EXHIBIT 2.02
THIS DEED OF TAX COVENANT is made on the day of February, 1998
BETWEEN:-
(1) THE GENERAL ELECTRIC COMPANY, p.l.c.(registered in England No. 67307),
having its registered office at ▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (the
"Covenantor"); and
(2) IFR SYSTEMS LIMITED (registered in England No. 3491978), having its
registered office at ▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (the "Purchaser").
NOW THIS DEED WITNESSES as follows:-
1. INTERPRETATION
In this deed of covenant:-
(i) the following expressions shall have the following meanings:-
"ACCOUNTS" means, in relation to each Group
Company, its audited balance sheet drawn
up as at the Accounts Date;
"ACCOUNTS DATE" means 31st March, 1997;
"AGREEMENT" means the agreement for the sale and
purchase of the Shares (as therein
defined) made between the Covenantor and
the Purchaser;
"BUSINESS DAY" means a day (other than a Saturday or a
Sunday) on which banks are open for
business in London;
"CLAIM" means the issue of any notice, letter or
other document by or on behalf of any
Tax Authority or the taking of any other
action by or on behalf of any Tax
Authority from which notice, letter,
document or action it appears either
that a Tax Liability is to be imposed on
a Group Company or, in the context of
CLAUSE 15 (Counter Covenant), that a
liability or increased liability to Tax
is to be imposed on the Covenantor
and/or any of its subsidiaries;
"COMPLETION" means completion of the sale and
purchase of the Shares under the
Agreement;
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"COVENANTOR'S GROUP" means The General Electric Company,
p.l.c. and all its subsidiaries or
subsidiary undertakings from time to
time other than the Group Companies;
"DEEMED TAX LIABILITY" has the meaning given in
paragraph (ii)(b);
"DEFAULT RATE" means 2 per cent. above the base rate
from time to time of National
Westminster Bank plc;
"DISCLOSURE LETTER" has the meaning given to it in the
Agreement;
"DISPOSAL LIABILITY" has the meaning given to it in CLAUSE 2
(Covenant);
"DISTRIBUTION" has the meaning given in
paragraph (iii)(c);
"EVENT" means any transaction, action or
omission, any change in the residence of
any person for the purposes of any Tax,
the death of any person, and a failure
to take any action which would avoid an
apportionment or deemed distribution of
income (regardless of whether the taking
of any such action after Completion
could have avoided such apportionment or
deemed distribution) and shall also
include Completion and (for the
avoidance of doubt) any Distribution and
any Group Company ceasing to be a member
of the Covenantor's Group;
"GROUP COMPANY" has the meaning given to it in the
Agreement;
"GROUP RELIEF" means any loss, allowance or other
amount eligible for surrender by way of
group relief in accordance with the
provisions contained in sections 402
to 413 ICTA and any advance corporation
tax eligible for surrender in accordance
with section 240 ICTA;
"ICTA" means the Income and Corporation Taxes
▇▇▇ ▇▇▇▇;
"IFR GROUP" has the meaning given to it in the
Agreement;
"INCOME, PROFITS OR GAINS" has the meaning given in
PARAGRAPH (iii)(a);
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"MARCONI (UK)" means Marconi Instruments Limited,
registered in England No. 317241 and
having its registered office at
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"MARCONI (US)" means Marconi Instruments Inc.,
registered in Delaware, USA No.
727041009 and having its registered
office at The Corporation Trust Co.,
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇;
"MII" means Marconi Instruments International
Limited, registered in England No 934595
and having its registered office at
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"PROCEEDINGS" means any proceeding, suit or action
arising out of or in connection with
this deed;
"RELIEF" means any relief, allowance, exemption
or credit in respect of any Tax or any
deduction in computing Income, Profits
or Gains for the purposes of any Tax;
"▇▇▇▇▇▇▇ INSTRUMENTS" means ▇▇▇▇▇▇▇ Instruments Limited,
registered in England No 607978 and
having its registered office at
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"SHARES" has the meaning given to it in the
Agreement;
"TAX" includes:-
(a) within the United Kingdom,
corporation tax, advance
corporation tax, income tax
(including income tax required to
be deducted or withheld from or
accounted for in respect of any
payment), capital gains tax,
capital transfer tax, inheritance
tax, value added tax, national
insurance contributions, stamp duty
reserve tax, duties of customs and
excise, any liability arising under
section 419 or 601 ICTA or Schedule
9A VATA, and any other taxes,
levies, duties, charges, imposts or
withholdings
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corresponding to, similar to,
replaced by or replacing any of
them, together with all penalties,
charges and interest relating to any
of them; and
(b) outside the United Kingdom, all
taxes, levies, duties, imposts,
charges and withholdings of any
nature whatsoever, including
(without limitation) taxes on gross
or net Income, Profits or Gains and
taxes on receipts, sales, use,
occupation, franchise, value added
and personal property, together
with all penalties, charges and
interest relating to any of them,
regardless (in either case) of whether
any such taxes, levies, duties, imposts,
charges, withholdings, penalties and
interest are chargeable directly or
primarily against or attributable
directly or primarily to a Group Company
or any other person and of whether any
amount in respect of any of them is
recoverable from any other person as
mentioned in CLAUSE 10 (Recovery from
Other Persons);
"TAX ASSESSMENT" means any assessment, demand or other
similar formal notice of a Tax Liability
issued by or on behalf of any Tax
Authority by virtue of which a Group
Company or, in the context of CLAUSE 15
(Counter Covenant), the Covenantor or
