EXHIBIT 10.4
CONFORMED COPY
Private & Confidential
DATED 28 JULY 2005
FRAMLINGTON HOLDINGS LIMITED (1)
THE GUARANTORS AS NAMED IN THIS AGREEMENT (2)
AND
AXA INVESTMENT MANAGERS SA (3)
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IMPLEMENTATION AGREEMENT
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[XXXXXX XXXX LOGO]
CONFORMED COPY
CONTENTS
CLAUSE PAGE
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1 Definitions and interpretation.................................. 3
2 Conditions precedent............................................ 13
3 Pre-Completion Matters.......................................... 14
4 Completion...................................................... 17
5 The Warranties.................................................. 19
6 Claims against the Seller and the Guarantors.................... 21
7 Non-competition provisions and use of names..................... 22
8 Covenants and Other Undertakings................................ 23
9 Pensions........................................................ 25
10 Release and indemnity for outstanding Guarantees and LTIP
obligations.................................................. 26
11 Guarantee of Seller's obligations............................... 27
12 Intellectual property and other matters......................... 28
13 Entire agreement................................................ 29
14 Effect of Completion............................................ 30
15 Remedies........................................................ 30
16 Payments........................................................ 31
17 Further assurances.............................................. 32
18 Announcements and confidentiality............................... 32
19 Records......................................................... 33
20 Severability and set-off........................................ 34
21 Miscellaneous................................................... 34
22 Notices......................................................... 34
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23 Assignment...................................................... 35
24 Buyer's Agent for service....................................... 36
25 Agent for service............................................... 36
26 Agent for service............................................... 37
27 Governing law and submission to jurisdiction.................... 37
Schedule 1 Part A - The Seller........................................... 38
Part B - The Guarantors............................................ 38
Schedule 2 Information about the Group................................... 39
Part A - The Company............................................... 39
Part B - The Subsidiaries.......................................... 40
Part C - African Companies......................................... 46
Part D - Dormant Companies......................................... 48
Schedule 3 Part A - The Warranties....................................... 64
Schedule 4 Actuary's Letter.............................................. 94
Schedule 5 The Properties................................................ 95
Schedule 6 Limitations on the liability of the Seller and the
Guarantors............................................................ 96
Schedule 7 Part A - The preparation of the Completion Accounts........... 103
Part B - Form of Completion Accounts............................... 106
Part C - Agreed accounting policies and principles................. 107
Schedule 8 Pre-Completion Undertakings................................... 108
AGREED FORM DOCUMENTS
Power of Attorney
Taxation Deed
Disclosure Letter
Schedule of Deeds
Shareholder Resolution
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THIS AGREEMENT is dated 28th July 2005 and is made BETWEEN:
(1) Framlington Holdings Limited, a company incorporated in England and Wales
(registered number 02314914), whose registered office is at 000
Xxxxxxxxxxx, Xxxxxx, XX0X 0XX (the "SELLER");
(2) The persons whose names and addresses are stated in Part B of Schedule 1
(together, the "GUARANTORS"); and
(3) AXA INVESTMENT MANAGERS, societe anonyme whose registered office is at
Coeur La Defense, Tour B, La Defense 4, 000 Xxxxxxxxx xx Xxxxxxx xx Xxxxxx
- 00000 Xxxxx La Defense, France, registered at the registre du commerce et
des societes de Nanterre with the number RCS 393 051 826 (the "BUYER").
NOW IT IS HEREBY AGREED AS FOLLOWS:
1 DEFINITIONS AND INTERPRETATION
1.1 In this Agreement, unless the context requires otherwise:
"ACCOUNTANTS" shall have the meaning given to it in paragraph 1 of Schedule
7;
"ACCOUNTS" means the consolidated accounts of the Company, including the
balance sheet, profit and loss statement, cash flow statement, notes to
those accounts and the associated directors' and auditors' reports, for
each of the last two financial years the last of which ended on the
Accounts Date;
"ACCOUNTING STANDARDS" means the Financial Reporting Standards and
Statements of Standard Accounting Practice issued and/or adopted by the
Accounting Standards Board and Abstracts issued by the Urgent Issues Task
Force of the Accounting Standards Board;
"ACCOUNTS DATE" means 31st December 2004;
"ACTUAL NET ASSET VALUE" means the amount shown opposite the heading "Net
Assets excluding pension deficit" as shown in the Completion Accounts as
prepared in accordance with Schedule 7;
"ACTUAL TAXATION LIABILITY" has the meaning given to that expression in the
Taxation Deed;
"ACTUARIAL ASSUMPTIONS" means the assumptions in the agreed form;
"AFRICAN COMPANIES" means the companies set out in Part C of Schedule 2;
"AFRICAN EXIT PLAN" means the plan in relation to the African Companies set
out in Schedule 10;
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"AFRICAN FUNDS" has the meaning given in paragraph 4 of Schedule 10;
"ARTICLES OF ASSOCIATION" means the articles of association of the Company
as amended from time to time;
"AUDITORS" means the auditors of the Company, namely PricewaterhouseCoopers
LLP, Chartered Accountants, of Southwark Towers, 00 Xxxxxx Xxxxxx Xxxxxx,
Xxxxxx XX0 0XX;
"AUM STATEMENT" shall have the meaning given to it in Schedule 9;
"AWARDS" has the meaning given in the LTIP Rules save that the term shall
exclude Options (also as defined in the LTIP Rules);
"BOARD" means the board of directors of the Company;
"BOOKS AND RECORDS" has its common law meaning and includes, without
limitation, all notices, correspondence, orders, inquiries, drawings,
plans, books of account and other documents and all computer disks or tapes
or other machine legible programs or other records;
"BUSINESS" means the business of the Group;
"BUSINESS DAY" means a day other than a Saturday or Sunday or other public
or bank holiday on which banks are ordinarily open for the transaction of
normal banking business in London, other than solely for the settlement and
clearing of euro;
"BUSINESS INFORMATION" means all information, know-how and records (whether
or not confidential and in whatever form held) including (without
limitation) all formulae, data, manuals and instructions and all customer
lists, sales information, business plans and forecasts, and all technical
or other expertise and all accounting and Taxation records, correspondence,
orders and inquiries;
"BUYER'S ACCOUNTANTS" means KPMG, Chartered Accountants;
"BUYER'S ACTUARY" means the person nominated by the Buyer from time to time
in relation to this Agreement;
"BUYER'S GROUP" means the Buyer and each company which is from time to time
a Related Company of the Buyer;
"BUYER'S SOLICITORS" means Xxxxxxxxx and May, of Xxx Xxxxxxx Xxx, Xxxxxx
XX0X 0XX;
"BUYER'S WARRANTIES" means the warranties set out in Part B of Schedule 3
to be given by the Buyer to the Seller and the Guarantors;
"CA 1985" means the Companies Xxx 0000;
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"COMPANY" means Framlington Group Limited, a company incorporated in
England and Wales (registered number 01237167), whose registered office is
at 000 Xxxxxxxxxxx, Xxxxxx XX0X 0XX, further details of which are set out
in Part A of Schedule 2;
"COMPLETION" means the performance by the parties of their respective
obligations under clause 5.1;
"COMPLETION ACCOUNTS" means the consolidated pro forma net asset statement
of the Company as at the Completion Date to be prepared in accordance with
Schedule 7;
"COMPLETION DATE" means, subject to the proviso to clause 3.4, the last
Business Day in the calendar month in which a Completion Month Reference
Date falls, save that, without prejudice to clause 2.8, if there is a
Completion Month Reference Date in any following month, the Completion Date
shall be the last Business Day of that calendar month;
"COMPLETION MONTH REFERENCE DATE" means the date falling seven days after
the later of:
(i) the FSA Approval Date;
(ii) the expiry of any PCU Cure Period where such expiry occurs after the
FSA Approval Date; and
(iii) the expiry of any Warranty Cure Period where such expiry occurs after
the FSA Approval Date;
"CONDITIONS" means the conditions specified in clause 2.1, and "CONDITION"
shall mean any one of them;
"CONNECTED PERSON" means, in relation to each Guarantor and the Seller, any
company which is for the time being a Related Company of that Guarantor or
the Seller other than any Group Company;
"DATA ROOM" means all correspondence, documents and other information made
available by the Seller for inspection by the Buyer and its advisers by any
means and which is listed in the Data Room Index;
"DATA ROOM INDEX" means the index detailing the contents of the Data Room,
in the agreed form;
"DISCLOSURE LETTER" means the letter of the same date as this Agreement
from the Seller to the Buyer disclosing certain matters in relation to the
Warranties, together with all documents attached to it;
"DORMANT COMPANIES" means the companies listed in Part D of Schedule 2;
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"EGM" has the meaning given in clause 3.2;
"ENCUMBRANCE" means any mortgage, charge, pledge, lien, option,
restriction, right of first refusal, right of pre-emption, claim, right,
interest or preference granted to any third party, or any other encumbrance
or security interest of any kind (or an agreement or commitment to create
any of the same);
"FSA" means the Financial Services Authority;
"FSA APPROVAL DATE" means the date on which the Condition in clause 2.1(a)
is satisfied;
"FSA SETTLEMENT" means the settlement and contribution agreement between,
inter alia, Framlington Investment Management Limited and the FSA dated
24th December 2004;
"FSMA" means the Financial Services and Markets Xxx 0000;
"FUNDAMENTAL BREACH OF THE PRE-COMPLETION UNDERTAKINGS" means one or more
matter(s), event(s) or circumstance(s) constituting a breach or breaches of
the Pre-Completion Undertakings which give(s) rise to, or is or are (as the
case may be) reasonably likely to give rise to, a reduction in the market
value of the equity share capital of the Company in excess of L78.4
million or the equivalent in any other currency;
"FUNDAMENTAL BREACH OF THE WARRANTIES" means one or more matter(s),
event(s) or circumstance(s) constituting a breach or breaches of the
Warranties which give(s) rise to, or is or are (as the case may be)
reasonably likely to give rise to, a reduction in the market value of the
equity share capital of the Company in excess of L78.4 million or the
equivalent in any other currency;
"FUNDING AGREEMENT" means the letter dated 21st July 2003 between the
Company and the trustee of the LTIP Trust pursuant to which the Company
agreed to contribute a percentage of its profits to the LTIP Trust and to
procure the delivery of ordinary shares in the Company to participants in
the LTIP;
"FUNDS" means those investment trusts, OEICs and unit trusts and other
collective investment schemes of which any Group Company is the operator,
manager (including fund manager and sub-fund manager), investment adviser,
sub-investment adviser or authorised corporate director at any time prior
to Completion;
"GOVERNMENT ENTITY" means, in relation to anywhere in the world, any
supra-national, national, state, municipal or local government, any
sub-division, court, administrative agency or commission or other authority
thereof, or any quasi-governmental or private body exercising any
regulatory, importing or other governmental or quasi-governmental authority
or any Taxation Authority;
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"GROUP" means the Company and the Subsidiaries, details of which are set
out in Parts A, B and C of Schedule 2, and "GROUP COMPANY" means any of
them;
"GROUP PERSONAL PENSION SCHEME" means the Framlington Group Personal
Pension Scheme;
"GUARANTEE" means any guarantee, indemnity, suretyship, letter of comfort
or other assurance, security or right of set off given or undertaken by a
person (other than a Group Company) to secure or support the obligations
(actual or contingent) of the Business or any Group Company and whether
given directly or by way of counter indemnity to any other person who has
provided any of the foregoing;
"HMRC" means HM Revenue and Customs;
"HOLDING COMPANY" means a holding company (as defined by sections 736 and
736A CA 1985) or a parent undertaking (as defined by section 258 CA 1985);
"ICTA 1988" means the Income and Corporation Taxes Xxx 0000;
"IMPLEMENTATION DOCUMENTS" has the meaning given in Clause 15.1;
"INFLOW AMOUNT" shall have the meaning given to it in Schedule 9;
"INSTALMENT PAYMENTS REGULATIONS" means the Corporation Tax (Instalment
Payment Regulations) 1998;
"INTERNAL MARKET" means the rules of the internal market established in
connection with the LTIP;
"INTELLECTUAL PROPERTY RIGHTS" means all or any copyrights, patents, trade
marks, trade names, service marks, design rights and database rights
(whether or not any of these is registered and including applications for
registration of any such thing) and all other rights or forms of protection
of a similar nature or having equivalent or similar effect to any of these
which may subsist anywhere in the world;
"INVESTMENT TRUST" means any company listed as an investment trust company
on the Official List of the London Stock Exchange;
"KEY EMPLOYEES" means Xxxxxx Xxxxxxxx, Xxxxx Xxxxxx, Xxxxx Xxxxxxxx,
Xxxxxxx Xxxxxxx, Xxxxx Xxxxxxxx and Xxxxx Xxxxxx and "KEY EMPLOYEE" shall
mean any of them;
"LIBOR" means the display rate per annum of the offered quotation for
deposits in sterling for a period of one month which appears on Telerate
3750 (or such other page as the parties may agree) at or about 11.00 a.m.
London time on the due date;
"LONGSTOP DATE" means 30th November 2005;
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"LOSSES" means actions, proceedings, losses, reasonable costs, claims,
damages, liabilities and reasonable expenses;
"LTIP" means the Framlington Group Long Term Incentive Plan as adopted by
the Board on 20th March 2003;
"LTIP RULES" means the rules of the LTIP as amended from time to time;
"LTIP TRUST" means the trust created pursuant to the trust deed dated 6th
March 2003 made between The Company and the LTIP Trustee;
"LTIP TRUSTEE" means Ogier Employee Benefit Trustee Limited;
"MANAGEMENT ACCOUNTS" means the unaudited management accounts of the Group,
including a profit and loss account and balance sheet and selected
information on funds under management in the format included in the Data
Room;
"NET OUTFLOW AMOUNT" means the difference between the Outflow Amount and
the Inflow Amount provided that if the Inflow Amount exceeds the Outflow
Amount, the Net Outflow Amount shall be nil;
"OFFER DOCUMENTS" means the offer document dated 27th July 2005 containing
the terms of the offer made by the Buyer for the entire issued share
capital of the Company and the accompanying form of acceptance;
"ON RISK TIME" means a moment in time which is the same amount of time
after a Completion Month Reference Date as it is before the last Business
Day of the month in which such Completion Month Reference Date falls, save
that:
(i) if the proviso to clause 3.4 applies then the On Risk Time shall
be the moment in time which is the same amount of time after the
Completion Month Reference Date which has then occurred as it is
before 31st October 2005; and
(ii) in any event, if the relevant Completion Month Reference Date is
the last Business Day of a month then the On Risk Time shall be
deemed to be 12.00 noon (London time) on that day.
"OPTION" has the meaning given in the LTIP Rules;
"OUTFLOW AMOUNT" shall have the meaning given to it in Schedule 9;
"PCU CURE PERIOD" has the meaning given in clause 4.4;
"PENSION SCHEME" means the Framlington Group Pension Plan which is
currently governed by the Second Definitive Trust Deed dated 26th August
1999;
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"PENSION SCHEME MEMBERS" means the directors, employees, past employees and
past directors of the Company who are entitled to benefits under the
Pension Scheme and all those persons who are entitled to claim through
them;
"PHANTOM OPTION AGREEMENTS" means phantom option agreements made between
the Seller and certain employees of the Group Companies at any time before
the Completion Date;
"PRE-COMPLETION UNDERTAKINGS" means the undertakings given by the Seller
and the Guarantors as set out in Schedule 8;
"PRE-SALE DIVIDEND" means a dividend of an amount to be determined and to
be declared by the Company prior to Completion;
"PROCEEDINGS" means any proceeding, suit or action arising out of or in
connection with this Agreement;
"PROPERTIES" means the properties, details of which are set out in Schedule
5 and "PROPERTY" shall be construed accordingly;
"PROVISIONAL NET ASSET VALUE" means the sum of L22,360,000;
"RECOGNISED INVESTMENT EXCHANGE" shall have the meaning given to it in
section 285(1) of FSMA;
"RECORD DATE" has the meaning given in clause 3.4.7;
"REGULATORY AUTHORITY" means any relevant Government Entity (other than any
Taxation Authority) or other authority, in any jurisdiction, which is
responsible for authorising, supervising or otherwise regulating any part
of the Business or has any other regulatory, investigative, administrative
or quasi-judicial jurisdiction, power or other similar function in relation
to any part of the Business, including, without limitation, the FSA, the
Financial Ombudsman Service and the SEC;
"RELATED COMPANY" means, in relation to any company, any subsidiary or
holding company of that company or any subsidiary of that holding company;
"RELEVANT CLAIM" means a claim by the Buyer against the Seller under clause
7.1 or clause 7.2 (other than a claim under the Taxation Warranties);
"RELEVANT EMPLOYEE" means an employee or director for the time being of, or
a former employee or director of, any Group Company;
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"RELIEF" means any loss, relief, allowance, exemption, set-off, deduction,
credit or other relief relating to any Taxation or to the computation of
income, profits or gains for the purposes of any Taxation;
"RESPECTIVE PERCENTAGE" means in relation to each Guarantor, the respective
percentage shown in column 3 of Part B of Schedule 1 opposite its name;
"RETAIL FUNDS" means Absolute Growth Fund, American Growth Fund, Biotech
Fund, Blue Chip Fund, Emerging Markets Fund, Equity Income Fund, European
Fund, Financial Fund, Gilt Fund, Health Fund, Japan Fund, Managed Balanced
Fund, Managed Distribution Fund, Managed Growth Fund, Managed Income Fund,
Managed Portfolio Fund, Monthly Income Fund, Nasdaq Fund, NetNet Fund, New
Leaders Fund, Pan Euro Bond Fund, UK Growth Fund, UK Select Opportunities
Fund and UK Smaller Companies Fund;
"SALE SHARES" means 63,431,552 issued ordinary shares of 5p each in the
capital of the Company;
"SELLER'S ACCOUNTANTS" means Deloitte, Chartered Accountants;
"SELLER'S ACTUARY" means the person nominated by the Seller from time to
time in relation to this Agreement;
"SELLER INSURANCE POLICIES" means the directors and officers liability
insurance (policy number 072790U) and financial institutions professional
indemnity civil liability insurance (policy numbers PI01763OU, PI01762OU
and PI 04607 O U) in the name of the Seller and "SELLER INSURANCE POLICY"
shall mean any of them;
"SERVICE DOCUMENT" means a claim form, application notice, order, judgement
or other document relating to any Proceedings;
SENIOR EMPLOYEE" means a director or employee of any Group Company whose
basic salary (including for this purpose applicable bonuses but, for the
avoidance of doubt, excluding any other benefits or emoluments) exceeds
L100,000 per annum;
"SHAREHOLDER RESOLUTION" means the resolution of the members of the Company
in the agreed form;
"SHARES" means ordinary shares of 5 xxxxx each in the capital of the
Company;
"SIGNING AUM" means L3,747,292,091;
"SUBSIDIARIES" means the companies and undertakings specified in Parts B
and C of Schedule 2 and "SUBSIDIARY" means any of them;
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"SUBSIDIARY" means a subsidiary (as defined by sections 736 and 736A CA
1985) or a subsidiary undertaking (as defined by section 258 CA 1985);
"TAXATION" or "TAX" means:
(b) all forms of tax, levy, duty, contribution, charge, impost,
deduction, withholding or other amount whenever created or
imposed and whether of the United Kingdom or elsewhere, payable
to or imposed by any Taxation Authority;
(c) without limitation all employment taxes including contributions;
and
(d) all charges, interest, penalties, costs and fines incidental or
relating to any Taxation falling within paragraphs (a) or (b)
above or which arise as a result of the failure to pay any
Taxation on the due date or to comply with any obligation
relating to Tax;
"TAXATION AUTHORITY" means HMRC or any other revenue, customs, fiscal,
governmental, statutory, state or provincial authority, body or person,
whether of the United Kingdom or elsewhere;
"TAX CLAIM" means a claim under the Tax Deed;
"TAXATION DEED" means the taxation deed in the agreed form entered, or to
be entered, into between the Seller (1), the Guarantors (2) and the Buyer
(3);
"TAXATION WARRANTIES" means the Warranties contained in paragraph 22 of
Part A of Schedule 3;
"VAT" means value added tax as provided for in the Sixth Directive of the
European Community, charged by the provisions of the Value Added Tax Xxx
0000 ("VATA 1994"), any regulation promulgated thereunder or any tax of a
similar nature;
"WARRANTIES" means the warranties set out in Part A of Schedule 3 to this
Agreement;
"WARRANTY CURE PERIOD" has the meaning given in clause 5.4; and
"WORKING HOURS" means, in any place, the period 9.30 a.m. to 5.30 p.m. by
day which is a Business Day in that place.
1.2 In this Agreement, unless the context requires otherwise:
(a) a document expressed to be in the "AGREED FORM" means a document
in a form which has been agreed by the parties on or before the
execution of this Agreement and signed or initialled by them or
on their behalf for the purposes of identification;
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(b) references to a clause or Schedule are to a clause of, or a
Schedule to, this Agreement, references to this Agreement include
its Schedules, and references to a Part or paragraph are to a
Part or paragraph of a Schedule to this Agreement;
(c) references to this Agreement or any other document or to any
specified provision of this Agreement or any other document are
to this Agreement, that document or that provision as in force
for the time being and as amended from time to time in accordance
with the terms of this Agreement or that document or, as the case
may be, with the agreement of the relevant parties;
(d) references to any English legal term for any action, remedy,
method of judicial proceeding, legal document, legal status,
court, official or any legal concept or thing shall, in respect
of any jurisdiction other than England, be deemed to include what
most nearly approximates in that jurisdiction to the English
legal term;
(e) references to time are to London time;
(f) words importing the singular include the plural and vice versa,
words importing a gender include every gender, and references to
persons include corporations, partnerships and other
unincorporated associations or bodies of persons;
(g) the contents table and the headings to clauses, Schedules, Parts
and paragraphs are inserted for convenience only and shall be
ignored in interpreting this Agreement;
(h) the words and phrases "other", "including" and "in particular"
shall not limit the generality of any preceding words or be
construed as being limited to the same class as the preceding
words where a wider construction is possible; and
(i) reference to a person having control of another person, or being
controlled by another person, or being under common control with
another person shall be construed as referring to control within
the meaning of any of sections 416, 767B and 840 ICTA 1988.
1.3 In this Agreement, unless the context requires otherwise, a reference to
any statute or statutory provision (whether of the United Kingdom or
elsewhere) shall be construed as a reference to the same as it may have
been amended, modified or re-enacted except, where such amendment,
modification or re-enactment is made after the date of this Agreement, to
the extent that it would increase the liability of any party to this
Agreement.
1.4 The undertakings and promises given in this Agreement are given by each
party in consideration for the undertakings and promises given by each
other party.
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2 CONDITIONS PRECEDENT
2.1 Completion is conditional on:
(a) either
(i) the FSA indicating (in accordance with Part XII FSMA) that
it approves the acquisition of control by the Buyer and all
other persons who would become controllers (within the
meaning of section 422 of FSMA) of the Group Companies that
are authorised by the FSA provided such approval has not
been made subject to any conditions imposed by the FSA that
would have a material adverse effect on the ability of the
Buyer or the Group to carry on the Business after Completion
in substantially the same manner as the Business is carried
on as at Completion, unless such conditions have been varied
or removed before Completion; or
(ii) such approval being deemed as having been given pursuant to
section 184(2) of FSMA;
(b) the Shareholder Resolution having been passed; and
(c) a Structural Event (as defined in the Articles of Association)
having occurred and the Seller having transferred to the LTIP
Trustee or to participants in the LTIP for no consideration
5,146,241 Shares.
2.2 The Buyer undertakes:
2.2.1 to use all reasonable endeavours to ensure that the Condition referred to
in clause 2.1(a) is fulfilled as soon as possible after the date of this
Agreement and in any event by no later than the Longstop Date; and
2.2.2 as soon as reasonably practicable and in any event within 10 Business Days
following the date of this Agreement, to submit to the FSA an application
pursuant to section 178 of FSMA in relation to the proposed change of
control of the relevant Group Companies.
2.3 Without prejudice to the provisions of clause 2.2, pending Completion, the
Buyer, the Seller and each Guarantor undertake to co-operate with each
other by:
2.3.1 providing to the Company or each other (as the case may require) and any
Regulatory Authority as promptly as reasonably practicable upon request and
in good faith any information and documents reasonably required for the
purpose of making any submissions, filings and notifications to any such
Regulatory Authority in relation to the transactions provided for by this
Agreement; and
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2.3.2 promptly disclosing to each other all correspondence received from any
Regulatory Authority and keeping each other promptly informed of any other
communications in whatever form with any Regulatory Authority, in relation
to or affecting the approval contemplated in clause 2.1(a).
