEDULE 2
INTRA-GROUP LOANS
PART 1
INTRA-GROUP LOANS OWED BY PARTICIPATING COMPANIES(2)
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
TRADING COMPANIES (MATERIAL)
------------------------------------------------------------------------------------
ALBANY PARTNERSHIP LIMITED 1,079,346.13
------------------------------------------------------------------------------------
GPT SPECIAL PROJECT MANAGEMENT
LIMITED
------------------------------------------------------------------------------------
MARCONI BONDING LIMITED 26,563,509.96
+ 32,851,191.00
+ 45,289,547.16
-------------
104,704,248.12
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS 49,115.00
INVESTMENTS LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(IRELAND)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED 126,924,380.22
(UK)
+ 7,166,659.40
+ 140,876,950.87
+1,547,667.62
+ 311,701,804.42
--------------
588,217,462.53
------------------------------------------------------------------------------------
------------------------
(2)
123
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS OPTICAL
NETWORKS LIMITED (IRELAND)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OVERSEAS SERVICES LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SOUTH
AFRICA PTY LIMITED
------------------------------------------------------------------------------------
MARCONI OPTICAL COMPONENTS 120,601,369.40
LIMITED
------------------------------------------------------------------------------------
MARCONI CORPORATION PLC 39,485,100.44
------------------------------------------------------------------------------------
MARCONI PLC 201,888,433.35
------------------------------------------------------------------------------------
MARCONI SOFTWARE SOLUTIONS 1,933,904.88
LIMITED
------------------------------------------------------------------------------------
METAPATH SOFTWARE 9,015,056.11
INTERNATIONAL LIMITED
------------------------------------------------------------------------------------
RONALDI LTD
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SA
(FRANCE)
------------------------------------------------------------------------------------
MNI TECNOLOGIASE E SISTEMAS DE 84,734.72
COMMUNICACAO SA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS B.V.
(NETHERLANDS)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GMBH
(GERMANY)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS REAL
ESTATE GMBH
------------------------------------------------------------------------------------
124
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS GMBH & CO KG
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS VER. GMBH
------------------------------------------------------------------------------------
BEIJING MARCONI COMMUNICATIONS
TECHNOLOGY CO LTD
------------------------------------------------------------------------------------
GEC (HONG KONG) LIMITED
------------------------------------------------------------------------------------
MARCONI AUSTRALIA PTY LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS ASIA 205,824.96
LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SOUTH
EAST ASIA PTE LTD
------------------------------------------------------------------------------------
THE GENERAL ELECTRIC COMPANY
OF SINGAPORE PRIVATE LIMITED
(NOW KNOWN AS MARCONI
SINGAPORE PTE LTD)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONSSPA
------------------------------------------------------------------------------------
MARCONI IBERIA SA
------------------------------------------------------------------------------------
MARCONI MOBILE ACCESS SPA
------------------------------------------------------------------------------------
MARCONI SUD SPA
------------------------------------------------------------------------------------
MARCONI INTERNATIONAL SPA
------------------------------------------------------------------------------------
125
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS DE
MEXICO SA DE CV
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS 31,374,720.05
TELEMULTI LIMITADA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS DO
BRASIL LTDA
------------------------------------------------------------------------------------
FORE SYSTEMS LIMITADA
------------------------------------------------------------------------------------
MARCONI COLUMBIA SA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS 481,426.26
ARGENTINA SA
------------------------------------------------------------------------------------
MARCONI VENEZUELA CA 310,597.59
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS OPTICAL 35,849,269.63
NETWORKS CORP
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
TECHNOLOGY INC
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS CANADA
INC
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS FEDERAL
INC
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS INC 105,206,236.80
------------------------------------------------------------------------------------
MARCONI INC
------------------------------------------------------------------------------------
MARCONI SOFTWARE INTERNATIONAL 1,098,889.13*
INC
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (US) INC
------------------------------------------------------------------------------------
-------------------------
* It is intended that this amount shall be assigned on or before the Record Date
to Corp as part of a Trade Receivable Assignment to be entered into by Corp and
plc
126
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
SYSTEMS MANAGEMENT SPECIALISTS 3,563,345.14*
INC
------------------------------------------------------------------------------------
MARCONI MIDDLE EAST (SAUDI
ARABIA)
------------------------------------------------------------------------------------
MARCONI MIDDLE EAST LLC (DUBAI)
------------------------------------------------------------------------------------
MARCONI APPLIED TECNOLOGIES SA
------------------------------------------------------------------------------------
SNC COMPOSANTS & CIE
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
NON-TRADING SUBSIDIARIES
------------------------------------------------------------------------------------
MARCONI PROPERTY LTD
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL 192,201.48
INDUSTRIES LIMITED
------------------------------------------------------------------------------------
XXXXXX STREET INVESTMENTS
LIMITED
------------------------------------------------------------------------------------
EA CONTINENTAL LIMITED 219,000,000*
------------------------------------------------------------------------------------
XXXXXXX-AUTOMATION HOLDINGS
LIMITED
------------------------------------------------------------------------------------
THE ENGLISH ELECTRIC COMPANY, 1,537,611.83
LIMITED
------------------------------------------------------------------------------------
MARCONI (XXXXXX XXXXXX) LIMITED + 203,281,257.20
+ 104,419,241.30
+ 529,343,428.50
--------------
837,043,927.00
------------------------------------------------------------------------------------
-----------------------
* It is intended that plc shall release this loan in consideration for the
assignment of the EA Continental Limited-Corp loan referred to below.
127
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
MARCONI (HOLDINGS) LIMITED
------------------------------------------------------------------------------------
MARCONI AEROSPACE UNLIMITED
------------------------------------------------------------------------------------
MARCONI CAPITAL LIMITED + 4,658,963.85
+ 27,174,596.79
-------------
31,833,560.64
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS AFRICA
(PTY) LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS LIMITED
------------------------------------------------------------------------------------
MARCONI (DGP1) LIMITED + 372,717,107.72
+ 7,474,093,94
------------
380,191,201.66
------------------------------------------------------------------------------------
MARCONI (DGP2) LIMITED + 372,717,107.72
+ 7,474,093,69
------------
380,191,201.41
------------------------------------------------------------------------------------
MARCONI (XXXXXXX AUTOMATION)
LIMITED
------------------------------------------------------------------------------------
MOBILE SYSTEMS INTERNATIONAL
HOLDINGS LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GMBH
(SWITZERLAND)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS 575,830.28
HOLDINGS GMBH (GERMANY)
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES LTD (NOW
------------------------------------------------------------------------------------
128
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
KNOWN AS
MARCONI AUSTRALIA HOLDINGS
PTY. LIMITED)
------------------------------------------------------------------------------------
MARCONI HOLDINGS SPA
------------------------------------------------------------------------------------
RELTEC MEXICO SA DE CV (NOW
KNOWN AS MARCONI
COMMUNICATIONS, S.A. DE C.V.)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(CANADA)
------------------------------------------------------------------------------------
FS FINANCE CORP
------------------------------------------------------------------------------------
FS HOLDING CORP
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS NORTH
AMERICA INC.
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS CANADA
HOLDINGS INC.
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS HOLDINGS INC.
------------------------------------------------------------------------------------
METAPATH SOFTWARE INTERNATIONAL INC. 20,535,178.28
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
LIMITED (BERMUDA) (NOW
KNOWN AS MARCONI
INTERNATIONAL LIMITED)
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
DORMANT SUBSIDIARIES
------------------------------------------------------------------------------------
A.B. DICK HOLDINGS LTD
------------------------------------------------------------------------------------
ARROW LTD
------------------------------------------------------------------------------------
ASSOCIATED AUTOMATION LTD
------------------------------------------------------------------------------------
129
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES HOLDINGS LTD
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES (MANCHESTER) LTD
------------------------------------------------------------------------------------
CLANVILLE LIMITED
------------------------------------------------------------------------------------
COMBINED ELECTRICAL MANUFACTURERS LTD
------------------------------------------------------------------------------------
COPPENHALL NOMINEES LIMITED
------------------------------------------------------------------------------------
DAYMO LTD
------------------------------------------------------------------------------------
FF CHRESTIAN & CO LTD
------------------------------------------------------------------------------------
GPT CONSUMER PRODUCTS LTD
------------------------------------------------------------------------------------
GPT PAYPHONE SYSTEMS LTD
------------------------------------------------------------------------------------
GPT RELIANCE LTD
------------------------------------------------------------------------------------
THE KINGSWAY HOUSING ASSOCIATION LTD
------------------------------------------------------------------------------------
KRAYFORD LTD
------------------------------------------------------------------------------------
LARNERWAY LTD
------------------------------------------------------------------------------------
LAYANA LIMITED 165,556.64
------------------------------------------------------------------------------------
XXXXXXX XXXXXXX
DEVELOPMENTS LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OPTICAL FIBRES LIMITED
------------------------------------------------------------------------------------
MARCONI (FIFTEEN) LIMITED
------------------------------------------------------------------------------------
196,822.17
------------------------------------------------------------------------------------
MARCONI (FIFTY-NINE) LTD
------------------------------------------------------------------------------------
130
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
MARCONI (FIFTY-THREE) LTD
------------------------------------------------------------------------------------
MARCONI (FORTY-FIVE) LIMITED
------------------------------------------------------------------------------------
MARCONI (FORTY-FOUR) LTD
------------------------------------------------------------------------------------
MARCONI (FORTY-THREE) LIMITED
------------------------------------------------------------------------------------
XXXXXXX X.X. LIMITED 283,500.00
------------------------------------------------------------------------------------
MARCONI MOBILE SYSTEMS LIMITED
------------------------------------------------------------------------------------
MARCONI (NINE) LIMITED
------------------------------------------------------------------------------------
MARCONI PHOTONICA LIMITED
------------------------------------------------------------------------------------
MARCONI (SIXTEEN) LIMITED
------------------------------------------------------------------------------------
MARCONI (SIXTY-NINE) LIMITED 801,146.76
------------------------------------------------------------------------------------
MARCONI (SIXTY-TWO) LTD 2,859,252.73
------------------------------------------------------------------------------------
MARCONI (THIRTEEN) LIMITED
------------------------------------------------------------------------------------
MARCONI (THIRTY-TWO) LIMITED
------------------------------------------------------------------------------------
MARCONI (TLC) LTD
------------------------------------------------------------------------------------
MARCONI (TWENTY-SEVEN) LIMITED
------------------------------------------------------------------------------------
MARCONI (WCGL) UNLIMITED
------------------------------------------------------------------------------------
XXXXXXXXX LIMITED
------------------------------------------------------------------------------------
METROPOLITAN-XXXXXXX
ELECTRICAL CO LTD
------------------------------------------------------------------------------------
131
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
MOBILE SYSTEMS GROUP LTD
------------------------------------------------------------------------------------
MOBILE SYSTEMS (HOLDINGS) LTD
------------------------------------------------------------------------------------
MOBILE SYSTEMS SERVICES LTD
------------------------------------------------------------------------------------
MOBILE SYSTEMS (UK) LTD
------------------------------------------------------------------------------------
THE M-O VALVE CO LTD 101,122.49
------------------------------------------------------------------------------------
MSI CELLULAR INVESMTNETS (ONE) LTD
------------------------------------------------------------------------------------
PALMAZ LTD
------------------------------------------------------------------------------------
PHOTONICA LIMITED
------------------------------------------------------------------------------------
PHOTONIQA LIMITED
------------------------------------------------------------------------------------
PYFORD LIMITED
------------------------------------------------------------------------------------
RAINFORD GROUP TRUSTEES LTD
------------------------------------------------------------------------------------
RAINFORD RACKS LTD
------------------------------------------------------------------------------------
RELTEC (COVENTRY) LTD
------------------------------------------------------------------------------------
XXXXXX XXXXXXXXXX & HAWTHORNS LTD
------------------------------------------------------------------------------------
THE ROTARY ENGINEERING COMPANY LIMITED 1,876.19
------------------------------------------------------------------------------------
SALPLEX LTD
------------------------------------------------------------------------------------
STYLES & XXXXXXX LIMITED
------------------------------------------------------------------------------------
TCL PROJECTS LIMITED
------------------------------------------------------------------------------------
ZIPBOND LTD
------------------------------------------------------------------------------------
132
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
THE VULCAN FOUNDRY LTD
------------------------------------------------------------------------------------
TRADING COMPANIES (OTHERS)
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES INTERNATIONAL
LIMITED
------------------------------------------------------------------------------------
FORE SYSTEMS LIMITED 87,021.00
------------------------------------------------------------------------------------
GPT MIDDLE EAST LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
(CIS) LIMITED
------------------------------------------------------------------------------------
MARCONI FINANCE PLC
------------------------------------------------------------------------------------
MARCONI FLEET MANAGEMENT LIMITED
------------------------------------------------------------------------------------
MARCONI INFORMATION SYSTEMS LIMITED 15,751,443.94
------------------------------------------------------------------------------------
MARCONI (NCP) LIMITED
------------------------------------------------------------------------------------
NETSCIENT LIMITED
------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES LIMITED
------------------------------------------------------------------------------------
TELEPHONE CABLES LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS 12,843,257.68
INTERNATIONAL LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS CHINA LIMITED 381,562.68
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS + 45,165,548.52
INTERNATIONAL HOLDINGS LIMITED + 41,726,156.51
+ 28,633,106.00
-------------
115,524,811.03
------------------------------------------------------------------------------------
XXXXXX STREET OVERSEAS 100,000.00
INVESTMENTS LIMITED
------------------------------------------------------------------------------------
133
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
XXXXXX STREET PARTNERSHIP + 965,313,353.52
+ 965,313,353.52
--------------
1,930,626,707.04
------------------------------------------------------------------------------------
MARCONI INDIA LIMITED + 2,590.85
+ 1,306,939.05
------------
1,309,529.90
------------------------------------------------------------------------------------
MARCONI (THIRTY-ONE) LIMITED 8,346.03
------------------------------------------------------------------------------------
HIGHROSE LIMITED 701,208,853.58
------------------------------------------------------------------------------------
ANCRANE
------------------------------------------------------------------------------------
XXXXX OF COLCHESTER
HOUSING SOCIETY LIMITED
------------------------------------------------------------------------------------
MARCONI INSURANCE LIMITED
------------------------------------------------------------------------------------
TETREL LIMITED
------------------------------------------------------------------------------------
RELTEC SERVICES (UK) LIMITED
------------------------------------------------------------------------------------
MARCONI ANSTY LIMITED
------------------------------------------------------------------------------------
MARCONI NOMINEES LIMITED
------------------------------------------------------------------------------------
YESLINK UNLIMITED
------------------------------------------------------------------------------------
ELLIOT AUTOMATION CONTINENTAL SA 226,500
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL NOMINEES LIMITED
------------------------------------------------------------------------------------
MARCONI DEFENSE OVERSEAS LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
GLOBAL NETWORKS LIMITED
------------------------------------------------------------------------------------
MARCONICOM LIMITED
------------------------------------------------------------------------------------
134
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
MICRO SCOPE LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL INVESTMENTS
LIMITED
------------------------------------------------------------------------------------
GPT (NEDERLAND) BV
------------------------------------------------------------------------------------
GEC OF PAKISTAN LIMITED 100,000.00
------------------------------------------------------------------------------------
GEC ZAMBIA LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS AB
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS BVBA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SARL
------------------------------------------------------------------------------------
MARCONI CHANNEL MARKETS GMBH
------------------------------------------------------------------------------------
AEI FURNACES PTY LTD
------------------------------------------------------------------------------------
XXXXXX INFORMATION TECHNOLOGY PTY LTD
------------------------------------------------------------------------------------
MARCONI NEW ZEALAND LIMITED
------------------------------------------------------------------------------------
MARCONI TELECOMMUNICATIONS
INDIA PRIVATE LTD
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (AUSTRALIA) PTY LTD
------------------------------------------------------------------------------------
METAPATH SOFTWARE INTERNATIONAL
(HONG KONG) LIMITED
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (INDIA)
------------------------------------------------------------------------------------
135
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
PRIVATE LIMITED
------------------------------------------------------------------------------------
MARCONI ACQUISITION CORP
------------------------------------------------------------------------------------
MARCONI FINANCE INC.
------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES INC. 3,035,284.87
------------------------------------------------------------------------------------
APT NEDERLANDS BV
------------------------------------------------------------------------------------
APT TELECOMMUNICIONES SL
------------------------------------------------------------------------------------
METAPATH SOFTWARE INTERNATIONAL AB
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL BRASIL LTDA
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (FRANCE) SA
------------------------------------------------------------------------------------
MARCONI PROJECTS HONG KONG LTD 22,311.00
------------------------------------------------------------------------------------
PART 2
INTRA-GROUP LOANS OWED BY CORP AND PLC*
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
TRADING COMPANIES
(MATERIAL)
------------------------------------------------------------------------------------
------------------------
* It is intended that all loan balances owed by plc shall be schemed as
part of the plc Scheme.
136
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
ALBANY PARTNERSHIP LIMITED
------------------------------------------------------------------------------------
GPT SPECIAL PROJECT MANAGEMENT 18,793,671.00
LIMITED
------------------------------------------------------------------------------------
MARCONI BONDING LIMITED 1.00
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INVESTMENTS LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED 56,000,765
(IRELAND)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED 1,863,584.92
(UK)
+ 6,962,341.40
+
150,000.00
----------
8,975,926.32
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS OPTICAL
NETWORKS LIMITED (IRELAND)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OVERSEAS SERVICES LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SOUTH
AFRICA PTY LIMITED
------------------------------------------------------------------------------------
MARCONI OPTICAL COMPONENTS 6,147,994.77
LIMITED
------------------------------------------------------------------------------------
MARCONI CORPORATION PLC 201,888,433.35
------------------------------------------------------------------------------------
MARCONI PLC 39,485,100.44
------------------------------------------------------------------------------------
MARCONI SOFTWARE SOLUTIONS 29,802,166.98
LIMITED
------------------------------------------------------------------------------------
METAPATH SOFTWARE + 1,797,945.28
------------------------------------------------------------------------------------
137
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
INTERNATIONAL LIMITED + 907,313.26
----------
2,705,258.54
------------------------------------------------------------------------------------
RONALDI LTD
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SA 5,233,196.47
(FRANCE)
------------------------------------------------------------------------------------
MNI TECNOLOGIASE E SISTEMAS DE
COMMUNICACAO SA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS B.V.