any of its subsidiaries, either is
liable to make a payment of Tax or will,
with the passing of time, become so
liable (in the absence of any successful
application to postpone any such
payment);
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"TAX ASSET" means any net operating loss, net
capital loss, investment tax credit,
foreign tax credit, charitable deduction
or any other credit or Tax attribute
which could reduce Taxes (including,
without limitation, deductions and
credits relating to alternative minimum
Taxes), provided however that this term
shall not include the Tax basis of the
shares or assets of Marconi (US);
"TAX AUTHORITY" means any taxing or other authority
(whether within or outside the United
Kingdom) competent to impose any Tax
Liability;
"TAX LIABILITY" has the meaning given in
PARAGRAPH (ii)(a);
"VAT GROUP" means the group of companies of which
for the purposes of section 43 VATA 1994
(a) Marconi (UK) began to be treated as
a member on 1st April 1973 and Marconi
Instruments and ▇▇▇▇▇▇▇ Instruments
began to be treated as members on 1st
May 1996, and (b) the representative
member is the Covenantor;
"VATA" means the Value Added Tax ▇▇▇ ▇▇▇▇; and
"WORKING HOURS" means 9.30 a.m. to 5.30 p.m. on a
Business Day;
(ii) (a) references to any "TAX LIABILITY" of a Group Company shall
mean both liabilities of that Group Company to make actual
payments of Tax (or amounts in respect of Tax), regardless of
whether any such liability shall have been discharged in whole
or in part on or before Completion save to the extent such
discharge is taken into account in the Accounts, and also:-
(1) the loss of a right to repayment of Tax which has been
treated as an asset of the relevant Group Company in
preparing the Accounts or the setting off of any such
right to repayment of Tax against any actual Tax
Liability in respect of which the Purchaser would, but
for that setting off, have been able to make a claim
against the Covenantor under this deed;
(2) the setting off against Income, Profits or Gains which
were earned, accrued or received on or before Completion
or in respect of a period ended on or before Completion
or against
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any Tax otherwise chargeable in respect of an
Event occurring (or deemed to occur) on or before
Completion or in respect of a period ended on or before
Completion of any Relief (a "Post-Completion Relief")
which arises as a consequence of or by reference to an
Event occurring (or deemed to occur) after Completion or
in respect of a period commencing after Completion and
not as a consequence of or by reference to any Event
occurring (or deemed to occur) on or before Completion
or in respect of a period ended on or before Completion
in circumstances where, but for such setting off, a
Group Company would have had an actual Tax Liability in
respect of which the Purchaser would have been able to
make a claim against the Covenantor under this deed; and
(3) the unavailability of all or any part of a Relief which
has been taken into account in computing (and so
reducing) any provision for deferred Tax which appears
in the Accounts or the setting off of any such Relief
against any actual liability to Tax in respect of which
the Purchaser would, but for that setting off, have been
able to make a claim against the Covenantor under CLAUSE
2 (Covenant); and
(b) in any case falling within either of SUB-PARAGRAPHS (a)(1),
(a)(2) OR (a)(3) OF THIS PARAGRAPH, the amount that is to be
treated for the purposes of this deed as a Tax Liability of
the relevant Group Company (the "DEEMED TAX LIABILITY") shall
be determined as follows:-
(1) in a case which falls within SUB-PARAGRAPH (a)(1) OF
THIS PARAGRAPH, the Deemed Tax Liability shall be the
amount of the repayment that would have been obtained
but for the loss or setting off mentioned in that
sub-paragraph;
(2) in a case which falls within SUB-PARAGRAPH (a)(2) OR
(a)(3) OF THIS PARAGRAPH and where the Relief was a
deduction from or offset against Tax, the Deemed Tax
Liability shall be the amount of that Relief;
(3) in a case which falls within SUB-PARAGRAPH (a)(2) OF
THIS PARAGRAPH and where the Relief was a deduction from
or offset against Income, Profits or Gains, the Deemed
Tax Liability shall be the amount of Tax which has been
saved in consequence of the setting off; and
(4) in a case which falls within SUB-PARAGRAPH (a)(3) of
this paragraph and where the Relief was a deduction from
or offset against Income, Profits or Gains, the Deemed
Tax Liability shall
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be the amount of Tax which would had
been saved had the Relief been available;
(iii) references to:-
(a) "INCOME, PROFITS OR GAINS" shall include development value
and any other standard or measure for the purposes of any
Tax and shall also include any income, profits or gains
which are deemed to be earned, accrued or received for the
purposes of any Tax;
(b) Income, Profits or Gains (as defined in SUB-PARAGRAPH (a) OF
THIS PARAGRAPH) as being earned, accrued or received on or
before a particular date or in respect of a particular
period shall mean Income, Profits or Gains which are
regarded as having been, or are deemed to have been, earned,
accrued or received on or before that date or in respect of
that period for the purposes of any Tax;
(c) any "DISTRIBUTION" shall include anything which is, or is
deemed to be, a dividend or distribution for the purposes of
any Tax and shall also include any other Event which gives
rise to an obligation to account for advance corporation tax
or amounts corresponding to or similar to advance
corporation tax;
(d) any Distribution as occurring on or before a particular date
shall include any Distribution which has fallen due to be
made on or before that date for the purposes of any Tax; and
(e) any "SUBSIDIARY OF THE COVENANTOR" shall mean any company of
which the Covenantor has control for the purposes of
section 416 ICTA; and
(iv) unless otherwise specified:-