2.4 The Buyer may in its absolute discretion waive in whole or in part the
Conditions (other than the Condition contained in clause 2.1(a)).
2.5 If at any time the Seller or any Guarantor becomes aware of a fact or
circumstance which might prevent or materially delay the Conditions or any
of them being satisfied (including, without limitation, any proceedings or
possible proceedings intimating that the FSA's approval referred to in
clause 2.1(a) may not be granted), immediately it comes to the notice of
any of them, it shall promptly notify the Buyer.
2.6 If at any time the Buyer becomes aware of a fact or circumstance which
might prevent or materially delay the Conditions or any of them being
satisfied (including, without limitation, any proceedings or possible
proceedings intimating that the FSA's approval referred to in clause 2.1(a)
may not be granted), immediately it comes to the Buyer, it shall promptly
notify the Seller and the Guarantors.
2.7 The Buyer and the Seller (as the case may be) shall each give notice to the
other of the satisfaction of any Condition, as soon as reasonably
practicable following it becoming aware of such satisfaction.
2.8 If Completion has not taken place on or before the Longstop Date, then this
Agreement shall terminate with immediate effect.
3 PRE-COMPLETION STEPS
3.1 The Seller undertakes to effect or to use reasonable endeavours to effect
(as the case may be) the following steps in the order, and at the times,
contemplated in this clause 3.
3.2 The Seller undertakes to the Buyer that it will convene an extraordinary
general meeting (the "EGM") of the Company to be held as soon as
practicable after the date of this Agreement at which the Shareholder
Resolution is proposed.
3.3 The Seller shall procure that the Shareholder Resolution is passed at the
EGM or any valid adjournment thereof.
3.4 On the Business Day following receipt by the Seller from the Buyer of
confirmation pursuant to clause 2.7 that the Condition in clause 2.1(a) has
been satisfied or, if later, the expiry of a PCU Cure Period or a Warranty
Cure Period, the Seller shall procure that the following events shall occur
in the following order:
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3.4.1 the Board shall resolve, pursuant to the Articles of Association, that no
Shares held (either at that time or in the future) by the LTIP Trust shall
be converted into deferred shares in accordance with the Articles of
Association until such time as the Board may determine;
3.4.2 a Structural Event (as defined the Articles of Association) shall occur;
3.4.3 a letter (in a form approved by the Buyer) is sent to the participants in
the LTIP informing them of the occurrence of the Structural Event;
3.4.4 5,146,241 Shares are transferred for no consideration to the holders of
Awards or, at the Buyer's option, to the LTIP Trust;
3.4.5 the transfers referred to in clauses 3.4.4 are validly registered in the
register of members and the register of transfers of the Company;
3.4.6 the Board declares and the Seller approves the Pre-Sale Dividend in
respect of holders of Shares on the register of members of the Company at
5.00pm on the Business Day immediately preceding the Completion Date (the
"RECORD DATE")
PROVIDED THAT if compliance with this clause 3.4 would result in the
Structural Event occurring in the period from 20th September 2005 to 30th
September 2005 inclusive, then the Seller shall procure that the events set
out in this clause shall occur on the first Business Day in October 2005
and, subject to the other provisions of this Agreement, the Completion Date
shall be deferred until 31st October 2005.
3.5 Following the occurrence of the events contemplated by clause 3.4.3 to
clause 3.4.4 (inclusive), the Seller undertakes to use reasonable
endeavours to procure each holder of Options who determines to exercise his
Options after the occurrence of the Structural Event but before the Record
Date has transferred to him the Shares to which such Options relate and
that his name is placed is on the register of members of the Company on or
before the Record Date.
3.6 The Seller undertakes that the declaration and payment of the Pre-Sale
Dividend shall comply with applicable law and will not give rise to any
breach of any applicable regulatory capital requirements of a Regulatory
Authority on the part of any Group Company at the dates of declaration and
payment of the Pre-Sale Dividend.
3.7 The Seller undertakes to request the consent of the LTIP Trustee to
amendments to the terms of the Internal Market to allow participants in the
LTIP to sell Shares at or after Completion to the Buyer or the LTIP Trustee
without regard to the valuation mechanism therein. The Seller agrees to
provide its consent to such amendments and shall use its reasonable
endeavours to procure that the remuneration committee of the board of the
Company shall also approve such amendments. In lieu of the obligations
above, the Buyer may request the Seller to use reasonable endeavours to
suspend the operation of the Internal Market in the period between the
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date of this Agreement and Completion, in which case the Seller shall be
obliged to use reasonable endeavours to do so.
4 PENDING COMPLETION
4.1 Pending Completion, the Seller shall procure that the Pre-Completion
Undertakings are complied with in all respects.
4.2 For the purposes of determining the Net Outflow Amount, the provisions of
Schedule 9 shall apply.
4.3 The Seller and the Buyer each undertake, in respect of the period from and
including the time of signing of this Agreement to and including the
Completion Date, to disclose in writing to the other anything of which it
becomes aware which is or is reasonably likely to constitute a material
breach of any of the Pre-Completion Undertakings at or at any time before
Completion as soon as reasonably practicable after becoming aware of such
thing. The Seller undertakes to use reasonable endeavours to procure that
the Company discloses to the Buyer and Seller in writing anything of which
it becomes aware which is or is reasonably likely to constitute a material
breach of any of the Pre-Completion Undertakings at or at any time before
Completion as soon as reasonably practicable after becoming aware of such
thing.
4.4 If, at any time prior to Completion, the Buyer or the Seller becomes aware
(whether pursuant to clause 4.3 or otherwise) that there is or has been a
Fundamental Breach of the Pre-Completion Undertakings, the Seller or the
Buyer (as the case may be) shall, within 2 Business Days of becoming so
aware, serve notice (a "PCU BREACH NOTICE") on the other pursuant to this
clause 4.4. The Seller and the Guarantors shall have a period of up to 20
Business Days from the receipt or giving (as the case may be) of the PCU
Breach Notice to remedy the Fundamental Breach of the Pre-Completion
Undertakings, which period shall expire if and when this effective remedy
is achieved (the "PCU CURE PERIOD") If, at the expiry of the 20 Business
Day period from the receipt or giving of the PCU Breach Notice, such
Fundamental Breach of the Pre-Completion Undertakings has not been
effectively remedied in whole or in part such that the relevant matter(s),
event(s) or circumstance(s) constituting a breach of the Pre-Completion
Undertakings no longer constitute(s) a Fundamental Breach of the
Pre-Completion Undertakings, the Buyer shall be entitled (but not obliged)
to terminate this Agreement with immediate effect by written notice to the
other parties. For the purposes of this clause 4.4, a remedy shall be
deemed not to be effective if it is only in the short term interest of the
Group or involves the introduction of new business to the Group in the form
of investment management mandates or distribution agreements from the
Guarantors or any of their respective Connected Persons. Nothing in this
clause 4.4 shall constitute a waiver of, or prejudice, comprise or affect,
the Buyer's rights under any other provision of this Agreement (including,
without limitation, clause 4.1).
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5 COMPLETION
5.1 Completion shall take place at the London offices of Xxxxxx Xxxx or at such
other place as the parties may agree on the Completion Date when all (but
not part only unless the parties otherwise agree in writing) of the
following business referred to in this Clause 5.1 shall be transacted:
5.1.1 the Seller shall deliver to the Buyer or (as the case may be) procure that
the following shall be effected:
(a) certified copies of the minutes recording the resolution of the
board of directors of the Seller and the Guarantors authorising
the transactions contemplated by this Agreement;
(b) duly executed transfers (in favour of such person or persons as
the Buyer may direct or have directed) of all shares in the
Subsidiaries not registered in the name of any Group Company,
together with the certificates for those shares;
(c) the Taxation Deed duly executed by each of the parties to it
other than the Buyer;
(d) confirmation in the agreed form that the Funding Agreement has
been terminated;
(e) those persons nominated by the Buyer to the Seller are validly
appointed as additional directors provided that such nominations
are provided to the Seller not less than 2 Business Days prior to
Completion;
(f) Xxxxx Xxxxxxx, Alain Dromer, Xxxxxx Xxxxxxxxx and Xxxxxxx Xxxxx
cease to be directors of each Group Company and deliver to the
Buyer letters (executed as deeds) from all such persons so
resigning acknowledging that they have no claim outstanding for
compensation for loss of office or otherwise howsoever, including
redundancy and unfair dismissal; and
(g) confirmation in the agreed form from the Seller that all of the
rights under the Phantom Option Agreements have been satisfied by
the payment of the cash amounts contemplated by those agreements
to the relevant employees.
5.1.2 the Seller shall:
(a) cause the transfers of all Shares to which the Buyer or the LTIP
Trustee is entitled at that time to be resolved to be registered
(subject only to their being duly stamped); and
(b) make available at the Company's registered office (as agents for
each Group Company) all its statutory and minute books, its
common seal (if any), certificate of incorporation, any
certificate or certificates of incorporation or of change of name
and other documents and records including copies of its
memorandum and articles of association; and
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(c) make available at the Company's registered office the deeds and
documents of title relating to the Properties in accordance with
a schedule in the agreed form.
5.1.3 the Buyer shall deliver to the Seller the Taxation Deed duly executed by
the Buyer; and
5.1.4 the parties shall:
(a) join in procuring that all bank mandates in force for each Group
Company shall be altered (in the manner which the Buyer requires)
to reflect the resignations and appointments referred to above;
and
(b) deliver certified copies of the minutes recording the resolution
of their respective board of directors authorising the
transactions contemplated by this Agreement.
5.2 If the obligations of the Seller under clause 5.1.1 are not complied with
on the Completion Date, the Buyer may:
(a) defer Completion for a period of 2 Business Days (so that the
provisions of this clause 5 shall apply to Completion as so
deferred); and
(b) in respect of a failure by the Seller to comply with its
obligations under clause 5.1.1 at any Completion which has been
deferred pursuant to clause 5.2(a), to terminate this Agreement
with immediate effect by notice in writing to the Seller.
5.3 If the obligations of the Buyer under clause 5.1.3 are not complied with on
the Completion Date the Seller may:
(a) defer Completion for a period of 2 Business Days (so that the
provisions of this clause 5 shall apply to Completion as so
deferred); and
(b) in respect of a failure by the Buyer to comply with its
obligations under clause 5.1.3 at any Completion which has been
deferred pursuant to clause 5.3(a), to terminate this Agreement
with immediate effect by notice in writing to the Buyer.
5.4 If, immediately before an On Risk Time, either the Buyer or the Seller
becomes aware that there exists a Fundamental Breach of the Warranties if
the Warranties were to be repeated by reference to the facts and
circumstances then subsisting (such that all express or implied references
to the date of this Agreement are deemed to be references to the date of
such repetition), the Buyer or the Seller (as the case may be) shall, serve
notice thereof (a "WARRANTY BREACH NOTICE") on the other party whereupon
the Seller and the Guarantors shall be afforded a period of up to 20
Business Days in which to remedy such Fundamental Breach of the Warranties,
which period shall expire if and when an effective remedy is achieved (the
"WARRANTY CURE PERIOD"). If, at the expiry of the Warranty Cure Period,
such Fundamental Breach of the
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Warranties has not been remedied effectively in whole or in part such that
the relevant matter(s), event(s) or circumstance(s) constituting a breach
of the Warranties no longer constitute(s) a Fundamental Breach of the
Warranties, the Buyer shall be entitled (but not obliged) to terminate this
Agreement with immediate effect by written notice to the other parties. For
the purposes of this clause 5.4, a remedy shall be deemed not to be
effective if it is only in the short term interests of the Group or
involves the introduction of new business to the Group in the form of
investment management mandates or distribution agreements from the
Guarantors or any of their respective Connected Persons. Nothing in this
clause 5.4 shall constitute a waiver of, or prejudice, comprise or affect,
the Buyer's rights under any other provision of this Agreement (including
without limitation clause 7.1).
5.5 If there is a Net Outflow Amount at an On Risk Time which is greater than
24 per cent. of the Signing AUM the Buyer may terminate this Agreement with
immediate effect by notice in writing to the Seller on the date on which
the On Risk Time is reached, save that where such date is not a Business
Day such notice may be given to the Seller on the next Business Day.
6 ACTUAL NET ASSET VALUE
6.1 If the Actual Net Asset Value is:
(a) a positive sum which is less than the Provisional Net Asset
Value, the Seller shall pay to the Buyer in accordance with
clause 6.2 a sum equal to the difference;
(b) a negative sum, the Seller shall pay to the Buyer in accordance
with clause 6.2 a sum equal to the aggregate of the Provisional
Net Asset Value and the amount by which the Actual Net Asset
Value is less than zero; or
(c) equal to the Provisional Net Asset Value, no payment or further
payment from the Seller to the Buyer shall be made pursuant to
this clause 6.2.
6.2 Any sum payable as referred to under clause 6.1 or pursuant to the terms of
the Net Asset Adjustment set out in the Offer Documents shall be paid:
(a) within 3 Business Days after the agreement or determination of
the Actual Net Asset Value pursuant to Schedule 7;
(b) together with interest thereon at the rate of LIBOR as determined
at the Completion Date which shall accrue from day to day and
shall be calculated on the basis of a year of 365 days from the
Completion Date up to and including the date of payment (unless
such interest has already been paid pursuant to the Offer
Documents); and
(c) by electronic funds transfer for same day value to a bank account
nominated by the Buyer or (as the case may be) in accordance with
the Offer Documents.
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6.3 For the purposes of determining the Actual Net Asset Value, the provisions
of Part A of Schedule 7 shall apply.
7 THE WARRANTIES
7.1 The Seller warrants to the Buyer that:
7.1.1 each of the Warranties is true and accurate as at the date of this
Agreement; and
7.1.2 each of the following Warranties shall be true and accurate immediately
prior to Completion as if repeated immediately before Completion by
reference to the facts and circumstances subsisting at that time on the
basis that any reference in the Warranties, whether express or implied, to
the date of this Agreement is substituted by a reference to the Completion
Date: 1.1 to 1.6 (inclusive), 2.1 to 2.3 (inclusive), 3.1 to 3.5
(inclusive), 4.1, 4.4, 4.5, 4.7, 4.12 to 4.15 (inclusive), 5.1 to 5.3
(inclusive), 6.3 to 6.4 (inclusive), 9.3 (second sentence only) to 9.4
(inclusive), 10.1, first sentence of 10.3, 10.4, 10.5, 11.3, all of
paragraph 12 (other than 12.3, 12.4, 12.5, 12.8), 13.5 (second sentence
only) to 13.10 (inclusive), 13.13, all of paragraph 14 (other than 14.2,
14.3 and 14.9), 15.1, 15.3, 16.2, 16.3 (second sentence), 16.4, 16.5, 16.6,
16.8, 16.9, 16.12, 16.13, 16.15, 17, 19.1, 19.2, 20.4, 20.5, 20.7 to 20.11
(inclusive) and all of 21, 22.1, 22.2, 22.5, 22.6, 22.13, 22.16,
22.19-22.21 and the first sentence of 22.23, 22.24-22.27, 22.30, 22.32,
22.33, 22.34, 22.36, 22.40 and 22.42.
7.2 For the purposes of Schedule 3, "SO FAR AS THE SELLER IS AWARE" or any
similar phrase refers to the actual knowledge of Xxxxx Xxxxxxx, Alain
Dromer, Xxxxxxx Xxxxx and Xxxxxx Xxxxxxxxx having made reasonable enquiries
of (but only of) Xxx Xxxxxxxxx, (Chief Operating Officer) Xxxxxxx Xxxxxxx
(Company Secretary) (in respect of Xxxxxxxxxx 0, 0, 0, 0, 00 xxx 00),
Xxxxxx Xxxxx (Financial Controller) (in respect of Warranties 6, 7, 8, 9,
15, 21 and 22), Xxxxxxxx Xxxxx (Head of Compliance) (in respect of
Warranties 4, 5, 9, 16 and 20), Xxxxx Xxxxx (Head of Legal) (in respect of
Warranties 4, 5, 7, 9, 12, 14, 16, 17, 18, 19 and 20), Xxxx Xxxxxxx (Sales
and Marketing Director) (in respect of Warranties 4, 9, 10 and 11), Xxxx
Xxxxxxxx (Head of IT) (in respect of Warranties 9 and 16), Una Xxxxxx (Head
of Facilities and Personnel) (in respect of Warranties 12 to 14) and Xxxxxx
Xxxxxxx (Chief Investment Officer) (in respect of Warranties 4 and 9). Each
of the Guarantors and the Seller undertakes to procure that each of Xxxxx
Xxxxxxx, Xxxxx Xxxxxx, Xxxxxxx Xxxxx and Xxxxxx Xxxxxxxxx make reasonable
enquiries of each such person (or, in each case, such other person who at
the relevant time holds the relevant position in the Group) in respect of
each Warranty set out next to his name before signing of this Agreement
and, in respect only of those Warranties qualified by the Seller's
awareness, before Completion
7.3 The Buyer warrants to the Seller and the Guarantors that each of the
Buyer's Warranties is true and accurate as at the date of this Agreement
and shall be true and accurate on the Completion
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Date as if repeated immediately before Completion by reference to the facts
and circumstances subsisting at that time.
7.4 The Warranties are qualified by those facts, matters, events or
circumstances fairly disclosed in the Disclosure Letter and the Data Room
and for this purpose "FAIRLY DISCLOSED" means disclosed in such manner and
in sufficient detail as to enable a reasonable buyer to make a reasonable
assessment and evaluation of the implications thereof including without
limitation the nature and scale of the facts, matters, events or
circumstances concerned. No warranty or representation is given as to the
accuracy or completeness of any statements (including any statements of
opinion) contained in the Disclosure Letter or the Data Room.
7.5 Save for bona fide claims for fraud, wilful concealment with intent to
mislead or a wilful misrepresentation with intent to mislead, the Seller
undertakes not to, and the Guarantors undertake not to and to procure that
none of their Connected Persons, make or makes any claim against any
director or employee of any Group Company on whom any of them may have
relied before agreeing to any terms of the Implementation Documents or
authorising any statement in the Disclosure Letter. The provisions of this
clause 7.5 shall be enforceable by each director or employee of any such
Group Company.
7.6 Each of the paragraphs in Schedule 3 shall be construed as a separate and
independent warranty and (except where expressly provided to the contrary)
shall not be limited or restricted by reference to or inference from the
terms of any other Warranty or any other term of this Agreement.
8 CLAIMS AGAINST THE SELLER AND THE GUARANTORS
8.1 The liability of the Guarantors under the Implementation Documents shall be
several and not joint.
8.2 The provisions of Schedule 6 shall apply in accordance with their terms.
8.3 Each of the Guarantors acknowledge and undertake that the Seller's
obligations, liabilities and responsibilities under and in respect of the
Implementation Documents shall remain in full force and effect, and shall
not be affected, compromised or prejudiced, in the event that the Seller
enters into a voluntary or involuntary liquidation or similar process.
8.4 Without prejudice in any respect to the Buyer's rights under clause 13.4,
the Buyer undertakes that, to the extent the consent of the Buyer or any
member of the Group is requested by the Seller or the Guarantors following
Completion in order to implement or effect a voluntary liquidation or a
reduction of capital of the Seller, the Buyer shall (or shall procure that
the relevant member of the Group shall) promptly give its unconditional
consent.
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9 NON-COMPETITION PROVISIONS AND USE OF NAMES
9.1 Each of the Seller and the Guarantors undertakes with the Buyer that it
shall not, and shall procure that its respective Connected Persons shall
not, without the prior written consent of the Buyer, for a period
commencing on the date of this Agreement and ending on the second
anniversary of the Completion Date, solicit or entice away or endeavour to
solicit or entice away from any Group Company any Senior Employee (other
than a Key Employee or Xxxx Xxxxxxx), whether or not that person would
commit any breach of their contract of employment by reason of leaving the
service of that Group Company, provided always that nothing in this clause
9.1 shall prevent the Seller or the Guarantors or any of them from
employing a Senior Employee (other than a Key Employee or Xxxx Xxxxxxx) of
any Group Company (from time to time) pursuant to a general advertisement
to the public or pursuant to a recruitment campaign which is not directed
specifically at the employees of Group Companies.
9.2 Each of the Seller and the Guarantors undertakes with the Buyer that it
shall not, and shall procure that its respective Connected Persons shall
not, without the prior written consent of the Buyer, for a period
commencing on the date of this Agreement and ending on the third
anniversary of the Completion Date, solicit or entice away or endeavour to
solicit or entice away from any Group Company any Key Employee or Xxxx
Xxxxxxx, whether or not that person would commit any breach of their
contract of employment by reason of leaving the service of that Group
Company.
9.3 The Buyer undertakes to procure that neither it, the Company, any Related
Company to the Buyer nor any member of the Group shall at any time after
Completion represent itself or hold itself out as being in any way
connected with the Seller, any Guarantor or any Connected Person, and each
of the Seller and the Guarantors undertakes to procure that neither it nor
any Connected Person shall at any time after Completion represent itself or
hold itself out as being in any way connected with the Buyer, any Related
Company to the Buyer or any member of the Group.
9.4 Each of the Guarantors and the Seller agrees with the Company and the Buyer
that the restrictive covenants in this clause 9 are reasonable and
necessary for the protection of the value of the Sale Shares and the
Company and that having regard to that fact that those covenants do not
work harshly on it. While the restriction is considered by the parties to
be reasonable in all the circumstances, it is agreed that if the
restriction is adjudged to go beyond what is reasonable in all the
circumstances for the protection of the legitimate interests of the Buyer
but would be adjudged reasonable if part of its wording were deleted or
amended or qualified, or if the period referred to were reduced, then the
relevant restriction or restrictions shall apply with such modification or
modifications as may be necessary to make it or them valid and effective.
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10 COVENANTS AND OTHER UNDERTAKINGS
10.1 The Seller (for itself and its nominees) hereby irrevocably waives any
rights of pre-emption conferred on them by the Articles of Association or
otherwise over any of the Sale Shares.
10.2 The Seller covenant with the Buyer that the Seller or the Guarantors will
pay to the Buyer or such person as the Buyer may direct an amount equal to
the aggregate of:
(a) any un-extinguished Losses (and excluding, for the avoidance of
doubt, any contribution made to Funds Distribution Limited
pursuant to the FSA Settlement) suffered or incurred by the Buyer
(provided that such Losses would not have arisen but for the
acquisition of the Group) or any Group Company arising out of or
in connection with the involvement of any Group Company, or any
Relevant Employee acting as such, in split capital investment
trusts (whether as manager or otherwise) including without
limitation:
(i) any further call for funds made by the FSA or Funds
Distribution Limited (other than the contribution made
pursuant to the FSA Settlement); and
(ii) any other settlement in connection therewith otherwise
agreed with any claimant; and
(b) any obligation on any Group Company to compensate any of the
Funds for amounts charged to the Funds by a Group Company on or
prior to Completion in respect of VAT on supplies made by that
Group Company to the Funds, where such obligation arises as a
result of the eventual decision in the test case brought by the
Association of Investment Trust Companies and JPMorgan Xxxxxxx
Claverhouse Investment Trust plc;
(c) any Losses suffered or incurred by any member of the Buyer's
Group or any Group Company arising out of or in connection with:
(i) any claim made by Deutsche Bank AG or any of its Connected
Persons in connection with the contractual option
arrangements involving, inter alia, Framlington NetNet PLC,
LCF Rothschild (CI) Limited and the Framlington Health &
Income Fund; and
(ii) any claim made in connection with a breach of any mandate
agreed with Stagecoach PLC or any of its Connected Persons
where such claim arises as a result of a breach by any Group
Company of restrictions on holdings of AIM listed
securities;
(d) any Losses suffered or incurred by any member of the Buyer's
Group or any Group Company arising in respect of, or in
connection with, the ownership or disposal of the Dormant
Companies;
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(e) any Losses suffered or incurred by any member of the Buyer's
Group or any Group Company arising in respect of, or in
connection with, the African Companies or the African Funds
PROVIDED THAT this covenant shall not apply to Losses to the
extent that such Losses result from the failure of a Group
Company to comply with the African Exit Plan.