(NETHERLANDS)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GMBH 6,531,622.34
(GERMANY)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS REAL
ESTATE GMBH
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS GMBH & CO KG
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS VER. GMBH
------------------------------------------------------------------------------------
BEIJING MARCONI COMMUNICATIONS
TECHNOLOGY CO LTD
------------------------------------------------------------------------------------
GEC (HONG KONG) LIMITED 53,669,470.54
------------------------------------------------------------------------------------
MARCONI AUSTRALIA PTY LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS ASIA
LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SOUTH
EAST ASIA PTE LTD
------------------------------------------------------------------------------------
138
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
SGD7,450,000.00
THE GENERAL ELECTRIC COMPANY + GBP860,000.00
OF SINGAPORE PRIVATE LIMITED (Total equivalent to
(NOW KNOWN AS MARCONI GBP 3,527,955.88 as at
SINGAPORE PTE LTD) 31/12/02)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONSSPA
------------------------------------------------------------------------------------
MARCONI IBERIA SA 7,169,860.51
------------------------------------------------------------------------------------
MARCONI MOBILE ACCESS SPA
------------------------------------------------------------------------------------
MARCONI SUD SPA
------------------------------------------------------------------------------------
MARCONI INTERNATIONAL SPA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS DE
------------------------------------------------------------------------------------
MEXICO SA DE CV
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
TELEMULTI LIMITADA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS DO
BRASIL LTDA
------------------------------------------------------------------------------------
FORE SYSTEMS LIMITADA
------------------------------------------------------------------------------------
MARCONI COLUMBIA SA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
ARGENTINA SA
------------------------------------------------------------------------------------
MARCONI VENEZUELA CA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS OPTICAL
NETWORKS CORP
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
TECHNOLOGY INC
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
------------------------------------------------------------------------------------
139
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
CANADA INC
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS FEDERAL
INC
------------------------------------------------------------------------------------
3,001,537
MARCONI COMMUNICATIONS INC +
4,923,218.41
------------
7,924,755.41
------------------------------------------------------------------------------------
MARCONI INC 1,276,106,394.81
------------------------------------------------------------------------------------
MARCONI SOFTWARE INTERNATIONAL
INC
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (US) INC
------------------------------------------------------------------------------------
SYSTEMS MANAGEMENT SPECIALISTS
INC
------------------------------------------------------------------------------------
MARCONI MIDDLE EAST (SAUDI
ARABIA)
------------------------------------------------------------------------------------
MARCONI MIDDLE EAST LLC (DUBAI)
------------------------------------------------------------------------------------
MARCONI APPLIED TECNOLOGIES SA 12,263,858.23
------------------------------------------------------------------------------------
SNC COMPOSANTS & CIE 3,954,810.98
------------------------------------------------------------------------------------
NON-TRADING SUBSIDIARIES
------------------------------------------------------------------------------------
MARCONI PROPERTY LTD 1.00
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL 134,993,728.40
INDUSTRIES LIMITED
------------------------------------------------------------------------------------
XXXXXX STREET INVESTMENTS LIMITED 100.00
------------------------------------------------------------------------------------
140
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
EA CONTINENTAL LIMITED 363,308,102.03*
------------------------------------------------------------------------------------
XXXXXXX-AUTOMATION 78,486,756.70
HOLDINGS LIMITED
------------------------------------------------------------------------------------
THE ENGLISH ELECTRIC COMPANY, LIMITED 300,733,962.69
------------------------------------------------------------------------------------
MARCONI (XXXXXX STREET) LIMITED 871,397,961.00
------------------------------------------------------------------------------------
MARCONI (HOLDINGS) LIMITED 8,353,965.42
+ 287,395.99
----------
8,641,361.41
------------------------------------------------------------------------------------
MARCONI AEROSPACE UNLIMITED 69,607,029.63
------------------------------------------------------------------------------------
MARCONI CAPITAL LIMITED 2.00
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS 12,270,242.05
AFRICA (PTY) LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS LIMITED
------------------------------------------------------------------------------------
MARCONI (DGP1) LIMITED
------------------------------------------------------------------------------------
MARCONI (DGP2) LIMITED
------------------------------------------------------------------------------------
MARCONI (XXXXXXX AUTOMATION) LIMITED 21,867,755.03
------------------------------------------------------------------------------------
MOBILE SYSTEMS INTERNATIONAL
HOLDINGS LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
GMBH (SWITZERLAND)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS GMBH (GERMANY)
------------------------------------------------------------------------------------
------------------------
* It is intended that subject to certain creditor consent and prior to
the Record Date this amount shall be assigned to Ancrane by an
assignment between EA Continental Limited and plc and then assigned to
Ancrane by an assignment between Ancrane and plc.
141
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL 130,149,000.00
INDUSTRIES LTD (NOW
KNOWN AS MARCONI
AUSTRALIA HOLDINGS PTY
LIMITED)
------------------------------------------------------------------------------------
MARCONI HOLDINGS SPA
------------------------------------------------------------------------------------
RELTEC MEXICO SA DE
CV (NOW KNOWN AS
MARCONI COMMUNICATIONS,
S.A. DE C.V.)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
LIMITED (CANADA)
------------------------------------------------------------------------------------
FS FINANCE CORP
------------------------------------------------------------------------------------
FS HOLDING CORP
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
NORTH AMERICA INC.
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
CANADA HOLDINGS INC.
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS INC.
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL INC.
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS 3,224,189.35
LIMITED (BERMUDA) (NOW
KNOWN AS MARCONI
INTERNATIONAL LIMITED)
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
DORMANT SUBSIDIARIES
------------------------------------------------------------------------------------
A.B. DICK HOLDINGS LTD 7,308,638.58
------------------------------------------------------------------------------------
ARROW LTD 49,958.87
------------------------------------------------------------------------------------
142
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
ASSOCIATED AUTOMATION LTD 2,723,292.41
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES HOLDINGS LTD
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES (MANCHESTER)
LTD
------------------------------------------------------------------------------------
CLANVILLE LIMITED 1.00
------------------------------------------------------------------------------------
COMBINED ELECTRICAL MANUFACTURERS LTD 6,895,676.71
------------------------------------------------------------------------------------
COPPENHALL NOMINEES LIMITED
------------------------------------------------------------------------------------
DAYMO LTD
------------------------------------------------------------------------------------
FF CHRESTIAN & CO LTD 34,944.36
------------------------------------------------------------------------------------
GPT CONSUMER PRODUCTS LTD
------------------------------------------------------------------------------------
GPT PAYPHONE SYSTEMS LTD
------------------------------------------------------------------------------------
GPT RELIANCE LTD
------------------------------------------------------------------------------------
THE KINGSWAY HOUSING 1,280,159.82
ASSOCIATION LTD
------------------------------------------------------------------------------------
KRAYFORD LTD
------------------------------------------------------------------------------------
LARNERWAY LTD
------------------------------------------------------------------------------------
LAYANA LIMITED
------------------------------------------------------------------------------------
XXXXXXX XXXXXXX
DEVELOPMENTS LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OPTICAL FIBRES LIMITED
------------------------------------------------------------------------------------
143
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
MARCONI (FIFTEEN) LIMITED
------------------------------------------------------------------------------------
MARCONI (FIFTY-NINE) LTD
------------------------------------------------------------------------------------
MARCONI (FIFTY-THREE) LTD 151,087.68
------------------------------------------------------------------------------------
MARCONI (FORTY-FIVE) LIMITED
------------------------------------------------------------------------------------
MARCONI (FORTY-FOUR) LTD
------------------------------------------------------------------------------------
MARCONI (FORTY-THREE) LIMITED
------------------------------------------------------------------------------------
XXXXXXX X.X. LIMITED
------------------------------------------------------------------------------------
MARCONI MOBILE SYSTEMS LIMITED
------------------------------------------------------------------------------------
MARCONI (NINE) LIMITED 141,080.92
------------------------------------------------------------------------------------
MARCONI PHOTONICA LIMITED
------------------------------------------------------------------------------------
MARCONI (SIXTEEN) LIMITED 1,250,099.99
------------------------------------------------------------------------------------
MARCONI (SIXTY-NINE) LIMITED 1,119,739.39
------------------------------------------------------------------------------------
MARCONI (SIXTY-TWO) LTD
------------------------------------------------------------------------------------
MARCONI (THIRTEEN) LIMITED
------------------------------------------------------------------------------------
MARCONI (THIRTY-TWO) LIMITED 107,416.44
------------------------------------------------------------------------------------
MARCONI (TLC) LTD
------------------------------------------------------------------------------------
MARCONI (TWENTY-SEVEN) LIMITED 1,542,489.94
------------------------------------------------------------------------------------
MARCONI (WCGL) UNLIMITED 1,853,074.20
------------------------------------------------------------------------------------
144
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
XXXXXXXXX LIMITED 5,075,000.00
------------------------------------------------------------------------------------
METROPOLITAN-XXXXXXX ELECTRICAL CO LTD
------------------------------------------------------------------------------------
MOBILE SYSTEMS GROUP LTD
------------------------------------------------------------------------------------
MOBILE SYSTEMS (HOLDINGS) LTD
------------------------------------------------------------------------------------
MOBILE SYSTEMS SERVICES LTD
------------------------------------------------------------------------------------
MOBILE SYSTEMS (UK) LTD
------------------------------------------------------------------------------------
THE M-O VALVE CO LTD
------------------------------------------------------------------------------------
MSI CELLULAR INVESMTNETS (ONE) LTD
------------------------------------------------------------------------------------
PALMAZ LTD
------------------------------------------------------------------------------------
PHOTONICA LIMITED 76,009.00
------------------------------------------------------------------------------------
PHOTONIQA LIMITED 1.00
------------------------------------------------------------------------------------
PYFORD LIMITED
------------------------------------------------------------------------------------
RAINFORD GROUP TRUSTEES LTD
------------------------------------------------------------------------------------
RAINFORD RACKS LTD
------------------------------------------------------------------------------------
RELTEC (COVENTRY) LTD
------------------------------------------------------------------------------------
XXXXXX XXXXXXXXXX & HAWTHORNS LTD
------------------------------------------------------------------------------------
THE ROTARY ENGINEERING COMPANY LIMITED
------------------------------------------------------------------------------------
SALPLEX LTD 92,386.96
------------------------------------------------------------------------------------
STYLES & XXXXXXX LIMITED
------------------------------------------------------------------------------------
145
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
TCL PROJECTS LIMITED
------------------------------------------------------------------------------------
ZIPBOND LTD 6,731,913.50
------------------------------------------------------------------------------------
THE VULCAN FOUNDRY LTD
------------------------------------------------------------------------------------
TRADING SUBSIDIARIES (OTHERS)
------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL 76,913.47
INDUSTRIES INTERNATIONAL LIMITED
------------------------------------------------------------------------------------
FORE SYSTEMS LIMITED
------------------------------------------------------------------------------------
GPT MIDDLE EAST LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS (CIS) LIMITED
------------------------------------------------------------------------------------
MARCONI FINANCE PLC 2,775,111.02
------------------------------------------------------------------------------------
MARCONI FLEET MANAGEMENT LIMITED 1,292,411.63
------------------------------------------------------------------------------------
MARCONI INFORMATION SYSTEMS LIMITED 54,945.94
------------------------------------------------------------------------------------
MARCONI (NCP) LIMITED
------------------------------------------------------------------------------------
NETSCIENT LIMITED
------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES LIMITED
------------------------------------------------------------------------------------
TELEPHONE CABLES LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS 7,065,000.00
INTERNATIONAL LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
CHINA LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL HOLDINGS LIMITED
------------------------------------------------------------------------------------
146
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
XXXXXX STREET
OVERSEAS INVESTMENTS LIMITED
------------------------------------------------------------------------------------
XXXXXX STREET PARTNERSHIP
------------------------------------------------------------------------------------
MARCONI INDIA LIMITED
------------------------------------------------------------------------------------
MARCONI (THIRTY-ONE) LIMITED
------------------------------------------------------------------------------------
HIGHROSE LIMITED
------------------------------------------------------------------------------------
ANCRANE
14,635,059.00
+ an amount
approximately equal to
387,403,015.00
(stemming from four
separate bond issues of
(1)E256,735,000;
(2)E67,868,000; (3)
US$131,011,000; and (4)
US$130,090,000)
------------------------------------------------------------------------------------
XXXXX OF COLCHESTER
HOUSING SOCIETY LIMITED
------------------------------------------------------------------------------------
MARCONI INSURANCE LIMITED
------------------------------------------------------------------------------------
TETREL LIMITED
------------------------------------------------------------------------------------
RELTEC SERVICES (UK) LIMITED
------------------------------------------------------------------------------------
MARCONI ANSTY LIMITED
------------------------------------------------------------------------------------
MARCONI NOMINEES LIMITED
------------------------------------------------------------------------------------
YESLINK UNLIMITED
------------------------------------------------------------------------------------
ELLIOT AUTOMATION CONTINENTAL SA
------------------------------------------------------------------------------------
147
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL NOMINEES
LIMITED
------------------------------------------------------------------------------------
MARCONI DEFENSE OVERSEAS LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GLOBAL
NETWORKS LIMITED
------------------------------------------------------------------------------------
MARCONICOM LIMITED
------------------------------------------------------------------------------------
MICRO SCOPE LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL INVESTMENTS
LIMITED
------------------------------------------------------------------------------------
GPT (NEDERLAND) BV
------------------------------------------------------------------------------------
GEC OF PAKISTAN LIMITED
------------------------------------------------------------------------------------
GEC ZAMBIA LIMITED 154,866.00
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS AB
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS BVBA
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SARL
------------------------------------------------------------------------------------
MARCONI CHANNEL MARKETS GMBH
------------------------------------------------------------------------------------
AEI FURNACES PTY LTD
------------------------------------------------------------------------------------
XXXXXX INFORMATION
TECHNOLOGY PTY LTD
------------------------------------------------------------------------------------
MARCONI NEW ZEALAND LIMITED
------------------------------------------------------------------------------------
MARCONI
TELECOMMUNICATIONS
------------------------------------------------------------------------------------
148
LOAN BALANCES L
(Loan balances as at 31st December, 2002 (to the extent such loan balances
remain outstanding))
OWED TO PLC OWED BY CORP
------------------------------------------------------------------------------------
INDIA PRIVATE LTD
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (AUSTRALIA) PTY LTD
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (HONG KONG) LIMITED
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (INDIA) PRIVATE LIMITED
------------------------------------------------------------------------------------
MARCONI ACQUISITION CORP
------------------------------------------------------------------------------------
MARCONI FINANCE INC.
------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES INC.
------------------------------------------------------------------------------------
APT NEDERLANDS BV
------------------------------------------------------------------------------------
APT TELECOMMUNICIONES SL
------------------------------------------------------------------------------------
METAPATH SOFTWARE INTERNATIONAL AB
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL BRASIL LTDA
------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (FRANCE) SA
------------------------------------------------------------------------------------
MARCONI PROJECTS HONG KONG LTD 55,454.23
------------------------------------------------------------------------------------
149
SCHEDULE 3
OTHER PRESERVED CLAIMS
PART 1
OTHER PRESERVED CLAIMS OWED BY PARTICIPATING COMPANIES
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
TRADING COMPANIES (MATERIAL)
------------------------------------------------------------------------------------
ALBANY PARTNERSHIP LIMITED
------------------------------------------------------------------------------------
GPT SPECIAL PROJECT MANAGEMENT
LIMITED
------------------------------------------------------------------------------------
MARCONI BONDING LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INVESTMENTS LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED 2,659,104.80
(IRELAND)
Trading balance transferred
to Corp on disposal of
Mobile business
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(UK)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS OPTICAL
NETWORKS LIMITED (IRELAND)
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OVERSEAS SERVICES LIMITED
------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SOUTH
AFRICA PTY LIMITED
------------------------------------------------------------------------------------
MARCONI OPTICAL COMPONENTS
LIMITED
------------------------------------------------------------------------------------
MARCONI CORPORATION PLC Balance owed to
plc by Corp of
L195k arising
from disposal of
Mobile business.
------------------------------------------------------------------------------------
150
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
Plc has no
record of debt
and as such it
is being written
back to capital
projects in
March 2003
------------------------------------------------------------------------------------
MARCONI PLC EXCHANGE AGREEMENT -
PURCHASE OF SHARES IN
SYSTEMS MANAGEMENT
SPECIALISTS, INC. in
exchange for shares in
Marconi plc (22nd May, 2000)
with a follow-up share sale
agreement from plc to Corp
Outstanding liabilities as
follows: minimal capacity,
trading and regulatory
warranties; certain
covenants; and indemnity
given to Xxxxxx Xxxxxx
for any losses, damages,
costs etc incurred in
connection with the breach
of any representation,
warranty or covenant.
Following on from the first
share sale agreement, plc
entered into an agreement
for the sale and purchase
of shares in Systems
Management Specialists, Inc.
with Corp under which the
obligations under the
original agreement were
mirrored between purchaser
and seller in the
intra-group sale
agreement. (18th July,
2000).
SHARE SALE AND PURCHASE
AGREEMENT RELATING TO THE
ACQUISITION OF ALBANY
PARTNERSHIP LIMITED from AJC
Elliman, Xxxxxx Xxxxx and
Dolphin Head Group Holdings
Plc to Plc ("Vendors")
(28th July, 2000) with a
follow-up intra
------------------------------------------------------------------------------------
151
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
group share sale agreement
from Plc to Corp.
Liabilities outstanding as
follows:
Plc warrants to the Vendors,
their estates and PRs that
at the date of the
Agreement: it is a
corporation duly
incorporated and validly
existing under the laws
of England and Wales; it
has the corporate power to
perform all its obligations
under and as envisaged by
the Agreement; the
execution or performance of
the Agreement by Plc does
not contravene any
provision of its memorandum
or articles of association
or any agreement created by
Plc or any law; and Plc has
full power and has procured
all corporate consents for
the execution and
performance by it of the
Agreement, which has been
executed in compliance with
its constitutional
documents and applicable
law. Under a related Tax
Deed dated 28th July, 2000,
Plc covenants to pay on
demand to the Vendors,
their estates and PRs an
amount equal to the amount
of any liability of
the Vendors or any Company
prior to Completion:
pursuant to section 767A,
767AA and 767B Taxes Act by
reason of the failure of
the Company to disclose a
liability to corporation
tax; and which results from
the Vendors or such other
------------------------------------------------------------------------------------
152
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
------------------------------------------------------------------------------------
company being treated as
a member of the same group
as a Company for VAT
purposes during any
prescribed accounting
period which was current at
Completion.
Under a Share Sale
Agreement (undated) Plc
sold its shares in Albany
Partnership Limited to Corp
and the various obligations
contained in the original
sale agreement were
mirrored between purchaser
and seller in the intra-
group sale agreement.
ACQUISITION OF MARIPOSA
TECHNOLOGY, INC BY WAY OF
MERGER WITH MARCONI ACQ.
(20th September, 2000)
It appears the liabilities
under this acquisition were
assigned to Corp from PLC on
18th October, 2000 pursuant
to an Assignment Agreement,
but under the assignment
clause, Plc still remains
liable.
Liabilities outstanding as
follows:
1. indemnity to selling
stockholders for costs,
losses, damages etc arising
in respect of breaches of
representations or
warranties in the merger
agreement/other documents;
2. limited warranties
given (along with Marconi
Acquisition Sub)
reorganisation, consents and
approvals, capitalisation
and
------------------------------------------------------------------------------------
153
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
various mechanical/admin
steps; and
3. bonus payments under
two employment contracts
plus indemnity for income
tax assessed on these
employees in respect of
certain employee share
options.