(a) references to clauses, sub-clauses, paragraphs,
sub-paragraphs and the schedules are to clauses,
sub-clauses, paragraphs, sub-paragraphs of, and the
schedules to, this deed;
(b) a reference to any statute or statutory provision shall be
construed as a reference to the same as it may have been, or
may from time to time be, amended, modified or re-enacted;
(c) references to a "PERSON" shall be construed so as to include
any individual, firm, company, government, state or agency
of a state or any joint venture, association or partnership
(whether or not having separate legal personality);
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(d) references to a "COMPANY" shall be construed so as to
include any company, corporation or other body corporate,
wherever and however incorporated or established;
(e) the expression "BODY CORPORATE" shall have the meaning given
in the Companies ▇▇▇ ▇▇▇▇;
(f) references to writing shall include any modes of reproducing
words in a legible and non-transitory form;
(g) references to times of the day are to London (United
Kingdom) time;
(h) headings to clauses and the schedule are for convenience
only and do not affect the interpretation of this deed;
(i) 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; and
(j) (1) the rule known as the ejusdem generis rule shall not
apply and accordingly general words introduced by the
word "other" shall not be given a restrictive meaning
by reason of the fact that they are preceded by words
indicating a particular class of acts, matters or
things; and
(2) general words shall not be given a restrictive meaning
by reason of the fact that they are followed by
particular examples intended to be embraced by the
general words.
2. COVENANT
(A) Subject to the provisions of CLAUSE 3 (Limits on Clause 2), CLAUSE 4
(Exclusions) and CLAUSE 18 (Assignment), the Covenantor hereby covenants
with the Purchaser to pay to the Purchaser (so far as possible by way of
repayment of the consideration payable under the Agreement for the Shares)
an amount equal to any of the following:-
(i) any Tax Liability of a Group Company arising:-
(a) as a consequence of or by reference to any Event which occurred
on or before the Accounts Date or was deemed to occur on or
before the Accounts Date for the purposes of any Tax; or
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(b) in respect of or by reference to any Income, Profits or Gains
which were earned, accrued or received on or before the
Accounts Date or in respect of a period ending on or before the
Accounts Date;
(ii) any Tax Liability of a Group Company arising as a consequence of or
by reference to any of the following occurring or being deemed to
occur before Completion:-
(a) any Distribution; or
(b) the disposal of any asset (including trading stock) or the
supply of any service or business facility of any kind
(including a loan of money or the letting, hiring or licensing
of any tangible or intangible property) in circumstances where
the consideration actually received (if any) for such disposal
or supply is less than the consideration deemed to have been
received for the purposes of any Tax; or
(c) the relevant Group Company ceasing, or being deemed to cease,
to be a member of any group of companies or associated with any
other company for the purposes of any Tax; or
(d) any Event or the earning of any Income, Profits or Gains which
results in the relevant Group Company becoming liable to pay or
bear a Tax Liability chargeable directly or primarily against
or attributable directly or primarily to another person (not
being the Group Company in question); or
(e) any other Event which gives rise to a Tax Liability on deemed
(as opposed to actual) Income, Profits or Gains,
but only, in the case of any Event referred to in SUB-PARAGRAPH (b)
OF THIS PARAGRAPH, to the extent that the Tax Liability is
attributable to the difference between the consideration referred to
in that paragraph as being actually received and the consideration
so referred to as being deemed to have been received for the
purposes of any Tax;
(iii) any liability or increased liability to Tax of a Group Company which
is chargeable directly or primarily against or attributable directly
or primarily to any company, not being a Group Company, that may be
treated for the purposes of any Tax as being, or as having at any
time been, either a member of the same group of companies as the
Covenantor or otherwise associated with the Covenantor (a "Relevant
Company"), and which arises as a result of the failure of any
Relevant Company to discharge that liability or increased liability;
or
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(iv) any Tax Liability of Marconi (US) (including for the avoidance of
doubt any liability to Tax assessed by the State of California)
which would not have arisen but for its membership prior to
Completion of an affiliated, consolidated or combined group with any
other member of the Covenantor's Group; or
(v) any Tax Liability of Marconi (US) which arises as a consequence of
or by reference to a determination by the US Internal Revenue
Service that the GEC-Employees' Savings and Investment Plan has
wrongfully excluded part-time employees from the Profit-Sharing Plan
(as that term is defined in the Agreement); or
(vi) any Tax Liability of Marconi (UK) (a "Disposal Liability") arising
as a consequence of or by reference to the disposal of Longacres,
St. Albans (as described in paragraph 2.1(v) of the Disclosure
Letter) or the disposal of the share capital of Marconi Instruments
Pty Limited (as described in paragraph 9.1 of the Disclosure
Letter); or
(vii) any reasonable out-of-pocket legal and accounting or other
professional costs and expenses reasonably and properly incurred by
the Purchaser and/or a Group Company in connection either with any
such Tax Liability as is mentioned in PARAGRAPHS (i) TO (vi) or with
any Claim therefor or in taking or defending any action under this
deed.