10.3 The Group shall, at the Seller's cost, purchase a run-off policy in the
name of, and on terms reasonably satisfactory to, the Company in respect of
each Seller Insurance Policy. Each such run-off policy shall come to come
into effect from Completion and shall have a term of not less than 2 years.
For the avoidance of doubt, the Seller shall be responsible for the
premiums payable over the life of such run-off policies.
10.4 In the event that the Seller has the right to a claim under any Seller
Insurance Policy in respect of an event or circumstance relating to a Group
Company and arising prior to Completion in respect of which a Group Company
suffers a loss or liability and which claim cannot be made or brought
directly by a Group Company, if requested by the Buyer or any Group Company
at any time after Completion, the Seller shall, as soon as reasonably
practicable, take reasonable steps to procure that a claim (in a form
reasonably satisfactory to the Company) is made under the relevant Seller
Insurance Policy in respect of the relevant event or circumstance and in
this regard:
(a) the Seller undertakes to comply with any reasonable request made
by any Group Company in respect of the conduct of such claim; and
(b) the parties undertake to co-operate with each other by providing
to each other and any insurer as promptly as reasonably
practicable upon request and in good faith any necessary
information and documents for the purpose of making any claims
under the Insurance Polices of any of them and disclosing to each
other all correspondence received from any relevant insurer and
keeping each other informed of any other communications in
whatever form with any such insurer.
Subject to clause 10.5, the Seller undertakes and acknowledges that the
proceeds (after taking into account any deductions, and less any tax
suffered on the proceeds suffered by the Seller) of any successful claim
made pursuant to this clause 10.4 shall be held on trust for the relevant
Group Company and that it shall procure that such proceeds are paid to the
relevant Group Company as soon as practicable. Any proceeds so received
shall reduce to the same extent any entitlement to make a Relevant Claim or
a Tax Claim in respect of the loss, damage or destruction which is the
subject of the relevant insurance claim. The Buyer undertakes and confirms
that it shall be responsible for the Seller's reasonable costs and expenses
incurred as a result of complying with their obligations under this clause
10.4.
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10.5 Nothing in clause 10.4 shall require the Seller or the Guarantors to
undertake or threaten litigation or incur any expenditure or liability
without being put in funds by the Buyer prior to incurring any such
expenditure or liability.
11 PENSIONS
11.1 The Seller covenants with the Buyer to pay to the Buyer within 30 days of
the determination of the Shortfall (if any) an amount in cash equal to the
Shortfall (the "SHORTFALL PAYMENT").
11.2 For the purpose of this clause 11, the "SHORTFALL" means the amount (if
any) by which as at close of business on the day of Completion the value of
the assets of the Pension Scheme is exceeded by the value of the benefits
(valued in accordance with the Actuarial Assumptions), payable (whether
immediately, prospectively or contingently) under the Pension Scheme,
taking no account of service after 31st December 2003 but making proper
allowance (on the basis set out in the Actuarial Assumptions) for future
increases in pay and discretionary increases to pensions, both while in
payment and in deferment.
11.3 The Seller and the Buyer will use their reasonable endeavours to procure
that the Buyer's Actuary and the Seller's Actuary shall calculate and agree
the Shortfall as soon as practicable after Completion, and, in any event no
later than 31st December 2005. To this end:
(a) Within 30 business days of Completion the Seller and the Buyer
shall provide or shall procure to be provided to the Seller's
Actuary and to the Buyer's Actuary all such information as the
Seller's Actuary and the Buyer's Actuary may reasonably require
in order to calculate the Shortfall in accordance with the
Actuarial Assumptions.
(b) Within 30 business days of the date of receipt of the information
referred to in (a) above, the Seller's Actuary shall calculate
the Shortfall (the "SELLER'S ESTIMATE") and provide the Seller's
Estimate to the Buyer's Actuary.
(c) The Buyer's Actuary shall review the Seller's Estimate, and shall
endeavour to reach agreement with the Seller's Actuary on the
amount of the Shortfall within 30 Business Days of receipt of the
Seller's Estimate.
(d) If the amount of the Shortfall has not been agreed between the
Buyer's Actuary and the Seller's Actuary within 30 Business Days
of receipt of the Sellers' Estimate, the matter will be referred
to the independent actuary for determination pursuant to clause
11.4, unless the Buyer and Seller agree otherwise.
11.4 Any dispute between the Seller's Actuary and the Buyer's Actuary concerning
the determination or agreement of any matter to be determined or agreed by
them for the purposes of this clause 11 shall, in the absence of agreement
between them, be referred to an independent actuary to be nominated jointly
by the Seller and the Buyer or, failing such nomination, to be nominated by
the President for the time being of the Institute of Actuaries at the
instance of the party first applying to him. The actuary so appointed shall
act as an expert and not as an arbitrator; his decision
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shall be final and binding and his costs shall be borne between the Seller
and the Buyer as the Actuary may direct (or equally between the Seller and
the Buyer if the Actuary makes no direction).
11.5 The Buyer covenants with the Seller that as soon as reasonably practicable
after receipt of the Shortfall Payment from the Seller, it will procure
that the Company pays into the Pension Scheme an amount (as a single
payment) equal to the Shortfall Payment.
11.6 If the Buyer or the Company or any member of the Buyer's group (for the
purposes of this clause 11.6, the "RELIEVED PERSON") either receives, from
a Taxation Authority a payment (whether attributable to a relief or
otherwise) or obtains relief arising in consequence of the payment by the
Company of an amount equal to the Shortfall Payment pursuant to clause 11.5
above (and the Buyer will use its reasonable endeavours to obtain such
payment or relief), then:
(a) the Buyer shall notify the Seller of that fact as soon as
possible;
(b) subject to the Shortfall Payment having been made by the Seller,
if any Relieved Person receives or obtains such a payment or
relief, then the Buyer shall, by way of refund of amounts payable
under clause 11.1 and, as such (so far as possible) by way of
re-adjustment to the consideration payable under this Agreement,
pay to the Seller the amount received from the Taxation Authority
or the amount that the relevant Relieved Person will save by
virtue of the relief, as the case may be.
11.7 Any payment required to be made by the Buyer pursuant to clause 11.6 shall
be made:
(a) in a case where a Relieved Person receives a payment, within 30
days of the receipt of that payment, and
(b) in a case where a Relieved Person obtains a relief, within 30
days of the date on which tax would have become recoverable but
for the use of such relief or if later the date such relief is
confirmed as applying by the appropriate Taxation Authority.
11.8 For the purposes of clauses 11.6 and 11.7, "RELIEF" includes, unless the
context otherwise requires, any allowance, credit, deduction, exemption or
set-off in respect of any Tax or relevant to the computation of any income,
profits or gains for the purposes of any Tax, or any right to repayment of
Tax.
12 RELEASE AND INDEMNITY FOR OUTSTANDING GUARANTEES
12.1 The Buyer shall:
(a) use all reasonable endeavours to secure with effect from
Completion the release of the Seller or any Guarantors from any
Guarantees (including, if required, offering its own Guarantee or
liability on the same terms as and in substitution for the
existing Guarantee or other liability of the Seller or the
Guarantors); and
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(b) pending release of any Guarantees, indemnify and keep indemnified
the Seller and the Guarantors (which take the benefit of this
indemnity for themselves and as trustees for each Connected
Person) against all Losses arising after Completion which it or
any Connected Person may suffer or incur in respect of any claim,
made under or in respect of any of the Guarantees.
12.2 The Seller covenants with the Buyer that the Seller will pay to the Buyer
or such person as the Buyer may direct an amount equal to the aggregate of
all Losses suffered or incurred by any Group Company in carrying out its
obligations under clause 12.1(a) in respect of any Guarantee which was not
fairly disclosed to the Buyer prior to the date of this Agreement.
13 GUARANTEE OF SELLER'S OBLIGATIONS
13.1 In consideration of the Buyer entering into this Agreement with the Seller,
each of the Guarantors irrevocably and unconditionally:
(a) guarantees to the Buyer the full, prompt and complete performance
by the Seller of all its obligations under the Implementation
Documents and Offer Documents and the due and punctual payment on
demand of all sums now or subsequently due and payable by the
Seller to the Buyer under or pursuant to the Implementation
Documents and Offer Documents; and
(b) agrees as primary obligor to indemnify the Buyer on demand from
and against any loss incurred by the Buyer as a result of any of
the obligations of the Seller under or pursuant to the
Implementation Documents and Offer Documents being or becoming
void, voidable, unenforceable or ineffective as against the
Seller for any reason whatsoever (including without limitation
for the reason that the Seller has commenced a voluntary or
involuntary liquidation or similar proces), whether or not known
to the Buyer, the amount of such loss being the amount which the
Buyer would otherwise have been entitled to recover from the
Seller.
13.2 The guarantees contained in this clause are continuing guarantees and shall
remain in force until all the obligations of the Seller under the
Implementation Documents and Offer Documents have been fully performed and
all sums payable by the Seller have been fully paid and notwithstanding the
winding-up, liquidation, dissolution or other incapacity of the Seller or
any change in the status, control or ownership of the Seller.
13.3 The obligations of the Guarantors under this clause 13 shall not be
affected by any act, omission, matter or thing which, but for this
provision, might operate to release or otherwise exonerate either of the
Guarantors from its obligations or affect such obligations, including
without limitation and whether or not known by either of the Guarantors:
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(a) any variation of any Implementation Document or Offer Documents
or any time, indulgence, waiver or consent at any time given to
the Seller or any other person;
(b) any compromise or release, or abstention from obtaining,
perfecting or enforcing any security or other right or remedy
whatsoever from or against, the Seller or any other person;
(c) any legal limitation, disability, incapacity or other
circumstance relating to the Seller or any other person; or
(d) any irregularity, unenforceability or invalidity of any
obligations of the Seller under any Implementation Document, and
Offer Documents or the dissolution, amalgamation, reconstruction,
liquidation, winding up or insolvency of the Seller.
13.4 If no winding up or liquidation proceedings have been commenced in respect
of the Seller, the guarantees contained in this clause 13 may not be
enforced by the Buyer unless the Buyer has first taken any steps or
proceedings against the Seller PROVIDED THAT, with effect from the date on
which the Seller commences a voluntary or involuntary liquidation or
similar process, the provisions of the Implementation Documents may be
enforced against either Guarantor without the Buyer first taking any steps
or proceedings against the Seller.
13.5 The total aggregate liability of the Guarantors together in respect of all
claims under this Agreement shall not exceed the total aggregate liability
of the Seller under the Agreement.
14 INTELLECTUAL PROPERTY AND OTHER MATTERS
14.1 The Seller confirms that the Dormant Companies were transferred to the
Seller prior to the date hereof for no consideration and, at the time of
transfer of each Dormant Company, the relevant Dormant Company had no
material asset.
14.2 Without prejudice to clauses 14.4 and 14.5, the Seller shall, upon written
notice from the Buyer (provided such notice is received prior to the expiry
of the period ending on 31st May 2007), to the extent it is reasonably able
to do so transfer for no consideration any asset used exclusively or
primarily by any Group Company in the 24 months prior to Completion to the
Buyer or such person as it may nominate, and to the extent it is not
reasonably able to transfer any Intellectual Property Rights or Business
Information, it shall procure the grant to the Buyer of a non-exclusive,
perpetual, worldwide, assignable, royalty-free licence (with the right to
sub-license) to use any Intellectual Property Rights or Business
Information owned by the Seller which has been used exclusively or
primarily in the two years prior to Completion by any Group Company.
14.3 The Seller and the Guarantors agree to procure that the Seller and any
Connected Person (including for this purpose any Guarantor) which uses
"Framlington" as part of its corporate name shall, as soon as reasonably
practicable after and in any event within one month of the
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Completion Date, save in respect of Framlington Maghreb SA, change its
corporate name to a name which does not include the word "Framlington" or
any confusingly similar word.
14.4 The Seller and each of the Guarantors hereby transfer, and agree to procure
that the Seller and each Connected Person of each Guarantor transfers, all
of their respective right and title in and to the name and xxxx
"Framlington", and all goodwill associated with the name "Framlington", to
the Buyer.
14.5 Subject to clause 14.4, the Seller and each of the Guarantors hereby
undertake, and agree to procure that the Seller and any Connected Person of
each Guarantor undertakes, not to use the name "Framlington" in any
business the same as or similar to the Business as carried on at the date
of this Agreement for a period of five years from the Completion Date.
15 ENTIRE AGREEMENT
Each of the Seller and the Guarantors agrees for itself and the Buyer
agrees for itself and as agent for each Group Company that:
(a) this Agreement, the Taxation Deed and the Disclosure Letter
(together the "IMPLEMENTATION DOCUMENTS") supersede any prior
discussions, understandings and agreements between the parties
concerning their subject matter (including, for the avoidance of
doubt, the Confidentiality Agreement) and constitute the entire
and only agreement between the parties concerning their subject
matter; and
(b) none of the Implementation Documents has been entered into in
reliance on any Pre-contractual Statement which is not expressly
set out in an Implementation Document and each party hereby
unconditionally and irrevocably waives any claims, rights or
remedies arising by virtue of any Pre-contractual Statement not
set out in an Implementation Document;
(c) provided always that this clause 15 shall not exclude or limit
any liability or right which arises as a result of any fraudulent
act, omission or statement.
In this clause 15, "PRE-CONTRACTUAL STATEMENT" means any agreement,
undertaking, representation, statement, warranty, promise, assurance or
arrangement of any nature (which express or implied and whether or not in
written or draft form) made or given by any person prior to the execution
of this Agreement in connection with any matters dealt with in any of the
Implementation Documents, including, without limitation, any made or given
by virtue of the Information Memorandum prepared with regard to the Company
as of 28 April 2005.
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16 EFFECT OF COMPLETION
Except as expressly provided in this Agreement, all provisions of this
Agreement shall so far as they are capable of being performed or observed
continue in full force and effect notwithstanding Completion and Completion
shall not constitute a waiver of any of the Buyer's rights in relation to
any Implementation Document.
17 REMEDIES
17.1 Prior to Completion, this Agreement may terminate only in accordance with
clause 2.8, clause 4.4, clause 5.2, clause 5.3, clause 5.4 or clause 5.5 or
with the written consent of all parties. Following Completion, no party
shall be entitled to terminate or rescind this Agreement or the Taxation
Deed for any reason whatsoever.
17.2 In the event of termination of this Agreement under clause 2.8, clause 4.4,
clause 5.2, clause 5.3, clause 5.4 or clause 5.5, all the rights and
obligations of the parties shall forthwith cease except for clause 15
(entire agreement), clause 20 (announcements and confidentiality) and
clauses 22 (severability and set-off) to 29 (governing law and submission
to jurisdiction) (inclusive). Termination of this Agreement shall not
affect any rights, liabilities or remedies arising under this Agreement
prior to such termination.
17.3 Subject to clause 5.4, the Buyer's sole remedy in respect of a breach of
the Warranties shall be a claim for damages which shall be made subject to
and in accordance with the terms of this Agreement (including the
provisions of Schedule 6) and the Buyer will not have any claim or remedy
in respect of misrepresentation (whether negligent or otherwise) in respect
thereof. Subject to the foregoing provisions of this clause 17.3, the Buyer
shall be entitled to claim either before or after Completion that any of
the Warranties or Pre-Completion Undertakings or any other provision of the
Implementation Documents has or had been breached and, for the avoidance of
doubt, this means that claims arising in respect of the Warranties, claims
arising in respect of the Pre-Completion Undertakings and each other claim
under or in respect of the Implementation Document shall survive
Completion.
17.4 The sole remedy of the Buyer against the Seller under the Taxation Deed
shall be a claim in accordance with the terms of the Taxation Deed.
17.5 Nothing in this Agreement shall exclude or limit any liability or right
which arises as a result of any fraudulent act, omission or statement, in
relation to which all remedies available under English law shall apply.
17.6 No delay or omission by any party to this Agreement in exercising any
right, power or remedy under this Agreement or any other documents referred
to in it shall:
(a) affect that right, power or remedy; or
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(b) operate as a waiver thereof.
17.7 The single or partial exercise of any right, power or remedy provided under
this Agreement shall not preclude any other or further exercise of it or
the exercise of any other right, power or remedy.
17.8 The rights, powers and remedies provided in this Agreement are cumulative.
18 PAYMENTS
18.1 This clause 18 shall have no force or effect prior to Completion and shall
come into force on Completion. No payments made pursuant to clause 6.2
shall be subject to this clause 18.
18.2 All sums payable under this Agreement or the Taxation Deed by any of the
Seller, the Buyer or either of the Guarantors (in each case, the "PAYER")
to any other party (the "RECIPIENT") shall be paid free and clear of all
deductions or withholdings whatsoever, save only as may be required by law.
18.3 If, at any time, any applicable law, regulation or regulatory requirement
requires any payer to make any deduction or withholding from any sums
payable to any recipient under this Agreement or the Taxation Deed then,
except in relation to interest, the amount so due shall be increased to the
extent necessary to ensure that, after the making of such deduction or
withholding, the recipient receives, on the due date for such payment, a
net sum equal to the sum which it would have received had no such deduction
or withholding been required to be made, provided that this clause 18.3
shall not apply if the requirement to make such deduction or withholding
would not have arisen but for a voluntary act of the recipient.
18.4 Subject to clause 18.7, If the payer is required by law to make any
deduction or withholding as referred to in clause 18.3, the payer shall:
18.4.1 make such deduction or withholding; and
18.4.2 pay the full amount deducted or withheld to the relevant Taxation
Authority in accordance with applicable law, regulation or regulatory
requirement.
18.5 If, at any time after any increased payment is made by any payer as a
consequence of the application of clause 18.3, the recipient receives or is
granted a credit against, relief from or repayment of any Taxation payable
by it which it would not otherwise have received or been granted, the
recipient shall, to the extent that it can do so without prejudicing the
retention of the amount of such credit, relief or repayment, reimburse the
payer with such amount as shall leave the recipient (after such
reimbursement) in no better or no worse a position than it would have been
in had the circumstances giving rise to the increased payment not in fact
arisen. Such
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reimbursement shall be made not later than ten business days after the
recipient receives or is granted such credit.
18.6 Subject to clause 18.7, if any amount paid or due to any recipient under
this Agreement or the Taxation Deed, other than interest or the purchase
price for the Sale Shares payable by the Buyer under the Offer Documents,
gives rise to any Actual Taxation Liability, or would (but for the
availability of any Relief) give rise to an Actual Taxation Liability, in
the hands of that recipient, then the payer in question shall be under the
same obligation to make an increased payment in relation to that Actual
Taxation Liability as if the liability were a deduction or withholding
required by law.
18.7 If the recipient of any payment under this Agreement or the Taxation Deed
is subject to Taxation in any jurisdiction other than the United Kingdom,
the payer shall be obliged to pay no more under this clause 18 than would
have been the case had the recipient been resident for tax purposes only in
the United Kingdom and receiving that payment for the purposes of its
business in the United Kingdom only.
19 FURTHER ASSURANCES
The Seller, each of the Guarantors and the Buyer shall for a period ending
on 31 May 2007 execute or, so far as they are able, procure that any
necessary third party shall execute all such documents and/or do or, so far
as each is able, procure the doing of such acts and things as may be
required by law or as may be necessary to give effect to this Agreement and
any documents entered into pursuant to it, provided that no party shall be
obliged to incur any expense or liability in performing their obligations
under this clause.
20 ANNOUNCEMENTS AND CONFIDENTIALITY
20.1 Subject to clause 20.2, no announcement, circular or communication (each an
"ANNOUNCEMENT") concerning the existence or content of this Agreement shall
be made by any party (or any Connected Person or Related Company of the
Buyer (including, after Completion, any (Group Company)) without the prior
written approval of the Guarantors and the Buyer (such approval not to be
unreasonably withheld or delayed).
20.2 Clause 20.1 does not apply to any Announcement if, and to the extent that,
it is required to be made by the rules of any stock exchange or any
governmental, regulatory or supervisory body or court of competent
jurisdiction ("RELEVANT AUTHORITY") to which the party making the
Announcement is subject, whether or not any of the same has the force of
law, provided that any Announcement shall, so far as is practicable, be
made after consultation with the other parties and after taking into
account their reasonable requirements regarding the content, timing and
manner of despatch of the Announcement in question.
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20.3 Subject to Clause 20.4, each party shall treat as strictly confidential all
information received or obtained as a result of entering into or performing
this Agreement which relates to:
(a) the subject matter and provisions of this Agreement;
(b) the negotiations relating to this Agreement; or
(c) the other parties.
20.4 A party may disclose information which would otherwise be confidential if
and to the extent:
(a) the information is given to the FSA in connection with the
application for approval contemplated by clause 2.2.2;
(b) required by the law of any relevant jurisdiction;
(c) required by existing contractual obligations;
(d) required by any Relevant Authority or Taxation Authority to which
the party making the disclosure is subject, whether or not such
requirement has the force of law;
(e) required to vest the full benefit of this Agreement in any party;
(f) disclosure is made to the professional advisers, auditors and
bankers of any party;
(g) the information has come into the public domain through no fault
of that party; or
(h) the other parties have given prior written approval to the
disclosure,
provided that any disclosure shall, so far as practicable, be made only
after consultation with the other parties.
21 RECORDS
21.1 For a period of six years after Completion, the Seller shall maintain and
provide copies to the Buyer (at the Buyer's request and cost) of any Books
and Records proprietary to the Seller relating primarily (but not
exclusively) to the business carried on by any Group Company prior to
Completion.
21.2 For a period of six years after Completion, the Buyer shall procure that
the Group maintains and provides copies to the Seller (at the Seller's
request and cost) of any Books and Records proprietary to any Group Company
relating primarily (but not exclusively) to the business carried on by the
Seller prior to Completion.
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22 SEVERABILITY AND SET-OFF
22.1 Each provision of this Agreement is severable and distinct from the others
and, if any provision is, or at any time becomes, to any extent or in any
circumstances invalid, illegal or unenforceable for any reason, that
provision shall to that extent be deemed not to form part of this Agreement
but the validity, legality and enforceability of the remaining parts of
this Agreement shall not be affected or impaired, it being the parties'
intention that every provision of this Agreement shall be and remain valid
and enforceable to the fullest extent permitted by law.
22.2 Neither the Seller or the Guarantors shall be entitled to set off any sum
due by any of them to the Buyer against any sum due by the Buyer to the
Seller or any of the Guarantors under or in relation to this Agreement or
the Taxation Deed.
22.3 The Buyer shall not be entitled to set off any sum due by it to the Seller
or the Guarantors against any sum due by the Seller or the Guarantors to
the Buyer under or in relation to this Agreement or the Taxation Deed.
23 MISCELLANEOUS
23.1 No purported alteration of this Agreement shall be effective unless it is
in writing, refers to this Agreement and is duly executed by the Buyer and
each Guarantor.
23.2 This Agreement may be executed in any number of counterparts, and each of
the executed counterparts, when duly exchanged or delivered, shall be
deemed to be an original, but, taken together, they shall constitute one
instrument.
23.3 Each of the parties shall be responsible for its respective legal and other
costs incurred in relation to the negotiation, preparation and completion
of the Implementation Documents.
23.4 This Agreement shall be binding on and shall enure for the benefit of the
successors in title and personal representatives of each party.
23.5 Save as expressly provided in this Agreement, a person who is not a party
to this Agreement has no right under the Contracts (Rights of Third
Parties) Xxx 0000 to enforce any of its terms. Subject to clause 21.1 this
Agreement may be varied in any way and at any time by the parties to it
without the consent of any person who is not a party to this Agreement.
24 NOTICES
24.1 A notice or other communication given under or in connection with this
Agreement (a "NOTICE") shall be:
(a) in writing;
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(b) in the English language; and
(c) sent by the Permitted Method to the Notified Address.
24.2 The Permitted Method means any of personal delivery, courier and fax
transmission.
24.3 The Notified Addresses of each of the parties is as set out below:
NAME OF PARTY ADDRESS
------------- -------
The Seller The address set out in Part A of Schedule 1
The Guarantors Each of the addresses set out in Part B of Schedule 1
The Buyer The address set out on page 3
or such other Notified Address as any of the parties may, by written notice
to the other parties, substitute for their Notified Address set out above.
24.4 No notice given under this Agreement shall be effective until received by
the intended recipient, save that if such a notice is so received outside
Working Hours in the place of receipt, it shall be deemed to have been
received at the start of the next period of Working Hours in that place.
25 ASSIGNMENT
25.1 The Buyer may assign any or all of its rights under the Implementation
Documents to any other member of the Buyer's Group without the consent of
any other party to this Agreement provided that the liability of the Seller
under any of the Implementation Documents shall not be thereby increased.