-------------------------------------------------------------------------------------------
MARCONI SOFTWARE
SOLUTIONS LIMITED
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL LIMITED
-------------------------------------------------------------------------------------------
RONALDI LTD
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SA (FRANCE)
-------------------------------------------------------------------------------------------
MNI TECNOLOGIASE E
SISTEMAS DE
COMMUNICACAO SA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
B.V. (NETHERLANDS)
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS 255,529.70
GmbH (GERMANY)
Trading balance transferred
to Corp on disposal of
Mobile business
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
REAL ESTATE GmbH
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS GmbH
& CO KG
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS VER.
GmbH
-------------------------------------------------------------------------------------------
154
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
BEIJING MARCONI
COMMUNICATIONS
TECHNOLOGY CO LTD
-------------------------------------------------------------------------------------------
GEC (HONG KONG)
LIMITED
-------------------------------------------------------------------------------------------
MARCONI AUSTRALIA PTY
LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
ASIA LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOUTH EAST ASIA PTE LTD
-------------------------------------------------------------------------------------------
THE GENERAL ELECTRIC
COMPANY OF SINGAPORE
PRIVATE LIMITED (NOW
KNOWN AS MARCONI
SINGAPORE PTE LTD)
-------------------------------------------------------------------------------------------
MARCONI
COMMUNICATIONSSPA
-------------------------------------------------------------------------------------------
MARCONI IBERIA SA
-------------------------------------------------------------------------------------------
MARCONI MOBILE ACCESS
SpA
-------------------------------------------------------------------------------------------
MARCONI SUD SPA 6,518.06
Amount owed as part of
Jabil outsourcing transaction
17,846,339.36
Balance due to corp by
Marconi Sud as per debt
agreement 31st July 2002.
(Project Saturn)
-------------------------------------------------------------------------------------------
MARCONI INTERNATIONAL
SpA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
DE MEXICO SA DE CV
-------------------------------------------------------------------------------------------
155
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
TELEMULTI LIMITADA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
DO BRASIL LTDA
-------------------------------------------------------------------------------------------
FORE SYSTEMS LIMITADA
-------------------------------------------------------------------------------------------
MARCONI COLUMBIA SA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
ARGENTINA SA
-------------------------------------------------------------------------------------------
MARCONI VENEZUELA CA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OPTICAL NETWORKS CORP
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
TECHNOLOGY INC
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
CANADA INC
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
FEDERAL INC
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INC
-------------------------------------------------------------------------------------------
MARCONI INC
-------------------------------------------------------------------------------------------
MARCONI SOFTWARE
INTERNATIONAL INC
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (US) INC
-------------------------------------------------------------------------------------------
SYSTEMS MANAGEMENT
SPECIALISTS INC
-------------------------------------------------------------------------------------------
MARCONI MIDDLE EAST
(SAUDI ARABIA)
-------------------------------------------------------------------------------------------
MARCONI MIDDLE EAST LLC
(DUBAI)
-------------------------------------------------------------------------------------------
156
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
MARCONI APPLIED
TECNOLOGIES SA
-------------------------------------------------------------------------------------------
SNC COMPOSANTS & CIE
-------------------------------------------------------------------------------------------
NON-TRADING SUBSIDIARIES
-------------------------------------------------------------------------------------------
MARCONI PROPERTY LTD
-------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES LIMITED
-------------------------------------------------------------------------------------------
XXXXXX STREET INVESTMENTS
LIMITED
-------------------------------------------------------------------------------------------
EA CONTINENTAL LIMITED
-------------------------------------------------------------------------------------------
XXXXXXX-AUTOMATION
HOLDINGS LIMITED
-------------------------------------------------------------------------------------------
THE ENGLISH ELECTRIC
COMPANY, LIMITED
-------------------------------------------------------------------------------------------
MARCONI (XXXXXX STREET)
LIMITED
-------------------------------------------------------------------------------------------
MARCONI (HOLDINGS)
LIMITED
-------------------------------------------------------------------------------------------
MARCONI AEROSPACE
UNLIMITED
-------------------------------------------------------------------------------------------
MARCONI CAPITAL LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
AFRICA (PTY) LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS LIMITED
-------------------------------------------------------------------------------------------
MARCONI (DGP1) LIMITED
-------------------------------------------------------------------------------------------
MARCONI (DGP2) LIMITED
-------------------------------------------------------------------------------------------
157
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
MARCONI (XXXXXXX
AUTOMATION) LIMITED
-------------------------------------------------------------------------------------------
MOBILE SYSTEMS
INTERNATIONAL HOLDINGS
LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
GmbH (SWITZERLAND)
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS GmbH
(GERMANY)
-------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES LTD (NOW
KNOWN AS MARCONI
AUSTRALIA HOLDINGS PTY
LIMITED)
-------------------------------------------------------------------------------------------
MARCONI HOLDINGS SpA
-------------------------------------------------------------------------------------------
RELTEC MEXICO SA DE
CV (NOW KNOWN AS
MARCONI COMMUNICATIONS,
S.A. DE C.V.)
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
LIMITED (CANADA)
-------------------------------------------------------------------------------------------
FS FINANCE CORP $1 billion obligation of FS
corp to pay Marconi
Corporation plc under the
"repo finance" clause, used
to purchase Fore Systems in
1999.
-------------------------------------------------------------------------------------------
FS HOLDING CORP
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
NORTH AMERICA INC.
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
CANADA HOLDINGS INC.
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS INC.
-------------------------------------------------------------------------------------------
158
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL INC.
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
LIMITED (BERMUDA) (NOW
KNOWN AS MARCONI
INTERNATIONAL LIMITED)
-------------------------------------------------------------------------------------------
DORMANT SUBSIDIARIES
-------------------------------------------------------------------------------------------
A.B. DICK HOLDINGS LTD
-------------------------------------------------------------------------------------------
ARROW LTD
-------------------------------------------------------------------------------------------
ASSOCIATED AUTOMATION
LTD
-------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES HOLDINGS LTD
-------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES (MANCHESTER)
LTD
-------------------------------------------------------------------------------------------
CLANVILLE LIMITED
-------------------------------------------------------------------------------------------
COMBINED ELECTRICAL
MANUFACTURERS LTD
-------------------------------------------------------------------------------------------
COPPENHALL NOMINEES
LIMITED
-------------------------------------------------------------------------------------------
DAYMO LTD
-------------------------------------------------------------------------------------------
FF CHRESTIAN & CO LTD
-------------------------------------------------------------------------------------------
GPT CONSUMER PRODUCTS
LTD
-------------------------------------------------------------------------------------------
GPT PAYPHONE SYSTEMS
LTD
-------------------------------------------------------------------------------------------
GPT RELIANCE LTD
-------------------------------------------------------------------------------------------
THE KINGSWAY HOUSING
ASSOCIATION LTD
-------------------------------------------------------------------------------------------
159
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
KRAYFORD LTD
-------------------------------------------------------------------------------------------
LARNERWAY LTD
-------------------------------------------------------------------------------------------
LAYANA LIMITED
-------------------------------------------------------------------------------------------
XXXXXXX XXXXXXX
DEVELOPMENTS LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OPTICAL FIBRES LIMITED
-------------------------------------------------------------------------------------------
MARCONI (FIFTEEN) LIMITED
-------------------------------------------------------------------------------------------
MARCONI (FIFTY-NINE) LTD
-------------------------------------------------------------------------------------------
MARCONI (FIFTY-THREE) LTD
-------------------------------------------------------------------------------------------
MARCONI (FORTY-FIVE)
LIMITED
-------------------------------------------------------------------------------------------
MARCONI (FORTY-FOUR) LTD
-------------------------------------------------------------------------------------------
MARCONI (FORTY-THREE)
LIMITED
-------------------------------------------------------------------------------------------
XXXXXXX X.X. LIMITED
-------------------------------------------------------------------------------------------
MARCONI MOBILE SYSTEMS
LIMITED
-------------------------------------------------------------------------------------------
MARCONI (NINE) LIMITED
-------------------------------------------------------------------------------------------
MARCONI PHOTONICA
LIMITED
-------------------------------------------------------------------------------------------
MARCONI (SIXTEEN) LIMITED
-------------------------------------------------------------------------------------------
MARCONI (SIXTY-NINE)
LIMITED
-------------------------------------------------------------------------------------------
MARCONI (SIXTY-TWO) LTD
-------------------------------------------------------------------------------------------
MARCONI (THIRTEEN)
LIMITED
-------------------------------------------------------------------------------------------
160
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
MARCONI (THIRTY-TWO)
LIMITED
-------------------------------------------------------------------------------------------
MARCONI (TLC) LTD
-------------------------------------------------------------------------------------------
MARCONI (TWENTY-SEVEN)
LIMITED
-------------------------------------------------------------------------------------------
MARCONI (WCGL)
UNLIMITED
-------------------------------------------------------------------------------------------
XXXXXXXXX LIMITED
-------------------------------------------------------------------------------------------
METROPOLITAN-XXXXXXX
ELECTRICAL CO LTD
-------------------------------------------------------------------------------------------
MOBILE SYSTEMS GROUP
LTD
-------------------------------------------------------------------------------------------
MOBILE SYSTEMS (HOLDINGS)
LTD
-------------------------------------------------------------------------------------------
MOBILE SYSTEMS SERVICES
LTD
-------------------------------------------------------------------------------------------
MOBILE SYSTEMS (UK) LTD
-------------------------------------------------------------------------------------------
THE M-O VALVE CO LTD
-------------------------------------------------------------------------------------------
MSI CELLULAR INVESMTNETS
(ONE) LTD
-------------------------------------------------------------------------------------------
PALMAZ LTD
-------------------------------------------------------------------------------------------
PHOTONICA LIMITED
-------------------------------------------------------------------------------------------
PHOTONIQA LIMITED
-------------------------------------------------------------------------------------------
PYFORD LIMITED
-------------------------------------------------------------------------------------------
RAINFORD GROUP TRUSTEES
LTD
-------------------------------------------------------------------------------------------
RAINFORD RACKS LTD
-------------------------------------------------------------------------------------------
RELTEC (COVENTRY) LTD
-------------------------------------------------------------------------------------------
161
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
XXXXXX XXXXXXXXXX &
HAWTHORNS LTD
-------------------------------------------------------------------------------------------
THE ROTARY ENGINEERING
COMPANY LIMITED
-------------------------------------------------------------------------------------------
SALPLEX LTD
-------------------------------------------------------------------------------------------
STYLES & XXXXXXX LIMITED
-------------------------------------------------------------------------------------------
TCL PROJECTS LIMITED
-------------------------------------------------------------------------------------------
ZIPBOND LTD
-------------------------------------------------------------------------------------------
THE VULCAN FOUNDRY LTD
-------------------------------------------------------------------------------------------
TRADING SUBSIDIARIES
(OTHERS)
-------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES INTERNATIONAL
LIMITED
-------------------------------------------------------------------------------------------
FORE SYSTEMS LIMITED
-------------------------------------------------------------------------------------------
GPT MIDDLE EAST LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
(CIS) LIMITED
-------------------------------------------------------------------------------------------
MARCONI FINANCE plc
-------------------------------------------------------------------------------------------
MARCONI FLEET
MANAGEMENT LIMITED
-------------------------------------------------------------------------------------------
MARCONI INFORMATION
SYSTEMS LIMITED
-------------------------------------------------------------------------------------------
MARCONI (NCP) LIMITED
-------------------------------------------------------------------------------------------
NETSCIENT LIMITED
-------------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES
LIMITED
-------------------------------------------------------------------------------------------
TELEPHONE CABLES LIMITED
-------------------------------------------------------------------------------------------
162
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
CHINA LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL HOLDINGS
LIMITED
-------------------------------------------------------------------------------------------
XXXXXX STREET OVERSEAS
INVESTMENTS LIMITED
-------------------------------------------------------------------------------------------
XXXXXX STREET PARTNERSHIP
-------------------------------------------------------------------------------------------
MARCONI INDIA LIMITED
-------------------------------------------------------------------------------------------
MARCONI (THIRTY-ONE)
LIMITED
-------------------------------------------------------------------------------------------
HIGHROSE LIMITED
-------------------------------------------------------------------------------------------
ANCRANE
-------------------------------------------------------------------------------------------
XXXXX OF COLCHESTER
HOUSING SOCIETY LIMITED
-------------------------------------------------------------------------------------------
MARCONI INSURANCE
LIMITED
-------------------------------------------------------------------------------------------
TETREL LIMITED
-------------------------------------------------------------------------------------------
RELTEC SERVICES (UK)
LIMITED
-------------------------------------------------------------------------------------------
MARCONI ANSTY LIMITED
-------------------------------------------------------------------------------------------
MARCONI NOMINEES
LIMITED
-------------------------------------------------------------------------------------------
YESLINK UNLIMITED
-------------------------------------------------------------------------------------------
ELLIOT AUTOMATION
CONTINENTAL SA
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL NOMINEES
-------------------------------------------------------------------------------------------
163
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
LIMITED
-------------------------------------------------------------------------------------------
MARCONI DEFENSE OVERSEAS
LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
GLOBAL NETWORKS LIMITED
-------------------------------------------------------------------------------------------
MARCONICOM LIMITED
-------------------------------------------------------------------------------------------
MICRO SCOPE LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL INVESTMENTS
LIMITED
-------------------------------------------------------------------------------------------
GPT (NEDERLAND) BV
-------------------------------------------------------------------------------------------
GEC OF PAKISTAN LIMITED
-------------------------------------------------------------------------------------------
GEC ZAMBIA LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
AB
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
BVBA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SARL
-------------------------------------------------------------------------------------------
MARCONI CHANNEL MARKETS
GmbH
-------------------------------------------------------------------------------------------
AEI FURNACES PTY LTD
-------------------------------------------------------------------------------------------
XXXXXX INFORMATION
TECHNOLOGY PTY LTD
-------------------------------------------------------------------------------------------
MARCONI NEW ZEALAND
LIMITED
-------------------------------------------------------------------------------------------
MARCONI
TELECOMMUNICATIONS
INDIA PRIVATE LTD
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (AUSTRALIA)
-------------------------------------------------------------------------------------------
164
OTHER LIABILITIES
(Excluding trading and current account liabilities)
OWED TO PLC OWED TO CORP
-------------------------------------------------------------------------------------------
PTY LTD
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (HONG KONG)
LIMITED
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (INDIA) PRIVATE
LIMITED
-------------------------------------------------------------------------------------------
MARCONI ACQUISITION CORP
-------------------------------------------------------------------------------------------
MARCONI FINANCE INC.
-------------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES
INC.
-------------------------------------------------------------------------------------------
APT NEDERLANDS BV
-------------------------------------------------------------------------------------------
APT TELECOMMUNICIONES
SL
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL AB
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL BRASIL LTDA
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (FRANCE) SA
-------------------------------------------------------------------------------------------
MARCONI PROJECTS HONG
KONG LTD
-------------------------------------------------------------------------------------------
165
SCHEDULE 4
ACCESSION LETTER
To: Marconi plc, Marconi Corporation plc and each other party to the
Statement and Waiver Agreement referred to below
From: [NAME OF PARTICIPATING COMPANY] (the ACCEDING COMPANY)]
Dated:
Dear Sirs,
We refer to the Statement and Waiver of Intercompany Balances dated [ ] and
entered into by, inter alios, Marconi plc, Marconi Corporation plc, and each of
the Participating Companies (defined therein), (the STATEMENT AND WAIVER
AGREEMENT). This is an Accession Letter. Terms defined in the Statement and
Waiver Agreement have the same meaning in this Accession Letter.
1. ACCESSION
The Acceding Company agrees to accede to the Statement and Waiver
Agreement as a [Trading Company/Non-Trading Company/Dormant Company]
(*) and to be bound by the terms of the Statement and Waiver Agreement
and undertakes to perform all the obligations expressed in the
Statement and Waiver Agreement to be assumed by a [Trading
Company/Non-Trading Company/Dormant Company] (*) and agrees to be bound
by all the provisions of the Statement and Waiver Agreement, as if it
were an original party to the Statement and Waiver Agreement and that
all the obligations assumed by it under the Statement and Waiver
Agreement are legal, valid and binding.
2. STATEMENT OF INTRA-GROUP LOANS
2.1 Corp and plc each confirms, to the best of its knowledge and belief,
that the loan balances set out opposite its name in Part 1 of Schedule
2 (Intra-group loans owed by Participating Companies) to the Statement
and Waiver Agreement are all of the loans which were owing to it by the
Acceding Company as at 31st December, 2002.
2.2 The Acceding Company confirms, to the best of its knowledge and belief,
that the loan balances set out opposite its name in Part 2 of Schedule
2 (Intra-group loans owed by Corp and plc) to the Statement and Waiver
Agreement are all of the loans which were owing to it by Corp or plc as
at 31st December, 2002.
3. ACKNOWLEDGEMENT OF LIABILITIES
3.1 Acknowledgement by Corp and plc
Each of Corp and plc acknowledges and confirms its liability in respect
of:
--------------------------
* Delete as applicable
166
(a) the loan balances set out in Part 2 of Schedule 2 (Intra-group
loans owed by Corp and plc) to the Statement and Waiver
Agreement and expressed to be owing by it;
(b) the trading and current account liabilities expressed to be
owing by it to the Acceding Company in the management accounts
upon which the audited consolidated financial accounts of plc
as at [31st March, 2002] [in relation to each Trading and each
Non-Trading Company] / 30th September, 2002] [in relation to
each Dormant Company] have been prepared, to the extent such
trading and current account liabilities remain outstanding;
(c) any counter indemnity or equivalent reimbursement obligation
(which is written or is implied by law) of Corp and/or plc to
the Acceding Company under any non-financial guarantee or
indemnity (which is contractual or implied by law) and which
is given by such Acceding Company and is: (A) in favour of any
person which is not a member of the Marconi Group; (B) in
respect of any contractual or implied by law obligations of
Corp and/or plc and (C) set out in Part 2 of Schedule 5
(non-financial guarantees and indemnities given by
Participating Companies) to the Statement and Waiver
Agreement; and
(d) the other preserved Claims set out in Part 2 of Schedule 3
(Other preserved Claims owed by Corp and plc) to the Statement
and Waiver Agreement expressed to be owing by it.
3.2 Acknowledgement of Acceding Company
The Acceding Company acknowledges and confirms its liability in respect
of:
(a) the loan balances set out in Part 1 of Schedule 2 (Intra-group
loans owed by the Participating Companies) to the Statement
and Waiver Agreement and expressed to be owing by it;
(b) the trading and current account liabilities and expressed to
be owing by it to plc and/or Corp in the management accounts
upon which the audited consolidated financial accounts of plc
as at [31st March, 2002] [in relation to each Trading and each
Non-Trading Company] / 30th September, 2002] [in relation to
each Dormant Company] have been prepared, to the extent such
trading and current account liabilities remain outstanding;
(c) any counter indemnity or equivalent reimbursement obligation
(which is written or is implied by law) of the Acceding
Company to Corp and/or plc under any non-financial guarantee
or indemnity (which is contractual or implied by law) and
which is given by Corp and/or plc and is: (A) in favour of any
person which is not a member of the Marconi Group; (B) in
respect of any contractual or implied by law obligations of
that Acceding Company and (C) set out in Part 1 of Schedule 5
(non-financial guarantees and indemnities given by Corp or
plc) to the Statement and Waiver Agreement; and
(d) the other preserved Claims set out in Part 1 of Schedule 3
(Other preserved Claims owed by Participating Companies) to
the Statement and Waiver Agreement expressed to be owing by
it.