(B) The Covenantor hereby covenants with the Purchaser that (save in any case
where it has obtained the prior approval of the Purchaser) it will not
cause or permit any member of the Covenantor's Group or other company
affiliated with the Covenantor (including, before but not after Completion,
any Group Company) to make or change any Tax election, take any position on
any Tax return, adjust the Tax basis of any asset, settle any Tax dispute
or otherwise take any action which results after Completion in any
increased liability to Tax or reduction of any Tax Asset of Marconi (US)
and the Covenantor agrees that Marconi (US) is to have no liability for any
resulting Tax and that it will indemnify and hold harmless Marconi (US)
against any such Tax.
3. LIMITS ON CLAUSE 2
The covenant given in CLAUSE 2 (Covenant) shall not cover any Tax Liability of
any Group Company:-
(i) to the extent that provision or reserve in respect of that Tax
Liability was made in the Accounts; or
(ii) to the extent that that Tax Liability arises or is increased as a
result only of any increase in rates of Tax or any change in law or
practice or any withdrawal of any extra-statutory concession by a
Tax Authority or any change in
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accountancy practice or principles generally accepted in the relevant
jurisdiction, being an increase, withdrawal or change made, in any
such case, after Completion with retrospective effect; or
(iii) to the extent that that Tax Liability would not have arisen but for
a voluntary transaction, action or omission carried out or effected
by a Group Company at any time after Completion which could
reasonably have been avoided and which the Purchaser or the Group
Company in question knew or ought reasonably to have known would
result in a Tax Liability, but not including any such transaction,
action or omission:-
(a) carried out or effected under a legally binding commitment
created on or before Completion; or
(b) carried out or effected in the ordinary course of the trade
carried on by the relevant Group Company as at Completion; or
(c) carried out or effected with the express approval of the
Covenantor; or
(iv) to the extent that that Tax Liability would not have arisen or
would have been reduced but for a failure or omission on the part
of the Purchaser and/or a Group Company after Completion to make
any election or claim any Relief, the making or claiming of which
was taken into account in computing the provision or reserve for
Tax in the Accounts; or
(v) to the extent that that Tax Liability arises by reason of a
voluntary disclaimer by a Group Company after Completion of the
whole or part of any allowance to which it is entitled under Part
II of the Capital Allowances Act 1990 or by reason of the
revocation by a Group Company after Completion of any claim for
Relief made (whether provisionally or otherwise) by it prior to
Completion; or
(vi) to the extent that that Tax Liability arises as a result of any
changes after Completion in the bases, methods or policies of
accounting of the Purchaser or a Group Company; or
(vii) to the extent that that Tax Liability has been made good by
insurers or otherwise compensated for without cost to the Purchaser
and/or a Group Company (so that, for the avoidance of doubt, the
Covenantor shall pay any increase in insurance premiums which
arises as a direct result of any such making good); or
(viii) to the extent that any Income, Profits or Gains to which that Tax
Liability is attributable were actually earned or received by or
actually accrued to a Group Company but were not (in either such
case) reflected in the Accounts,
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provided that such Income, Profits or Gains are still retained in
the relevant Group Company at Completion; or
(ix) to the extent that that Tax Liability arises or is increased as a
consequence of any failure by the Purchaser or a Group Company to
comply with any of their respective obligations under CLAUSES 5
(Mitigation), 11 (Claims Procedure), 12 (Tax Returns), or 15
(Counter Covenant); or
(x) to the extent that that Tax Liability would not have arisen but for
a cessation of, or any change in the nature or conduct of, any
trade carried on by a Group Company, being a cessation or change
occurring on or after Completion.
4. EXCLUSIONS
(A) The Covenantor shall not be liable under this deed in respect of any
Tax Liability unless the Tax Liability in question shall have arisen
within seven years from Completion and the Purchaser shall by notice
in writing to the Covenantor have given sufficient details of the
Claim to enable the Covenantor to identify the matter giving rise to
that Tax Liability and the amount claimed in respect thereof.
(B) The provisions of sub-paragraph 3.1 of Schedule 4 to the Agreement
shall apply to this deed as if set out herein.