If the Buyer assigns the benefit of any of its rights under the
Implementation Documents it shall neither cause nor permit any assignee to
cease to be a member of the Buyer's Group unless or until that assignee
assigns the benefit of such assigned rights to the Buyer or another member
of the Buyer's Group.
25.2 Subject to the provisions of clause 25.1, none of the parties shall or
shall purport to assign, transfer, charge or otherwise deal with all or any
of its rights or obligations under this Agreement or the Taxation Deed nor
grant, declare, create or dispose of any right or interest in this
Agreement or the Taxation Deed without the prior written consent of the
other parties.
25.3 Any purported assignment in contravention of this clause 25 shall be void.
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26 BUYER'S AGENT FOR SERVICE
26.1 The Buyer irrevocably appoints AXA Investment Managers Limited of 0 Xxxxxxx
Xxxxxx, Xxxxxx to be its agent for the receipt of service of process in
England. It agrees that any Service Document may be effectively served on
it in connection with Proceedings in England and Wales by service on its
agent.
26.2 Any Service Document shall be deemed to have been duly served if marked for
the attention of the person named in clause 26.1 at the address in that
clause or such other address within England and Wales as may be notified to
the party wishing to serve the Document and left at the specified address.
26.3 The Service Document will be deemed to have been duly served when it is
left.
26.4 If the agent at any time ceases for any reason to act as such, the Buyer
shall appoint a replacement agent having an address for service in England
or Wales and shall notify the other parties of the name and address of the
replacement agent. The provisions of this clause applying to service on an
agent apply equally to service on a replacement agent.
26.5 A copy of any Service Document served on an agent shall be sent by post to
the Buyer. Failure or delay in so doing shall not prejudice the
effectiveness of service of the Service Document.
27 CCF'S AGENT FOR SERVICE
27.1 CCF S.A. irrevocably appoints HSBC Investment Businesses Limited of 0
Xxxxxx Xxxxxx, Xxxxxx X00 to be its agent for the receipt of service of
process in England. It agrees that any Service Document may be effectively
served on it in connection with Proceedings in England and Wales by service
on its agent.
27.2 Any Service Document shall be deemed to have been duly served if marked for
the attention of the person named in clause 27.1 at the address in that
clause or such other address within England and Wales as may be notified to
the party wishing to serve the Document and left at the specified address.
27.3 The Service Document will be deemed to have been duly served when it is
left.
27.4 If the agent at any time ceases for any reason to act as such, CCF S.A.
shall appoint a replacement agent having an address for service in England
or Wales and shall notify the other parties of the name and address of the
replacement agent. The provisions of this clause applying to service on an
agent apply equally to service on a replacement agent.
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27.5 A copy of any Service Document served on an agent shall be sent by post to
CCF S.A. Failure or delay in so doing shall not prejudice the effectiveness
of service of the Service Document.
28 COMERICA'S AGENT FOR SERVICE
28.1 Comerica, Inc. irrevocably appoints Law Debenture Corporate Services
Limited, of Xxxxx Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx, XX0X 0XX to be its agent
for the receipt of service of process in England for a period of 10 years
from the date of this Agreement. It agrees that any Service Document may be
effectively served on it in connection with Proceedings in England and
Wales by service on its agent.
28.2 Any Service Document shall be deemed to have been duly served if marked for
the attention of Law Debenture Corporate Services Limited at Fifth Floor,
100 Wood Street (as aforesaid) or such other address within England and
Wales as may be notified to the party wishing to serve the Document and
left at the specified address.
28.3 If the agent at any time in the period referred to in clause 28.1 ceases
for any reason to act as such, Comerica, Inc. shall appoint a replacement
agent having an address for service in England or Wales and shall notify
the other parties of the name and address of the replacement agent. The
provisions of this clause applying to service on an agent apply equally to
service on a replacement agent.
28.4 A copy of any Service Document served on an agent shall be sent by post to
Comerica, Inc. Failure or delay in so doing shall not prejudice the
effectiveness of service of the Service Document.
29 GOVERNING LAW AND SUBMISSION TO JURISDICTION
29.1 This Agreement shall be governed by and construed in accordance with the
laws of England and Wales.
29.2 The parties irrevocably agree that the courts of England and Wales are to
have exclusive jurisdiction to settle any disputes which may arise out of
or in connection with this Agreement. The parties hereby irrevocably submit
to the jurisdiction of such courts and waive any objection on the ground of
venue or on the ground that the proceedings have been brought in an
inconvenient forum provided that this clause shall be without prejudice to
the right to bring proceedings in any other jurisdiction for the purpose of
enforcement or execution of any judgement or other settlement in any other
courts.
IN WITNESS of which this Agreement has been entered into on the date first above
written.
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SCHEDULE 1
PART A - THE SELLER
1 2 3
NAME ADDRESS / REGISTERED OFFICE SALE SHARES HELD
---- --------------------------- ----------------
Framlington Holdings Limited (No. 000 Xxxxxxxxxxx 68,577,292
02314914) Xxxxxx XX0X 0XX
Framlington Administration Services 000 Xxxxxxxxxxx 000
Xxxxxxx Xxxxxx XX0X 0XX
Framlington Nominees Limited 000 Xxxxxxxxxxx 0
Xxxxxx XX0X 0XX
PART B - THE GUARANTORS
1 2 3
NAME ADDRESS / REGISTERED OFFICE RESPECTIVE PERCENTAGE (%)
---- --------------------------- -------------------------
CCF S.A. 000 xxxxxx xxx Xxxxxx-Xxxxxxx, 00
00000 Xxxxx, Xxxxxx
Comerica Incorporated 000 Xxxxxxxx Xxxxxx 00
Xxxxxxx
Xxxxxxxx 00000
XXX
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SCHEDULE 2
INFORMATION ABOUT THE GROUP
PART A - THE COMPANY
NAME OF COMPANY Framlington Group Limited
DATE AND PLACE OF INCORPORATION 00 Xxxxxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 01237167
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 90,000,000 Ordinary Shares of 5p each
ISSUED SHARE CAPITAL 69,878,770 Ordinary Shares of 5p each
DIRECTORS Lord Douro
I Barnetson
C Xxxx
XX Xxxxxxx
X Xxxxx
A Dromer
NTA Xxxxxxx
XX Xxxxxxx
XX XxxXxxxxx
X Xxxxxxxxx
Lord Stewartby
SECRETARY Xxxxxxx Xxxxxxx
AUDITORS PricewaterhouseCoopers LLP
ACCOUNTING REFERENCE DATE 31 December
SHARE REGISTER 68,577,292 held by Framlington Holdings
Limited 500 held by Framlington Administration
Services Limited 1 held by Framlington
Nominees Limited 330,768 held by Ogier
Employee Benefit Trustee Limited 700 held by a
former employee of Framlington Group Limited
969,509 held by current employees of
Framlington Group Limited
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PART B - THE SUBSIDIARIES
NAME OF COMPANY Framlington Investment Management Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 00 Xxxxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 01858790
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 425,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 425,000 Ordinary Shares of L1 each
SHAREHOLDER 424,999 held by Framlington Group Limited
1 held by Framlington Investment Trust Services Limited
DIRECTORS I Barnetson
P A Xxxxxxxx
NTA Xxxxxxx
XX Xxxxxxx
X X Xxxxxxxxx
SECRETARY Framlington Services Limited
AUDITORS PricewaterhouseCoopers LLP
ACCOUNTING REFERENCE DATE 31 December
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NAME OF COMPANY Framlington Unit Management Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 0 Xxxxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 00895241
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 100,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 100,000 Ordinary Shares of L1 each
SHAREHOLDER 99,999 held by Framlington Group Limited
1 held by Framlington Administration Services Limited
DIRECTORS I Barnetson
NTA Xxxxxxx
XX Xxxxxxx
SECRETARY Framlington Services Limited
AUDITORS PricewaterhouseCoopers LLP
ACCOUNTING REFERENCE DATE 31 December
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NAME OF COMPANY Framlington Overseas Investment Management Limited
DATE AND PLACE OF INCORPORATION 00 Xxxxxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 01536760
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 250,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 100 Ordinary Shares of L1 each
SHAREHOLDER 99 held by Framlington Investment Trust Services Limited
1 held by Xxxxxxxxxxx Street Nominees Limited
DIRECTORS I Barnetson
NTA Xxxxxxx
XX Xxxxxxx
XX Xxxxxxxx
SECRETARY Framlington Services Limited
AUDITORS PricewaterhouseCoopers LLP
ACCOUNTING REFERENCE DATE 31 December
42
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NAME OF COMPANY Framlington Investment Trust Services Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 00 Xxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 01556736
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 2,249,775 Ordinary Shares of 10p each
ISSUED SHARE CAPITAL 2,197,030 Ordinary Shares of 10p each
SHAREHOLDER 1 held by Framlington Administration Services Limited
2,197,029 held by Framlington Group Limited
DIRECTORS PA Xxxxxxxx
XX Xxxxxxx
SECRETARY Framlington Services Limited
AUDITORS PricewaterhouseCoopers LLP
ACCOUNTING REFERENCE DATE 31 December
43
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NAME OF COMPANY Framlington Administration Services Limited
DATE AND PLACE OF INCORPORATION 00 Xxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 01370370
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 100 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 100 Ordinary Shares of L1 each
SHAREHOLDER 99 held by Framlington Group Limited
1 held by Framlington Nominees Limited
DIRECTORS I Barnetson
SECRETARY Framlington Services Limited
AUDITORS PricewaterhouseCoopers LLP
ACCOUNTING REFERENCE DATE 31 December
44
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NAME OF COMPANY Framlington Investment Management (Ireland)
Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 00 Xxx 0000, Xxxxxxx
REGISTERED NUMBER IE217071
REGISTERED XXXXXX Xxxxxx Xxxxx, Xxxxxxxx Xxxxxx, Xxxxxxxx Xxxxxx, Xxxxxx 0
AUTHORISED SHARE CAPITAL 1,000,000 Ordinary Shares of E1.27 each
ISSUED SHARE CAPITAL 100,000 Ordinary shares of E1.27 each
SHAREHOLDER 99,999 held by Framlington Group Limited
1 held by Framlington Administration Services Limited
DIRECTORS X XxXxxxxx
D Shubotham
SECRETARY Management International (Dublin)
AUDITORS
ACCOUNTING REFERENCE DATE
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PART C - AFRICAN COMPANIES
NAME OF COMPANY Framlington Asset Management West Africa SA
DATE AND PLACE OF INCORPORATION 14 April 1997, Ivory Coast
REGISTERED NUMBER 31.78.1343
REGISTERED XXXXXX 0-00 Xxxxxx Xxxxxx Xxxxx, 00 XX 0000, Xxxxxxx
01, Ivory Coast
AUTHORISED SHARE CAPITAL Ordinary Shares of 10,000,000 CFA Franc BCEAO
ISSUED SHARE CAPITAL Ordinary Shares of 10,000,000 CFA Franc BCEAO
SHAREHOLDER Framlington Group Limited 5.08 million FCFA
Proparco 1.5 million FCFA
Sfi 1.5 million FCFA
Xxxxxx Xxxxxxxx 1.5 million FCFA
XX Xxxxx 0.4 million FCFA
XX Xxxxxxxxx 10,000 FCFA
T Xxxxxxxx 10,000 FCFA
DIRECTORS
SECRETARY
AUDITORS
ACCOUNTING REFERENCE DATE
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NAME OF COMPANY Framlington Asset Management Central Africa SA
DATE AND PLACE OF INCORPORATION 30 July 2003, Ivory Coast
REGISTERED NUMBER
REGISTERED OFFICE
AUTHORISED SHARE CAPITAL 1,000 Ordinary Shares of 10,000 CFA Franc BCEAO
ISSUED SHARE CAPITAL 1,000 Ordinary Shares of 10,000 CFA Franc BCEAO
SHAREHOLDER 1,000 held by Framlington Group Limited
DIRECTORS
SECRETARY
AUDITORS
ACCOUNTING REFERENCE DATE
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PART D - DORMANT COMPANIES
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NAME OF COMPANY Framlington Maghreb SA
DATE AND XXXXX XX XXXXXXXXXXXXX 00 Xxx 0000, Xxxxxxx
REGISTERED NUMBER 118654
REGISTERED OFFICE Chez la Banque Commerciale du Maroc, 00 Xxxxxx xxx Xxxxxx
Xxxxxx Xxxxxxx, Xxxxxxxxxx, Xxxxxxx
AUTHORISED SHARE CAPITAL 100,000 Ordinary Shares of 100 Dirhams
ISSUED SHARE CAPITAL 100,000 Ordinary Shares of 100 Dirhams
SHAREHOLDER 51,000 held by Framlington Investment Management Limited
DIRECTORS
SECRETARY
AUDITORS
ACCOUNTING REFERENCE DATE
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NAME OF COMPANY Framlington Investment Management (Bermuda)
Limited
DATE AND PLACE OF INCORPORATION 9 September 1997, Bermuda
REGISTERED NUMBER EC23815
REGISTERED XXXXXX Xxxxxx Xxxxx, Xxxxxx xxx Xxxxxxxxxx Xxxxxxx,
Xxxxxxxx, Xxxxxxx
AUTHORISED SHARE CAPITAL 12,000 Ordinary Shares of $1
ISSUED SHARE CAPITAL 12,000 Ordinary Shares of $1
SHAREHOLDER 12,000 held by Framlington Group Limited
DIRECTORS XX Xxxxx
XX Xxxxxxx
XX Xxxxxxx
SECRETARY J Xxxxxxxxxx
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
50
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NAME OF COMPANY Framlington Portfolio Management Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 00 Xxxxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 04362302
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 1,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 1 Ordinary Share of L1 each
SHAREHOLDER 1 held by Framlington Group Limited
DIRECTORS I Barnetson
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
51
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NAME OF COMPANY Framlington International Holdings Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 00 Xxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 02937900
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 1,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 2 Ordinary Shares of L1 each
SHAREHOLDER 1 held by Framlington Group Limited
1 held by Framlington Investment Management
Limited
DIRECTORS I Barnetson
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
52
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NAME OF COMPANY Xxxxxxxx Xxxxx & Co. Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 0 Xxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 02145826
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 56,600 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 56,600 Ordinary Shares of L1 each
SHAREHOLDER 1 held by Framlington Administration Services
Limited
56,599 held by Framlington Group Limited
DIRECTORS XX Xxxxxxx
XX Xxxxx
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
53
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NAME OF COMPANY Framlington Asset Management Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 00 Xxxxxxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 02169390
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 5,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 5,000 Ordinary Shares of L1 each
SHAREHOLDER 4,999 held by Framlington Group Limited
1 held by Framlington Administration Services
Limited
DIRECTORS I Barnetson
PA Xxxxxxxx
XX Xxxxxxx
XX Xxxxxxxx
NTA Xxxxxxx
XX Xxxxxx
XX Xxxxx
XX Xxxxxxxx
AB Milford
XX Xxxxxx
R Xxxxxxx
CA Rock
NAD Xxxxxx
XX Xxxxxxxx
BR Xxxxxx
REH Whiteoak
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
54
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NAME OF COMPANY Framlington International Fund Management Limited
DATE AND PLACE OF INCORPORATION 00 Xxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 01815755
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 5,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 5,000 Ordinary Shares of L1 each
SHAREHOLDER 4,999 held by Framlington Group Limited
1 held by Framlington Administration Services Limited
DIRECTORS I Barnetson
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
55
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NAME OF COMPANY Framlington Nominees Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 00 Xxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 02013252
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 100 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 2 Ordinary Shares of L1 each
SHAREHOLDER 1 held by Framlington Group Limited
1 held by Framlington Administration Services Limited
DIRECTORS XX Xxxxxxx
XX Xxxxx
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
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NAME OF COMPANY Framlington (USA) Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 00 Xxxxxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 01957436
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 10,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 2 Ordinary Shares of L1 each
SHAREHOLDER 1 held by Framlington Group Limited
1 held by Framlington Administration Services Limited
DIRECTORS XX Xxxxxxx
XX Xxxxx
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
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NAME OF COMPANY Framlington Services Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 0 Xxxxxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 02314696
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 10,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 100 Ordinary Shares of L1 each
SHAREHOLDER 99 held by Framlington Group Limited
1 held by Framlington Investment Management
Limited
DIRECTORS I Barnetson
SECRETARY Xxxxxxx Xxxxxxx
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
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NAME OF COMPANY Framlington Financial Services Limited
DATE AND PLACE OF INCORPORATION 0 Xxxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 01838673
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 25,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 25,000 Ordinary Shares of L1 each
SHAREHOLDER 24,999 held by Framlington Overseas Investment
Management Limited
1 held by Framlington Investment Trust
Services Limited
DIRECTORS I Barnetson
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
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NAME OF COMPANY Framlington PEP Nominees Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 0 Xxxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 02355432
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 1,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 2 Ordinary Shares of L1 each
SHAREHOLDER 1 held by Framlington Overseas Investment
Management Limited
1 held by Framlington Investment Trust
Services Limited
DIRECTORS I Barnetson
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
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NAME OF COMPANY Framlington Savings Scheme Nominees Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 0 Xxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 02136631
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 1,000 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 4 Ordinary Shares of L1 each
SHAREHOLDER 3 held by Framlington Overseas Investment
Management Limited
1 held by Framlington Investment Trust
Services Limited
DIRECTORS XX Xxxxxxx
XX Xxxxx
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
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NAME OF COMPANY Xxxxxxxxxxx Street Nominees Limited
DATE XXX XXXXX XX XXXXXXXXXXXXX 00 Xxxx 0000, Xxxxxx Xxxxxxx
REGISTERED NUMBER 00362345
REGISTERED OFFICE 000 Xxxxxxxxxxx, Xxxxxx, XX0X 0XX
AUTHORISED SHARE CAPITAL 100 Ordinary Shares of L1 each
ISSUED SHARE CAPITAL 6 Ordinary Shares of L1 each
SHAREHOLDER 5 held by Framlington Overseas Investment
Management Limited
1 held by Framlington Investment Trust
Services Limited
DIRECTORS Framlington Investment Management Limited
XX Xxxxx
SECRETARY Framlington Services Limited
AUDITORS N/A
ACCOUNTING REFERENCE DATE 31 December
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NAME OF COMPANY Framlington CET Investment Managers Limited
DATE AND PLACE OF INCORPORATION 24 November 1995, Jersey
REGISTERED NUMBER FC 20689
REGISTERED OFFICE Xxxxxxxxx House, 0 Xxxxxx Xxxxxx, Xx. Xxxxxx,
Xxxxxx, XX0 0XX
AUTHORISED SHARE CAPITAL 12,500 Class A Shares of L1 each
12,500 Class B Shares of L1 each
ISSUED SHARE CAPITAL 12,500 Class A Shares of L1 each
12,500 Class B Shares of L1 each
SHAREHOLDER 12,500 Class A Shares held by Framlington
Group Limited
12,500 Class B Shares held by Central Europe
Trust Co. Limited
DIRECTORS PA Xxxxxxxxx
TO Xxxxx
XX Xxxxxxxx
SECRETARY Jersey Trust Company
AUDITORS PricewaterhouseCoopers LLP
ACCOUNTING REFERENCE DATE 31 December
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SCHEDULE 3
PART A - THE WARRANTIES
1 CAPACITY AND AUTHORITY
1.1 The Seller and each of the Guarantors is duly incorporated and validly
existing under applicable law.
1.2 The Seller and each of the Guarantors has the right, power and authority to
execute and deliver, and to exercise its rights and perform its obligations
under, each of the Implementation Documents to which it is a party.
1.3 Each Implementation Document to be executed by the Seller and each of the
Guarantors will, when executed, constitute its legal, valid and binding
obligations enforceable in accordance with their respective terms.
1.4 The execution and delivery of, and the performance of obligations under and
compliance with the provisions of, each Implementation Document to which
the Seller or either Guarantor is a party will not result in:
(a) a violation of any provision of its memorandum or articles of
association (or equivalent document); or
(b) a breach of or a default under any instrument to which it is a
party
where, in each case, such breach would materially and adversely affect its
ability to enter into or perform its obligations under the relevant
Implementation Document.
1.5 Save as expressly provided for in this Agreement, no consent,
authorisation, licence or approval of or notice to its shareholders or any
governmental, administrative, judicial or regulatory body, authority or
organisation is required to authorise the execution, delivery, validity,
enforceability or admissibility in evidence of each Implementation Document
to which the Seller or either Guarantor is a party or the performance by
the Seller or either of the Guarantors of its obligations thereunder.
1.6 No order has been made, petition presented or meeting convened for the
purpose of considering a resolution for the winding up of the Seller or
either of the Guarantors or for the appointment of any provisional
liquidator. No petition has been presented for an administration order to
be made in relation to the Seller or either of the Guarantors, and no
receiver (including any administrative receiver) has been appointed in
respect of the whole or any part of any of the property, assets and/or
undertaking of the Seller or either of the Guarantors. No events or
circumstances analogous to any of those referred to in this paragraph 1.6
have occurred in any jurisdiction outside England.
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2 THE SALE SHARES
2.1 The Seller is the sole legal and beneficial owner of the Sale Shares free
from Encumbrances. The Seller has the right to transfer legal and
beneficial title to the Sale Shares and none of the Sale Shares is subject
to any rights of pre-emption or restrictions on transfer.
2.2 The Shares held by the Seller have been validly issued, are fully paid and
constitute 98.14 per cent of the issued and allotted share capital of the
Company and the Sale Shares constitute 90.77 per cent of the issued and
allotted share capital of the Company. There is no shareholder or joint
venture agreement to which the Seller is a party in effect in respect of
the Shares held by the Seller.
2.3 There is no agreement or commitment to give or create any Encumbrance on or
over the Sale Shares and no person has made any claim to be entitled to any
right over or affecting the Sale Shares.
3 CONSTITUTION AND STRUCTURE OF THE GROUP
3.1 The information set out in Parts A, B and C of Schedule 2 is complete and
accurate in all respects.
3.2 The Subsidiaries are the only subsidiaries of the Company (or another Group
Company) and the share capital of each Subsidiary is wholly legally and
beneficially owned by the Company (or another Group Company) other than as
indicated in Schedule 2 and is free from any Encumbrances. All of the
shares directly or indirectly held by the Company in any other Group
Company are validly issued and allotted and are fully paid. None of the
shares directly or indirectly held by the Company in any other Group
Company are subject to any rights of pre-emption or restrictions on
transfer.
3.3 No person has the right (whether exercisable now or in the future and
whether contingent or not) to call for the issue or transfer of any
security, share or loan capital of any Group Company under any option or
other agreement or otherwise howsoever.
3.4 No Group Company has or has agreed to acquire an interest in any body
corporate, partnership, joint venture or unincorporated association and no
Group Company has or has agreed to establish any branch or place of
business outside the United Kingdom.
3.5 Neither any Guarantor nor any Connected Person of any Guarantor (other than
the Seller) owns or has any right, title interest or asset (other than
Intellectual Property Rights and Information Technology, as defined in
paragraph 16.1 of this Schedule 3) which has been used exclusively or
primarily by any Group Company in the 24 months prior to the date of this
Agreement.
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3.6 Copies of the memorandum and articles of association in force at the date
of this Agreement of each Group Company are included in the Data Room.
4 FUNDS UNDER MANAGEMENT AND TRADING
4.1 So far as the Seller is aware, no investment product of any Group Company
has any guaranteed or other minimum return feature attached to it and no
client of any Group Company has the benefit of a legally binding promise of
performance to a minimum standard or in line with stated benchmarks.
4.2 The information in Appendix 53 to the Disclosure Letter relating to the
Group's funds under management is true and correct in all material
respects. All investment management agreements and investment advisory
agreements (save in respect of private clients where the assets under
management are less than L10 million) to which any Group Company is a
party are set out in paragraph 4.2 of the Disclosure Letter.
4.3 All funds under management of the Group are set out in Appendix 53 to the
Disclosure Letter and have been valued in accordance with the normal
practice of the Company applicable to the relevant client(s) used in order
to determine the amount of fees due.
4.4 Each Group Company has in the 24 months prior to the date of this Agreement
complied in all material respects with its obligations under each fund
management or advisory agreement to which that Group Company is a party.
4.5 No Group Company has received notice in writing in the 24 months prior to
the date of this Agreement that it is in default in any material respect
under any subsisting fund management or advisory agreement to which that
Group Company is a party.