167
4. GENERAL
This Accession Letter is governed by English law.
168
This Accession Letter is entered into by Agreement.
SIGNED by )
for [INSERT NAME] )
)
Address:
Fax:
SIGNED by )
for MARCONI )
CORPORATION PLC )
SIGNED by )
for MARCONI PLC )
169
SCHEDULE 5
NON-FINANCIAL GUARANTEES AND INDEMNITIES
PART 1
NON-FINANCIAL GUARANTEES AND INDEMNITIES GIVEN BY CORP OR PLC
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
TRADING COMPANIES
(MATERIAL)
-------------------------------------------------------------------------------------------
ALBANY PARTNERSHIP LIMITED
-------------------------------------------------------------------------------------------
GPT SPECIAL PROJECT MANAGEMENT
LIMITED
-------------------------------------------------------------------------------------------
MARCONI BONDING LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INVESTMENTS LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(IRELAND)
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(UK)
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS OPTICAL
NETWORKS LIMITED (IRELAND)
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OVERSEAS SERVICES LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SOUTH
AFRICA PTY LIMITED
-------------------------------------------------------------------------------------------
MARCONI OPTICAL COMPONENTS SALE OF MARCONI OPTICAL
LIMITED BUSINESS TO BOOKHAM
TECHNOLOGY PLC (17th
December, 2001, supplemental
agreement dated 31st
January, 2002)
-------------------------------------------------------------------------------------------
170
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
Corp guaranteed:
Marconi Optical's
undertaking to purchase a
minimum of L30m of
components from Bookham over
18 months from February,
2002. Out of the L27
million still outstanding,
it is estimated that the
business plan can justify
only half being purchased in
that time frame, with the
balance to be paid out to
Bookham;
all other obligations of
Marconi Optical under the
Agreement, Transfer of
Freehold Property and
certain payment obligations
under a Supply Agreement.
Corp also indemnified
Bookham against any costs
incurred in ensuring
compliance with the above
agreements.
Marconi Optical gave usual
warranties (limited to
awareness of Corp).
Total liability of Marconi
Optical and Corp shall not
exceed L12 million,
excluding an environmental
indemnity claim which (when
aggregated with all other
claims) shall not exceed
L24 million. Maximum
liability under
environmental remediation
works is L500,000, plus
effect of pay-out under
minimum purchasing
undertaking.
-------------------------------------------------------------------------------------------
MARCONI CORPORATION plc SALE OF THE SHARE CAPITAL OF
YESLINK INTERCO LTD.
171
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
AND YESLINK UNLIMITED TO
PRUDENTIAL
Indemnity by PLC in respect of
all costs, expenses and
liabilities incurred to the
extent that Corp did not meet
its obligations under the
Trade Xxxx Assignment.
Trade xxxx indemnity is
uncapped.
SALE OF MARCONI MEDICAL
SYSTEMS HOLDINGS, INC. (3rd
July, 2000)
According to Marconi, Plc
guaranteed the Seller's
obligations under this
agreement.
On 15th July, 2002, Corp,
Marconi, Inc. (as successor to
Marconi Holding Systems, Inc.)
and Philips entered into a
Final Settlement Agreement.
Under this Agreement, the
purchase price was adjusted to
US$837 million. The value of
the Closing Net Assets was
agreed to be US$755 million.
Marconi paid Philips US$12
million on 19th July, 2002 and
was released from liabilities
in relation to the warranty in
respect of the non-US Vendor
Debt (Latin American debt)
which was rescinded and in
relation to the indemnity for
breach of representation. US$8
million of this was in full
satisfaction of Marconi's
payment obligations under the
Stock Purchase Agreement. The
tax
172
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
indemnity under the Stock
Purchase Agreement remains in
effect, including in respect
of the tax liabilities that
could have been included in
determining the Closing Net
Assets.
Following the Final Settlement
Agreement, estimated liability
is US$15.3 million (being
approx. L10 million).
DISPOSAL OF MARCONI DATA
SYSTEMS INC, MARCONI DATA
SYSTEMS LIMITED, MARCONI DATA
SYSTEMS EUROPE B.V. AND
MARCONI DATA SYSTEMS B.V.
(10th January, 2002)
Sellers were Marconi Systems
Holdings, Inc. (now Marconi,
Inc.) and A.B. Dick Holdings.
Corp was a joint-Seller.
Plc guaranteed all the
obligations of the Sellers and
warranted its status,
authority and non-violation of
any obligation in providing
the guarantee. Note that the
Sellers have given extensive
warranties (on an indemnified
basis), which are all still in
force:
1. usual warranties on an
indemnified basis;
2. tax warranties;
3. environmental warranties;
173
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
and
4. incorporation, authority,
shares and capital stock
warranties.
Total not to exceed US$100
million (US$100 million is 25%
of purchase price).
SALE OF MARCONI COMMERCE
SYSTEMS, INC. AND MARCONI
COMMERCE SYSTEMS LIMITED (20th
December, 2001)
Plc guaranteed the obligations
of the sellers. Corp is a
Joint seller with Marconi
Systems Holdings, Inc. (now
Marconi, Inc.) (the
"SELLERS").
Capped at 25% of the Adjusted
Purchase Price (25% is approx.
US$81.25 million).
-------------------------------------------------------------------------------------------
MARCONI plc
-------------------------------------------------------------------------------------------
MARCONI SOFTWARE SOLUTIONS THE EASAMS AGREEMENT UNDER THE
LIMITED DISPOSAL OF MES BUSINESS TO
BRITISH AEROSPACE PLC ("BAE").
(1st November, 1999)
PLC guarantees various
obligations.
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE AGREEMENT AND PLAN OF MERGER
INTERNATIONAL LIMITED BETWEEN MARCONI AND METAPATH
(17th April, 2000)
Indemnity given to officers/
directors/employees
174
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
as at time of merger for
acts/omissions by them
occurring at or prior to date
of merger.
-------------------------------------------------------------------------------------------
RONALDI LTD
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SA
(FRANCE)
-------------------------------------------------------------------------------------------
MNI TECNOLOGIASE E SISTEMAS DE
COMMUNICACAO SA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS B.V.
(NETHERLANDS)
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GmbH Corp and Marconi Corp and Marconi
(GERMANY) Communications as joint and Communications Ltd as joint
several guarantors of MC GmbH and several guarantors of MC
jointly and severally with GmbH jointly and severally
Marconi Communications Real with Marconi Communications
Estate GmbH under the purchase Real Estate GmbH under the
of the P1 Business from Xxxxxx purchase of the P1 Business
Bosch GmbH ("RB GmbH") and from Xxxxxx Xxxxx XxxX ("XX
Xxxxx Telecom GmbH ("BT GmbH") and Bosch Telecom
GmbH")dated 14th November, GmbH ("BT GmbH") dated 14th
1999. November, 1999.
Each Guarantor undertook to Each Guarantor undertook to
perform jointly and severally perform jointly and
with the Purchaser all severally with the Purchaser
obligations of the Purchaser all obligations of the
under the agreement. Corp Purchaser under the
agreed to procure that the new agreement. Corp agreed to
ultimate parent of the Marconi procure that the new
Group under the 1999 Scheme of ultimate parent of the
Arrangement [PLC] would become Marconi Group under the 1999
an additional Guarantor as Scheme of Arrangement [PLC]
soon as practicable after would become an additional
signing. Guarantor as soon as
practicable after signing
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS REAL XXXXXXXX XX X0 XXXXXXXX (00xx XXXXXXXX XX X0 XXXXXXXX
XXXXXX GmbH November, 1999) Corp, PLC and (24th November, 1999) Corp,
Marconi PLC and Marconi
-------------------------------------------------------------------------------------------
175
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
Communications Limited are Communications Limited are
guarantors of the obligations guarantors of the
of Marconi Communications GmbH obligations of Marconi
and Marconi Communications Communications GmbH and
Real Estate GmbH. Marconi Communications Real
Estate GmbH.
Each Guarantor undertook to Each Guarantor undertook to
perform jointly and severally perform jointly and
with the Purchaser all severally with the Purchaser
obligations of the Purchaser all obligations of the
under the agreement. Corp Purchaser under the
agreed to procure that the new agreement. Corp agreed to
ultimate parent of the Marconi procure that the new
Group under the 1999 Scheme of ultimate parent of the
Arrangement would become an Marconi Group under the 1999
additional Guarantor as soon Scheme of Arrangement would
as practicable after signing become an additional
[i.e. PLC]. Guarantor as soon as
practicable after signing
[i.e. PLC].
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS GmbH & CO KG
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS VER. GmbH
-------------------------------------------------------------------------------------------
BEIJING MARCONI COMMUNICATIONS
TECHNOLOGY CO LTD
-------------------------------------------------------------------------------------------
GEC (HONG KONG) Corp guarantees GEC (HK)
LIMITED Ltd's various obligations
to:
the HONG KONG GOVERNMENT
under a MAINTENANCE CONTRACT
FOR THE HONG KONG AIR
TRAFFIC CONTROL SYSTEM for
damage to premises, 3rd
party IPR claims and defects
in the Works [+ Corp
undertakes not to assign or
dispose etc. of any part of
its shareholding in GEC (HK)
which would affect the
-------------------------------------------------------------------------------------------
176
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
beneficial ownership and
control of GEC (HK) by Corp
or take any action that will
result in GEC (HK) being
unable to comply with its
obligations under the
contract];
NISHIMATSU CONSTRUCTION CO.
AND KUMAGAI GUMI CO, LTD
under a SUB-CONTRACT DATED
30/06/94 [Corp authorises
Standard Chartered Bank Hong
Kong to debit from it's a/c
all amounts Standard
Chartered pays under a
HK$32,480,000 performance
bond under this
sub-contract];
NISHIMATSU CONSTRUCTION CO.
LTD AND DRAGAGES ET TRAVAUX
PUBLICS (H.K.) LTD IN A
JOINT VENTURE UNDER A
SUB-CONTRACT DATED 21/03/96
FOR THE ROUTE 3 COUNTRY PARK
SECTION XXX XXX TUNNEL &
XXXX XXXX APPROACH ROAD
[HK$23 million retention but
also guarantee contains a
clause limiting Corp's
maximum liability to the
sub-contract sum];
Performance Bond issued by
Federal Insurance Company
for the value :
HK$47,479,800.00 is due
outstanding
THE AIRPORT AUTHORITY UNDER
A SUB-CONTRACT DATED
31/01/97 [+ Corp undertakes
not to assign or dispose
etc. of any part of its
shareholding in GEC (HK)
which would affect the
beneficial ownership and
control of GEC (HK) by
177
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
Corp or take any action that
will result in GEC (HK)
being unable to comply with
its obligations under the
contract]
THE MASS TRANSIT RAILWAY
CORPORATION UNDER A
SUB-CONTRACT DATED 10/11/97:
Mass Transit Railway
Corporation under a Contract
690 for Quarry Bay
Congestion Relief
Works-Power Supply System.
Performance Bond issued by
Federal Insurance Co for HK$
3,782,800.00 was returned
for cancellation on 13 Feb
03. Parent Company Guarantee
also returned
MASS TRANSIT RAILWAY
CORPORATION UNDER a Contract
No. 674 , Xxxxxx Xxxx O
Extension -Building Services
for TKO Station and Tiu Xxxx
Xxxx Station Performance
Bond issued by Federal
Insurance Company for the
value : HK$19,280,000.00
THE DRAGAGES-ZEN PACIFIC
JOINT VENTURE UNDER A
SUB-CONTRACT DATED 03/08/99
for KCRC West Rail DB320
HONG KONG GOVERNMENT UNDER
TWO CONTRACTS for Lantau
Fixed Crossing Contracts for
Traffic Control and
Surveillance System Contract
No.
178
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
HY/92/24 ( Part N works, &
HY/92/24 ( Part X & Y works)
Performance Bonds are
HK$25,581,080.00 and
HK$5,007,605.00 issued by
American Home Assurance
Company
-------------------------------------------------------------------------------------------
MARCONI AUSTRALIA PTY LIMITED Corp has issued letters of
comfort to MAPL in respect
of its business
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS ASIA
LIMITED
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOUTH EAST ASIA PTE LTD
-------------------------------------------------------------------------------------------
THE GENERAL ELECTRIC COMPANY
OF SINGAPORE PRIVATE LIMITED
(NOW KNOWN AS MARCONI SINGAPORE
PTE LTD)
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONSSPA
-------------------------------------------------------------------------------------------
MARCONI IBERIA SA
-------------------------------------------------------------------------------------------
MARCONI MOBILE ACCESS SpA
-------------------------------------------------------------------------------------------
MARCONI SUD SpA
-------------------------------------------------------------------------------------------
MARCONI INTERNATIONAL SpA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS DE
MEXICO SA DE CV
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
TELEMULTI LIMITADA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
DO BRASIL LTDA
-------------------------------------------------------------------------------------------
FORE SYSTEMS LIMITADA
-------------------------------------------------------------------------------------------
179
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
MARCONI COLUMBIA SA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
ARGENTINA SA
-------------------------------------------------------------------------------------------
MARCONI VENEZUELA CA
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OPTICAL NETWORKS CORP
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
TECHNOLOGY INC
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
CANADA INC
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
FEDERAL INC
-------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS INC Global Procurement
Agreement between Marconi
Communications Inc. and
Bookham Technology Plc.
Marconi Corporation plc
guarantees Marconi
Communications Inc.'s
obligations under this
Global Procurement
Agreement. The Global
Procurement Agreement
contains no warranties or
indemnities, but states that
except in relation to PI or
death caused by negligence,
cap in respect of any
Purchase Order is limited to
the greater of:
(a) L10 million; or
(b) the total purchase
price paid for all products
under this agreement at the
date such a claim arises,
except maximum liability in
no event to
-------------------------------------------------------------------------------------------
180
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
exceed the minimum Purchase
Commitments (L 30
million).
MARCONI INC DISPOSAL OF MARCONI DATA STOCK PURCHASE AGREEMENT
SYSTEMS INC, MARCONI DATA RELATING TO SALE OF
SYSTEMS LIMITED, MARCONI DATA OUTSTANDING SHARES IN A.B.
SYSTEMS EUROPE B.V. AND DICK COMPANY (19th December,
MARCONI DATA SYSTEMS B.V. 1996)
(10th January, 2002)
Continuing an irrevocable
Sellers were Marconi Systems guarantee given by Corp in
Holdings, Inc. (now Marconi, favour of the Purchaser in
Inc.) and A.B. Dick Holdings. consideration of $10.
Corp was a joint-Seller. Guarantees the Seller's full
and prompt performance and
Plc guaranteed all the payment of all obligations
obligations of the Sellers and of Seller under the stock
warranted its status, purchase agreement and the
authority and non-violation of Assumption Agreement.
any obligation in providing Guarantee only triggered by
the guarantee. Note that the Change of Control (another
Sellers have given extensive party acquires more than 50%
warranties (on an indemnified "beneficial ownership" in
basis), which are all still in the Seller's shares - other
force: than Corp) or Seller does
not satisfy its obligations
1. usual warranties on an under Purchase Agreement and
indemnified basis; also where Seller declares
dividends, or makes other
2. tax warranties; distributions/payments to
Corp or any of its
3. environmental warranties; affiliates. Enforceable
and against Corp without need
for proceedings to have been
4. incorporation, authority, implemented by Purchaser or
shares and capital stock direct notice of
warranties. non-performance etc. to
Corp.
Total not to exceed US$100
million (US$100 million is SALE OF MARCONI COMMERCE
SYSTEMS INC. AND MARCONI
COMMERCE SYSTEMS LIMITED
(20th
-------------------------------------------------------------------------------------------
181
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
25% of purchase price). December, 2001)
SALE OF MARCONI COMMERCE Corp and Marconi Systems
SYSTEMS INC. AND MARCONI Holdings Inc. (now Marconi,
COMMERCE SYSTEMS LIMITED Inc.) (the SELLERS) to DH
(20th December, 2001) Holdings Corp, Launchchange
Limited and DH Holdings (the
PURCHASERS)
Plc guaranteed the obligations
Corp is a Joint seller with Capped at 25% of The
Marconi Systems Holdings, Adjusted Purchase Price (25%
Inc. (now Marconi, Inc.) is approx. US$81.25 million).
(the "SELLERS"). of the Sellers.
Capped at 25% of the ASSET TRANSFER AGREEMENT IN
Adjusted Purchase Price (25% RESPECT OF THE HEALTHCARE
is approx. US$81.25 million). INFORMATION BUSINESS (BEING
TRANSFERRED TO HCIS SUB)
(17th October, 2001)
SALE OF MARCONI MEDICAL
SYSTEMS HOLDINGS, INC. (3rd Corp, Marconi Systems
July, 2001) Holdings, Inc. (now Marconi,
Inc.) and Marconi
Communications Limited
Plc guaranteed the Sellers' (called HCIS Sub) have
obligations under this jointly and severally
agreement jointly and indemnified Marconi Medical
severally with Marconi Systems U.K. Limited (sold
Systems Holdings, Inc (now to Koninklijke Philips
Marconi, Inc.) (and possibly Electronics) in relation to
other subsidiaries). Cap is any liability or obligation
US$825 million. related to the Healthcare
Information business
(subject to the Stock
Purchase Agreement).
No cap.
SETTLEMENT AND RELEASE
AGREEMENT RELATING TO THE
SALE OF MARCONI COMMERCE
SYSTEMS LIMITED AND MARCONI
-------------------------------------------------------------------------------------------
182
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
COMMERCE SYSTEMS, INC
between Launchchange
Limited, DH Holdings Corp
(together "Xxxxxxx"), Corp
and Marconi, Inc. (7th
August, 2002)
Liability is capped at the
available Holdback Amount
except as provided in the
Agreement
-------------------------------------------------------------------------------------------
MARCONI SOFTWARE
INTERNATIONAL INC
-------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (US) INC
-------------------------------------------------------------------------------------------
SYSTEMS MANAGEMENT EXCHANGE AGREEMENT - PURCHASE
SPECIALISTS INC OF SHARES IN SYSTEMS
MANAGEMENT SPECIALISTS, INC.
IN EXCHANGE FOR SHARES IN
MARCONI PLC (22nd May, 2000)
Outstanding liabilities as
follows:
1. minimal capacity, trading
and regulatory warranties;
2. certain covenants; and
3. indemnity given to Xxxxxx
Xxxxxx for any losses,
damages, costs etc incurred in
connection with the breach of
representation, warranty or
covenant.
