Common use of Demerger Clause in Contracts

Demerger. Notwithstanding the foregoing, if the Trustee determines that there is a Demerger of all the Employers (or, in any one or more cases, of the holding company of the Employer) currently employing the employees engaged in any Business Group (“the Relevant Employers”), the Trustee shall, irrespective of whether or not the Demerger involves the sale of shares or assets of the Relevant Employers, apply the provisions of this paragraph 6. If the Trustee proposes to make a transfer of assets in respect of any Member or other Beneficiary affected by the Demerger to a Receiving Plan under clause H.5.1, the Trustee shall have full discretion to make those determinations which it considers most appropriate in all the circumstances PROVIDED that it shall whenever possible proceed in accordance with the following principles: (a) The Trustee shall consider the value of the proposed transfer specified by the Principal Company under clause H.5.3. (b) If the value proposed is the minimum calculated under clause H.5.3(ii), the Trustee shall, on the Demerger taking effect, implement those increases under paragraph 1 which would apply if there were a Relevant Sale of the Relevant Employers (the “Contingent Increases”). (c) If the value proposed exceeds that in (b) the Trustee shall not implement the Contingent Increases unless it considers the amount of such excess to be trivial. (d) Where Contingent Increases are granted, the Trustee may attach such conditions (if any) to the transfer as it thinks appropriate. (e) Where Contingent Increases are not granted, the Trustee shall comply with paragraph 2 and may attach such other conditions (if any) to the transfer as it thinks appropriate. SCHEDULE 4 1. The Plan is intended to be an occupational pension scheme which is contracted-out by virtue of satisfying section 9(2) of the ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ and shall be administered so as to comply with all applicable requirements to enable it to be so contracted-out for all periods in respect of which there is in force a contracting-out certificate issued in accordance with Chapter I of Part III of the ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ applying to employments contracted-out by reference to the Plan. 2. The provisions of this Schedule 4 override any of the other provisions of the Plan with which they are inconsistent. 3. Part II of this Schedule 4 applies in relation to periods of contracted-out employment by reference to the Plan (as in section 8(l)(a)(i) and 8(l)(b) of the Pension Schemes Act 1993) prior to 6 April 1997 and Part III of this Schedule 4 applies in relation to periods of contracted-out employment by reference to the Plan (as aforesaid) after 5 April 1997.

Demerger. Notwithstanding So far as the foregoingSeller is aware, if the Trustee determines that there is a Demerger of all the Employers (or, in any one or more cases, no member of the holding company Group has been concerned in an exempt distribution (as defined in section 214(4) ICTA 1988). 1. Limitation on quantum and general (A) The following thresholds shall apply: (i) save in respect of the Employer) currently employing the employees engaged in any Business Group paragraph 4.5 of schedule 2 (“the Relevant Employers”Accounts and Management Accounts), the Trustee shallPurchaser shall not be entitled to damages or other payment in respect of any Warranty Claim or Warranty Claims unless and until the aggregate amount of all such Warranty Claims for which the Seller is liable exceeds £500,000, irrespective but once the aggregate amount of whether all such Warranty Claims has exceeded such sum, the Seller shall be liable under the Warranties in respect of only the amount by which such sum is exceeded; and (ii) the Purchaser shall not be entitled to damages or not other payment in respect of any claim under the Demerger involves Tax Covenant until the sale aggregate amount of shares or assets all such claims for which the Seller is liable under the Tax Covenant exceeds £25,000, but once the aggregate amount of all such claims has exceeded such sum, the Seller shall be liable under the Tax Covenant in respect of only the amount by which such sum is exceeded. (B) The total aggregate liability of the Relevant Employers, apply Seller under the Warranties and the Tax Covenant shall not in any event exceed an amount equal to £5 million. (C) The total aggregate liability of the Seller under the Mis-selling Indemnity shall not in any event exceed an amount equal to £10 million. (D) As regards the Tax Covenant the provisions of this paragraph 6. If Schedule shall operate to limit the Trustee proposes liability of the Seller in so far as any provision in this Schedule is expressed to make a transfer be applicable to the Tax Covenant and the provisions of assets the Tax Covenant shall further operate to limit the liability of the Seller in respect of any Member or other Beneficiary affected by the Demerger to a Receiving Plan under clause H.5.1, the Trustee shall have full discretion to make those determinations which it considers most appropriate in all the circumstances PROVIDED that it shall whenever possible proceed in accordance with the following principles: (a) The Trustee shall consider the value of the proposed transfer specified by the Principal Company under clause H.5.3claim thereunder. (bE) If the value proposed is the minimum calculated under clause H.5.3(iiWithout prejudice to Clause 24 (Entire agreement), the Trustee shall, on Purchaser acknowledges and agrees that the Demerger taking effect, implement those increases under paragraph 1 which would apply if there were a Relevant Sale Seller does not give or make any warranty or indemnity as to the accuracy of the Relevant Employers forecasts, estimates, projections, statements of intent or statements of honestly expressed opinion provided to the Purchaser (however so provided) on or prior to the “Contingent Increases”date of this Agreement, including (without limitation), in the Disclosure Letter, the Information Memorandum or the information supplied to or made available to the Purchaser during its due diligence exercise. (cF) If the value proposed exceeds that The financial limitations contained in (bsub-paragraphs 1(A) the Trustee and 1(B) above shall not implement apply in the Contingent Increases unless it considers the amount event of such excess to be trivial. (d) Where Contingent Increases are granted, the Trustee may attach such conditions (if any) to the transfer as it thinks appropriate. (e) Where Contingent Increases are not granted, the Trustee shall comply with paragraph 2 and may attach such other conditions (if any) to the transfer as it thinks appropriate. SCHEDULE 4 1. The Plan is intended to be an occupational pension scheme which is contracted-out by virtue of satisfying section 9(2) any fraudulent act or omission of the ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ and Seller in the giving of the Warranties and/or the Indemnities and/or preparation of the Disclosure Letter nor shall be administered so as to comply with all applicable requirements to enable it to be so contracted-out for all periods such limitations apply in respect of which there is in force a contracting-out certificate issued in accordance with Chapter I of Part III any claim under the Warranties at paragraph 1 (Ownership of the ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ applying to employments contracted-out by reference to Shares) or paragraph 2 (Capacity of the PlanSeller) of Schedule 2 (Warranties). 2. The provisions Time limits for bringing claims (i) subject to sub-paragraph 2(ii), on or before the date falling 18 months after the Completion Date; or (ii) in respect of this Schedule 4 override any claims under the Tax Warranties or the Tax Covenant, not later than the seventh anniversary of the other provisions Completion Date, PROVIDED THAT the liability of the Plan with which they are inconsistent. 3. Part II Seller in respect of this Schedule 4 applies a claim under the Warranties shall absolutely determine (if such claim has not been previously satisfied, settled or withdrawn) if legal proceedings in relation to periods respect of contracted-out employment by reference to the Plan (as in section 8(l)(a)(i) and 8(l)(b) such claim shall not have been commenced within 6 months of the Pension Schemes Act 1993) prior service of such notice and for this purpose proceedings shall not be deemed to 6 April 1997 have been commenced unless they shall have been properly issued and Part III of this Schedule 4 applies in relation to periods of contracted-out employment by reference to validly served upon the Plan (as aforesaid) after 5 April 1997Seller.