4.6 No Group Company has received notice in writing in the 18 months prior to
the date of this Agreement from a client representing more than
L100,000 in revenue per annum terminating any subsisting fund
management or advisory agreement to which that Group Company is a party. So
far as the Seller is aware, no Group Company has, in the 6 months prior to
the date of this Agreement, received notice in writing from any such client
of any firm intention to terminate any such fund management or advisory
agreement.
4.7 No client of any Group Company or unit holder or shareholder in any fund
managed or operated by any Group Company, or former client, unit holder or
shareholder, has in the 24 months prior to the date of this Agreement
expressed an intention in writing, or has reserved a right in writing, to
claim compensation which might exceed L100,000 from any Group Company
on the grounds of negligence, breach of contract or breach of applicable
investment restriction.
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4.8 Copies of all of the current prospectuses of the Funds established by any
Group Company have been disclosed to the Buyer, are complete and accurate
in all material respects and are contained in the Data Room.
4.9 An anonymised list of the top 50 distributors by Retail Fund assets under
management as at 30th June 2005 is contained in the Data Room.
4.10 No client of any Group Company is presently withholding fees which are due
and payable in an amount in excess of L10,000 in aggregate.
4.11 In the 24 months prior to the date of this Agreement, no Group Company has
received notice in writing of a claim or complaint by a person alleging
that any investment product of any Group Company or any investment product
distributed by any Group Company was mis-sold to them.
4.12 In the 18 months prior to the date of this Agreement, there have been no
significant errors in the operation of any administrative functions
operated by or so far as the Seller is aware on behalf of any Group
Company.
4.13 So far as the Seller is aware, in the 4 years prior to the date of this
Agreement, no open-ended fund managed by a Group Company has been the
subject of late trading or market timing activities.
4.14 So far as the Seller is aware, in respect of investment funds or companies
which are managed by a Group Company which are open-ended, no liability on
the part of any Group Company exists in respect of any pricing errors for
the issue or redemption of units in such investment funds or companies.
4.15 The Signing AUM has been prepared in accordance with the provisions of
paragraph 1 of Schedule 9.
4.16 No Group Company has any liability in respect of Losses arising in
connection with any claim made by the trustee in bankruptcy of OFZ Profity.
5 COMPLIANCE WITH LEGAL REQUIREMENTS
5.1 All registers and minute books required by law to be kept by each Group
Company:
5.1.1 contain an accurate and complete record of the matters which should by law
be dealt with in the register of holders of securities and such registers
have been properly written up;
5.1.2 in respect of all other matters which should by law be dealt with in such
books, contain a accurate and complete record and have been properly
written up, in each case in all material respects,
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and no Group Company has in the 48 months prior to the date of this
Agreement received any application or written request for rectification of
its statutory registers or any other notice in writing that any of them is
incorrect.
5.2 Each Group Company has obtained all material licences, permissions,
consents, authorisations and other approvals (together "PERMITS") and has
in the 3 years prior to the date of this Agreement in respect of FSMA, the
Proceeds of Crime Xxx 0000, the Money Laundering Regulations 2003 and the
Investment Advisers Act of 1940 (United States) including, in respect of
each enactment, all subordinate legislation and the FSA Handbook (the
"RELEVANT LAWS") and in the 18 months prior to the date of this Agreement
in respect of all laws and legally binding regulations other than the
Relevant Laws made all material filings, authorisations, notifications and
registrations required for or in connection with the carrying on of its
business in the places and in the manner in which its business is now
carried on and no such Permits are revoked, suspended, cancelled,
restricted or subject to any special conditions. So far as the Seller is
aware, there are no circumstances in which any such Permits are reasonably
likely to be revoked, suspended, cancelled or not renewed or materially
varied or made subject to any material restriction or material condition
(in whole or in part).
5.3 Each Group Company is conducting and has in the 3 years prior to the date
of this Agreement in respect of the Relevant Laws and in the 24 months
prior to the date of this Agreement in respect of all other laws and
legally binding regulations conducted its business in all material respects
in accordance with all applicable laws and legally binding regulations.
6 ACCOUNTS, MANAGEMENT ACCOUNTS, ASSETS AND INFORMATION
6.1 The Accounts:
(a) have been properly prepared in accordance with CA 1985 and all
applicable Accounting Standards;
(b) were each prepared on the same basis and in accordance with the
same accounting principles and practices, consistently applied,
as the audited financial statements for the previous two
financial periods prior to the accounting period to which the
relevant Accounts relate save for changes to comply with changes
in applicable Accounting Standards; and
(c) give a true and fair view of the state of affairs of the Company
and the Group at each accounting reference date to which the
Accounts relate and the profit and cash flows of the Company and
the Group for the year ended on each accounting reference date to
which the Accounts relate.
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6.2 The Management Accounts for the period from the Accounts Date to the end of
the calendar month preceding the date of this Agreement were prepared with
due care and attention, were prepared on the same basis and in accordance
with the same accounting principles and practices, consistently applied, as
the Accounts and were prepared on a basis consistent with the Management
Accounts of the Company on the basis of the accounting bases, practices and
policies used in the preparation of the Management Accounts in each case in
the preceding month. Having regard to the purpose for which the Management
Accounts were prepared, the Management Accounts show a reasonably accurate
representation of the state of affairs of the Group (including the assets
and liabilities of the Group) at each date to which they relate and of the
profits and losses of the Group for each period to which they relate.
6.3 The accounting records of each Group Company are in its possession and are
in all material respects up-to-date and have in all material respects been
properly written up on a consistent basis and contain the information
required by applicable law to be entered in them.
6.4 Save for assets held subject to retention of title or similar arrangements
arising in the ordinary course of the Business, leased assets and assets
hired or rented on hire purchase or Intellectual Property Rights or
Information Technology used under licence in the ordinary course of the
Business and the Properties, the Group is the absolute owner of and is in
actual possession of all material assets used in the course of the Business
or which are necessary for the continuation of its business as it is now
carried on. So far as the Seller is aware, save as aforesaid, no person has
the right to call for any payment in respect of any of those assets and no
Group Company has created or agreed to create any Encumbrance over any part
of its undertaking or assets (other than Encumbrances arising by the
operation of law in the ordinary course of Business). No Group Company has
received written notice in the 12 months prior to the date of this
Agreement from any person claiming any such right or the benefit of any
such Encumbrance.
7 EVENTS SINCE THE ACCOUNTS DATE
7.1 Since the Accounts Date:
(a) there has been no material adverse change in the business,
assets, financial condition or operations of the Group;
(b) Group Companies have carried on their respective businesses in
the ordinary course in all respects and without any material
interruption;
(c) no asset of a value in excess of L250,000 has been acquired
or disposed of on capital account or has been agreed to be
acquired or disposed of and no contract involving expenditure by
it on capital account in excess of L250,000 has been
entered into by any Group Company;
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(d) no Group Company has resolved to change its name or to alter its
memorandum or articles of association;
(e) no Group Company has allotted or issued or agreed to allot or
issue any shares or any securities or granted or agreed to grant
any right which confers on the holder any right to acquire any
shares or other securities;
(f) no Group Company has declared, paid or made any dividend or other
distribution;
(g) no Group Company has repaid, redeemed or purchased any of its
share capital or loan capital or agreed to do so;
(h) no Group Company has reduced its share capital;
(i) no Group Company has resolved to be voluntarily wound up;
(j) no Group Company has passed any shareholder resolution or
obtained any consent from any of its members;
(k) no Group Company has otherwise than in the ordinary course of
business made, or agreed to make, any material change in the
nature or extent of its business;
(l) no Group Company has created, or agreed to create, any
Encumbrance over its business, undertaking or over any of its
assets other than on the ordinary course of business;
(m) no Group Company has appointed new auditors;
(n) no Group Company has made any change in its accounting reference
period; and
(o) no Group Company has made any change in its accounting policies
or practices.
8 INDEBTEDNESS AND GUARANTEES
8.1 Except as disclosed in the Disclosure Letter:
(a) no Group Company is a party to any outstanding indebtedness
(other than trading debtors in the ordinary course of business),
overdraft, loans or other financial or borrowing facilities; and
(b) there is no outstanding indebtedness on any account whatever
owing by any Group Company to the Seller or any Connected Person
or by the Seller or any Connected Person to any Group Company.
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8.2 No Group Company has received any written notice in the 12 months prior to
the date of this Agreement alleging that an event has occurred which
constitutes an event of default, or otherwise gives rise to an obligation
to repay prior to the scheduled repayment date, under any agreement entered
into by a Group Company relating to the borrowing or indebtedness in the
nature of borrowing.
8.3 Details of all debentures, charges, guarantees and indemnities given to
secure such indebtedness or loans referred to in paragraph 8.1 are
disclosed in the Disclosure Letter.
8.4 Save as otherwise contemplated by this Agreement, none of the indebtedness
or loans referred to in paragraph 8.1 will be become repayable on or as a
result of Completion.
9 CONTRACTS
9.1 The Seller has provided the Buyer with hard copies of all Material
Contracts. For the purposes of this paragraph 9, "MATERIAL CONTRACT" means
(1) a contract to which a Group Company is a party pursuant to which the
fee income (net of applicable VAT) is expected to exceed L250,000 in
the next 12 months and (2) a contract entered into to which a Group Company
is a party and which as at the date of this Agreement contains outstanding
financial liabilities (whether actual or contingent) of, or financial
benefits (whether actual or contingent) accruing to such Group Company
involving a single financial commitment in excess of L250,000 on a
per incident basis or L250,000 per annum but excludes any lease,
licence or other contract or agreement creating or relating to an interest
in land. Each Material Contract is on arms' length terms.
9.2 There are no outstanding agreements or arrangements under which any Group
Company is under an obligation to acquire or dispose of all or a
substantial part of its assets or business.
9.3 No Group Company has received written notification within the last 24
months of the termination of (otherwise than through expiry in accordance
with the terms of the relevant contract) or any claim for breach of
contract in respect of any Material Contracts. So far as the Seller is
aware, there are no material breaches, invalidity, or grounds for
determination, rescission, avoidance or repudiation of any Material
Contract.
9.4 There are no agreements or arrangements between any Group Company and the
Seller or any Connected Person for the supply of any goods or services
(including without limitation administration, human resources, information
technology, taxation, administration, custodian, outsourcing, insurances,
premises or other services) or the use by one such party of the property,
rights or assets of the other.
9.5 So far as the Seller is aware, no bid or tender given or made by any Group
Company on or before the date of this Agreement and still outstanding is
capable of giving rise to an agreement or arrangement merely by a
unilateral act of another person.
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9.6 Other than the Material Contracts or any lease, licence or other contract
or agreement creating or relating to an interest in land, no Group Company
is a party to:
(a) so far as the Seller is aware, any contract for lease, hire, hire
purchase, credit sale, conditional sale or purchase by
instalments which is not accounted for in the Accounts or the
Management Accounts (other than in relation to the Properties or
Information Technology);
(b) any guarantee, indemnity other than an indemnity given in the
ordinary course of business, surety or letter of credit;
(c) any joint venture agreement or arrangement, partnership rights or
obligations or any other agreement or arrangement under which it
participates with any other person in any business;
(d) so far as the Seller is aware, any contract or arrangement which
constitutes a commercial transaction or arrangement not entirely
on arms' length terms;
(e) any contract or arrangement in which any director of any Group
Company or any person connected with any such director (within
the meaning of section 346 Companies Act 1985) is legally or
financially interested; and
(f) so far as the Seller is aware, any contract or arrangement which
can be terminated in the event of any change in the underlying
ownership or control of the Company or any other Group Company or
which contains a unilateral right in favour of the counter-party
to change the terms thereof in the event of any change in the
underlying ownership or control of the Company or any other Group
Company, where, in each such case, such termination or change
would have a material impact on the Group.
9.7 No Group Company has given any covenants or is a party to any arrangements
limiting or excluding its right to do business and/or compete in any area
or field (whether limited by reference to a geographical area or type of
business) as it may think fit or the ability to transfer the whole or any
part of its business with any other person.
9.8 So far as the Seller is aware, compliance with this Agreement shall not:
(a) materially breach or constitute a material default under an
agreement or arrangement to which any Group Company is a party,
or any provision of the memorandum or articles of association of
any Group Company, or any security interest or regulation
applicable to any Group Company; or
(b) result in the creation, imposition, crystallisation or
enforcement of any Encumbrance on any of the material assets of
the Company.
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10 FUNDS
10.1 All of the Funds established by any Group Company have been established in
accordance with the applicable laws and regulations in the jurisdictions in
which they are established.
10.2 No decision has been taken to wind up or close any current Funds
established by any Group Company.
10.3 To the extent necessary, taking into account the purposes for which it has
been established and is marketed, each Fund established by any Group
Company is duly authorised by the governmental or regulatory authority in
the jurisdiction in which it is established and so far as the Seller is
aware there are no circumstances to indicate that any such authorisation
will be revoked in whole or part, in the ordinary course of events (whether
as a result of the acquisition of the Sale Shares or otherwise). For each
such authorised Fund, details of the relevant government or regulatory
authority, the type of authorisation and any special conditions attaching
to the Fund's authorisation are set out in the Disclosure Letter.
10.4 So far as the Seller is aware, all unlisted and unquoted investments of all
of the Funds are and have within the last three years been valued in the
period in which they have been under the management of a Group Company in
accordance with applicable laws and regulations.
10.5 So far as the Seller is aware, the assets held in any Fund or any other
portfolio under the management of a Group Company are and have in the 18
months prior to the date of this Agreement in each case in any period in
which they have been under the management of the Group Company been held in
all material respects in accordance with the provisions of any applicable
law or regulation.
11 AGENTS AND BROKERS
11.1 Details of the standard terms of trade between the Group Company and the
twenty largest distribution agents (based on sales during the twelve month
period prior to the date of this Agreement) to whom any Group Company pays
or has paid commission or advanced expenses are contained in the Data Room
and there are no other arrangements or agreements between any Group Company
and any such agent which contain terms materially different from the
standard terms disclosed in the Data Room.
11.2 No written indication has been received by the Seller or a Group Company
that any distribution agents will cease carrying on business with any Group
Company as a result of this Agreement or Completion.
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11.3 So far as the Seller is aware, no Group Company has in the 18 months prior
to the date of this Agreement paid any commissions or other incentives to
an agent or broker for business offered by that agent or broker to such
Group Company where such payment was illegal.
12 THE PROPERTIES AND OTHER INTERESTS IN LAND
12.1 The Properties are all the properties owned, controlled, used or occupied
by a Group Company or in which any Group Company has any interest or right.
A Group Company is the legal and beneficial owner of or is otherwise
absolutely entitled to its interest in each of the Properties. Details of
all covenants, restrictions, easements or other matters set out or referred
to in the deeds and documents relating to the relevant Group Company's
interest in each of the Properties are contained in the Data Room.
12.2 No Group Company has any material liability (contingent or actual) in
respect of any leasehold property except the Properties.
12.3 A Group Company has in its possession or under its control all the deeds
and documents necessary to prove title to its interest in each of the
Properties.
12.4 Each Property is held under the terms of the lease or licence applicable to
it referred to in Schedule 5 and no material variations, collateral
assurances or concessions have been entered into.
12.5 The relevant Group Company has paid all rent or licence fees and all other
outgoings which have become due in respect of each of the Properties.
12.6 So far as the Seller is aware, the relevant Group Company has performed and
observed all obligations, covenants and conditions affecting each of the
Properties in all material respects. No Group Company has received any
written notice alleging breach of any such covenants and conditions which
remains outstanding.
12.7 The Seller is not aware of any dispute, claims, demands, actions, notices
or complaints relating to any of the Properties which remains or remain
outstanding.
12.8 A Group Company holds each of the Properties subject to the third party
rights of occupation or possession described or contained in the Data Room
but is otherwise in physical possession and actual occupation of each
Property. Where a Property is sublet to a third party, the third party has
performed and observed all obligations, covenants and conditions on its
part contained in the relevant sublease in all material respects. All rent
or other outgoings which have become due under the relevant sublease have
been paid to date.
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12.9 In relation to such of the Properties as are leasehold, where the rent
reserved by the lease or tenancy of any such Property is subject to review
there are no disputes outstanding as to the settlement of the relevant
level of rent.
12.10 So far as the Seller is aware, each Group Company is in compliance in all
material respects with all applicable environmental and health and safety
laws including without limitation, in relation to the Control of Asbestos
at Work Regulations 2002 with respect to either the Properties or the
carrying on of the business of the Company substantially as it is presently
carried on. No Group Company has received any notification or claim from
any relevant authority alleging that it has not complied in all material
respects with all such applicable environmental and health and safety laws
within the last three years or is under any investigation or inquiry by any
relevant authority under any applicable environmental or health and safety
rules.
13 EMPLOYEES
13.1 The Disclosure Letter contains or refers to details of the employees of
each Group Company including employing company, job title, remuneration
payable (including bonus arrangements), length of service, notice period
and other principal benefits provided.
13.2 The Seller has disclosed to the Buyer copies of the service contracts of
the Senior Employees and a representative sample of the contracts of
employment between each Group Company and its employees, and none of the
employees have contractual terms which are materially different.
13.3 To the extent not disclosed under paragraph 13.1 material details of any
benefit received by any employee otherwise than in cash and of any benefit
received by any employee in cash which is related to sales, profits,
turnover or performance, or which is otherwise variable (other than normal
overtime) are set out or discussed in the Disclosure Letter or Data Room.
13.4 Each Group Company has maintained records which are adequate and up-to-date
in all material respects regarding the service of each of its employees and
these records will be made available to the Buyer on Completion.
13.5 No Senior Employee has, since the Accounts Date, given notice terminating
their contract of employment or is under notice of dismissal. No amount due
to or in respect of any employee of any Group Company is in arrears or
unpaid other than salary for the month current at the date of this
Agreement.
13.6 No Group Company is involved in any material dispute or negotiation with
any of its employees and so far as the Seller is aware there is no such
dispute pending or threatened in writing.
13.7 Since the Accounts Date, (i) no change has been made in the emoluments or
other terms of engagement of any Senior Employee of any Group Company or
(ii) no material change has
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been made in the emoluments of any category of other employees of any Group
Company numbering 10 or more. The annual salary review takes place in
December and no other material changes have been proposed by any Group
Company in writing or are due to other emoluments or terms and conditions
in the 6 months from the date of this Agreement.
13.8 Within the period of 18 months before the date of this Agreement no Group
Company has given notice of any redundancies to the Secretary of State for
Work and Pensions or started consultations with any independent trade union
or unions or other employee representatives under Part XI Employment Rights
Act 1996 and no Group Company has failed to comply with any obligation
under such Part XI. No Group Company has in the 18 months before the date
of this Agreement entered into any contractual enhanced redundancy
entitlements on termination of employment. Details of any discretionary
redundancy payments made in the last 12 months have been fairly disclosed
to the Buyer.
13.9 No gratuitous payment or payments which individually or in the aggregate
are material, have been made or promised by any Group Company in connection
with the actual or proposed termination, breach, suspension or variation of
any employment or engagement of any present or former director, officer or
employee of that company.
13.10 No director, officer or employee of the Company or any Group Company will
be entitled to receive any payment or right or benefit from any Group
Company arising out of or in connection with either this Agreement or
Completion.
13.11 The Disclosure Letter contains details of the entitlement of each employee
of any Group Company to options or awards under the LTIP or under the
Phantom Option Agreement. There are no other arrangements of any Group
Company entitling any employee to any equity or option over equity or
reward based upon notional equity. Save as contemplated by the terms of the
Funding Agreement, no Group Company has any obligation or responsibility to
fund the LTIP Trust. The Seller confirms that there are no performance
conditions applicable to any outstanding Award or Option.
13.12 There are no employees of any Group Company other than as set out in the
Disclosure Letter and no Group Company has made any offer to employ any
person who would become a Senior Employee if such offer were accepted or to
more than 5 persons who would become an employee who in each case is not
listed as an employee in such schedule.
13.13 Each Group Company has in relation to each of its employees in all
material respects in the 24 months prior to the date of this Agreement:
(a) Complied with all obligations imposed on it under such employees
terms and conditions of employment and any collective agreement
and arrangements which relate to any such employees; and
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(b) Complied with all obligations imposed on it by, and all orders
and awards made under, all statutes and regulations which are
relevant to such employees.
14 PENSIONS
IN THIS PARAGRAPH "THE TAXES ACT" SHALL MEAN THE INCOME AND CORPORATION
TAXES XXX 0000.
14.1 Save for the Pension Scheme and the Group Personal Pension Scheme the
Company is not under any legal or other obligation to provide any relevant
benefits (as defined in section 612(1) of the Taxes Act) to any of the
employees of the Company or their dependants and has no grounds for
believing that the Company will become so liable in future.
14.2 The Seller warrants that sufficient particulars of the Pension Scheme and
the Group Personal Pension Scheme have been disclosed to enable the Buyer
to determine the benefit structure of those schemes and the duties and
obligations of the Company and, where appropriate, the trustees of those
schemes, in relation to the Pension Scheme Members, under the provisions of
those schemes, including without prejudice to the generality of the
foregoing:
(a) the Second Definitive Trust Deed for the Pension Scheme dated 26
August 1999 and subsequent amending deeds (which together
constitute the trust deed);
(b) the 2004 version booklet for the Pension Scheme (which is the
current booklet);
(c) any other relevant booklets and written announcements given to
the Pension Scheme Members.
14.3 All employer contributions due as at the date of this Agreement in respect
of the employees of the Company to the Group Personal Pension Scheme and
the trustees of the Pension Scheme have been paid in accordance with the
provisions of the Second Definitive Trust Deed and within the requirements
of the Pensions Xxx 0000 and those which fall due for payment before the
date of Completion will have been paid by that date.
14.4 The Pension Scheme is an exempt approved scheme within the meaning of Part
XIV of the Taxes Act and so far as the Seller is aware (i) there is no
reason why such approval should be withdrawn; and (ii) the Pension Scheme
and the Group Personal Pension Scheme have at all times complied with and
been duly administered in all respects in accordance with, all applicable
laws and regulations.
14.5 The Company has at all times complied in all material respects with all
applicable laws and regulations (including without limitation Article 141
of the Treaty of Rome, all applicable EEC directives and all UK statutes,
regulations and statutory instruments), and the provisions of the Pension
Scheme, relating to the participation of the Relevant Employees in the
Pension Scheme.
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14.6 The Group Personal Pension Scheme and the Pension Scheme are not contracted
out of the State Second Pension.
14.7 (a) So far as the Seller is aware, there are no outstanding complaints
under the internal disputes resolution procedure of the Pension Scheme
and there are no outstanding complaints by any Relevant Employee in
relation to the the Group Personal Pension Scheme;
(b) There are no proceedings in the courts in relation to the Pension
Scheme or the Group Personal Pension Scheme; and
(c) So far as the Seller is aware, no complaints have been made to the
pensions ombudsman in relation to the Pension Scheme or the Group
Personal Pension Scheme.
14.8 The Company has been duly admitted to participation in the Pension Scheme
and no other Company has participated in the Pension Scheme, other than
Xxxxxxxxxxx Investment Management between 8 December 1986 and 16 November
1998.
14.9 The Company has no liability to make any payment to any pension scheme in
which it formerly participated, whether pursuant to section 75 of the
Pensions Xxx 0000 or otherwise.
14.10 All benefits (other than a refund of the member's contributions with
interest where appropriate) payable under the Pension Scheme or the Group
Personal Pension Scheme on death before normal pension age of a Relevant
Employee while in an employment to which the Pension Scheme relates are
fully insured with Norwich Union. As far as the Seller is aware, there are
no circumstances that would or might result in revocation or restriction of
cover under this policy.
14.11 No undertaking or assurance has been given to any Relevant Employee as to
the continuance or introduction or increase or improvements of any pension
rights or entitlements which the Buyer or the Company would be required to
implement in accordance with good industrial relations practice whether or
not there is any legal obligation to do so and no discretion has been
exercised to admit to membership any Relevant Employee who would not
otherwise have been eligible for admission to membership.
14.12 The Group Personal Pension Scheme provides only money purchase benefits
within the meaning of Section 181(1) of the Xxxxxxx Xxxxxxx Xxx 0000 and no
assurance, promise or guarantee (whether written or oral) has been given to
any Member or Relevant Employee of any particular level or amount of
benefit (other than death in service benefits) payable to or in respect of
him on retirement, death or leaving service.