Plc's liability is capped at
$12,750,000 but the indemnity
will not be triggered unless
the aggregate amount of its
liability exceeds $300,000 in
which case it must
-------------------------------------------------------------------------------------------
183
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
-------------------------------------------------------------------------------------------
indemnify Xxxxxx Xxxxxx for
any damage in excess of
$50,000.
Plc will meet its indemnity
obligation through the issue
of additional common stock,
valued in the same manner as
the consideration for the
Shares was valued.
Following on from this, Plc
entered into an agreement for
the sale and purchase of
shares in Systems Management
Specialists, Inc. with Corp
(18th July, 2000)
-------------------------------------------------------------------------------------------
MARCONI MIDDLE EAST
(SAUDI ARABIA)
-------------------------------------------------------------------------------------------
MARCONI MIDDLE EAST LLC
(DUBAI)
-------------------------------------------------------------------------------------------
MARCONI APPLIED
TECNOLOGIES SA
-------------------------------------------------------------------------------------------
SNC COMPOSANTS & CIE
-------------------------------------------------------------------------------------------
NON-TRADING SUBSIDIARIES
-------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES LIMITED
-------------------------------------------------------------------------------------------
XXXXXX STREET INVESTMENTS
LIMITED
-------------------------------------------------------------------------------------------
EA CONTINENTAL LIMITED
-------------------------------------------------------------------------------------------
XXXXXXX-AUTOMATION
HOLDINGS LIMITED
-------------------------------------------------------------------------------------------
184
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
---------------------------------------------------------------------------------------------
THE ENGLISH ELECTRIC COMPANY,
LIMITED
---------------------------------------------------------------------------------------------
Guarantee of approx. Guarantee of approx.
MARCONI (XXXXXX STREET) E 353,050,000, re SALE OF E 353,050,000, re SALE OF
LIMITED MARCONI MOBILE HOLDINGS MARCONI MOBILE HOLDINGS
S.P.A BY MARCONI (XXXXXX S.p.A BY MARCONI (XXXXXX
STREET) LIMITED TO STREET) LIMITED TO
FINMECCANICA S.p.A. FINMECCANICA S.p.A.
Currently relates to Plc and Currently relates to Plc and
Marconi (Xxxxxx Street) Marconi (Xxxxxx Street)
Limited, however, relevant Limited, however , relevant
to Corp as part of the to Corp as part of the
proposed restructuring. proposed restructuring.
Concurrent with any Marconi Concurrent with any Marconi
Corporate Restructuring, Plc Corporate Restructuring, Plc
is to procure that the is to procure that the
ultimate parent of Marconi ultimate parent of Marconi
and the company owing all or and the company owing all or
substantially all of the substantially all of the
assets of the Marconi Group assets of the Marconi Group
immediately prior to the immediately prior to the
date of completion of the date of completion of the
Marconi Group Restructuring Marconi Group Restructuring
[i.e. Corp] novates the [i.e. Corp] novates the
Marconi Guarantee under this Marconi Guarantee under this
deal [value: 57.7% of the deal [value: 57.7% of the
Purchase Price (this amounts Purchase Price (this amounts
to approx. E 353,050,000, to approx. E 353,050,000,
subject to any completion subject to any completion
adjustment)] to Corp adjustment)] to Corp
[The cap of E 353,050,000 [The cap of E 353,050,000
excludes any matter excludes any matter
regarding the Private Mobile regarding the Private
Radio and Public Mobile Mobile Radio and Public
Radio Business, the Mobile Radio Business, the
demergers of Marconi demergers of Marconi
Holdings SpA and Marconi Holdings SpA and Marconi
Communications SpA and the Communications SpA and the
Closing Restructuring and Closing Restructuring and
any matter relating to any matter relating to
capacity, authority and capacity, authority and
title to the MMH Shares and title to the MMH Shares and
the shares in the MMH the shares in the MMH
Subsidiaries.] Subsidiaries.]
---------------------------------------------------------------------------------------------
MARCONI (HOLDINGS)
---------------------------------------------------------------------------------------------
185
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
LIMITED
--------------------------------------------------------------------------------------------
MARCONI AEROSPACE UNLIMITED
--------------------------------------------------------------------------------------------
MARCONI CAPITAL LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS AFRICA
(PTY) LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS LIMITED
--------------------------------------------------------------------------------------------
MARCONI (DGP1) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (DGP2) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (XXXXXXX AUTOMATION)
LIMITED
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS INTERNATIONAL
HOLDINGS LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GMBH
(SWITZERLAND)
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS GMBH (GERMANY)
--------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL Marconi Corp. has given to
INDUSTRIES LTD (NOW KNOWN AS Marconi Australia Holdings
MARCONI AUSTRALIA HOLDINGS PTY Pty Ltd ("XXXX") a letter of
LIMITED) support in respect of an
intra-group transaction
comprising a loan from XXXX
to the Xxxxxx and Xxxxxxx
Trustees Limited ("Xxxxxx")
for GBP 11M, bearing
interest. Xxxxxx does not
have adequate funds to repay
the loan itself.
Corp. has issued letters of
comfort to XXXX in respect
--------------------------------------------------------------------------------------------
186
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
of its business
--------------------------------------------------------------------------------------------
Guarantee implied under
MARCONI HOLDINGS SpA article 2362 of the Italian
Civil Code which may arise
as a result of the Marconi
Corporation plc's sole
shareholding in Marconi
Finanziaria SpA (now Marconi
Holdings SpA) for the period
from March 2000 to 29
October 2001.
--------------------------------------------------------------------------------------------
RELTEC MEXICO SA DE CV (NOW
KNOWN AS MARCONI
COMMUNICATIONS, S.A. DE C.V.)
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(CANADA)
--------------------------------------------------------------------------------------------
FS FINANCE CORP
--------------------------------------------------------------------------------------------
FS HOLDING CORP
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS NORTH
AMERICA INC.
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS CANADA
HOLDINGS INC.
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS INC.
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL INC.
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(BERMUDA) (NOW KNOWN AS
MARCONI INTERNATIONAL LIMITED)
--------------------------------------------------------------------------------------------
DORMANT SUBSIDIARIES
--------------------------------------------------------------------------------------------
A.B. DICK HOLDINGS LTD DISPOSAL OF MARCONI DATA
SYSTEMS INC, MARCONI
--------------------------------------------------------------------------------------------
187
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
DATA SYSTEMS LIMITED, MARCONI
DATA SYSTEMS EUROPE B.V. AND
MARCONI DATA SYSTEMS B.V.
(Index ref: G.1.35) (10th
January, 2002)
Plc guaranteed all the
obligations of the Sellers and
warranted its status,
authority and non-violation of
any obligation in providing
the guarantee. Note that the
Sellers have given extensive
warranties (on an indemnified
basis), which are all still in
force
Sellers are jointly and
severally liable as follows:
1. usual warranties on an
indemnified basis;
2. tax warranties;
3. environmental warranties.
4. incorporation, authority,
shares and capital stock
warranties.
Other Sellers are Marconi
Systems Holdings, Inc. (now
Marconi, Inc.) and A.B. Dick
Holdings..
--------------------------------------------------------------------------------------------
ARROW LTD
--------------------------------------------------------------------------------------------
ASSOCIATED AUTOMATION LTD
--------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
--------------------------------------------------------------------------------------------
188
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
INDUSTRIES HOLDINGS LTD
--------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES (MANCHESTER) LTD
--------------------------------------------------------------------------------------------
CLANVILLE LIMITED
--------------------------------------------------------------------------------------------
COMBINED ELECTRICAL
MANUFACTURERS LTD
--------------------------------------------------------------------------------------------
COPPENHALL NOMINEES LIMITED
--------------------------------------------------------------------------------------------
DAYMO LTD
--------------------------------------------------------------------------------------------
FF CHRESTIAN & CO LTD
--------------------------------------------------------------------------------------------
GPT CONSUMER PRODUCTS LTD
--------------------------------------------------------------------------------------------
GPT PAYPHONE SYSTEMS LTD
--------------------------------------------------------------------------------------------
GPT RELIANCE LTD
--------------------------------------------------------------------------------------------
THE KINGSWAY HOUSING
ASSOCIATION LTD
--------------------------------------------------------------------------------------------
KRAYFORD LTD
--------------------------------------------------------------------------------------------
LARNERWAY LTD
--------------------------------------------------------------------------------------------
LAYANA LIMITED
--------------------------------------------------------------------------------------------
XXXXXXX XXXXXXX DEVELOPMENTS
LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS OPTICAL
FIBRES LIMITED
--------------------------------------------------------------------------------------------
MARCONI (FIFTEEN) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (FIFTY-NINE) LTD
--------------------------------------------------------------------------------------------
189
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
MARCONI (FIFTY-THREE) LTD
--------------------------------------------------------------------------------------------
MARCONI (FORTY-FIVE) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (FORTY-FOUR) LTD
--------------------------------------------------------------------------------------------
MARCONI (FORTY-THREE) LIMITED
--------------------------------------------------------------------------------------------
XXXXXXX X.X. LIMITED
--------------------------------------------------------------------------------------------
MARCONI MOBILE SYSTEMS LIMITED
--------------------------------------------------------------------------------------------
MARCONI (NINE) LIMITED
--------------------------------------------------------------------------------------------
MARCONI PHOTONICA LIMITED
--------------------------------------------------------------------------------------------
MARCONI (SIXTEEN) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (SIXTY-NINE) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (SIXTY-TWO) LTD
--------------------------------------------------------------------------------------------
MARCONI (THIRTEEN) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (THIRTY-TWO) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (TLC) LTD
--------------------------------------------------------------------------------------------
MARCONI (TWENTY-SEVEN) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (WCGL) UNLIMITED
--------------------------------------------------------------------------------------------
XXXXXXXXX LIMITED
--------------------------------------------------------------------------------------------
METROPOLITAN-XXXXXXX
--------------------------------------------------------------------------------------------
190
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
ELECTRICAL CO LTD
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS GROUP LTD
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS (HOLDINGS) LTD
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS SERVICES LTD
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS (UK) LTD
--------------------------------------------------------------------------------------------
THE M-O VALVE CO LTD
--------------------------------------------------------------------------------------------
MSI CELLULAR INVESMTNETS (ONE)
LTD
--------------------------------------------------------------------------------------------
PALMAZ LTD
--------------------------------------------------------------------------------------------
PHOTONICA LIMITED
--------------------------------------------------------------------------------------------
PHOTONIQA LIMITED
--------------------------------------------------------------------------------------------
PYFORD LIMITED
--------------------------------------------------------------------------------------------
RAINFORD GROUP TRUSTEES LTD
--------------------------------------------------------------------------------------------
RAINFORD RACKS LTD
--------------------------------------------------------------------------------------------
RELTEC (COVENTRY) LTD
--------------------------------------------------------------------------------------------
XXXXXX XXXXXXXXXX & HAWTHORNS
LTD
--------------------------------------------------------------------------------------------
THE ROTARY ENGINEERING COMPANY
LIMITED
--------------------------------------------------------------------------------------------
SALPLEX LTD
--------------------------------------------------------------------------------------------
STYLES & XXXXXXX LIMITED
--------------------------------------------------------------------------------------------
TCL PROJECTS LIMITED
--------------------------------------------------------------------------------------------
191
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
ZIPBOND LTD
--------------------------------------------------------------------------------------------
THE VULCAN FOUNDRY LTD
--------------------------------------------------------------------------------------------
TRADING SUBSIDIARIES
(OTHERS)
--------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES INTERNATIONAL
LIMITED
--------------------------------------------------------------------------------------------
FORE SYSTEMS LIMITED
--------------------------------------------------------------------------------------------
GPT MIDDLE EAST LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS (CIS)
LIMITED
--------------------------------------------------------------------------------------------
MARCONI FINANCE PLC
--------------------------------------------------------------------------------------------
MARCONI FLEET MANAGEMENT
LIMITED
--------------------------------------------------------------------------------------------
MARCONI INFORMATION SYSTEMS
LIMITED
--------------------------------------------------------------------------------------------
MARCONI (NCP) LIMITED
--------------------------------------------------------------------------------------------
NETSCIENT LIMITED
--------------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES LIMITED
--------------------------------------------------------------------------------------------
TELEPHONE CABLES LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS CHINA
LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL HOLDINGS LIMITED
--------------------------------------------------------------------------------------------
192
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
XXXXXX STREET OVERSEAS
INVESTMENTS LIMITED
--------------------------------------------------------------------------------------------
XXXXXX STREET PARTNERSHIP
--------------------------------------------------------------------------------------------
MARCONI INDIA LIMITED
--------------------------------------------------------------------------------------------
MARCONI (THIRTY-ONE) LIMITED
--------------------------------------------------------------------------------------------
HIGHROSE LIMITED
--------------------------------------------------------------------------------------------
ANCRANE
--------------------------------------------------------------------------------------------
XXXXX OF COLCHESTER HOUSING
SOCIETY LIMITED
--------------------------------------------------------------------------------------------
MARCONI INSURANCE LIMITED
--------------------------------------------------------------------------------------------
TETREL LIMITED
--------------------------------------------------------------------------------------------
RELTEC SERVICES (UK) LIMITED
--------------------------------------------------------------------------------------------
MARCONI ANSTY LIMITED
--------------------------------------------------------------------------------------------
MARCONI NOMINEES LIMITED
--------------------------------------------------------------------------------------------
YESLINK UNLIMITED
--------------------------------------------------------------------------------------------
ELLIOT AUTOMATION CONTINENTAL
SA
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL NOMINEES LIMITED
--------------------------------------------------------------------------------------------
MARCONI DEFENSE OVERSEAS
LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GLOBAL
NETWORKS LIMITED
--------------------------------------------------------------------------------------------
193
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
MARCONICOM LIMITED
--------------------------------------------------------------------------------------------
MICRO SCOPE LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL INVESTMENTS
LIMITED
--------------------------------------------------------------------------------------------
GPT (NEDERLAND) BV
--------------------------------------------------------------------------------------------
GEC OF PAKISTAN LIMITED
--------------------------------------------------------------------------------------------
GEC ZAMBIA LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS AB
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS BVBA
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SARL
--------------------------------------------------------------------------------------------
MARCONI CHANNEL MARKETS GMBH
--------------------------------------------------------------------------------------------
AEI FURNACES PTY LTD
--------------------------------------------------------------------------------------------
XXXXXX INFORMATION
TECHNOLOGY
PTY LTD
--------------------------------------------------------------------------------------------
MARCONI NEW ZEALAND LIMITED
--------------------------------------------------------------------------------------------
MARCONI TELECOMMUNICATIONS
INDIA PRIVATE LTD
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (AUSTRALIA) PTY
LTD
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (HONG KONG)
--------------------------------------------------------------------------------------------
194
OFF-BALANCE SHEET LIABILITIES
OWED BY PLC OWED BY CORP
--------------------------------------------------------------------------------------------
LIMITED
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (INDIA)
PRIVATE LIMITED
--------------------------------------------------------------------------------------------
MARCONI ACQUISITION CORP
--------------------------------------------------------------------------------------------
MARCONI FINANCE INC.
--------------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES INC.
--------------------------------------------------------------------------------------------
APT NEDERLANDS BV
--------------------------------------------------------------------------------------------
APT TELECOMMUNICIONES SL
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL AB
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL BRASIL LTDa
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (FRANCE) SA
--------------------------------------------------------------------------------------------
MARCONI PROJECTS HONG KONG LTD
--------------------------------------------------------------------------------------------
195
PART 2
NON-FINANCIAL GUARANTEES AND INDEMNITIES GIVEN BY PARTICIPATING
COMPANIES
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
TRADING COMPANIES
(MATERIAL)
--------------------------------------------------------------------------------------------
ALBANY PARTNERSHIP LIMITED
--------------------------------------------------------------------------------------------
GPT SPECIAL PROJECT MANAGEMENT
LIMITED
--------------------------------------------------------------------------------------------
MARCONI BONDING LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INVESTMENTS LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(IRELAND)
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED In consideration of Corp
(UK) agreeing to provide the
services of certain
executives, each of whom has
signed a service agreement
with corp, for the purposes
of advising on MCL's
business, MCL
unconditionally and
irrevocably guarantees to
all of these executives the
due and punctual performance
and observance by corp of
all its obligations,
commitments and undertakings
under and pursuant to each
of their respective service
agreements as mentioned
above, and agrees to
indemnify each executive in
respect of any breach by
corp, of any of its
obligations, commitments
--------------------------------------------------------------------------------------------
196
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
and undertakings under and
pursuant to each respective
service agreement. This
guarantee is to be a
continuing guarantee and
accordingly is to remain in
force until all obligations
of corp shall have been
performed or satisfied.
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS OPTICAL
NETWORKS LIMITED (IRELAND)
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OVERSEAS SERVICES LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SOUTH
AFRICA PTY LIMITED
--------------------------------------------------------------------------------------------
MARCONI OPTICAL COMPONENTS
LIMITED
--------------------------------------------------------------------------------------------
MARCONI CORPORATION plc
--------------------------------------------------------------------------------------------
MARCONI plc SALE OF THE SHARE CAPITAL OF
YESLINK INTERCO LTD. AND
YESLINK UNLIMITED TO
PRUDENTIAL
Indemnity by PLC in respect
of all costs, expenses and
liabilities incurred to the
extent that Corp did not
meet its obligations under
the Trade Xxxx Assignment.
Trade xxxx indemnity is
uncapped.
SALE OF MARCONI MEDICAL
SYSTEMS HOLDINGS, INC. (3rd
July, 2000)
According to Marconi, Plc
guaranteed the Seller's
obligations under this
agreement.
--------------------------------------------------------------------------------------------
197
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
On 15th July, 2002, Corp,
Marconi, Inc. (as successor
to Marconi Holding Systems,
Inc.) and Philips entered
into a Final Settlement
Agreement. Under this
Agreement, the purchase
price was adjusted to US$837
million. The value of the
Closing Net Assets was
agreed to be US$755 million.
Marconi paid Philips US$12
million on 19th July, 2002
and was released from
liabilities in relation to
the warranty in respect of
the non-US Vendor Debt
(Latin American debt) which
was rescinded and in
relation to the indemnity
for breach of
representation. US$8 million
of this was in full
satisfaction of Marconi's
payment obligations under
the Stock Purchase
Agreement. The tax indemnity
under the Stock Purchase
Agreement remains in effect,
including in respect of the
tax liabilities that could
have been included in
determining the Closing Net
Assets.
Following the Final
Settlement Agreement,
estimated liability is
US$15.3 million (being
approx. L10 million).
DISPOSAL OF MARCONI DATA
SYSTEMS INC, MARCONI DATA
SYSTEMS LIMITED, MARCONI
DATA SYSTEMS EUROPE B.V. AND
MARCONI DATA SYSTEMS B.V.
(10th
--------------------------------------------------------------------------------------------
198
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
January, 2002)
Sellers were Marconi Systems
Holdings, Inc. (now Marconi,
Inc.) and A.B. Dick
Holdings. Corp was a
joint-Seller.
Plc guaranteed all the
obligations of the Sellers
and warranted its status,
authority and non-violation
of any obligation in
providing the guarantee.