5. MITIGATION
The Purchaser shall, at the direction in writing of the Covenantor, procure
that each Group Company take all such steps as the Covenantor may require to:-
(i) use in the manner hereinafter mentioned all such Reliefs arising as
a consequence of or by reference to any Event occurring (or deemed
to occur) on or before Completion or in respect of a period ended on
or before Completion and not as a consequence of or by reference to
an Event occurring (or deemed to occur) after Completion or in
respect of a period commencing after Completion as are available to
each Group Company to reduce or eliminate any Tax Liability in
respect of which the Purchaser would have been able to make a claim
against the Covenantor under this deed (such Reliefs including,
without limitation, Reliefs made available to a company by means of
a surrender from another company), the said use being to effect the
reduction or elimination of any such Tax Liability to the extent
specified by the Covenantor and permitted by law, and to provide to
the Covenantor, at the Covenantor's expense, a certificate from the
auditors (for the time being) of each relevant Group Company
confirming that all such Reliefs have been so used;
(ii) make all such claims and elections specified by the Covenantor in
respect of any accounting period of the relevant Group Company
ending on or before or
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deemed to end on or before Completion as have the effect of
reducing or eliminating any such Tax Liability as is mentioned
in PARAGRAPH (i), provided that no such claim or election
shall require that Group Company to use any Relief which
arises solely as a consequence of or by reference to an Event
occurring (or deemed to occur) after Completion or in respect
of a period commencing after Completion; and
(iii) allow the Covenantor to reduce or eliminate any Tax Liability by
surrendering or procuring the surrender by any company not being a
Group Company of Group Relief to any Group Company to the extent
permitted by law but without any payment being made in consideration
for such surrender.
6. PAYMENT FOR GROUP RELIEF
(A) Subject to the following provisions of this CLAUSE 6, the Purchaser
shall procure that (to the extent permitted by law) Marconi
(UK) shall, in respect of any accounting period ended on or
before Completion, make, give or enter into such claims,
elections, notices or consents (whether unconditional or
conditional, whether or not forming part of any other return
or tax document and whether provisional or final, and
including amendments to or withdrawals of earlier claims,
elections, notices or consents) as the Covenantor shall direct
in connection with the surrender of any Group Relief by any
member of the Covenantor's Group (the "Relevant Member") to
Marconi (UK). Payment shall be made in respect of any such
surrender as provided in the following provisions of this
CLAUSE 6.
(B) If, in respect of any accounting period ended on or before
Completion:-
(i) Marconi (UK) has paid Tax and a surrender effected pursuant to
SUB-CLAUSE (A) above has the effect of causing a repayment of some
or all of that Tax; or
(ii) provision for Tax is made in the Accounts and a surrender effected
pursuant to SUB-CLAUSE (A) has the effect of discharging all or
part of the liability represented by that provision; or
(iii) a liability to make a payment for Group Relief appears in the
Accounts, being a liability which has not been discharged before
Completion,
the Purchaser shall procure that a payment for Group Relief shall be made
in respect of any such surrender or liability by Marconi (UK) to the
Relevant Member in accordance with SUB-CLAUSES (C) AND (D).
(C) The amount of any such payment as is referred to in SUB-CLAUSE (B)
shall be equal to:-
(i) in a case where PARAGRAPH (B)(i) applies, the amount of Tax so
repaid (together with any repayment supplement or interest);
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(ii) in a case where PARAGRAPH (B)(ii) applies, the amount of Tax saved
as a result of the relevant surrender, up to a maximum of the
amount in respect of which provision is made in the Accounts; and
(iii) in a case where PARAGRAPH (B)(iii) applies, the amount of the
liability shown in the Accounts.
(D) Any payment under SUB-CLAUSE (B) shall be made:-
(i) in a case where PARAGRAPH (B)(i) applies, on the date three
Business Days after the date on which such repayment is received or
would be received but for being offset by some other liability to
Tax;
(ii) in a case where PARAGRAPH (B)(ii) applies, on the later of the date
on which such Tax would have become due and payable and three
Business Days after the date on which notice is given by the
Covenantor to the Purchaser of such surrender; and
(iii) in a case where PARAGRAPH (B)(iii) applies, on the later of the
date on which Tax would have become due and payable in the absence
of the relevant surrender and the date three Business Days after
the date on which notice is given by the Covenantor to the
Purchaser of the relevant surrender.
(E) If a payment is made under SUB-CLAUSE (B) and the surrender to which
it relates is subsequently determined to have been excessive,
invalid or to any extent ineffective, then the payment so made
(or so much of it as relates to such part of the surrender
found to be excessive, invalid or ineffective) shall be
refunded as soon as practicable thereafter, together with
interest from the date of payment until the date of the refund
at the Default Rate.
7. VAT
(A) The Covenantor shall ensure that each of Marconi (UK), MII and ▇▇▇▇▇▇▇
Instruments is excluded from the VAT Group on or before the
date of the Agreement and shall use its reasonable endeavours
to secure that those three companies (the "UK Group Companies"
and each a "UK Group Company") are from the date of exclusion
treated as a separate group for the purposes of section 43
VATA.
(B) The Purchaser shall procure that the UK Group Companies pay to the
Covenantor, free and clear of any set-off or counterclaim, an amount
equal to any value added tax which is properly attributable to
supplies made by those companies (for the avoidance of doubt
taking into account both output tax and input tax), for which
the Covenantor is not liable under CLAUSE 2 (Covenant) and for
which the Covenantor is accountable but has not been
reimbursed by those companies.