14.13 The Seller has not received any written notice in the past 24 months from
either the trustees of the Pension Scheme or the administrators of the
Group Personal Pension Scheme that they have had cause to report any
breaches of the 1995 Act nor any other breaches of law to Opra or the
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Pensions Regulator and neither the Seller nor, to the best of the Seller's
knowledge and awareness, the trustees have been contacted in writing by
Opra, the Pensions Regulator or the Pensions Ombudsman in connection with
any such breach or alleged breach.
14.14 The Seller has not received any written notice in the past 24 months that
any professional adviser has had cause to blow the whistle in accordance
with section 28 of the Pensions Xxx 0000 or section 70 of the Pensions Xxx
0000 and neither the Seller nor, to the best of the Seller's knowledge and
awareness, the trustees have been contacted in writing by Opra, the
Pensions Regulator or the Pensions Ombudsman in connection with any such
breach or alleged breach.
15 INSURANCE
15.1 Each Group Company has in the 18 months prior to the date of this Agreement
maintained all insurance required by applicable regulation and statute.
15.2 Hard copy summaries of all insurance policies maintained by each Group
Company and in force at any time in the past 24 months ("POLICIES") have
been made available to the Buyer in the Disclosure Letter.
15.3 All premiums due on the Policies have been paid and, so far as the Seller
is aware, all the Policies are in full force and effect. No claim exceeding
L100,000 is outstanding either by the insurer or the insured under any of
the Policies. No event has occurred in relation to the Group Companies
which requires notification under any of the insurance policies maintained
by the Group Companies that has not as at the date of this Agreement been
so notified in accordance with the terms of such policy.
16 INTELLECTUAL PROPERTY RIGHTS AND INFORMATION TECHNOLOGY AND DATA PROTECTION
16.1 In this paragraph and in paragraph 3.5 of this Schedule 3 unless the
context requires otherwise:
"INFORMATION TECHNOLOGY" means information technology infrastructure
including computer hardware, software and networks and the manuals and
documents relating to it.
16.2 So far as the Seller is aware, no Group Company is infringing or has in the
past 2 years infringed the Intellectual Property Rights or know-how of any
other person nor, so far as the Seller is aware, is any third party
infringing or has in the past 2 years infringed any Intellectual Property
Rights owned by a Group Company.
16.3 Accurate details of all registered Intellectual Property Rights (including
applications for registration of any such rights) and material unregistered
Intellectual Property Rights (including rights in computer software and
rights in and to the name "Framlington" and derivations thereof) and
business-critical know-how owned by any Group Company are fairly disclosed
(within the
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meaning of clause 7.4 of this Agreement). The relevant Group Company is the
sole legal and beneficial owner of each such right free from Encumbrances.
16.4 All renewal, application and other fees and steps required for the
progression and maintenance of all the registered Intellectual Property
Rights (including applications for registration of any such rights)
disclosed in the Disclosure Letter or the Data Room have been paid or
taken.
16.5 So far as the Seller is aware, none of the Intellectual Property Rights or
know-how owned by any Group Company are the subject of any litigation or
administrative proceedings.
16.6 So far as the Seller is aware, no third party uses or has in the last 2
years used the name "Framlington", or any name which, in the Seller's
reasonable opinion, is confusingly similar to the name "Framlington" in any
financial services business.
16.7 Complete and accurate copies of all material written current licences and
agreements relating to Intellectual Property Rights, know-how and
Information Technology (including without limitation software licences,
leases, maintenance and support agreements, development agreements,
management agreements, outsourcing agreements, escrow agreements relating
to the deposit of source code, security arrangements and disaster recovery
agreements) entered into by any member of the Group are fairly disclosed
(within the meaning of clause 7.4 of this Agreement).
16.8 Details of all material unwritten current licences and agreements relating
to Intellectual Property Rights, know-how and Information Technology
entered into by any member of the Group are fairly disclosed within the
meaning of clause 7.4 of this Agreement.
16.9 So far as the Seller is aware, no Group Company is in, nor is any third
party in, material breach of any licence or agreement required to be
disclosed pursuant to paragraph 16.7 of this Schedule.
16.10 Each Group Company either owns or has a licence or contractual right to
use all Intellectual Property Rights, know how and Information Technology
necessary to carry on the business currently conducted by that member of
the Group and, so far as the Seller is aware, none of these licences or
contractual rights to use when material and unwritten, will be affected as
a result of any direct or indirect change in the underlying ownership or
control of any Group Company or otherwise by reason of the transactions
contemplated by this Agreement.
16.11 None of the Seller, any Guarantor or any Connected Person of any Guarantor
owns any Intellectual Property Rights or know-how or Information Technology
which is used by any member of the Group, or is licensed to use any such
Intellectual Property Rights or know-how or Information Technology under a
licence the benefit of which is shared with any Group Company, and the
Information Technology systems of the Group do not integrate to or depend
on Information Technology systems of the Seller, any Guarantor or any
Connected Person of any Guarantor.
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16.12 So far as the Seller is aware, no material Business Information which is
confidential and proprietary to any member of the Group has been disclosed
to any third party other than under an obligation of confidentiality in the
3 years prior to the date of this Agreement.
16.13 Details of all domain names registered by any Group Company are fairly
disclosed (within the meaning of clause 7.4 of this Agreement).
16.14 In the 12 months prior to Completion, no Group Company has experienced any
material disruption in or to its business or operations as a result of (a)
any security breach in relation to any Information Technology or (b) any
failure (whether arising from any bug, virus, defect or otherwise), lack of
capacity or other sub-standard performance of any Information Technology.
16.15 The Information Technology systems of the Group include up-to-date virus
software and, so far as the Seller is aware, contain no virus or
potentially harmful program codes.
16.16 Details of the disaster recovery and security arrangements in place in
relation to the Information Technology used by the Group are fairly
disclosed (within the meaning of clause 7.4 of this Agreement).
16.17 Each Group Company has complied with all relevant requirements of the Data
Protection Act 1998 (including, without limitation, the data protection
principles set out in that Act).
16.18 The Disclosure Letter sets out details of all data protection
registrations, (or notifications, as appropriate) made by any Group Company
and no Group Company has in the 12 months prior to the date of this
Agreement received any written complaints, enforcement notice or
deregistration notice from any person (including any relevant regulator)
regarding the storage or use of any data where any of the same would have
an adverse effect on the Group.
17 POWERS OF ATTORNEY
No Group Company has given any power of attorney which is still outstanding
or effective to any person to enter into any contract or commitment on its
behalf other than to its employees to enter into routine trading contracts
in the normal course of their duties.
18 COMPETITION AND GRANTS
18.1 No Group Company is or has been in the past two years a party to, and is
not and has not in the past two years been concerned in, any agreement or
arrangement, and is not conducting and has not conducted itself (whether by
omission or otherwise) in a manner, which:
(a) infringes Article 81 or 82 of the EC Treaty or section 2 or
section 18 of the Competition Xxx 0000 or any other anti-trust or
similar legislation in any jurisdiction in which the
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Group has assets or carries or intends to carry on business or
where its activities may have an effect; or
(b) is unenforceable or void (whether in whole or in part) or renders
the Company or any other Group Company liable to civil, criminal
or administrative proceedings by virtue of any anti-trust or
similar legislation or any undertakings given or orders made
under such legislation in any jurisdiction in which any Group
Company has assets or carries on or intends to carry on business
or where its activities may have an effect.
18.2 In the past two years, no Group Company has given an undertaking to, and is
not subject to any order of or investigation by, and has not received any
request for information from, any court or governmental authority
(including, without limitation, any national competition authority, the
European Commission and any sectoral regulator) under any anti-trust or
similar legislation in any jurisdiction in which any Group Company has
assets or carries on or intends to carry on business or where its
activities may have an effect.
18.3 No Group Company has applied for or received any aid (as that term is
understood for the purposes of Articles 87 to 89 of the EC Treaty) during
the last two years.
19 LITIGATION
19.1 No Group Company is engaged in any capacity in any litigation, arbitration,
prosecution or other legal proceedings or in any proceedings or hearings
before any statutory or governmental body, department, board or agency or
other dispute resolution proceedings whether as claimant, defendant or
otherwise and no such litigation, arbitration, prosecution or other
proceedings are pending or threatened. So far as the Seller is aware, there
is no fact or circumstance reasonably likely to give rise to any material
litigation, arbitration, mediation or administrative or criminal
proceedings.
19.2 No Group Company has received written notice of any outstanding judgment,
order, decree, arbitral award or decision of any court, tribunal,
arbitrator or governmental agency against any Group Company.
20 REGULATORY MATTERS
20.1 So far as the Seller is aware, all material correspondence, agreements and
memoranda of understanding between any Group Company and any Regulatory
Authority within the 3 years prior to this Agreement (including letters,
reports, risk assessments, licences and other notices produced by any
Regulatory Authority) other than any such document which is subject to an
obligation of confidentiality legally binding on the relevant Group Company
have been disclosed to the Buyer in part 8 of the Data Room or paragraph 20
of the Disclosure Letter. So far as the
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Seller is aware, there are no confidential agreements between a Group
Company and any Regulatory Authority in existence.
20.2 No Group Company:
(a) has any Permit issued by any Regulatory Authority;
(b) has the benefit of any individual waiver of any statutory
provision, rule or regulation granted by any Regulatory
Authority; or
(c) is in the process of applying for any of the things in (a) or (b)
above,
other than as is disclosed in paragraph 20(a), (b) and (c) of the
Disclosure Letter.
20.3 So far as the Seller is aware, each Group Company has reasonable procedures
in place designed to ensure that each of its relevant directors and
employees has complied with all applicable individual registration and
training and competence requirements made pursuant to the rules,
regulations and practices of any Regulatory Authority. So far as the Seller
is aware, no such director or employee is in material breach of such
requirements or has either been refused, or received any notice of
intention to terminate, such registration as an approved person during the
course of their employment with a Group Company.
20.4 No Group Company is, or has been:
(a) the subject of any inquiry, investigation, censure, prosecution,
dispute, disciplinary proceedings, prohibition, restriction,
exercise of powers of intervention, order, direction or notice,
by any Regulatory Authority (including any exercise by the FSA of
its powers under Part XI of FSMA); or
(b) engaged in or the subject of any other governmental,
administrative, tribunal, or judicial inquiry involving a
Regulatory Authority or other proceedings of a financial
regulatory nature,
in the three years prior to the date of this Agreement, and so far as
the Seller is aware there are no particular material circumstances
which are likely to give rise to such action in the future.
20.5 No Group Company has been informed in writing of any material outstanding
issues with any Regulatory Authority concerning any visits made to it by
the relevant Regulatory Authority regarding the standards of regulatory
compliance that have applied or may still apply in the conduct of business,
internal organisation, risk management disciplines or other relevant
control functions in respect of any business carried on by the Group
Company in the three years prior to the date of this Agreement.
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20.6 Each Group Company has access to, and may demand return of, any books and
records (or copies thereof) not held by them but on their behalf by third
parties in relation to the Business conducted by them which are required to
be kept under applicable legal or regulatory requirements other than those
books and records mentioned in paragraphs 5.1 and 6.5 of this Schedule 3.
20.7 So far as the Seller is aware, no Group Company (nor any of its officers,
employees or agents) in the 24 months prior to the date of this Agreement
has offered to or solicited offers for any securities or other products
from any person in any jurisdiction in which such offer or solicitation is
unlawful or where such offer or solicitation is required to be authorised
by the appropriate governmental agency or regulatory body and has not been
so authorised otherwise than in accordance with all applicable laws and
regulations.
20.8 So far as the Seller is aware, no Group Company (nor any of its officers,
employees or agents) in the 24 months prior to the date of this Agreement
has distributed any prospectus or offering document in any jurisdiction
where such distribution is unlawful or where such distribution is
restricted without observing such restrictions or otherwise than in
accordance with all applicable laws and regulations.
20.9 All regulatory breaches by any Group Company (if any) identified to the
Company by or notified by any Group Company to (formally or informally) any
Regulatory Authority to which any Group Company is subject in the 3 years
prior to the date of this Agreement have been remedied to such Regulatory
Authority's satisfaction.
20.10 All recommendations (if any) suggested by any Regulatory Authority in
writing in the 3 years prior to the date of this Agreement to which any
Group Company is subject have been implemented within the period
contemplated by the recommendation to such Regulatory Authority's
reasonable satisfaction.
20.11 Other than as disclosed at part 8 of the Data Room or paragraph 20.11 of
the Disclosure Letter, in the 2 years prior to the date of this Agreement,
no written complaints or claims for compensation have been made to any
Group Companies and no complaints or claims for compensation have been
notified to any Group Company by any Regulatory Authority.
21 INSOLVENCY
21.1 No order has been made and no resolution has been passed for the winding-up
of any Group Company or for a liquidator to be appointed in respect of any
Group Company and no petition has been presented and no meeting has been
convened for the purpose of winding-up any Group Company.
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21.2 No administration order has been made, and no petition for such an order
has been presented in respect of any Group Company.
21.3 No receiver (which expression shall include an administrative receiver) has
been appointed in respect of any Group Company or in respect of all or any
part of its assets.
21.4 No voluntary arrangement has been proposed under section 1 Insolvency Xxx
0000 in respect of any Group Company.
21.5 No event analogous to any of the circumstances mentioned in any of the
foregoing sub paragraphs of this paragraph 16 has occurred in relation to
any Group Company outside England.
22 TAXATION
22.1 All returns, computations, notices, statements, reports or information
which ought to have been made by or in respect of any Group Company for any
Taxation purpose have been properly and punctually submitted to the
relevant Taxation Authority; all such returns, computations, notices,
accounts, statements, reports and information supplied to any Taxation
Authority were, when made or supplied, up-to-date and correct in all
material respects; none of such returns, computations, notices, accounts
statements, reports or information is the subject of any material present
or, so far as the Seller is aware, contemplated dispute or disagreement
with any Taxation Authority regarding liability or potential liability to
any Taxation recoverable from any member of the Group or regarding the
availability of any material relief from Taxation to any member of the
Group, and there is no fact or circumstance of which the Seller is aware
which makes any such dispute or disagreement likely to commence.
22.2 The Company or the relevant member of the Group has sufficient records
relating to past events, including any elections made, to calculate the
Taxation liability or relief which would arise on any disposal or on the
realisation of any asset owned at the Accounts Date by any member of the
Group or acquired by any such member since that date but before Completion
including sufficient books, documents, records and other information to
enable any member of the Group promptly to comply in full with any notice
served on it under regulations 10 or 11 of the Instalment Payments
Regulations in respect of any accounting period commencing before
Completion.
22.3 Each member of the Group has duly submitted all claims, elections,
disclaimers or withdrawals of claims or notifications which have been
assumed to have been made for the purposes of the Accounts and which are
due to be made on or before Completion.
22.4 No member of the Group has received any notice from any Taxation Authority
which required or will or may require such member to withhold tax from any
payment made since the Accounts Date or which will or may be made after the
date of this Agreement.
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22.5 All Taxation for which each of the Group Companies is liable, the due date
for payment of which is (in the absence of any application to postpone) on
or before Completion has been or will be paid on or before Completion.
Without limitation, each Group Company has made all deductions,
withholdings and retentions of or on account of Taxation as it was or is
obliged or entitled to make, and has accounted to the relevant Taxation
Authority for any such deductions and retentions for which it was obliged
to account.
22.6 No Group Company is or has within the three years before the date of this
Agreement been liable to pay to any Taxation Authority any penalty, fine,
surcharge or interest in connection with any Taxation or otherwise paid any
Taxation after its due date for payment or become liable to pay any
Taxation the due date for payment of which has passed or become
prospectively liable to pay any Taxation the due date for payment of which
will arise in the 30 days after this Agreement.
22.7 The Disclosure Letter indicates that the Company and each UK resident
member of the Group is a "large company" within the meaning of regulation 3
of the Instalment Payments Regulations and the Disclosure Letter contains
full details of all instalment payments required to be made by any member
of the Group under the Instalment Payments Regulations since the Accounts
Date.
22.8 All Taxation liabilities (including actual, deferred, contingent,
quantified, disputed or otherwise) of each Group Company measured by
reference to income, profits or chargeable gains earned, accrued or
received on or before the Accounts Date, or arising in respect of an event
occurring on or before that date, are properly provided for, or the subject
of proper reserve made, in the Accounts.
22.9 Since the Accounts Date:
22.9.1 no Group Company has been involved in any transaction which has given or
may give rise to a liability to Taxation on any member of the Group (or
would have given rise to such a liability but for the availability of any
relief) other than Taxation in respect of normal trading income or receipts
arising from transactions entered into in the ordinary course of business;
22.9.2 no disposal has taken place or other event occurred which has the effect
of crystallising a liability to Taxation which should have been included in
the provision for deferred Taxation contained in the Accounts if such
disposal or other event had been planned or predicted at the Accounts Date;
and
22.9.3 no member of the Group has been a party to any transaction for which any
Taxation clearance provided for by statute has been obtained.
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22.10 No action has been taken by any member of the Group before Completion such
that the provisions of regulation 14 of the Instalment Payments Regulations
could have effect in respect of any member of the Group at any time.
22.11 No Taxation Authority has in the last six years carried out or (so far as
the Seller is aware) is at present conducting, any review, audit or
investigation into any aspect of the business or affairs of any of the
Group Companies other than of a routine nature, and there is no reason why
any such review, audit or investigation should be initiated. HMRC has not
given a notice of enquiry into a Taxation return of any member of the Group
pursuant to Part IV of Schedule 18 of the Finance Xxx 0000.
22.12 The amount of Taxation chargeable on the Group Companies as a whole during
any accounting period ending on or within six years before the Accounts
Date has not, to any material extent, depended on any concession, agreement
or other formal or informal arrangement with any Taxation Authority (being
a concession, agreement or other arrangement which is not set out in any
legislation or published practice of that Taxation Authority).
22.13 No member of the Group has been a party to, or a Promoter in relation to,
any transaction forming part of notifiable arrangements (as defined for the
purposes of Part 7 of the Finance Xxx 0000 (Disclosure of Tax Avoidance
Schemes)).
22.14 No member of the Group has made any election under paragraph 6 of the Loan
Relationship and Derivative Contracts (Disregard and Bringing into Account
of Profits and Losses) Regulations 2004).
22.15 The Company has not been since October 1996, and, so far as the Seller is
aware, has never been, a close company within the terms of section 414 ICTA
1988 or a close investment holding company within the terms of section 13A
ICTA 1988.
22.16 No member of the Group has entered into any transaction or arrangement the
consideration for which was or will be determined otherwise than on arm's
length terms, nor has any member of the Group agreed to do so, in
circumstances that any Group Company's income or capital gains could be
required to be adjusted for Taxation purposes, and the relevant member of
the Group holds documentation (including any pricing methodology) which is
sufficient to satisfy any requirement to demonstrate that any transaction
to which it was a party was entered into on arm's length terms.
22.17 Particulars of all arrangements and agreements relating to intra-group
surrender of Taxation reliefs to which any Group Company is or has been a
party are set out in the Disclosure Letter.
22.18 Except as provided for in the Accounts, there exists no obligation on any
Group Company to make any payment (other than to any other Group Company)
in respect of any period ending on
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or before the Accounts Date under the arrangements referred to in paragraph
22.17 above nor do any circumstances exist which may give rise to such an
obligation.
22.19 No member of the Group constitutes a permanent establishment of another
person, business or enterprise for any Taxation purpose.
22.20 Each member of the Group is and has within the past 6 years been resident
in the country named as its place of incorporation in Part B of Schedule 2
(Information about the Group) for Taxation purposes.
22.21 Each member of the Group is not and within the past 6 years has not been
treated as resident in any other jurisdiction for any Taxation purpose
(including for the purposes of any double taxation agreement). So far as
the Seller is aware, no member of the Group has, or has within the past six
years had, a permanent establishment outside the country named as its place
of incorporation in Part B of Schedule 2, (Information about the Group).
22.22 All non-UK resident Group Companies are engaged in exempt activities
within the meaning of Part II of Schedule 25 ICTA 1988 or fall within
section 748(1)(e) ICTA.
22.23 All documents in the possession of the Group Companies or to the
production of which any of the Group Companies is entitled which establish
or are necessary to establish the title of any Group Company to any asset,
or by virtue of which any Group Company has any right, and which attract
stamp duty in the United Kingdom or elsewhere have been duly stamped. Since
the Accounts Date, no member of the Group has incurred any liability to
stamp duty reserve tax or stamp duty land tax.
22.24 In relation to VAT or any equivalent in any other jurisdiction:
(i) details of the VAT registration (or the registration number for
the purposes of any equivalent tax) of each Group Company are set
out in the Disclosure Letter; and
(ii) each Group Company has complied in all material respects with
applicable VAT or equivalent legislation.
22.25 Each member of the Group is, and has for the last six years been, treated
for the purposes of section 43 VATA 1994 as a member of a group of
companies (the "VAT GROUP") of which the representative member is the
Company (the "REPRESENTATIVE MEMBER"). No member of the Group is or has
been registered for the purposes of VATA 1994 otherwise than as part of the
VAT Group, no member of the Group is or has been a member of any other
group for VAT purposes, and no company which is not a member of the Group
is or has been a member of the VAT Group, in each of these cases, within
the last six years.
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22.26 The Representative Member has made, given, obtained and kept full,
complete, correct and up-to-date returns, records, invoices and other
documents appropriate or required for the purposes of VATA 1994 and is not
in arrears with any payments or returns due and has not been required to
give security under paragraph 4 of Schedule 11 VATA 1994.
22.27 Details of any claim made by the Representative Member for bad debt relief
under section 36 VATA 1994 are set out in the Disclosure Letter.
22.28 There is no land in which any member of the Group has an interest, or over
which any member of the group has a right, or which any member of the Group
has a licence to occupy, that is (in any such case) land in relation to
which an election made under paragraph 2 of Schedule 10 VATA 1994
("election to waive exemption") has effect or will have effect so as (in
either such case) to render any supply made by any member of the Group of,
or in respect of, any interest in, right over or licence to occupy such
land a supply that will be taxable at the standard rate of VAT or (as the
case may be) a supply that would be so taxable but for any disapplication
of such election in circumstances prescribed by relevant provisions of VATA
1994.
22.29 No member of the Group owns any asset to which the provisions of Part XV
of the Value Added Tax Regulations 1995 (the Capital Goods Scheme) apply:
22.30 Neither the Representative Member nor any other member of the Group has,
at any time within the last six years, acted as agent of any person not
resident in the United Kingdom for the purpose of section 47 VATA 1994 or
been appointed as a VAT representative of any person for the purposes of
section 48 VATA 1994.
22.31 On a disposal of all its assets by any member of the Group for:
(A) in the case of each asset owned by that member of the Group at
the Accounts Date, a consideration equal to the value attributed
to that asset in preparing the Accounts; or
(B) in the case of each asset acquired since the Accounts Date, a
consideration equal to the consideration given for the
acquisition
then either:
in respect of any asset falling within (A) above, the liability to Taxation
(if any) which would be incurred by that member of the Group in respect of
that asset would not exceed the amount taken into account in respect of
that asset in computing the maximum liability to deferred Taxation as
stated in the Accounts and no balancing charge in respect of any capital
allowances claimed or given, or other recapture of writing down allowances,
would arise except to the extent that such charge is fully provided for in
the Accounts; or
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in respect of any asset within (B) above, no Taxation liability would be
incurred by that member of the Group in respect of that asset.
22.32 No Group Company has acquired in the past six years an asset in
circumstances that it will be deemed under applicable Taxation legislation
to dispose of that asset and re-acquire it by virtue of or in consequence
of this Agreement or its performance.
22.33 Particulars of each claim under sections 152 or 153 of the Taxation of
Chargeable Gains Xxx 0000 made prior to the date of this Agreement to which
section 154 of the Taxation of Chargeable Gains Xxx 0000 applies and which
affects any asset which was owned by any member of the Group on or after
the Accounts Date have (except where the held over gain is treated as
having accrued prior to the Accounts Date) been disclosed in the Disclosure
Letter.
22.34 Since 6 April 1965, no member of the Group has made any repayment of share
capital to which section 210(1) ICTA 1988 applies. No member of the Group
has in the past ten years issued any share capital or other security as
paid up otherwise than by the receipt of new consideration within the
meaning of Part VI ICTA 1988.