Note that the Sellers have
given extensive warranties
(on an indemnified basis),
which are all still in
force:
1. usual warranties on an
indemnified basis;
2. tax warranties;
3. environmental warranties;
and
4. incorporation, authority,
shares and capital stock
warranties.
Total not to exceed US$100
million (US$100 million is
25% of purchase price).
SALE OF MARCONI COMMERCE
SYSTEMS, INC. AND MARCONI
COMMERCE SYSTEMS LIMITED
(20th December, 2001)
Plc guaranteed the
obligations of the sellers.
Corp is a Joint seller with
--------------------------------------------------------------------------------------------
199
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
Marconi Systems Holdings,
Inc. (now Marconi, Inc.)
(the "SELLERS").
Capped at 25% of the
Adjusted Purchase Price (25%
is approx. US$81.25
million)..
--------------------------------------------------------------------------------------------
MARCONI SOFTWARE SOLUTIONS
LIMITED
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL LIMITED
--------------------------------------------------------------------------------------------
RONALDI LTD
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SA
(FRANCE)
--------------------------------------------------------------------------------------------
MNI TECNOLOGIASE e
SISTEMAS de
COMMUNICACAO SA
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS B.V.
(NETHERLANDS)
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GmbH
(GERMANY)
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS REAL
ESTATE GMBH
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS GmbH
& CO KG
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOFTWARE SYSTEMS VER. GmbH
--------------------------------------------------------------------------------------------
BEIJING MARCONI COMMUNICATIONS
TECHNOLOGY CO LTD
--------------------------------------------------------------------------------------------
GEC (HONG KONG)
--------------------------------------------------------------------------------------------
200
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
LIMITED
--------------------------------------------------------------------------------------------
MARCONI AUSTRALIA PTY LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
ASIA LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
SOUTH EAST ASIA PTE LTD
--------------------------------------------------------------------------------------------
THE GENERAL ELECTRIC COMPANY
OF SINGAPORE PRIVATE LIMITED
(NOW KNOWN AS MARCONI
SINGAPORE PTE LTD)
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONSSPA
--------------------------------------------------------------------------------------------
MARCONI IBERIA SA
--------------------------------------------------------------------------------------------
MARCONI MOBILE ACCESS SpA
--------------------------------------------------------------------------------------------
MARCONI SUD SpA
--------------------------------------------------------------------------------------------
MARCONI INTERNATIONAL SpA
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS de
MEXICO SA de CV
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
TELEMULTI LIMITADA
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS DO
BRASIL LTDa
--------------------------------------------------------------------------------------------
FORE SYSTEMS LIMITADA
--------------------------------------------------------------------------------------------
MARCONI COLUMBIA SA
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
ARGENTINA SA
--------------------------------------------------------------------------------------------
MARCONI VENEZUELA CA
--------------------------------------------------------------------------------------------
201
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
OPTICAL NETWORKS CORP
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
TECHNOLOGY INC
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
CANADA INC
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
FEDERAL INC
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS INC
--------------------------------------------------------------------------------------------
MARCONI INC
--------------------------------------------------------------------------------------------
MARCONI SOFTWARE
INTERNATIONAL INC
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (US) INC
--------------------------------------------------------------------------------------------
SYSTEMS MANAGEMENT
SPECIALISTS INC
--------------------------------------------------------------------------------------------
MARCONI MIDDLE EAST
(SAUDI ARABIA)
--------------------------------------------------------------------------------------------
MARCONI MIDDLE EAST
LLC (DUBAI)
--------------------------------------------------------------------------------------------
MARCONI APPLIED TECNOLOGIES
SA
--------------------------------------------------------------------------------------------
SNC COMPOSANTS & CIE
--------------------------------------------------------------------------------------------
NON-TRADING SUBSIDIARIES
--------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES LIMITED
--------------------------------------------------------------------------------------------
XXXXXX STREET INVESTMENTS
LIMITED
--------------------------------------------------------------------------------------------
202
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
EA CONTINENTAL LIMITED
--------------------------------------------------------------------------------------------
XXXXXXX-AUTOMATION HOLDINGS
LIMITED
--------------------------------------------------------------------------------------------
THE ENGLISH ELECTRIC COMPANY,
LIMITED
--------------------------------------------------------------------------------------------
MARCONI (XXXXXX STREET)
LIMITED
--------------------------------------------------------------------------------------------
MARCONI (HOLDINGS) LIMITED
--------------------------------------------------------------------------------------------
MARCONI AEROSPACE UNLIMITED
--------------------------------------------------------------------------------------------
MARCONI CAPITAL LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS AFRICA
(PTY) LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS LIMITED
--------------------------------------------------------------------------------------------
MARCONI (DGP1) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (DGP2) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (XXXXXXX AUTOMATION)
LIMITED
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS INTERNATIONAL
HOLDINGS LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GmbH
(SWITZERLAND)
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS GmbH (GERMANY)
--------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
--------------------------------------------------------------------------------------------
203
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
INDUSTRIES LTD (NOW KNOWN AS
MARCONI AUSTRALIA HOLDINGS PTY
LIMITED)
--------------------------------------------------------------------------------------------
MARCONI HOLDINGS SpA
--------------------------------------------------------------------------------------------
RELTEC MEXICO SA de CV (NOW
KNOWN AS MARCONI
COMMUNICATIONS, S.A. DE C.V.)
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(CANADA)
--------------------------------------------------------------------------------------------
FS FINANCE CORP
--------------------------------------------------------------------------------------------
FS HOLDING CORP
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS NORTH
AMERICA INC.
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS CANADA
HOLDINGS INC.
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
HOLDINGS INC.
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL INC.
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS LIMITED
(BERMUDA) (NOW KNOWN AS
MARCONI INTERNATIONAL LIMITED)
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
DORMANT SUBSIDIARIES
--------------------------------------------------------------------------------------------
A.B. DICK HOLDINGS LTD
--------------------------------------------------------------------------------------------
ARROW LTD
--------------------------------------------------------------------------------------------
204
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
ASSOCIATED AUTOMATION LTD
--------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES HOLDINGS LTD
--------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES (MANCHESTER) LTD
--------------------------------------------------------------------------------------------
CLANVILLE LIMITED
--------------------------------------------------------------------------------------------
COMBINED ELECTRICAL
MANUFACTURERS LTD
--------------------------------------------------------------------------------------------
COPPENHALL NOMINEES LIMITED
--------------------------------------------------------------------------------------------
DAYMO LTD
--------------------------------------------------------------------------------------------
FF CHRESTIAN & CO LTD
--------------------------------------------------------------------------------------------
GPT CONSUMER PRODUCTS LTD
--------------------------------------------------------------------------------------------
GPT PAYPHONE SYSTEMS LTD
--------------------------------------------------------------------------------------------
GPT RELIANCE LTD
--------------------------------------------------------------------------------------------
THE KINGSWAY HOUSING
ASSOCIATION LTD
--------------------------------------------------------------------------------------------
KRAYFORD LTD
--------------------------------------------------------------------------------------------
LARNERWAY LTD
--------------------------------------------------------------------------------------------
LAYANA LIMITED
--------------------------------------------------------------------------------------------
XXXXXXX XXXXXXX DEVELOPMENTS
LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS OPTICAL
FIBRES LIMITED
--------------------------------------------------------------------------------------------
205
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
MARCONI (FIFTEEN) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (FIFTY-NINE) LTD
--------------------------------------------------------------------------------------------
MARCONI (FIFTY-THREE) LTD
--------------------------------------------------------------------------------------------
MARCONI (FORTY-FIVE) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (FORTY-FOUR) LTD
--------------------------------------------------------------------------------------------
MARCONI (FORTY-THREE) LIMITED
--------------------------------------------------------------------------------------------
XXXXXXX X.X. LIMITED
--------------------------------------------------------------------------------------------
MARCONI MOBILE SYSTEMS LIMITED
--------------------------------------------------------------------------------------------
MARCONI (NINE) LIMITED
--------------------------------------------------------------------------------------------
MARCONI PHOTONICA LIMITED
--------------------------------------------------------------------------------------------
MARCONI (SIXTEEN) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (SIXTY-NINE) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (SIXTY-TWO) LTD
--------------------------------------------------------------------------------------------
MARCONI (THIRTEEN) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (THIRTY-TWO) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (TLC) LTD
--------------------------------------------------------------------------------------------
MARCONI (TWENTY-SEVEN) LIMITED
--------------------------------------------------------------------------------------------
MARCONI (WCGL) UNLIMITED
--------------------------------------------------------------------------------------------
206
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
XXXXXXXXX LIMITED
--------------------------------------------------------------------------------------------
METROPOLITAN-XXXXXXX
ELECTRICAL CO LTD
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS GROUP LTD
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS (HOLDINGS) LTD
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS SERVICES LTD
--------------------------------------------------------------------------------------------
MOBILE SYSTEMS (UK) LTD
--------------------------------------------------------------------------------------------
THE M-O VALVE CO LTD
--------------------------------------------------------------------------------------------
MSI CELLULAR INVESMTNETS (ONE)
LTD
--------------------------------------------------------------------------------------------
PALMAZ LTD
--------------------------------------------------------------------------------------------
PHOTONICA LIMITED
--------------------------------------------------------------------------------------------
PHOTONIQA LIMITED
--------------------------------------------------------------------------------------------
PYFORD LIMITED
--------------------------------------------------------------------------------------------
RAINFORD GROUP TRUSTEES LTD
--------------------------------------------------------------------------------------------
RAINFORD RACKS LTD
--------------------------------------------------------------------------------------------
RELTEC (COVENTRY) LTD
--------------------------------------------------------------------------------------------
XXXXXX XXXXXXXXXX & HAWTHORNS
LTD
--------------------------------------------------------------------------------------------
THE ROTARY ENGINEERING COMPANY
LIMITED
--------------------------------------------------------------------------------------------
SALPLEX LTD
--------------------------------------------------------------------------------------------
207
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
STYLES & XXXXXXX LIMITED
--------------------------------------------------------------------------------------------
TCL PROJECTS LIMITED
--------------------------------------------------------------------------------------------
ZIPBOND LTD
--------------------------------------------------------------------------------------------
THE VULCAN FOUNDRY LTD
--------------------------------------------------------------------------------------------
TRADING SUBSIDIARIES (OTHERS)
--------------------------------------------------------------------------------------------
ASSOCIATED ELECTRICAL
INDUSTRIES INTERNATIONAL
LIMITED
--------------------------------------------------------------------------------------------
FORE SYSTEMS LIMITED
--------------------------------------------------------------------------------------------
GPT MIDDLE EAST LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS (CIS)
LIMITED
--------------------------------------------------------------------------------------------
MARCONI FINANCE plc
--------------------------------------------------------------------------------------------
MARCONI FLEET MANAGEMENT
LIMITED
--------------------------------------------------------------------------------------------
MARCONI INFORMATION SYSTEMS
LIMITED
--------------------------------------------------------------------------------------------
MARCONI (NCP) LIMITED
--------------------------------------------------------------------------------------------
NETSCIENT LIMITED
--------------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES LIMITED
--------------------------------------------------------------------------------------------
TELEPHONE CABLES LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS CHINA
LIMITED
--------------------------------------------------------------------------------------------
208
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL HOLDINGS LIMITED
--------------------------------------------------------------------------------------------
XXXXXX STREET OVERSEAS
INVESTMENTS LIMITED
--------------------------------------------------------------------------------------------
XXXXXX STREET PARTNERSHIP
--------------------------------------------------------------------------------------------
MARCONI INDIA LIMITED
--------------------------------------------------------------------------------------------
MARCONI (THIRTY-ONE) LIMITED
--------------------------------------------------------------------------------------------
HIGHROSE LIMITED
--------------------------------------------------------------------------------------------
ANCRANE
--------------------------------------------------------------------------------------------
XXXXX OF COLCHESTER HOUSING
SOCIETY LIMITED
--------------------------------------------------------------------------------------------
MARCONI INSURANCE LIMITED
--------------------------------------------------------------------------------------------
TETREL LIMITED
--------------------------------------------------------------------------------------------
RELTEC SERVICES (UK) LIMITED
--------------------------------------------------------------------------------------------
MARCONI ANSTY LIMITED
--------------------------------------------------------------------------------------------
MARCONI NOMINEES LIMITED
--------------------------------------------------------------------------------------------
YESLINK UNLIMITED
--------------------------------------------------------------------------------------------
ELLIOT AUTOMATION CONTINENTAL
SA
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL NOMINEES LIMITED
--------------------------------------------------------------------------------------------
MARCONI DEFENSE OVERSEAS
--------------------------------------------------------------------------------------------
209
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS GLOBAL
NETWORKS LIMITED
--------------------------------------------------------------------------------------------
MARCONICOM LIMITED
--------------------------------------------------------------------------------------------
MICRO SCOPE LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS
INTERNATIONAL INVESTMENTS
LIMITED
--------------------------------------------------------------------------------------------
GPT (NEDERLAND) BV
--------------------------------------------------------------------------------------------
GEC OF PAKISTAN LIMITED
--------------------------------------------------------------------------------------------
GEC ZAMBIA LIMITED
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS AB
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS BVBA
--------------------------------------------------------------------------------------------
MARCONI COMMUNICATIONS SARL
--------------------------------------------------------------------------------------------
MARCONI CHANNEL MARKETS GmbH
--------------------------------------------------------------------------------------------
AEI FURNACES PTY LTD
--------------------------------------------------------------------------------------------
XXXXXX INFORMATION TECHNOLOGY
PTY LTD
--------------------------------------------------------------------------------------------
MARCONI NEW ZEALAND LIMITED
--------------------------------------------------------------------------------------------
MARCONI TELECOMMUNICATIONS
INDIA PRIVATE LTD
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (AUSTRALIA)
--------------------------------------------------------------------------------------------
210
OFF-BALANCE SHEET LIABILITIES
OWED TO PLC OWED TO CORP
--------------------------------------------------------------------------------------------
PTY LTD
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (HONG KONG)
LIMITED
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (INDIA) PRIVATE
LIMITED
--------------------------------------------------------------------------------------------
MARCONI ACQUISITION CORP
--------------------------------------------------------------------------------------------
MARCONI FINANCE INC.
--------------------------------------------------------------------------------------------
NORTHWOOD TECHNOLOGIES INC.
--------------------------------------------------------------------------------------------
APT NEDERLANDS BV
--------------------------------------------------------------------------------------------
APT TELECOMMUNICIONES SL
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL AB
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL BRASIL LTDA
--------------------------------------------------------------------------------------------
METAPATH SOFTWARE
INTERNATIONAL (FRANCE) SA
--------------------------------------------------------------------------------------------
MARCONI PROJECTS HONG KONG LTD
--------------------------------------------------------------------------------------------
211
IN WITNESS of which this Agreement has been executed as an Agreement
and has been delivered on the date which appears first on page 1.
SIGNED by )
for MARCONI )
CORPORATION PLC )
as CORP )
SIGNED by )
for MARCONI )
CORPORATION PLC )
as a TRADING COMPANY )
SIGNED by )
for MARCONI PLC )
as plc )
SIGNED by )
for MARCONI PLC )
as a TRADING COMPANY )
212
SCHEDULE 14
CORP COVENANT
DATED [ ] MARCH, 2003
MARCONI CORPORATION PLC
MARCONI PLC
AND
ANCRANE
CORP DEED OF INDEMNITY
XXXXX & XXXXX
London
213
CONTENTS
CLAUSE PAGE
1. Interpretation................................................................................... 215
2. Covenant......................................................................................... 218
3. Mitigation....................................................................................... 219
4. Exclusions....................................................................................... 219
5. Due Date for Payment............................................................................. 219
6. Repayments....................................................................................... 219
7. Conduct of Claims................................................................................ 220
8. Time Limit....................................................................................... 220
9. Deductions from Payments, etc.................................................................... 220
10. Non-Assignability................................................................................ 221
11. Waivers and Remedies Cumulative.................................................................. 221
12. Severability..................................................................................... 221
13. Counterparts..................................................................................... 221
14. Notices.......................................................................................... 221
15. Expenses......................................................................................... 222
16. Jurisdiction..................................................................................... 222
17. Governing Law.................................................................................... 222
214
THIS DEED OF INDEMNITY is made on [ ] March, 2003 BETWEEN:
(1) MARCONI CORPORATION PLC, (registered number 67307) whose registered
office is at New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0
0XX (CORP);
(2) MARCONI PLC, (registered number 3846429) whose registered office is at
New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (plc); and
(3) ANCRANE, (registered number 4308188) whose registered office is at New
Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (ANCRANE).
WHEREAS
(A) It is proposed that Ancrane will, by way of a repayment of capital in
specie, assign its beneficial interest in inter alia the Bonds and the
Highrose Debt to plc.
(B) plc and Ancrane may incur a liability to Taxation in respect of
Exchange Gains in respect of the Bonds and the Highrose Debt.
(C) Corp is willing to indemnify plc and Ancrane for liability to Taxation
as set forth in this Deed.