15
(C) The Covenantor hereby covenants to refund to the relevant UK Group
Company an amount equal to any value added tax which is
properly attributable to any member of the VAT Group other
than the UK Group Companies but for which that UK Group
Company is required to account by virtue of section 43(1) VATA.
(D) Payment of amounts due under THIS CLAUSE 7 shall be made within five
Business Days of Completion or, if later, two Business Days after
demand is made therefor (the "Due Date") and any such payment
not made by the Due Date shall thereafter carry interest at
the Default Rate until it is actually made.
(E) The Purchaser shall procure that the UK Group Companies provide the
Covenantor with such documents, information and assistance as it may
reasonably require to fulfil its statutory obligations as
representative member of the VAT Group.
8. OVER-PROVISIONS, RELIEFS, ETC.
(A) If the auditors for the time being of the relevant Group Company shall
certify (at the request and expense of the Covenantor) that
any provision for Tax in the Accounts (excluding any provision
for deferred Tax) has proved to be an over-provision, then the
amount of such over-provision shall be dealt with in
accordance with SUB-CLAUSE (C).
(B) If the auditors for the time being of the relevant Group Company shall
certify (at the request and expense of the Covenantor) that any Tax
Liability which has resulted in a payment having been made by
or becoming due from the Covenantor under this deed will give
rise to a Relief for that Group Company which would not
otherwise have arisen and a liability of a Group Company to
make an actual payment of Tax has been satisfied or avoided by
the use of that Relief (which Relief must be used before any
Post-Completion Relief then available), then the amount by
which that liability to Tax has been satisfied or avoided
shall be dealt with in accordance with SUB-CLAUSE (C).
(C) Where it is provided under SUB-CLAUSE (A) OR (B) that any amount (the
"RELEVANT AMOUNT") is to be dealt with in accordance with THIS
SUB-CLAUSE:-
(i) the Relevant Amount shall first be set off against any payment then
due from the Covenantor under this deed or in respect of the
warranties relating to Tax which appear in Schedule 3 to the
Agreement (the "Tax Warranties"); and
(ii) to the extent there is an excess, a refund shall be made to the
Covenantor of any previous payment or payments made by the
Covenantor under this deed or in respect of the Tax Warranties (and
not previously refunded under this clause) up to the amount of such
excess; and
(iii) to the extent that the excess referred to in PARAGRAPH (ii) OF THIS
SUB-CLAUSE is not exhausted under that paragraph, the remainder of
that excess shall be
16
carried forward and set off against any future payments which
become due from the Covenantor under this deed or in respect of the
Tax Warranties.
(D) Where any such certification as is mentioned in SUB-CLAUSE (A) OR (B)
has been made, the Covenantor, the Purchaser or the Company
may request the auditors for the time being of the relevant
Group Company to review such certification in the light of all
relevant circumstances, including any facts which have become
known only since such certification, and to certify whether
such certification remains correct or whether, in the light of
those circumstances, the amount that was the subject of such
certification should be amended.
(E) If the auditors certify under SUB-CLAUSE (D) that an amount previously
certified should be amended, that amended amount shall be substituted
for the purposes of SUB-CLAUSE (C) as the Relevant Amount in
respect of the certification in question in place of the
amount originally certified, and such adjusting payment (if
any) as may be required by virtue of the above-mentioned
substitution shall be made as soon as practicable by the
Covenantor or (as the case may be) to the Covenantor.
9. REFUNDS AND CREDITS
(A) The Covenantor's Group shall be entitled to the benefit of any refunds
or credits of Taxes in respect of the income of Marconi (US)
attributable to or arising in any period ending on or before the
Accounts Date.
(B) The IFR Group or, as the case may be, Marconi (US) shall be entitled
to the benefit of any refunds or credits of Taxes in respect of the
income of Marconi (US) attributable to or arising in Tax periods
beginning on or after the Accounts Date.
(C) If in respect of or in connection with Marconi (US) any person
receives any refund or credit of amounts to which another person or
persons is or are entitled under this deed, the recipient or
recipients shall within ten Business Days pay such amounts to the
person or persons entitled thereto.
10. RECOVERY FROM OTHER PERSONS
If, in the event of any payment becoming due from the Covenantor under CLAUSE 2
(Covenant), a Group Company either is immediately entitled at the due date for
the making of that payment to recover from any person (including any Tax
Authority) any sum in respect of the Tax Liability that has resulted in that
payment becoming due from the Covenantor, or at some subsequent date becomes
entitled to make such a recovery, then the Purchaser shall procure that the
Group Company entitled to make that recovery shall promptly notify the
Covenantor of its entitlement and shall, if so required by the Covenantor and
at the Covenantor's sole expense, take all appropriate steps to enforce that
recovery (keeping the Covenantor fully and promptly informed of the progress of
any action taken); and if the Covenantor has made a payment under CLAUSE 2
(Covenant) in respect of the Tax
17
Liability in question, the Purchaser shall account to the Covenantor for
whichever is the lesser of:-
(i) any sum so recovered by the relevant Group Company in respect of
that Tax Liability (subtracting any costs or expenses incurred by
the Purchaser or a Group Company in connection with the recovery
which have not already been reimbursed, but including any interest
or repayment supplement paid by the Tax Authority or other person
on or in respect thereof less any Tax chargeable on that Group
Company in respect of that interest); and
(ii) the amount paid by the Covenantor under CLAUSE 2 (Covenant) in
respect of that Tax Liability.