22.35 No member of the Group has, since the Accounts Date, made any payment, nor
is any member of the Group under any obligation to make any future payment
(in either case being a payment in excess of L10,000 and being made other
than as consideration for the acquisition of capital assets) which will be
prevented by reason of a statutory provision designed to prevent or to
limit the avoidance of Tax (including without limitation, Schedule 28AA
ICTA 1988 and paragraphs 11 and 13 of Schedule 9 to the UK Finance Act
1996) from being deductible for corporation tax purposes, whether as a
deduction in computing the profits of a trade or as an expense of
management or as a charge on income or as a non-trading debit under Chapter
II Part IV of the Finance Xxx 0000.
22.36 No member of the Group has, at any time within the last six years,
acquired any asset from any other company (including another member of the
Group) which was, at the time of the acquisition, a member of the same
group of companies as that member for the purposes of any Taxation.
22.37 There are no circumstances by virtue of which section 410 or 413 ICTA 1988
would prevent each member of the Group being treated as a member of the
same group of companies as each other such member for the purposes of
Chapter IV Part X ICTA 1988 for any accounting period commencing on or
before the date of this Agreement.
22.38 No member of the Group has made any surrender of or claim for (i) group
relief or (ii) any amount of surplus advance corporation tax or (iii) a
refund of tax within section 102 Finance Act 1989 which involves any
company which is not a member of the Group.
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22.39 No member of the Group has received any payment in respect of a surrender
of group relief or of surplus advance corporation tax or of a tax refund
which could, in any circumstances, be due to be repaid to any company other
than another member of the Group.
22.40 No member of the Group has been concerned in an exempt distribution (as
defined in section 214(4) ICTA 1988) within the last six years.
22.41 There have been no arrangements made with HMRC under section 36 of the
Finance Xxx 0000 under which provision has been made for the liability to
corporation tax of any Group Company to be discharged by any other company.
22.42 There are no circumstances by virtue of which any Group Company is or will
be obliged to make any payment to any person who is or has been an investor
in any Fund by way of compensation for the failure of the Fund in question
to satisfy the requirements for investment trust status as set out in
Section 842 ICTA 1988.
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PART B - THE BUYER'S WARRANTIES
1 The Buyer is a company duly incorporated and organised and validly existing
under the laws of England and Wales.
2 The Buyer has the right, power and authority required to enter into each of
the Implementation Documents and perform fully its obligations under them
in accordance with their terms.
3 Each of the Implementation Documents constitutes and the other documents to
be executed by the Buyer which are to be delivered at Completion in
accordance with clause 5 will, when executed, constitute legal, valid and
binding obligations enforceable in accordance with their respective terms.
4 Neither the entry into this Agreement nor the implementation of the
transactions contemplated by it will result in:
(a) a violation or breach of any provision of the memorandum and
articles of association of the Buyer;
(b) a breach of, or give rise to a default under, any contract or
other instrument to which the Buyer is a party or by which it is
bound;
(c) a violation or breach of any applicable laws or regulations or of
any order, decree or judgment of any court, governmental agency
or regulatory authority applicable to the Buyer or any of its
assets; or
(d) a requirement for the Buyer to obtain any consent or approval of,
or give any notice to or make any registration with, any
governmental, regulatory or other authority which has not been
applied for, obtained or made at Completion,
where, in each case, such breach would materially and adversely affect its
ability to enter into or perform its obligations under the relevant
Implementation Document.
5 No order has been made, petition presented or meeting convened for the
purpose of considering a resolution for the winding up of the Buyer or for
the appointment of any provisional liquidator. No petition has been
presented for an administration order to be made in relation to the Buyer,
and no receiver (including any administrative receiver) has been appointed
in respect of the whole or any part of any of the property, assets and/or
undertaking of the Buyer. No events or circumstances analogous to any of
those referred to in this paragraph 5 have occurred in any jurisdiction
outside England.
6 The Buyer has available cash or available loan facilities which will at
Completion provide in immediately available funds the necessary cash
resources to pay the purchase price for the
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Sale Shares payable by the Buyer under the Offer Documents and meet its
other obligations under this Agreement and, in the case of loan facilities,
they involve no material pre-conditions and the Buyer will be able to
satisfy all conditions of drawdown to such loan facilities at or prior to
Completion.
7 No member of the Buyer's Group is:
(a) subject to applicable law, regulation or other statutory or
legislative provisions of any country or to any order, decree or
judgment of any court, governmental agency or regulatory
authority which is still in force; nor
(b) a party to any litigation, arbitration or administrative
proceedings which are in progress or threatened or pending by or
against or concerning it or any of its assets; nor
(c) the subject of any governmental, regulatory or official
investigation or enquiry which is in progress or threatened or
pending,
which in any case has or could reasonably be expected to have a material
adverse effect on the Buyer's ability to execute, deliver and perform its
obligations under this Agreement.
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SCHEDULE 4
ACTUARY'S LETTER
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SCHEDULE 5
THE PROPERTIES
ROOT OF
TITLE/TITLE CURRENT
NO. TENURE NUMBER (IF ANY) PARTIES OWNER /TENANT PROPERTY ADDRESS
--- --------- ---------------- --------------------------------- --------------- ---------------------
1 Leasehold Lease dated 20 (1) Rosehaugh Stanhope (Broadgate the Company Xxxxx 0
Xxxxxxxxx 0000, Xxxxx 0) XXX 000 Xxxxxxxxxxx
registered under (2) Xxxxxxxxxxx Xxxxx XXX Xxxxxx XX0X 0XX
title number (3) The Xxxxxxxxxxx Trust PLC
NGL646697
2 Licence Licence dated (1) MWB Business Exchange UK the Company 0/00 Xx Xxxxxx Xxxxxx
13 and 21 Limited Edinburgh
October 2004 (2) the Company XX0 0XX
3 Leasehold Lease dated 24 (1) The Port Employers and the Company Ground Floor Premises
February 1988 Registered Dock Workers Pension Argosy House
registered under Fund Trustees Limited 00/00 Xxxxxxxx Xxxx
title number (2) Unit Trust Software Limited Kingston upon Thames
SGL510074
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SCHEDULE 6
LIMITATIONS ON THE LIABILITY OF THE SELLER AND THE GUARANTORS
1 GENERAL LIMITATIONS
1.1 The total aggregate liability of the Seller and the Guarantors together in
respect of all claims other than those claims pursuant to clauses 10.2(b)
(Claverhouse), 10.2(d) (Dormant Companies), clause 10.2(e) (African
Companies), clause 11.1 (Pensions) and clause 9 (Restrictive Covenants)
under this Agreement shall be limited in aggregate to L110.4 million.
1.2 The total aggregate liability of the Guarantors together in respect of all
claims under this Agreement shall not exceed the total aggregate liability
of the Seller under this Agreement.
1.3 The Seller shall have no liability in respect of a Relevant Claim or a
claim under any Taxation Warranty if the amount of such claim is equal to
or less than L75,000; subject to paragraph 1.5, in the event that the
amount of such claim exceeds this threshold, the Seller shall (subject to
the other provisions of this Agreement) be liable for the whole amount of
such claim and not merely the excess. For the purpose of this paragraph,
any claims arising out of the same or substantially similar facts or
circumstances shall be regarded as one claim so that the amount of such
claim shall be the aggregate of all such individual claims.
1.4 The Seller shall not be liable in respect of a Tax Claim unless and until
the aggregate amount of:
1.4.1 all Tax Claims exceed L500,000 in aggregate, in which case the
Seller shall be liable for the whole amount of all such claims (subject to
the other provisions of the Taxation Deed and this Agreement, in each case
to the extent applicable) and not merely the amount in excess of
L500,000; or
1.4.2 without prejudice to paragraph 1.2, all Tax Claims and all Relevant Claims
exceed L1.5 million in aggregate (whether or not all Tax Claims exceed
L500,000 in aggregate), in which case the Seller shall be liable for the
whole amount of all such claims (subject to the other provisions of the
Taxation Deed and this Agreement, in each case to the extent applicable)
and not merely the amount in excess of L1.5 million.
1.5 Without prejudice to paragraph 1.3, the Seller shall not be liable in
respect of a Relevant Claim or a claim under any Taxation Warranty unless
and until the aggregate amount of all such claims and all Tax Claims (if
any) exceed L1.5 million in aggregate (whether or not all Tax Claims exceed
L500,000 in aggregate), in which case the Seller shall be liable for the
whole amount of all such claims (subject to the other provisions of this
Agreement) and not merely the amount in excess of L1.5 million.
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1.6 The total liability of each Guarantor in respect of each claim under any
Implementation Document shall be limited to that Guarantor's Respective
Percentage of the amount claimed.
1.7 The total aggregate liability of the Seller in respect of claims under
clause 10.2(c)(i) and (ii) shall not exceed L10 million in aggregate. The
Seller shall have no liability in respect of any claim under clause
10.2(c)(i) and (ii) unless the amount of such claim is more than L15,000;
in the event that the amount of such claim exceeds this threshold, the
Seller shall (subject to the other provisions of this Agreement) be liable
for the whole amount of such claim and not merely the excess.
1.8 The following provisions of Schedule 6 are applicable to all claims under
the Agreement: paragraph 1.6, 4.1(a) and 4.1(b).
1.9 The following paragraphs of this Schedule 6 are applicable to claims under
clause 10.2: 3.1, 4.1(c), 5, 7 and 8.
2 TIME LIMIT FOR BRINGING A CLAIM
2.1 The Seller shall not be liable for a Relevant Claim or a Claim under any
Taxation Warranty or a Tax Claim unless the Buyer has given the Seller
notice of that Relevant Claim or a claim under any Taxation Warranty or
claim under the Taxation Deed, stating (if practicable) in reasonable
detail the nature of the Relevant Claim or a claim under any Taxation
Warranty or the claim under the Taxation Deed and the Buyer's then best
estimate of the amount claimed:
(a) in the case of a Tax Claim or a claim under any Taxation
Warranty, or a claim under clause 10.2(b) (Claverhouse - VAT),
within 7 years after Completion;
(b) or, in the case of any Relevant Claim or a claim under clause
4.1, by no later than 31 May 2007;
(c) in respect of claims under clause 10.2(c)(i) and (ii), by no
later than the third anniversary of Completion.
2.2 Any Relevant Claim or a claim under any Taxation Warranty or a Tax Claim
shall (if it has not been previously satisfied, settled or withdrawn) be
deemed to have been waived or withdrawn on the expiry of 18 months after
the date of the notice served pursuant to paragraph 2.1 of Schedule 6 (or
in the case of a Tax Claim and if later the date 120 Business Days after
the day on which any action taken by the parties pursuant to clause 5 of
the Taxation Deed is finally determined) unless legal proceedings in
respect of the Relevant Claim or Tax Claim have been started. For the
purposes of this paragraph 2.2 legal proceedings shall not be deemed to
have been started unless they have been both issued and served on the
Seller.
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3 SPECIFIC LIMITATIONS
3.1 The Seller shall not be liable in respect of a Relevant Claim and its
liability in respect of such claims shall not be increased to the extent
that the matter giving rise to the claim or the increase in the amount of
such claim:
(a) would not have arisen or occurred but for a voluntary act,
omission or transaction on the part of the Buyer or any of the
Group Companies or any of their respective directors or employees
after Completion PROVIDED THAT the act, omission or transaction
occurs (1) outside the ordinary course of business in
circumstances where the Buyer or Group Company were aware that
such act, omission or transaction would give rise to or increase
the amount of such Relevant Claim and (2) other than as required
by any law in force on or before Completion in each case;
(b) results from a change in the accounting or Taxation policies or
practices of the Buyer or any Related Company of the Buyer or any
Group Company (including the method of submitting taxation
returns) introduced by the Buyer and having effect after
Completion, save where such change is required to conform such
policy or practice of the relevant Group Company with law,
applicable regulation or generally accepted policies or practices
or where such change is necessary to correct an improper practice
or policy;
(c) occurs as a result of or is otherwise attributable to:
(i) any legislation not in force at Completion or any change of
law or administrative practice having retrospective effect
which comes into force after Completion; or
(ii) any increase after Completion in any rate of Taxation; or
(iii) the Buyer or any Group Company disclaiming any part of the
benefit of capital or other allowances against Taxation
properly claimed or proposed to be properly claimed on or
before the date of this Agreement; or
(d) is an amount for which any Group Company has a right of recovery
under the terms of any insurance policy of any Group Company
which is in force at the Completion Date (whether or not such
policy is in force at the time of the matter giving rise to a
Relevant Claim arising);
(e) arises as a result of any act or omission of the Buyer or any
Group Company which results in the right of recovery against a
person other than the Seller, the Guarantors or any Connected
Person being diminished or extinguished PROVIDED THAT the act or
omission occurs after Completion (1) outside the ordinary course
of business in circumstances where the Buyer or Group Company (as
the case may be) was aware
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that such act, omission or transaction would give rise to such a
result and (2) other than as required by any law in force on or
before Completion; or
(f) arises as a consequence of any act or omission in accordance with
the terms of this Agreement or at the request of the Buyer or
member of the Buyer's Group.
4 NO DUPLICATION OF LIABILITY
4.1 The Buyer agrees for itself and on behalf of every Group Company with the
Seller in respect of any claim under an Implementation Document:
(a) it shall not be entitled to recover damages or obtain payment for
reimbursement, resolution or indemnity more than once in respect
of any one loss or set of circumstances which give rise to more
than one claim under this Agreement or the Taxation Deed;
(b) to the extent that such liability is satisfied by way of a claim
under this Agreement, an amount payable under the Taxation Deed
in respect of the same matter is reduced accordingly, and vice
versa; and
(c) such liability shall be determined net of any reserves, liability
accruals or other provisions properly made in the Accounts.
5 CLAIMS AGAINST THIRD PARTIES
5.1 Nothing in this Schedule 6 shall require the Buyer to take proceedings
against any third party prior to taking or enforcing any proceedings
against the Seller or the Guarantors.
5.2 If the Seller pays to the Buyer or any Group Company an amount in respect
of any Relevant Claim and the Buyer or any Group Company (as the case may
be) subsequently recovers from a third party (including any insurer or any
Taxation Authority) a sum which is referable to that Claim, the Buyer shall
forthwith repay to the Seller so much of the amount paid by the Seller as
does not exceed the sum (net of all reasonable costs, charges, and expenses
incurred by the Buyer or the relevant Group Company in recovering such sum)
recovered from the third party.
5.3 Nothing contained in this paragraph shall limit the Buyer's obligations at
common law or the obligation of any Group Company to take reasonable steps
to mitigate any loss or damage resulting from or arising as a consequence
of any circumstances giving rise to any Relevant Claim.
5.4 Where any Group Company or the Buyer is or becomes entitled (whether under
any insurance or by way of payment, discount, credit, set off, counterclaim
or otherwise) to recover from any third party (other than a person who at
the relevant time is a client of any Group Company) in
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respect of any loss, damage or liability which is the subject of a claim
against the Seller, the Buyer shall give notice thereof promptly to the
Seller and, if so required by the Seller but without prejudice to the
Buyer's right to take or enforce proceedings against the Seller, take or
procure the relevant Group Company to take all such reasonable steps or
proceedings as the Seller may reasonably require to enforce such recovery.
5.5 The Buyer shall procure that the Seller is provided promptly with all such
information and reports concerning any such steps or proceedings taken by
the Buyer or the relevant Group Company as the Seller may from time to time
reasonably request PROVIDED THAT THE Buyer shall not be obliged to provide
the Seller with any information if to do so would constitute a waiver of
legal professional privilege.
5.6 If any such sum as is referred to in paragraph 5.2 of this Schedule 6 is
recovered by the Buyer or any Group Company from the third party, any claim
by the Buyer or any Group Company in respect of any loss, damage or
liability to which the sum relates shall be limited (without prejudice to
any other limitations on the liability of the Seller referred to in this
Schedule 6) to the amount (if any) by which the amount of such loss, damage
or liability exceeds the aggregate of:
5.6.1 the sum recovered less all reasonable costs, charges and expenses incurred
by the Buyer or any Group Company (as the case may be) in recovering that
sum from the third party; and
5.6.2 any sum or sums previously paid by the Seller to the Buyer or any Group
Company in respect of such loss, damage or liability.
If the aggregate of the sums referred to in paragraphs 5.6.1 and 5.6.2 of
this Schedule 6 exceeds the amount of the loss, damage or liability to
which the sum recovered relates the Buyer shall forthwith pay to the Seller
or, as the case may be, the Guarantors the amount of the excess is an
amount up to the amount paid under paragraph 5.6.2.
5.7 The Seller shall reimburse to the Buyer or the relevant Group Company (as
the case may be) all reasonable costs, charges and expenses incurred by it
in complying with its obligations under paragraphs 5.4 to 5.6 of Schedule 6
inclusive and the Buyer shall not (and shall procure that the relevant
Group Company shall not) accept or pay or compromise any relevant claim or
make any submission in respect of it without the Seller's prior written
consent (such consent not to be unreasonably withheld or delayed).
5.8 In this paragraph 5, "CLIENT" means an investor in any Fund or a client of
a Group Company who at the time when the Buyer or relevant Group Company is
or becomes entitled to make a claim has not given notice to terminate its
contract with the relevant Group Company and whose contract the relevant
Group Company has not given notice to terminate.
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6 THIRD PARTY CLAIMS
The Buyer shall, and shall procure that each Group Company shall notify the
Seller of any claims, potential claim, matter or event against the relevant
Group Company which might constitute a breach of any of the Warranties
(other than Taxation Warranties) or otherwise give rise to a Relevant Claim
(a "THIRD PARTY CLAIM") as soon as is reasonably practicable following
receipt of such claims. The Buyer shall conduct any negotiations,
proceedings, settlements or appeals relating to the Third Party Claim as
though the Buyer did not have the benefit of the Warranties contained in
this Agreement, but shall keep the Seller reasonably informed of progress
in relation to the Third Party Claim, shall take account of any reasonable
request as to the conduct of the Third Party Claim (at the Seller's
expense) and shall not settle the Third Party Claim without the prior
consent of the Seller (not to be unreasonably withheld or delayed). If so
required by the Seller, the Buyer shall, and shall procure that the
relevant Group Company shall, pursue any available counterclaim, in which
case the provisions of paragraph 5 shall apply as if the dispensation in
respect of Clients in paragraph 5.4 was not applicable.
7 SUCCESSFUL CLAIMS CONSTITUTE REDUCTION IN PURCHASE PRICE
The satisfaction by the Seller of either or both of the Guarantors of a
claim under any Implementation Document shall where possible be deemed to
constitute a reduction in the consideration payable by the Buyer for the
purchase of the Sale Shares.
8 THIRD PARTY CLAIMS - CERTAIN INDEMNITIES
8.1 The Buyer shall, and shall procure that each other Group Company shall
notify the Seller of any claims, potential claim, matter or event against
the Group Company which might give rise to a claim under clause 10.3 (a
"Third Party Claim") as soon as is reasonably practicable following receipt
of such claims. The Buyer shall procure that the Group Company, at the
Seller's sole expense, shall consult with the Seller in respect of the
Third Party Claim and, if required by the Seller, shall permit the Seller
to conduct any negotiations, proceedings, settlements or appeals relating
to the Third Party Claim.
8.2 If the Buyer becomes aware of any Third Party Claim, the Buyer shall, and
shall procure that each Group Company shall:
8.2.1 as soon as reasonably practicable and in any event within 14 days of
becoming so aware give notice of such Third Party Claim to the Seller and
consult with the Seller in respect of such Third Party Claim;
8.2.2 if so requested by the Seller by no later than 5 Business Days of being so
notified, take all reasonable steps or proceedings as the Seller may
reasonably consider necessary at the Seller's expense in order to mitigate,
avoid, resist, appeal, dispute, contest, remedy,
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compromise or defend any such Third Party Claim including permitting the
Seller to take such reasonable steps or proceedings on its behalf and in
its name, subject to the Group Company (as appropriate) being indemnified
by the Seller to the Buyer's reasonable satisfaction against all costs,
damages and expenses incurred in connection with the Third Party Claim;
8.2.3 on reasonable notice, give the Seller or its duly authorised
representatives reasonable access to the personnel of the Group Company and
to any premises, chattels, accounts, documents and records which are
relevant to the Third Party Claim and are within the power, possession or
control of Group Company ("relevant assets") to enable the Seller and its
duly authorised representatives to investigate the claim and to examine and
take copies or photographs of the relevant assets at the Seller's expense;
8.2.4 to the extent reasonably necessary, require the personnel of the relevant
Group Company to provide statements and proofs of evidence, and to attend
at any hearing to give evidence or otherwise, and to provide this
assistance at the Seller's expense to enable the Buyer or the relevant
Group Company to mitigate, avoid, resist, appeal, dispute, contest, remedy,
compromise or defend any Third Party Claim (in a manner that does not
disrupt business of the Buyer or the relevant Group Company);
8.2.5 keep the Seller informed of the progress of any Third Party Claim
(including any proposed settlement, compromise or admission of liability)
and provide the Seller with copies of all material correspondence relating
to it; and
8.2.6 save with the Seller's prior written consent (such consent not to be
unreasonably withheld or delayed) not to admit liability in respect of, or
compromise or settle, any Third Party Claim.
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SCHEDULE 7
PART A - THE PREPARATION OF THE COMPLETION ACCOUNTS
1 The Buyer shall procure that as soon as practicable following the
Completion Date, and in any event not later than 30 Business Days after the
Completion Date, a Draft of the Completion Accounts ("DRAFT COMPLETION
ACCOUNTS") shall be prepared by the Company in accordance with paragraph 2
and delivered simultaneously to the Buyer's Accountants and the Seller's
Accountants (together the "ACCOUNTANTS").
2 The Draft Completion Accounts shall be prepared by the Company:
2.1 in the form set out in Part B of this Schedule 7:
2.2 in accordance with the specific accounting treatments set out in Part C of
this Schedule 7; and, subject thereto
2.3 adopting the same accounting principles, policies, treatments and
categorisations as were used in the preparation of the Accounts for the
year ended on the Accounts Date, as there applied, including in relation to
the exercise of accounting discretion and judgement; and, subject thereto
2.4 in accordance with Accounting Standards relevant at the Completion Date.
For the avoidance of doubt, paragraph 2.2 shall take precedence over
paragraphs 2.3 and 2.4, and paragraph 2.3 shall take precedence over
paragraph 2.4.
2.5 As soon as practicable after delivery of the Draft Completion Accounts to
the Accountants in accordance with paragraph 1, and in any event within 20
Business Days after such delivery (the "REVIEW PERIOD"), the Accountants
shall review the Draft Completion Accounts and endeavour to agree what
adjustments (if any) need to be made to them in order for them to comply
with paragraphs 2.1 to 2.4 (inclusive).
If the Accountants agree upon all such adjustments as are referred to in
paragraph 2.5 within the Review Period, they shall jointly incorporate them
into the Draft Completion Accounts and the Draft Completion Accounts as so
adjusted shall be the "COMPLETION ACCOUNTS" for all purposes and shall,
save in the case of manifest error, be final and binding on all parties.
2.6 If the Accountants are unable to agree within the Review Period on any
aspect of the Completion Accounts (including as to:
2.6.1 whether adjustments need to be made to the Draft Completion Accounts;
2.6.2 the adjustments to be made thereto; or
2.6.3 the amount of the Actual Net Asset Value),
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the Seller and the Buyer shall endeavour in good faith to agree such matter
or matters and to incorporate them as so agreed into the Draft Completion
Accounts by making appropriate adjustments thereto. The Draft Completion
Accounts as so adjusted shall be the "COMPLETION ACCOUNTS" for all purposes
and shall, save in the case of manifest error, be final and binding on all
parties.
2.7 If the Seller and the Buyer have not resolved any such matter in dispute
referred to in paragraph 2.6 within 10 Business Days after the end of the
Review Period, then such matter or matters (but no other matters) shall
thereupon be referred to such firm of independent chartered accountants as
the Seller and the Buyer may agree within 14 days of a request by either of
them to the other or, failing such agreement within such time, as the
President for the time being of the Institute of Chartered Accountants in
England and Wales may nominate on the application of the Seller or the
Buyer (the "INDEPENDENT ACCOUNTANTS") for determination on the following
basis:
2.7.1 the Independent Accountants shall be instructed to notify the Seller and
the Buyer of their determination of any such matter within 30 Business Days
of such referral;
2.7.2 the Seller and the Buyer shall be entitled to make written submissions to
the Independent Accountants and copied to the other party's Accountants at
the same time, but subject thereto the Independent Accountants shall have
power to determine the procedure to be followed in relation to their
determination;
2.7.3 any submissions to and the determination of the Independent Accountants
shall be in the English language and any oral hearings shall be conducted
in English in London;
2.7.4 in making such submissions the Seller and the Buyer shall state their
respective best estimates of monetary amounts of the matters referred for
determination;
2.7.5 in making their determination the Independent Accountants shall act as
experts and not as arbitrators, their decision as to any matter referred to
them for determination shall be final and binding in all respects on the
parties and shall not be subject to question on any ground whatsoever; and
2.7.6 the fees and expenses of the Independent Accountants shall be borne and
paid as the Independent Accountants shall determine.