THIS DEED WITNESSES AND IT IS AGREED as follows:
1. INTERPRETATION
1.1 DEFINITIONS
In this Deed:
ARRANGEMENTS means arrangements as a result of which Ancrane and Corp,
or plc and Corp, as the case may be, are treated in accordance with
section 410 ICTA 1988 as not being members of the same group of
companies for the purposes of Part X, Chapter IV of ICTA 1988;
ARRANGEMENTS PERIOD means the period commencing on the day on which
Arrangements come into existence in relation to Corp and the Relevant
Company and ending on the Effective Date;
BONDS means the Eurobonds and Yankee Bonds in which Ancrane has the
ultimate beneficial ownership on the Record Date, totalling
approximately L450,000,000;
BUSINESS DAY means any day on which banks are open for general business
in both London and New York;
CORP CONDUCT MATTERS means the preparation, submission and negotiation
of all returns and computations, the preparation and submission of all
correspondence relating to such returns and computations and the
agreement of all matters relevant to the tax position of the Relevant
Companies in relation to Taxation payable by the Relevant Companies in
respect of which Corp may be liable in accordance with clause 2;
215
CORP SCHEME means the proposed scheme of arrangement in respect of Corp
pursuant to section 425 Companies Xxx 0000, the terms of which are set
out in Part II of the Scheme Document, including any modifications,
additions or conditions approved or imposed by the Court;
Document, including any modifications, additions or conditions approved
or imposed by the Court;
EFFECTIVE DATE means the date upon which an office copy of the order of
the Court sanctioning the Corp Scheme shall have been delivered to the
Registrar of Companies for registration;
EUROBONDS means the E 500,000,000 5.625 per cent. bonds due 2005 and
the E 1,000,000,000 6.375 per cent. bonds due 2010, both issued by Corp
and both guaranteed by plc;
EXCHANGE GAIN means an exchange gain as defined in section 103 Finance
Xxx 0000;
FINAL DETERMINATION means for any accounting period of a Relevant
Company, if that Relevant Company's tax return has been agreed with the
Inland Revenue the agreement of that tax return, or, if no such
agreement has been reached, on the earlier of the following events:
(i) a determination being agreed by Corp and the Relevant Company;
or
(ii) the corporation tax return of such Relevant Company for such
period being submitted to the Inland Revenue and one of the
following events having occurred:
(a) such Relevant Company has received a binding notice
from the Inland Revenue that such tax return is final
and incapable of amendment;
(b) the Inland Revenue is precluded from serving a notice
of enquiry or further notice of enquiry (as the case
may be) into such tax return;
(c) any such enquiry has been finally determined by the
Inland Revenue's serving a closure notice on such
Relevant Company and (1) such Relevant Company has
amended such tax return in a manner which accords
with the conclusions stated in the closure notice and
the Inland Revenue has failed to make any further
amendments to that tax return within the time limit
allowed by law, (2) the Inland Revenue has amended
such tax return in a manner which accords with the
conclusions stated in the closure notice or such
Relevant Company has failed to appeal against such
amendments within the time limit allowed by law or
(3) no such amendments are required;
(d) such Relevant Company has either failed to appeal
within the time limit allowed by law against any
amendment to such tax return made by the Inland
Revenue or any such appeal has been finally
determined;
(e) the Inland Revenue is precluded from amending or
further amending (as the case may be) such tax
return; or
216
(f) an appeal has been made against an amendment of such
tax return, such appeal has been determined by the
relevant court or tribunal and (1) one party to that
appeal has notified the other that it will not appeal
against that decision, (2) an expert has determined
that there is no reasonable prospect of an appeal
against that decision succeeding, and for this
purpose "expert" means leading tax counsel of at
least ten years' standing appointed by mutual
agreement between Corp and plc or, failing such
agreement, by the Chairman of the International Bar
Association, or (3) such determination is a decision
of the highest court of appeal;
GROUP RELIEF means losses or other amounts eligible for surrender under
Chapter IV of Part X of ICTA 1988;
HIGHROSE DEBT means the inter company loan of L23,404,000 from
Ancrane to Highrose Limited;
HIGHROSE LIMITED means Highrose Limited (registered number 4410334)
whose registered office is at New Century Park, X.X. Xxx 00, Xxxxxxxx,
Xxxxxxxxxxxx XX0 0XX;
ICTA 1988 means the Income and Corporation Taxes Xxx 0000;
PLC SCHEME means the proposed scheme of arrangement in respect of plc
pursuant to section 425 Companies Xxx 0000, the terms of which are set
out in Part III of the Scheme Document, including any modifications,
additions, or conditions approved or imposed by the Court;
PRE-ARRANGEMENTS PERIOD means the period commencing on 1 April 2003 and
ending on the day before the day on which Arrangements come into
existence in relation to Corp and the Relevant Company;
PRESCRIBED RATE means the rate of 1 per cent. per annum above the base
rate for the time being of Barclays Bank PLC;
RECORD DATE has the meaning given to it in the Corp Scheme or the plc
Scheme, as appropriate;
RELEVANT COMPANY means Ancrane or plc as appropriate;
RELIEF means loss, allowance, credit, relief, deduction or set-off or
any right to a repayment of Taxation;
SAVEABLE AMOUNT means, in respect of a Relief, the amount by which a
liability to Taxation may be decreased by the use of that Relief;
SCHEME DOCUMENT means the scheme document (together with the
explanatory statements and all appendices, schedules and annexures to
it) to be issued in connection with the Corp Scheme;
TAXATION means corporation tax and any interest, penalty, surcharge or
fine relating to such corporation tax; and
217
YANKEE BONDS means the US$900,000,000 7 3/4 per cent. bonds due 2010
and the US$900,000,000 8 3/8 per cent. bonds due 2030 both issued by
Corp and both guaranteed by plc.
1.2 CONSTRUCTION
(a) In this Deed:
(i) references to a person include a body corporate and
unincorporated associations of persons;
(ii) references to an individual include his estate and
personal representatives; and
(iii) references to a party to this Deed include references
to the successors or assigns (immediate or
otherwise), of that party.
(b) In this Deed any reference, express or implied, to an
enactment includes references to:
(i) that enactment as re-enacted, amended, extended or
applied by or under any other enactment (before or
after the signature of this Deed);
(ii) any enactment which that enactment re-enacts (with or
without modification); and
(iii) any subordinate legislation made (before or after the
signature of this Deed) under that enactment, as
re-enacted, amended, extended or applied as described
in paragraph (i) above, or under any enactment
referred to in paragraph (ii) above,
and "enactment" includes any legislation in any
jurisdiction.
(c) In this Deed a reference to a clause, subclause or schedule is
a reference to a clause, subclause or schedule to this Deed.
The schedules form part of this Deed.
(d) Subclauses 1.1 to 1.2(c) above apply unless the contrary
intention appears.
(e) The headings in this Deed do not affect its interpretation.
2. COVENANT
2.1 Corp covenants with Ancrane that, subject to the provisions of this
Deed, Corp will pay to the Inland Revenue on behalf of Ancrane an
amount equal to any Taxation payable by Ancrane in respect of Exchange
Gains on the Bonds and the Highrose Debt the liability for which arises
in Ancrane's accounting period commencing on 1 April 2003 and where the
relevant profit is not apportioned to the Pre-Arrangements Period in
accordance with section 403B ICTA 1988.
2.2 Corp covenants with plc that, conditional on the plc Scheme becoming
effective by delivery of an office copy of the order of the Court
sanctioning the plc Scheme being delivered to the Registrar of
Companies for registration and subject to the provisions of this Deed,
Corp will
218
pay to the Inland Revenue on behalf of plc an amount equal to any
Taxation payable by plc in respect of Exchange Gains on the Bonds and
the Highrose Debt the liability for which arises in plc's accounting
period commencing on 1 April 2003 and where the relevant profit is not
apportioned to the Pre-Arrangements Period in accordance with section
403B ICTA 1988.
2.3 Where Corp makes any payment in accordance with clause 2.1 or 2.2, it
will make it clear to the Inland Revenue at the time it makes such
payment that the payment is made in discharge of the relevant liability
to Taxation of Ancrane or plc, as the case may be.
3. MITIGATION
Corp shall not be liable under clause 2 unless, and then only to the
extent that, the amount of the relevant liability to Taxation exceeds
the Saveable Amount in respect of any Relief available to mitigate that
liability to Taxation (including for the avoidance of doubt any Reliefs
which are available for surrender by plc to Ancrane or vice versa), so
that in particular Corp's liability under each of clause 2.1 and 2.2
shall not exceed the corporation tax on the lesser of relevant Exchange
Gains and the total profits of Ancrane or, as the case may be, plc for
its accounting period commencing 1 April 2003 and shall be reduced to
the extent that Reliefs are available in subsequent accounting periods
for carry back to reduce the corporation tax that would otherwise be
payable as described in clauses 2.1 and 2.2.
4. EXCLUSIONS
The covenants contained in clause 2 shall not extend to any liability
under this Deed to the extent that it would not have arisen but for a
voluntary act or omission carried out or effected by plc or Ancrane
after the Effective Date.
5. DUE DATE FOR PAYMENT
5.1 Any payment due under clause 2 shall be paid within five Business Days
of the later of:
(a) a Final Determination that the relevant Taxation is due; and
(b) the date on which plc or Ancrane, as the case may be, gives
Corp notice in writing, specifying (in reasonable detail) the
nature of the claim and the amount claimed.
5.2 If Corp fails to pay any sum due from it under this Deed on the due
date for payment then, save to the extent that Corp's liability under
clause 2 compensates the Relevant Company for late payment of the sum
by virtue of its extending to interest and penalties, Corp shall pay
interest on that sum from the due date until actual payment at the
Prescribed Rate compounded annually.
6. REPAYMENTS
6.1 If Ancrane or, as the case may be, plc is or may be entitled to receive
from the Inland Revenue a repayment or credit in respect of Taxation in
respect of which Corp is liable under this Deed (the UNDERLYING TAX)
then:
(a) Ancrane or, as the case may be, plc shall give Corp full
details of the entitlement as soon as practicable and in any
event within 14 days of becoming aware of the entitlement;
219
(b) Ancrane or, as the case may be, plc shall at the request and
expense of Corp take all appropriate steps to procure that the
repayment or credit shall be obtained, keeping Corp fully
informed of the progress of any action taken or, at Corp's
request, the provisions of clause 7 shall apply as if
obtaining the repayment or credit were a Corp Conduct Matter,
with such amendments as are necessary; and
(c) Ancrane or, as the case may be, plc shall pay an amount equal
to the repayment or credit received by Ancrane or, as the case
may be, plc to Corp within five days of receipt to the extent
that Corp has made a payment in respect of the underlying tax
and shall at the same time also pay to Corp an amount equal to
any repayment supplement or interest on the amount of the
repayment or credit so paid.
7. CONDUCT OF CLAIMS
7.1 Corp (or such professional advisers as Corp may select) shall be
entitled to have the sole conduct of the Corp Conduct Matters.
7.2 plc and Ancrane shall immediately authorise, sign and submit to the
Inland Revenue such returns and other ancillary information, accounts,
statements and reports relating to each of the accounting periods of
plc and Ancrane which include all or any part of the Arrangements
Period, and make such claims and elections and give such consents
(including claims for and consents to the surrender of losses by way of
Group Relief from Ancrane to plc and vice versa) and comply with all
procedural requirements in respect of the making or giving of such
returns, ancillary information, accounts, statements and reports or
such claims, elections or consents as Corp (or its advisers) may, in
its absolute discretion, direct in writing.
7.3 Corp (and its advisers) shall be provided promptly with any information
received by plc or Ancrane, or of which plc or Ancrane otherwise
becomes aware, which may be relevant to the Corp Conduct Matters, and
with such assistance and access to such information as Corp (or its
advisers) may reasonably require in connection with the Corp Conduct
Matters.
8. TIME LIMIT
The liability of Corp to make any payment under this Deed shall cease
on the seventh anniversary of the Effective Date except in respect of
any claim of which plc or Ancrane gives notice to Corp before that date
specifying (in reasonable detail) the nature of the claim and the
amount claimed and in relation to which proceedings have been commenced
prior to the eighth anniversary of the Effective Date.
9. DEDUCTIONS FROM PAYMENTS, ETC.
9.1 All sums payable by Corp under this Deed shall be paid free and clear
of all deductions and withholdings whatsoever, save only as may be
required by law.
9.2 If any deductions or withholdings are required by law to be made from
any of the sums payable as mentioned in clause 9.1, other than in
respect of interest under clause 5.2, Corp shall be obliged to pay such
additional amount as will ensure that the net amount received under
this Deed will equal the full amount that would have been received in
the absence of any such requirement to make a deduction or withholding.
220
9.3 If any sum payable by Corp under this Deed (other than interest under
clause 5.2) shall be subject to Taxation in the hands of plc or
Ancrane, as the case may be, Corp shall be under the same obligation to
make an increased payment in relation to that Taxation as if the
liability were a deduction or withholding required by law.
10. NON-ASSIGNABILITY
No party may assign, transfer, novate, encumber or dispose of any of
its interest in, its rights and/or obligations under this Deed.
11. WAIVERS AND REMEDIES CUMULATIVE
The rights of each party under this Deed:
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights under the
general law; and
(c) may be waived only in writing and specifically.
Delay in exercising or non-exercise of any such right is not a waiver
of that right.
12. SEVERABILITY
If a provision of this Deed is or becomes illegal, invalid or
unenforceable in any jurisdiction, that shall not affect:
(a) the validity or enforceability in that jurisdiction of any
other provision of this Deed; or
(b) the validity or enforceability in other jurisdictions of that
or any other provision of this Deed.
13. COUNTERPARTS
This Deed may be executed in any number of counterparts, each of which
will be deemed an original and all of which will constitute one and the
same Deed and any party may enter into this Deed by executing a
counterpart.
14. NOTICES
14.1 All notices or other communications under or in connection with this
Deed shall be given in writing and may be made by facsimile. Any such
notice will be deemed to be given as follows:
(a) if by letter, when delivered personally or on actual receipt;
and
(b) if by facsimile, when received in legible form.
However, a notice given in accordance with the above but received on a
non-working day or after business hours in the place of receipt will
only be deemed to be given on the next working day in that place.
221
14.2 The address and facsimile number of each party for all notices under or
in connection with this Deed are:
(a) in relation to Corp:
New Century Park, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 020 7306 1395
(b) in relation to plc:
Xxx Xxxxxxx Xxxx, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 020 7306 1395
(c) in relation to Ancrane:
New Century Park, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 020 7306 1395
or any other notified by that party for this purpose to the other party
by not less than five Business Days' notice.
15. EXPENSES
Each party shall pay its own costs and expenses in connection with the
preparation, negotiation and execution of this Deed.
16. JURISDICTION
Each party to this Deed agrees that the courts of England shall have
jurisdiction to settle any disputes in connection with this Deed and,
accordingly, submits to the jurisdiction of the English courts.
17. GOVERNING LAW
This Deed is governed by, and shall be construed in accordance with,
English law.
IN WITNESS of which this Deed has been executed as a deed and has been delivered
on the date which appears first on page 1.
222
EXECUTED as a Deed ) ____________________________________
by MARCONI CORPORATION PLC ) Director
acting by [ ] and ) ____________________________________
[ ] ) Director/Secretary
EXECUTED as a Deed ) ____________________________________
by MARCONI PLC ) Director
acting by [ ] and ) ____________________________________
[ ] ) Director/Secretary
EXECUTED as a Deed ) ____________________________________
by ANCRANE ) Director
acting by [ ] and ) ____________________________________
[ ] ) Director/Secretary
223
SCHEDULE 15
ANCRANE DEED OF ASSIGNMENT
DATED [ ] MARCH, 2003
ANCRANE
AND
MARCONI PLC
----------------------
DEED OF ASSIGNMENT
BY WAY OF REPAYMENT OF CAPITAL
IN SPECIE
---------------------------
XXXXX & XXXXX
London
224
CONTENTS
CLAUSE PAGE
1. Interpretation................................................................................... 226
2. Assignment and Payment........................................................................... 229
3. Further Assurance................................................................................ 229
4. Turnover......................................................................................... 230
5. Set-off and Counterclaim......................................................................... 230
6. Representations and Warranties................................................................... 230
7. Assignor's Responsibility........................................................................ 231
8. Indemnity........................................................................................ 231
9. Changes to the Parties........................................................................... 231
10. Waivers and Remedies Cumulative.................................................................. 231
11. Severability..................................................................................... 231
12. Counterparts..................................................................................... 232
13. Notices.......................................................................................... 232
14. Expenses......................................................................................... 233
15. Stamp Duty....................................................................................... 233
16. Jurisdiction..................................................................................... 233
17. Governing Law.................................................................................... 233
Signatories.......................................................................................... 238
225
THIS DEED is dated [ ] March, 2003
BETWEEN:
(1) ANCRANE (registered number 04308188) whose registered office is at New
Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (the
ASSIGNOR); and
(2) MARCONI PLC (registered number 03846429) whose registered office is at
New Century Park, XX Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx, XX0 0XX (the
ASSIGNEE).
BACKGROUND:
(A) This Assignment has been entered into by the aforementioned parties as
part of the proposed financial restructuring of the Assignee and Corp
(the FINANCIAL RESTRUCTURING).
(B) As part of the Financial Restructuring, the Assignor was re-registered
as an unlimited company on 25th March, 2003 and the Assignee is the
registered holder of its entire issued share capital, save for one
ordinary share that is registered in the name of Marconi Nominees
Limited and held on trust for the Assignee.
(C) On the date of this Deed the Assignor reduced its existing share
capital (including its share premium account) from [-] to L100 to
enable it to make a repayment of capital in specie to the Assignee and
pursuant to the repayment of capital the Assignor has agreed to assign
the Assigned Rights to the Assignee prior to the Corp Creditors'
Meeting.
IT IS AGREED as follows:
1. INTERPRETATION
1.1 DEFINITIONS
In this Deed:
ASSIGNED RIGHTS means the beneficial interest in all assets, property,
rights, title, interest, benefits and obligations of the Assignor
including, but without limitation, any beneficial interest in the
Bonds, the Corp Loan and the Highrose Debt and any right or entitlement
of the Assignor to receive cash, loan notes, shares or other
consideration or payment as a creditor of Corp or the Assignee as a
result of the Financial Restructuring but, for the avoidance of doubt,
excluding L100 and any rights which the Assignor has under the
Corp Covenant;
ASSIGNMENT means the assignment of the Assigned Rights under this Deed;
BONDS means the Eurobonds and Yankee Bonds in which the Assignor had
the ultimate beneficial ownership at the date of this Deed;
BUSINESS DAY means any day other than Saturday, Sunday or any other day
which is a public holiday in England and Wales;
COMPLETION means the execution of this Deed by the parties set out
herein;
226
CORP means Marconi Corporation plc (registered number 67307) whose
registered office is at New Century Park, XX Xxx 00, Xxxxxxxx,
Xxxxxxxxxxxx, XX0 0XX;
CORP COVENANT means the deed entered into between, inter alia, Corp,
plc and Ancrane on [-], 2003, pursuant to which Corp has agreed to pay
certain corporation tax on behalf of plc and Ancrane;
CORP CREDITORS' MEETING means a meeting of Corp Scheme Creditors called
pursuant to the terms of the Corp Scheme to be held on [25th] April,
2003;
CORP LOAN means the loans from the Assignor to Corp in the amount
of L 363,308,000;
CORP SCHEME means the proposed scheme of arrangement with the Corp
Scheme Creditors in respect of Corp pursuant to section 425 Companies
Act 1985 (including any modifications, additions or conditions approved
or imposed by the court);
CORP SCHEME CREDITOR means a scheme creditor of Corp in respect of its
Scheme Claim;
CORP SPV means Krayford Limited (registered number 4307660),, whose
registered address is at New Century Park, X.X. Xxx 00, Xxxxxxxx,
Xxxxxxxxxxxx XX0 0XX;
EFFECTIVE DATE means in relation to either of the Schemes, the date on
which an office copy of the order of the Court sanctioning that the
relevant Scheme shall have been delivered to the Registrar of Companies
for registration;
ESCROW AND DISTRIBUTION AGREEMENT means the agreement to be entered
into between (inter alios) Corp, the Supervisors, the Escrow Trustee
and Bank of New York (as custodian and the distribution agent) in the
form set out in the Scheme Document, a condition precedent to the
effectiveness of which (insofar as it relates to the Scheme) is the
occurrence of the Effective Date;
ESCROW TRUSTEE means Corp Spv, who will be appointed under the terms of
the Escrow and Distribution Agreement and any successor from time to
time;
EUROBOND ISSUES means the E 500,000,000 5.625 per cent. bonds due 2005
and the E 1,000,000,000 6.375 per cent. bonds due 2010, both issued by
Corp and both guaranteed by the Assignee;
EUROBONDS means all or any of the bonds comprising the Eurobond Issues;
EXCLUDED CLAIMS means in relation to the Corp Scheme the claims of the
nature described in Part I of Appendix 9 of the Scheme Document and, in
relation to the plc Scheme, the claims of the nature described in Part
III of Appendix 9;
HIGHROSE DEBT means the inter company loan of L 23,404,000 from the
Assignor to Highrose Limited;
HIGHROSE means Highrose Limited (registered number 4410334) whose
registered office is at New Century Park, X.X. Xxx 00, Xxxxxxxx,
Xxxxxxxxxxxx XX0 0XX;
227
LIABILITY or LIABILITIES means any liability or obligation of a person
whether it is present, future, prospective or contingent, whether or
not it is fixed or undetermined, whether or not it involves the payment
of money or performance of an act or obligation and whether it arises
at common law, in equity or by statute, in England and Wales or in any
other jurisdiction, or in any other manner whatsoever, but such
expression does not include any liability which is barred by statute or
is otherwise unenforceable under English law or arises under a contract
which is void or, being voidable, has been duly avoided;
MARCONI NOMINEES LIMITED means Marconi Nominees Limited (registered
number 3854422) whose registered office is at New Century Park, X.X.