11. CLAIMS PROCEDURE
(A) Upon the Purchaser or a Group Company becoming aware of a Claim
relevant for the purposes of CLAUSE 2 of this deed, the Purchaser
shall as soon as practicable give written notice of that Claim to
the Covenantor or, as the case may be, shall procure that the relevant
Group Company as soon as practicable give written notice of that Claim
to the Covenantor, and the Purchaser shall further procure that the
relevant Group Company (if the Covenantor shall indemnify the
Purchaser and/or the Group Company in question to their reasonable
satisfaction against all losses, costs, damages and expenses,
including interest on overdue Tax, which may be incurred thereby) take
such action and give such information and assistance in connection
with the affairs of the relevant Group Company as the Covenantor may
reasonably and promptly by written notice request to avoid, resist,
appeal or compromise the Claim;
PROVIDED THAT:
(i) the Purchaser shall not be obliged to procure that a Group Company
appeal against any Tax Assessment if, the Covenantor having been
given written notice of the receipt of that Tax Assessment in
accordance with the preceding provisions of this sub-clause, that
Group Company has not within 21 days thereafter received
instructions in writing from the Covenantor, in accordance with
the preceding provisions of this sub-clause, to make that appeal;
(ii) the Purchaser shall not be obliged to procure that a Group Company
appeal against any Tax Assessment before any court, tribunal or
body of commissioners unless the Covenantor obtains and provides to
the Purchaser a written opinion from tax counsel of at least five
years' call to the effect that an appeal against the Tax Assessment
in question is in all the circumstances reasonable;
(iii) the Purchaser shall not be obliged to procure that a Group Company
take any action under THIS CLAUSE if the Covenantor or, prior to
Completion, the relevant Group Company has committed an act or is
responsible for an omission in
18
relation to the Tax Assessment in question which constitutes
fraudulent conduct or dishonesty.
(B) The actions which the Covenantor may reasonably request under
SUB-CLAUSE (A) shall include (without limitation) the relevant Group
Company applying to postpone (so far as legally possible) the payment
of any Tax and/or allowing the Covenantor to take on or take over at
its own expense the conduct of all or any proceedings of whatsoever
nature arising in connection with the Claim in question, and, if the
Covenantor takes on or takes over the conduct of proceedings, the
Purchaser shall provide and shall procure that the relevant Group
Company provide such information and assistance as the Covenantor may
reasonably require in connection with the preparation for and conduct
of those proceedings.
12. TAX RETURNS
(A) The Covenantor or its duly authorised agent shall prepare the Tax
returns of each Group Company for all accounting periods ended on
or prior to the Accounts Date, to the extent that the same shall
not have been prepared before Completion.
(B) The Purchaser shall procure that the Group Companies shall cause the
returns mentioned in SUB-CLAUSE (A) to be authorised, signed and
submitted to the appropriate authority without amendment or with
such amendments as the Covenantor shall agree and shall give the
Covenantor or its agent all such assistance as may be required to
agree those returns with the appropriate authorities;
PROVIDED THAT the Purchaser shall not be obliged to procure that a Group
Company take any such action as is mentioned in THIS SUB-CLAUSE in relation
to any Tax return that is not true and accurate in all material respects.
(C) The Covenantor or its duly authorised agent shall prepare all
documentation and deal with all matters (including
correspondence) relating to the Tax returns of each Group Company
for all accounting periods ended on or prior to the Accounts Date
and the Purchaser shall procure that each Group Company shall
afford such access to its books, accounts and records as is
necessary and reasonable to enable the Covenantor or its duly
authorised agent to prepare those returns and conduct matters
relating thereto in accordance with the Covenantor's rights under
this clause.
(D) The Purchaser shall procure that the Covenantor is sent a draft of the
Tax return of Marconi (UK) for the accounting period beginning
before and ending on or after Completion (the "Current Period")
at least one month before its intended submission to a Tax
Authority and that its final form contains such alterations as
the Covenantor may lawfully request in respect of any matter
which might give rise to a Disposal Liability. The Covenantor
covenants to pay to the Purchaser an amount equal to any
liability to Tax suffered by Marconi (UK) which Marconi (UK)
would not have suffered but for an alteration made at the
Covenantor's request pursuant to this CLAUSE 12(D).
19
(E) Nothing done by any Group Company pursuant to THIS CLAUSE shall in any
respect restrict or reduce any rights the Purchaser may have to make a
claim against the Covenantor under this deed in respect of any such
Tax Liability as is mentioned in CLAUSE 2 (Covenant).