2.8 Following any agreement between the Seller and the Buyer or any
determination by the Independent Accountants, the Accountants shall jointly
incorporate into and reflect in the Draft Completion Accounts the matters
resolved between the Seller and the Buyer and/or determined by the
Independent Accountants or otherwise, together with any adjustments which
may have been agreed between the Accountants and the Draft Completion
Accounts and the amount of the Actual Net Asset Value stated in such report
shall be the "COMPLETION ACCOUNTS" and the
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"ACTUAL NET ASSET VALUE" respectively for all purposes of this Agreement,
and shall, save in the case of manifest error, be final and binding on the
parties and shall, save as aforesaid, not be subject to question on any
ground whatsoever.
2.9 Until the Actual Net Asset Value has been agreed and/or determined the
Seller and the Buyer shall respectively:
2.9.1 give or procure that the Accountants and the Independent Accountants are
given access at all reasonable times to all books and records which are in
the possession or under the control of the Seller, the Group or the Buyer
(as the case may be); and
2.9.2 generally provide the Accountants and the Independent Accountants with
such other information and assistance as they may reasonably require
(including access to and assistance at reasonable times from personnel
employed by the Seller, the Group or the Buyer, as the case may be), in
relation to the review, resolution or determination of the Completion
Accounts and the determination of the Actual Net Asset Value.
2.10 The Seller and the Buyer shall use their respective reasonable endeavours
to procure that the Seller's Accountant and the Buyer's Accountants comply
with the requirements placed upon them under this Schedule 7 (including,
without limitation, the provisions relating to timing).
2.11 The fees and expenses of the Buyer's Accountants and of the Seller's
Accountants in respect of the matters to be dealt with by them under this
Schedule 7 shall be for the account of the Buyer and the Seller
respectively.
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PART B - FORM OF COMPLETION ACCOUNTS
As at the
Completion Date
L'000
FIXED ASSETS
Tangible assets
Investments
CURRENT ASSETS
Stock of units
Debtors
Cash at bank and in hand
CREDITORS
Less: amounts falling due within one year
NET CURRENT ASSETS
Total assets less current liabilities
Less: provisions for liabilities and charges
NET ASSETS EXCLUDING PENSION DEFICIT
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PART C - AGREED ACCOUNTING POLICIES AND PRINCIPLES
1. The accrual for corporation tax for the period from the Accounts Date to
the Completion Date will be calculated on the basis that the Completion
Date is the end of an accounting period for tax purposes.
2. No provision shall be made in the Completion Accounts for any Losses which
are recoverable by the Buyer or any Group Company pursuant to clause 10.2.
3. No provision shall be made in the Completion Accounts in respect of any
shortfall in relation to the Pension Scheme.
4. The African Companies shall not be consolidated in the Completion Accounts,
and the investments in them shall be valued at Lnil in the Completion
Accounts
5. The LTIP Trust shall not be consolidated in the Completion Accounts.
6. The cash held by the LTIP Trust immediately before Completion, plus the
aggregate exercise price payable by the holders of the options under the
LTIP assuming all those options were exercised in full, shall be included
in the Completion Accounts.
7. For the avoidance of doubt the Completion Accounts shall (a) include full
provision for the employer's National Insurance contributions arising in
connection with the Structural Event (as defined in the Articles of
Association of the Company) assuming all of the options outstanding under
the LTIP were exercised at the time the Structural Event occurred; and (b)
not include either an asset or a liability in respect of PAYE, employees'
National Insurance contributions, or stamp duty arising in connection with
the Structural Event (as defined in the Company's Articles of Association)
unless and to the extent that such amounts may not be set off against
amounts payable to participants in the LTIP in connection with the offer
made or to be made by the Buyer.
8. The Completion Accounts shall include full provision for all liabilities of
the LTIP Trust immediately prior to Completion.
9. The Completion Accounts shall include properly calculated amounts in
respect of all accruals and prepayments (for example, in respect of payroll
related liabilities (subject to paragraph 7 above)) as at the Completion
Date.
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SCHEDULE 8
PRE-COMPLETION UNDERTAKINGS
1 Subject to paragraph 4 of this Schedule 8, pending Completion (except as
expressly contemplated by this Agreement or with the prior written consent
of the Buyer) no Group Company shall:
(a) resolve to change its name or to alter its memorandum or articles
of association;
(b) create any share capital or loan capital;
(c) allot or issue or agree to allot or issue any shares or any
securities or grant or agree to grant rights which confer on the
holder any right to acquire any shares or other such interest
(including with limitation, make any awards under the LTIP or
grant any similar awards) unless such awards are made in
satisfaction of an existing contractual obligation where such
awards can be satisfied by a transfer of shares;
(d) declare, pay or make any dividend or other distribution other
than the Pre-Sale Dividend;
(e) reduce its share capital;
(f) amend the FSA Settlement;
(g) resolve to be voluntarily wound up; or
(h) pass any resolution of its members.
2 Subject to paragraph 4 of this Schedule 8, the Seller shall procure that:
(a) each Group Company shall give to the Buyer and its authorised
representatives:
(i) following a request made to the Seller (through the
Guarantors' professional advisers), copies of such books and
records of each Group Company and access to the Key
Employees as the Buyer and its authorised representatives
may reasonably request; and
(ii) copies of all board papers, management reports and accounts,
and such other information relating to each Group Company as
the Buyer may reasonably require;
(b) each Group Company shall provide reasonable assistance to the
Buyer to negotiate with any counterparty to a contractual
arrangement to which any Group Company is a
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party which can be terminated in the event of any change in the
underlying ownership or control of the Company or any other Group
Company or which contains a unilateral right in favour of the
counter-party to change the terms thereof in the event of any
change in the underlying ownership or control of the Company or
any other Group Company,
(c) each Group Company shall maintain insurance cover substantially
(but subject to market conditions) on the basis subsisting on the
date hereof;
(d) the Group shall continue to prepare Management Accounts in
respect of each calendar month in the period from signing to the
Completion Date and shall provide a copy of such Management
Accounts to the Buyer within 10 Business Days of the completion
of the month to which the Management Accounts relate;
(e) inform the Buyer promptly in the event that a Senior Employee
tenders his resignation;
(f) inform the Buyer promptly in the event that any Group Company
receives notice in writing from a client representing more than
L100,000 in revenue per annum terminating any subsisting fund
management or advisory agreement to which that Group Company is a
party;
(g) inform the Buyer promptly in the event that any client of any
Group Company is withholding fees in excess of L10,000;
(h) inform the Buyer in the event that any Group Company receives
written indication that any distribution agents will cease
carrying on business with any Group Company as a result of this
Agreement or Completion.
3 Subject to paragraph 4 of this Schedule 8, the Seller shall procure that
each Group Company shall operate its business or operations in the usual
and ordinary course in substantially the same manner consistent with past
practice, and, without prejudice to the foregoing, no Group Company will,
except as expressly contemplated by this Agreement or with the prior
written consent of the Buyer (such consent not to be unreasonably withheld
or delayed):
(a) dispose of, agree to dispose of, or grants or agrees to grant any
option in respect of, any material part of its assets or acquires
or agrees to make any material capital expenditure or acquire any
material asset or other asset having a value in excess of
L100,000;
(b) create, grant or issue, or agree to create, grant or issue, any
Encumbrance over its assets or give or agree to give, any
guarantees or indemnities;
(c) borrow any money or agree so to do except under existing
facilities;
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(d) discontinue or cease to operate all or a material part of its
business;
(e) save as disclosed in the Disclosure Letter, wind-up or close any
Fund;
(f) without prejudice to (g) below, engages or dismisses any Senior
Employee (other than the Key Employees (except where the
engagement or dismissal process has already commenced) or makes
any variation to the terms and conditions of employment of such
Senior Employees or any of them;
(g) no Group Company dismisses any Key Employee (except for gross
misconduct) or makes any variation to the terms and conditions of
employment of such Key Employees or any of them;
(h) make any amendments to the pension rights of any employee;
(i) amend any existing sales, distribution, market, custodian or fund
management agreement;
(j) enter into any Material Contract or vary any existing Material
Contract;
(k) alter (other than for purely administrative changes) in any
manner any bonus plan or scheme (including the LTIP);
(l) settle any existing litigation for a claim in an amount exceeding
L100,000, or commence (as claimant) any new litigation;
(m) except as required by law or by applicable accounting standards,
no Group Company shall depart from its current accounting
practices or policies;
(n) without prejudice to paragraph (f) above, employ any employee on
terms materially different to the terms of existing employees;
(o) acquire or agree to acquire any share, shares or other interest
in any company, partnership, or other incorporated or
unincorporated association or other venture; and
(p) enter into any covenant, agreement or arrangement limiting or
excluding its rights to do business and/or compete in any area or
field (whether limited by reference to a geographical area or
type of business) as it may think fit or the ability to transfer
the whole or any material part of its business with any other
person.
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4 Paragraphs 1, 2 and 3 of this Schedule 8 shall not operate so as to
restrict or prevent:
(a) the entering into in the ordinary course of business of any
contract or commitment which is terminable in accordance with its
terms by written notice of three months or less and which is not
material in relation to the Group;
(b) the completion or performance of any obligations undertaken
pursuant to any contract or arrangement entered into by any
member of the Group prior to the date of this Agreement
(including any contract or arrangement with any private client of
any Group Company);
(c) any matter undertaken at the written request, or with the prior
written consent, of the Buyer;
(d) any matters undertaken in order to comply with law or any
regulatory requirement, including any FSA requirement;
(e) any matter undertaken on behalf of any of the Funds pursuant to
an existing contractual, legal or fiduciary duty or in the
exercise of any contractual or legal rights;
(f) the declaration, authorisation and payment of the Pre-Sale
Dividend;
(g) the performance of any obligation or exercise of any right
relating to the Phantom Share Option Agreements or the LTIP in
existence as of the date of this Agreement;
(h) the payment of contributions by the Company to the Pension Scheme
whether to reduce any deficit in the Pension Scheme or otherwise;
or
(i) any matter reasonably undertaken by any member of the Group in an
emergency or disaster situation in circumstances where it is not
reasonably practicable to obtain the Buyer's prior consent with
the intention of minimising any adverse effect thereof (and of
which the Buyer will be promptly notified).
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SCHEDULE 9
1. SIGNING AUM
1.1 The Signing AUM shall be calculated as the aggregate value of the assets
under management of the Retail Funds and the Investment Trusts whose assets
are managed by the Group as at the date of this Agreement other than
Framlington Second Dual Trust plc (the "RELEVANT INVESTMENT TRUSTS")
calculated as at the close of business on the Business Day immediately
prior to the date of this Agreement.
1.2 For the purpose of this paragraph 1, the assets comprising the Retail Funds
shall be valued in accordance with the following principles: the Retail
Funds shall each be valued on the basis of the mid-price of the applicable
creation and cancellation prices set at 12 noon on the day immediately
prior to the date of this Agreement calculated in accordance with FSA
regulations and shown on the Group's records multiplied by the number of
units in the Retail Fund as at the close of business on the date
immediately prior to the date of this Agreement.
1.3 For the purpose of this paragraph 1, the assets comprising the Relevant
Investment Trusts shall be valued in accordance with the following
principles: the Relevant Investment Trusts shall each be valued at their
gross or net asset value (determined in the ordinary course of business and
consistently with the Management Accounts) shown on the Group's records as
at close of business on the Business Day falling two Business Days prior to
the date of this Agreement.
1.3.1 2. Net Outflow Amount
2.1 The Seller shall procure that the Company prepares and delivers to the
Seller and the Buyer on the Business Day immediately prior to the date on
which the On Risk Time falls a statement showing the Inflow Amount and the
Outflow Amount, together with the basis of calculation as set out below
(the "AUM STATEMENT"). The Seller undertakes to procure that the AUM
Statement is prepared in accordance with this Schedule 9. In the absence of
fraud or manifest error, the AUM Statement shall be conclusive and binding
on all parties for the purpose of determining whether the termination right
in clause 5.6 arises.
2.2 The Inflow Amount shall be calculated as the aggregate of:
2.2.1 for each Retail Fund, the gross sales amount as shown on the Group's
records arising from the purchase by investors of new units in that Retail
Fund during the period from the date of this Agreement until close of
business on the Business Day falling two Business Days prior to the date on
which the On Risk Time falls inclusive (the "AUM PERIOD");
2.2.2 for each Relevant Investment Trust, any increase in the gross or net asset
value (consistent with the Management Accounts) of that Relevant Investment
Trust attributable to an issue by
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the Relevant Investment Trust of new shares during the AUM Period (provided
that management fees are charged on such assets); and
2.2.3 the net asset value of any Investment Trust that is not a Relevant
Investment Trust that appoints any Group Company as investment manager
during the AUM Period, such value to be determined as at the date of such
appointment.
For the purpose of this paragraph 2.2:
(a) any assets which have been contractually committed to be invested in any
Retail Fund or Investment Trust shall be treated as if they have been
received by that Retail Fund or Investment Trust (as the case may be); and
(b) any assets invested or which are contractually committed to be invested in
any Retail Fund or Relevant Investment Trust by any of the Seller, the
Guarantors or any of their respective Connected Persons shall be
disregarded.
2.3 The Outflow Amount shall be calculated as the aggregate of:
2.3.1 for each Retail Fund, the gross redemption amount as shown on the Group's
records arising from the sale of units in that Retail Fund during the AUM
Period;
2.3.2 for each Relevant Investment Trust, any reduction in the net asset value
of that Relevant Investment Trust attributable to a share buyback initiated
by that Relevant Investment Trust during the AUM Period; and
2.3.3 for each Relevant Investment Trust, the amount of any assets in respect of
which any Group Company's appointment as investment manager has been
terminated during the AUM Period or in respect of which notice to terminate
has been given and not revoked during the AUM Period.
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SCHEDULE 10
THE AFRICAN EXIT PLAN
PART A - PRE-COMPLETION AND PUT OPTION
1.1 Notice to terminate
As soon as reasonably practicable after the date of this Agreement (but in
any event by 12 August 2005) the Seller shall procure that FIML shall give
notice to terminate the management agreements with each of the African
Funds.
1.2 Services Agreement
Within 30 Business Days of the date of this Agreement the Seller shall use
its reasonable endeavours to procure that FIML, Framlington Asset
Management Central Africa S.A. ("FAMCA") and FAMWA (as defined below) enter
into the Services Agreement.
1.3 Request to transfer shares in FAMWA.
1.3.1 Within 5 Business Days of the Service Agreement having been completed the
Seller shall procure that the Company submits to the board of Framlington
Asset Management West Africa SA ("FAMWA") a request to transfer all of the
shares that the Company owns as at the date of this Agreement in FAMWA
("SALE SHARES") to the Seller, provided it can do so on the basis that if
the board of FAMWA refuses such request the Company shall not be required
to offer the Sale Shares to any other person.
1.3.2 If the board of FAMWA approves the request referred to in paragraph 1.3.1
above the Company shall sell and the Seller shall purchase the Sale Shares
and the whole of the issued share capital of FAMCA for an aggregate
consideration of L2.
1.4 Put Option
1.4.1 In consideration of the mutual covenants contained in this Schedule 10,
the Seller irrevocably undertakes to acquire the Sale Shares at the
Company's first request pursuant to paragraph 1.4.2 and the whole of the
issued share capital of FAMCA ("PUT OPTION") for L1 at any time during the
period from the Completion Date until the first anniversary of the
Completion Date.
1.4.2 The Put Option shall be exercised by the Company serving written notice on
the Seller and such notice shall state the date (which shall be not more
than 20 Business Days nor less than 10 Business Days after the date upon
which such notice is received by the Seller) and place in the United
Kingdom where completion of the sale and purchase of the Sale Shares shall
take place.
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1.4.3 The Seller will have to complete the purchase of the Sale Shares unless:
(i) it is unable lawfully to acquire the Sale Shares without having to
offer any of such Sale Shares to any other person, whether pursuant to
the constitutional documents of FAMWA or any other agreements between
the shareholders;
(ii) the Services Agreement has not been entered into by FIML, FAMWA and
FAMCA; and
(iii) any consents or approvals to the sale of the Sale Shares and the
shares held by the Seller in FAMCA which are required from any
applicable Regulatory Authority have been not obtained on terms that
will not have a material adverse effect on the ability of either the
Seller, FAMWA or FAMCA to carry on FAMWA's or as appropriate FAMCA's
business in substantially the same manner as FAMCA's or FAMWA's
business was carried out prior to completion of the Put Option.
1.4.4 Pending completion of the Put Option the provisions of paragraph 2 and 3
of this Schedule 10 shall apply.
2. Exit Arrangements
Liquidation or Winding-up of the African Companies
2.1 As soon as practicable after FIML has ceased to be the manager of the
African Funds the Buyer shall take (or procure that there are taken) all
such reasonable steps and actions as are necessary to be taken to cause the
Winding-up of both of the African Companies.
2.2 The Buyer shall procure that an amount equal to the aggregate amount
returned to any shareholder of each African Company that is a member of the
Buyer's Group upon each Winding-up shall be paid to the Seller (or as the
Seller may direct) within 5 Business Days of payment to the relevant
shareholder.
Payment for successful completion
2.3 In the event that either:
(a) the Winding-up of the African Companies is completed and any
payment pursuant to paragraph 2.2 has been made within 14 months
of Completion; or
(b) both of the African Companies and both of the African Funds have
been sold to one or more third parties (being a person other than
a Connected Person) within 12 months of Completion,
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in each case in circumstances where neither the Seller nor the Guarantors
has, subject to the terms of any sale of the African Companies or African
Funds which it has approved, any liability or obligation to the Buyer or
any third party arising out of the African Companies or African Funds, the
Seller shall pay to the Buyer the sum of L204,000, save that no such
payment need be made if the sale referred to in paragraph (b) above is (1)
completed before Completion or (2) signed before Completion but then
subsequently completes after Completion.
Professional fees and expenses
2.4 The Seller shall be responsible for any and all the professional fees and
expenses reasonably incurred by the Buyer and any Group Company in order to
comply with its obligations under this Schedule 10.
3. CONDUCT OF THE BUSINESS UNTIL EXIT
3.1 The Buyer shall procure that for so long as FIML remains the investment
manager of the African Funds (or either of them) FIML shall perform its
duties and obligations and shall exercise its rights, powers and
authorities in accordance with the terms of the relevant investment
management agreement(s).
3.2 The Buyer shall procure that until an Exit Event occurs:
(a) the Seller shall be entitled from time to time and at its sole
expense to require the replacement of any Key African Employee
with such other persons as it may nominate and on such terms as
it may reasonably require, provided that such person is of
reasonable repute; and
(b) FIML and the African Companies are given reasonable access during
normal UK business hours to the Group's administrative employees,
including (without limitation) Xxxxxx Xxxxx and Xxxxxxx Xxxxxxx
(and anyone who from time to time may replace such employees) and
shall receive reasonable administrative and other support from
Group Companies; and
(c) it provides to the Seller such financial and other information
relating to the African Companies and the African Funds as the
Seller may from time to time reasonably request.
3.3 Save with the prior written consent of the Seller (such consent not to be
unreasonably withheld or delayed) the Buyer shall procure that until an
Exit Event occurs:
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(a) the Company does not dispose of its shares in the African
Companies; and
(b) each African Company shall operate its businesses or operations
in the usual and ordinary course.
3.4 Until an Exit Event occurs, (provided that at such time the management
agreements in respect of the African Funds shall have terminated), the
Seller shall pay to the Buyer or the Buyer shall pay to the Seller (as the
case may be) within 20 Business Days of the receipt of a Quarterly
Statement an amount equal to the following expenses incurred during the
Quarter to which the Quarterly Statement relates:
(a) the remuneration (including any related employer's cost) during
the relevant Quarter of Messrs Xxxxxxxx and Ngon (but only for
the 12 month period expiring on the anniversary of Completion)
and the remuneration (including any related employer's cost) of
Mr Okoto (but only for the 6 month period expiring on the date
which is six months after the Completion Date);
(b) any costs reasonably and properly incurred during the relevant
Quarter by the relevant African Company in connection with the
termination of the employment of Messrs Xxxxxxxx, Xxxx and Okoto;
and
(c) the actual operating costs of the African Companies properly
incurred during the relevant Quarter together with any costs
incurred by the Buyer's Group in the performance of its
obligations under this Schedule 10,
LESS an amount equal to all fees, including performance fees, and other
payments paid to FIML under or in connection with the relevant investment
management agreement(s).
Such amounts shall be paid in sterling (and original currencies shall be
converted at the spot rate shown in the Financial Times on the last
Business Day of the relevant Quarter).
3.5 The Buyer shall at the same time as it delivers the Quarterly Statement
provide to the Seller such supporting data and information as is reasonably
necessary for the Seller to calculate the net amount payable or receivable
by it in respect of the relevant Quarter.
3.6 All VAT costs borne by the Buyer and/or the African Companies shall be
compensated by a payment from the Seller to the Buyer and/or the African
Companies of an equivalent amount.
4. DEFINITIONS
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In this Schedule 10 the following definitions shall apply:
"AFRICAN FUNDS" means the Central Africa Growth Fund a collective investment
Company organised under the laws of the Grand Duchy of Luxembourg as a Societe
d'Investissment a Capital Variable and whose registered office is at 00, xxx
Xxxxxx, X-0000 Xxxxxxxxxx and the West Africa Growth Fund a collective
investment company organised under the laws of the Grand Duchy of Luxembourg as
a Societe d'Investissment a Capital Variable and whose registered office is at
0, xxxxxx Xxxxx-Xxxxxxx, X-0000 Xxxxxxxxxx;
"EXIT EVENT " means either (a) completion of the sale of all the shares of the
African Companies owned or (b) completion of the Winding-up of both of the
African Companies:
"FIML" means Framlington Investment Management Limited a company registered in
England under company number 01858790;
"KEY AFRICAN EMPLOYEES" means Messrs. Xxxxxxxx, Xxxx, Xxxxx and such other
employees who may from time to time replace one or more of those employees;
"QUARTERS" means the periods 1st October to 31st December, 1st January to 31st
March, 1st April to 30th June and 1st July to 30th September and "QUARTER" shall
be any one of such periods, provided that the first Quarter shall commence on
the day following the Completion Date and shall expire on the earliest of the
next following 31st December, 31st March, 30th June or 30th September;
"QUARTERLY STATEMENT" means a statement showing the amount of the expenses
incurred and income earned in respect of a particular Quarter as more
particularly set out in paragraph 2.5 of this Schedule 10;
"SERVICES AGREEMENT" means an agreement (in a form approved by the Buyer and the
Seller, such approval not to be unreasonably withheld or delayed) between FIML,
FAMCA and FAMWA for, inter alia, the provision of services to FIML;
"WINDING-UP" means the winding up, liquidation, dissolution or such other
equivalent or similar legal process in the relevant jurisdiction which results
in the dissolution of a company without further liability upon its shareholders.
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SIGNED by Xxxxx Xxxxxx..............)
for and on behalf of FRAMLINGTON ) ----------------------------------------
HOLDINGS LIMITED ) Duly authorised
in the presence of: )
-------------------------------------
[signature and name] Xxxxxx Xxxxxxxx
SIGNED by Xxxxx Xxxxxxx.............)
for and on behalf of CCF S.A. ) ----------------------------------------
) Duly authorised
in the presence of: )
-------------------------------------
[signature and name] Xxxxxx Xxxxxxxx
SIGNED by Xxxx Xxxxxxxx.............)
for and on behalf of COMERICA )
INCORPORPORATED ) ----------------------------------------
in the presence of: ) Duly authorised
-------------------------------------
[signature and name] Xxxx Xxxxxxxx
SIGNED by Laurent Clamagirand.......)
for and on behalf of AXA INVESTMENT )
MANAGERS S.A. ) ----------------------------------------
in the presence of: ) Duly authorised
-------------------------------------
[signature and name] Xxxxxx Xxxxxx
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