Xxx 00, Xxxxxxxx, Xxxxxxxxxxxx XX0 0XX;
PLC SCHEME means the proposed scheme of arrangement in respect of the
Assignee pursuant to section 425 Companies Xxx 0000, the terms of which
are set out in Part III of the Scheme Document (including any
modifications, additions or conditions approved or imposed by the
Court);
RECORD DATE has the meaning given to it in the Corp Scheme or the plc
Scheme, as appropriate;
SCHEME means either or both of the Corp Scheme or the plc Scheme, as
appropriate;
SCHEME CLAIM means any claim or right which a person is, or may in any
circumstances become, entitled to bring or enforce against Corp or the
Assignee (as appropriate) in respect of any Liability of Corp or the
Assignee (as appropriate) in each and every case in existence as at the
Record Date or after that date by reason of any Liability incurred
before that date, other than Excluded Claims.
SCHEME DOCUMENT means the document (including all appendices, schedules
and annexes to it) dated - March, 2003 issued in connection with the
Schemes;
SUPERVISORS means the persons holding office as the supervisors of the
Corp Scheme or plc Scheme or both, as appropriate, from time to time;
YANKEE BONDS means all or any of the bonds comprising the Yankee
Issues; and
YANKEE ISSUES means the US$900,000,000 7 3/4 per cent. bonds due 2010
and the US$900,000,000 8 3/8 per cent. bonds due 2030 both issued by
Corp and both guaranteed by plc.
1.2 CONSTRUCTION
(a) In this Deed:
(i) references to a person include a body corporate and
unincorporated associations of persons;
(ii) references to an individual include his estate and personal
representatives; and
(iii) references to a party to this Deed include references to the
successors or assigns (immediate or otherwise), of that party.
228
(b) In this Deed any reference, express or implied, to an enactment
includes references to:
(i) that enactment as re-enacted, amended, extended or applied by
or under any other enactment (before or after the signature of
this Deed);
(ii) any enactment which that enactment re-enacts (with or without
modification); and
(iii) any subordinate legislation made (before or after the
signature of this Deed) under that enactment, as re-enacted,
amended, extended or applied as described in paragraph (a)
above, or under any enactment referred to in paragraph (b)
above,
and "enactment" includes any legislation in any jurisdiction.
(c) In this Deed, unless the contrary intention appears, a reference to a
clause, subclause or schedule is a reference to a clause, subclause or
schedule to this Deed. The schedules form part of this Deed.
(d) Subclauses 1.1 to 1.2(c) above apply unless the contrary intention
appears.
(e) The headings in this Deed do not affect its interpretation.
2. ASSIGNMENT AND PAYMENT
2.1 ASSIGNMENT
With effect from Completion and subject to the terms of this Deed, the
Assignor, with full title guarantee (in accordance with the Law of
Property (Miscellaneous Provisions) Act 1994), assigns by way of
repayment of capital in specie to the Assignee the Assigned Rights.
2.2 NOTICE AND ACKNOWLEDGEMENTS
(a) The Assignor notifies the Assignee, and the Assignee acknowledges, that
the Assignor shall not:
(i) be required to reimburse the Assignee for, or otherwise be
responsible for or assure the Assignee against, any loss
suffered by the Assignee in consequence of the matters
provided for in this Deed (other than loss caused by the
negligent or wilful failure of the Assignor to perform or
observe the terms of this Deed); or
(ii) have any obligation to reacquire the Assigned Rights or any
part of the Assigned Rights.
(b) The Assignee agrees with effect from Completion to accept the
Assignment without recourse and to benefit from the consideration the
Assignor would have received (as original lender and creditor) as a
result of the Financial Restructuring.
3. FURTHER ASSURANCE
(a) The Assignor undertakes to execute and deliver the form of directions
letter appended to the Escrow and Distribution Agreement to Corp on or
before the 17th April, 2003.
(b) In addition, the Parties shall each take whatever action may be
necessary:
229
(i) so that the Assignee may assume, to the fullest extent
permitted and in accordance with the provisions of this Deed,
all the rights of the Assignor with respect to the Assigned
Rights with effect from Completion;
(ii) for the Assignor to be released from all obligations arising
after Completion in relation to the Assigned Rights; and
(iii) otherwise to implement the terms of this Deed,
including the execution of any further documents and the giving of any
notice, order or direction and the making of any registration which in
each case may be required.
4. TURNOVER
If any dividend is received or recovered by the Assignor in respect of
the Assigned Rights on or after the Completion Date, the Assignor shall
on and from such time hold such dividend on trust and forthwith assign
and/or pay to the Assignee that amount together with interest on it
from the date of receipt of the amount to the date of payment.
5. SET-OFF AND COUNTERCLAIM
The Assignment shall be made without set-off or counterclaim on amounts
which are not the subject of this Deed.
6. REPRESENTATIONS AND WARRANTIES
6.1 Each party severally represents and warrants to the other parties that:
(a) it has all requisite power and authority to enter into and
perform, and has taken all necessary action to authorise the
entry into, performance and delivery of, this Deed and the
transactions contemplated by this Deed.
(b) this Deed constitutes legal, valid and binding obligations
enforceable against it in accordance with its terms; and
(c) all authorisations required or desirable in connection with
the entry into, performance, validity and enforceability of
this Deed and the transactions contemplated by this Deed have
been obtained or effected and are in full force and effect.
6.2 The Assignor represents to the Assignee that:
(a) OBLIGATIONS: At the date of this Deed it will, to the best of
its knowledge and belief, have performed and complied with all
obligations required to be performed or complied with by it in
relation to the Assigned Rights under the Corp Loan up to the
Completion Date, and no rights, including rights of set-off,
will have arisen in respect of the Assigned Rights in favour
of Corp; and
(b) RIGHTS ASSIGNABLE: The rights in respect of the Assigned
Rights are assignable in accordance with the provisions of
this Deed and the Corp Loan.
230
(c) INDEBTEDNESS UNDER THE CORP LOAN: Corp is indebted to the
Assignor under the Corp Loan in the outstanding principal
amount of L363,308,000.
7. ASSIGNOR'S RESPONSIBILITY
Save as expressly provided in Clause 6 (Representations and Warranties)
the Assignor has not made and does not by this Deed make, and the
Assignee has not relied upon, any representation, warranty or condition
(expressed or implied) about, and the Assignor will have no
responsibility to the Assignee for, the effectiveness, validity or
enforceability of, the Bonds, the Corp Loan, the Highrose Debt or other
documentation delivered by the Assignor to the Assignee or any of the
terms, covenants or conditions contained in the Bonds, the Corp Loan,
the Highrose Debt or other documentation or any non-performance by any
party to them or the financial condition of Corp, Highrose or any other
person liable with respect to the Assigned Rights.
8. INDEMNITY
The Assignee agrees to indemnify the Assignor and the Assignor agrees
to indemnify the Assignee against any liabilities, obligations, losses,
damages, penalties, judgments, costs, expenses or disbursements of any
kind or nature which may be imposed on or incurred by the other party
as a consequence of failure by it duly and punctually to perform its
obligations, or breach by it of any of the representations and
warranties made by it, in this Deed.
9. CHANGES TO THE PARTIES
No party may assign, transfer, novate, encumber or dispose of any of
its interest in, its rights and/or obligations under this Deed without
the prior written consent of the other party. However, this Clause 9
shall not restrict the Assignee from assigning, charging or pledging
the whole or any part of its rights, title and interest in the Assigned
Rights to any third party.
10. WAIVERS AND REMEDIES CUMULATIVE
The rights of each party under this Deed:
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights under the
general law; and
(c) may be waived only in writing and specifically.
Delay in exercising or non-exercise of any such right is not a waiver
of that right.
11. SEVERABILITY
If a provision of this Deed is or becomes illegal, invalid or
unenforceable in any jurisdiction, that shall not affect:
(a) the validity or enforceability in that jurisdiction of any
other provision of this Deed; or
231
(b) the validity or enforceability in other jurisdictions of that
or any other provision of this Deed.
12. COUNTERPARTS
This Deed may be executed in any number of counterparts, each of which
will be deemed an original and all of which will constitute one and the
same Deed and any party may enter into this Deed by executing a
counterpart.
13. NOTICES
13.1 GIVING OF NOTICES
Subject to Clause 2.2 (Notices and acknowledgements), all notices or
other communications under or in connection with this Deed shall be
given in writing and, unless otherwise stated may be made by facsimile.
Any such notice will be deemed to be given as follows:
(a) if by letter, when delivered personally or on actual receipt;
and
(b) if by facsimile, when received in legible form.
However, a notice given in accordance with the above but received on a
non-working day or after business hours in the place of receipt will
only be deemed to be given on the next working day in that place.
13.2 ADDRESSES FOR NOTICES
The address and facsimile number of each party for all notices under or
in connection with this Deed are:
(a) in relation to the Assignor:
New Century Park, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 000 0000 0000
Attn: Company Secretary
(b) in relation to the Assignee:
Xxx Xxxxxxx Xxxx, XX Xxx 00
Xxxxxxxx, Xxxxxxxxxxxx,
XX0 0XX
Fax Number: 000 0000 0000
Attn: Company Secretary
or any other notified by that Party for this purpose to the other party
by not less than five Business Days' notice.
232
14. EXPENSES
Each party shall pay its own costs and expenses in connection with the
preparation, negotiation and execution of this Deed.
15. STAMP DUTY
15.1 The Assignee shall pay, and forthwith on demand indemnify each of the
other parties to this Deed against any liability it incurs in respect
of, any stamp, registration and similar tax which is or becomes payable
in connection with the entry into and performance of this Deed.
15.2 The Assignee covenants to submit this Deed to the Inland Revenue Stamp
Office for adjudication as soon as reasonably practicable after the
execution of this Deed (and in any event within thirty days thereof),
claiming relief from transfer stamp duty under section 42 of the
Finance Xxx 0000 (as amended).
16. JURISDICTION
Each party to this Deed agrees, for the benefit of the Assignor, that
the courts of England shall have jurisdiction to settle any disputes in
connection with this Deed and, accordingly, submits to the jurisdiction
of the English courts.
17. GOVERNING LAW
This Deed is governed by, and construed in accordance with, English
law.
IN WITNESS of which this Deed has been executed as a deed and has been delivered
on the date which it appears first on page 1.
233
SIGNATORIES
EXECUTED as a Deed ) __________________________________
by MARCONI PLC ) Director
acting by [ ] and )
[ ] ) _________________________________
Director/Secretary
EXECUTED as a Deed ) _________________________________
by ANCRANE ) Director
acting by [ ] and )
[ ] ) _________________________________
Director/Secretary
234
SCHEDULE 16
CORP SIDE LETTER
[ON LETTERHEAD OF CORP PLC]
To: Xxxxxxx Xxxx and Xxxxxx Xxxxxxx
(or their successors) in their capacity as
Scheme Supervisors of Marconi plc
(the BENEFICIARIES)
[DATE], 2003
Dear Sirs
FUNDING OF ONGOING COSTS
1. DEFINITIONS
Capitalised terms used in this letter, unless defined herein, shall
have the meaning assigned to them in Schedule 2 of the Letter of
Credit, as set out in Schedule 10 of the Performance Bonding Facility
dated on or about [31st] March, 2003 between Marconi Bonding Limited
(as applicant), Marconi Corporation plc (CORP), HSBC (as agent and
security trustee), the original issuing banks named therein, the
original banks named therein and the original indemnifying subsidiaries
of Corp named therein (the LETTER OF CREDIT).
2. CORP'S UNDERTAKING
Corp undertakes to make available to the Beneficiaries the Total L/C
Amount on the terms and conditions set out in the Letter of Credit on
the basis that any reference to the Issuing Bank in the Letter of
Credit will be interpreted as references to Corp. The terms in relation
to [the Expiry Date,] Payments, Assignment, New Beneficiaries [and UCP]
set out in the Letter of Credit shall also apply to this letter.
3. THE BENEFICIARIES' REPRESENTATIONS AND WARRANTIES
In consideration of Corp entering into this agreement and making the
Total L/C Amount available to the Beneficiaries, each Beneficiary
hereby undertakes that:
(a) any rights under, and any sums received pursuant to, this
letter by a Beneficiary will be in their capacity as agent of
Marconi plc;
(b) any sums received by a Beneficiary pursuant to this letter
will be used to meet Marconi plc's Ongoing Costs and will be
used solely for that purpose;
(c) any Demands shall be made on the basis provided under the
Letter of Credit;
(d) the Beneficiaries will submit a Demand in accordance with the
terms of the Letter of Credit if requested by Marconi plc and
if the request is to meet Ongoing Costs;
235
(e) when all Ongoing Costs have been met, any remaining sums
received pursuant to a Demand will be held on trust for Corp
and will be repaid to Corp as soon as reasonably practicable;
(f) the Beneficiaries shall notify Corp immediately in writing if
before, on or after the date upon which this letter is issued,
they are of the view (acting reasonably) that this letter is
no longer required or is required in a lesser amount; and
(g) if any such notification pursuant to subclause 3(f) above is
made before this letter has been issued, the Total L/C Amount
shall be reduced accordingly.
4. DELIVERY OF DEMAND AND NOTICES
Each Demand shall be in writing and, unless otherwise stated, may be
made by letter or fax and must be received in legible form by Corp at
its address and by the particular department or officer (if any) as
follows:
Marconi Corporation plc
Xxx Xxxxxxx Xxxx,
X.X. Xxx 00,
Xxxxxxxx,
Xxxxxxxxxxxx XX0 0XX
Fax: 000 0000 0000
Attention: Company Secretary
Any notice or other formal communication to be given under this
agreement to the Beneficiaries must be in writing and, unless otherwise
stated, may be made by letter or fax and may be delivered or sent by
post or fax to the Beneficiaries at the following address:
Xxxxxxx Xxxx and Xxxxxx Xxxxxxx
KPMG LLP
0 Xxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
5. GOVERNING LAW
This letter is governed by, and shall be construed in accordance with,
English law.
Yours faithfully
_________________________________
For and on behalf of
MARCONI CORPORATION PLC
By:
I agree to be bound by the terms of this agreement.
236
_______________________________ _________________________________
Xxxxxxx Xxxx Xxxxxx Xxxxxxx
Scheme Supervisor of Marconi plc Scheme Supervisor of Marconi plc
Date: Date:
237
SIGNATORIES
EXECUTED as a Deed ) XXXXXXXXXXX XXXXXX
by XXXXXXX PLC ) Director
acting by X. XXXXXX and X.XXXXXX ) XXXX XXXXXX
) Secretary
EXECUTED as a Deed ) XXXXXXXXXXX XXXXXX
by XXXXXXX CORPORATION PLC ) Director
acting by X.XXXXXX and X.XXXXXX ) XXXX XXXXXX
) Secretary
EXECUTED as a Deed ) XXXXX XXXXXXXXX
by E-A CONTINENTAL LIMITED ) Director
acting by X.XXXXXXXXX and X.XXXXXX ) XXXX XXXXXX
) Secretary
EXECUTED as a Deed ) XXXXXXXXXXX XXXXXX
by ANCRANE ) Director
acting by X.XXXXXX and X.XXXXXX ) XXXX XXXXXX
) Secretary
EXECUTED as a Deed ) XXXXX XXXXXXXXX
by XXXXXXX NOMINEES LIMITED ) Director
acting by X.XXXXXXXXX and X.XXXXXX ) XXXX XXXXXX
) Secretary
EXECUTED as a Deed ) XXXXX XXXXXX
by MARIPOSA TECHNOLOGY, INC. ) Director
acting by X.XXXXXX and X. XXXXXXXX ) XXXXXXXX XXXXXXX
) Director/Secretary
under authority of that Company, in the
presence of:
Witness signature: XXXXXXX XXXXX
Name: Xxxxxxx Xxxxx
Address: 000 Xxxxxx Xxxx
Xxxxx 000
Xxxxxx, XX 00000
Occupation: Sr. Administrative Assistant
238
EXECUTED as a Deed ) XXXXX XXXXXX
by SYSTEMS MANAGEMENT ) Director
SPECIALISTS, INC. )
acting by X.XXXXXX and X.XXXXXXX ) XXXXXXXX XXXXXXX
) Director/Secretary
under authority of that Company, in the
presence of:
Witness signature: XXXXXXX XXXXX
Name: Xxxxxxx Xxxxx
Address: 000 Xxxxxx Xxxx
Xxxxx 000
Xxxxxx, XX 00000
Occupation: Senior Administrative Assistant
EXECUTED as a Deed ) XXXX XXXXXXXX
by METAPATH SOFTWARE ) Director
INTERNATIONAL, INC. )
acting by X.XXXXXXXX and X. XXXXXXX ) XXXXXXXX XXXXXXX
) Director/Secretary
under authority of that Company, in the
presence of:
Witness signature: XXXXXXX XXXXX
Name: Xxxxxxx Xxxxx
Address: 000 Xxxxxx Xxxx
Xxxxx 000
Xxxxxx, XX 00000
Occupation: Senior Administrative Assistant
EXECUTED as a Deed ) XXXXX XXXXXXXXX
by MARCONI BONDING LIMITED ) Director
acting by X. XXXXXXXXX and X.XXXXXX ) XXXX XXXXXX
) Secretary
EXECUTED as a Deed ) XXXXXXXXXXX XXXXXX
by BRITISH SEALED BEAMS LIMITED ) Director
acting by X.XXXXXX and X. XXXXXX ) XXXXXXX XXXXXX
) Director
239
EXECUTED as a Deed ) XXXXX XXXXXXXXX
by XXXXXXX ANSTY LIMITED ) Director
acting by X. XXXXXXXXX and X. XXXXXX ) XXXX XXXXXX
) Secretary
EXECUTED as a Deed ) XXXXX XXXXXXXXX
by PHOTONIQA LIMITED ) Director
acting by X. XXXXXXXXX and X. XXXXXX ) XXXX XXXXXX
) Secretary
EXECUTED as a Deed ) XXXXX XXXXXXXXX
by YESLINK UNLIMITED ) Director
acting by X. XXXXXXXXX and X. XXXXXX ) XXXX XXXXXX
) Secretary
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