13. DUE DATE OF PAYMENT
(A) Where the Covenantor becomes liable to make any payment under CLAUSE 2
(Covenant), the due date for the making of that payment shall be:-
(i) in a case that involves an actual payment of Tax by a Group
Company, the date that is the last date on which that Group Company
would have had to have paid to the appropriate Tax Authority the
Tax that has given rise to the Covenantor's liability under this
deed in order to avoid incurring a liability to interest or a
charge or penalty in respect of that Tax Liability; or
(ii) in a case falling within any of SUB-PARAGRAPHS (a)(1), (a)(2) AND
(a)(3) OF PARAGRAPH (ii) OF CLAUSE 1 (Interpretation), the date
falling seven days after the date when the Covenantor has been
notified by the relevant Group Company or the Purchaser that the
auditors for the time being of the relevant Group Company have
certified, at the request of the Purchaser or the Group Company in
question, that the Covenantor has a liability for a determinable
amount under CLAUSE 2 (Covenant).
(B) If any payment required to be made by the Covenantor under this deed
is not made by the due date for the making thereof, then, except to
the extent that the Covenantor's liability under CLAUSE 2
(Covenant) compensates the Purchaser for the late payment by
virtue of its extending to interest and penalties, that payment
shall carry interest from that due date until the date when the
payment is actually made at the Default Rate.
14. DEDUCTIONS FROM PAYMENTS, ETC.
(A) All sums payable by the Covenantor to the Purchaser under this deed
shall be paid free and clear of all deductions or withholdings
whatsoever, save only as may be required by law.
(B) If any deductions or withholdings are required by law to be made from
any of the sums payable as mentioned in SUB-CLAUSE (A), the
Covenantor shall be obliged to pay to the Purchaser such sum as
will, after the deduction or withholding has been made, leave the
Purchaser with the same amount as it would have been entitled to
receive in the absence of any such requirement to make a
deduction or withholding.
(C) If any sum payable by the Covenantor to the Purchaser under this deed
(other than interest under CLAUSE 13 (Due Date of Payment)) shall be
subject to a Tax Liability in the hands of the Purchaser, the
Covenantor shall be under the same obligation to
20
make an increased payment in relation to that Tax Liability as if
the liability were a deduction or withholding required by law.
15. COUNTER COVENANT
(A) The Purchaser hereby covenants with the Covenantor to pay to the
Covenantor an amount equal to any of the following:-
(i) any liability or increased liability to Tax of the Covenantor or
any of its subsidiaries which arises as a result of or by reference
to any reduction or disallowance of Group Relief that would
otherwise have been available to the Covenantor or its relevant
subsidiary or subsidiaries where and to the extent that such
reduction or disallowance occurs as a result of or by reference
to:-
(a) any total or partial withdrawal effected by a Group Company
after Completion of any surrender of Group Relief that was
submitted by that Group Company to the Inland Revenue on or
before Completion in respect of any accounting period ended
on or before Completion; or
(b) any total or partial disclaimer made by a Group Company
after Completion of any capital allowances available to that
Group Company in respect of any accounting period ended on
or before Completion
save where any such withdrawal or disclaimer is made at the express
written request of the Covenantor;
(ii) any liability or increased liability to Tax of the Covenantor or
any of its subsidiaries:-
(a) which is caused by the failure of a Group Company to
discharge a liability to Tax (a "Group Company Liability")
which arises in respect of an accounting period beginning
before Completion; or
(b) which is otherwise properly attributable to Marconi (US)
(also a "GROUP COMPANY LIABILITY")
other than (in either case) a Group Company Liability in respect of
which the Purchaser could make a claim under CLAUSE 2 (Covenant);
and
(iii) any reasonable out-of-pocket legal and accounting or other
professional costs and expenses reasonably and properly incurred by
the Covenantor or any of its subsidiaries in connection with any
such liability or increased liability to Tax (or Claim therefor) or
in taking any action under THIS CLAUSE.
(B) The Purchaser hereby covenants that it will not cause or permit
Marconi (US) or any affiliate of the Purchaser to make or change any
Tax election, take any position on
21
any Tax return, adjust the Tax basis of any asset, settle any Tax
dispute or otherwise take any action that results in any increased
liability to Tax or reduction of any Tax Asset of the Covenantor or any
member of the Covenantor's Group and agrees that the Covenantor and any
such member are to have no liability for any resulting Tax and that it
will indemnify and hold harmless the Covenantor and any such member
against any such Tax.
(C) (i) Upon the Covenantor becoming aware of a Claim relevant for the
purposes of SUB-CLAUSE ((A)), the Covenantor shall forthwith give
written notice of that Claim to the Purchaser, and the Covenantor
shall or, as the case may be, shall procure that the relevant
subsidiary will (if the Purchaser shall indemnify the Covenantor
and/or the relevant subsidiary to the Covenantor's reasonable
satisfaction against all losses, costs, damages and expenses,
including interest on overdue Tax, which may be incurred thereby)
take such action and give such information and assistance in
connection with the affairs of the Covenantor and/or the relevant
subsidiary as the Purchaser may reasonably and promptly by written
notice request to avoid, resist, appeal or compromise the Claim;
PROVIDED THAT the Covenantor shall not be obliged to appeal
against any Tax Assessment or to procure that any subsidiary
appeals against any Tax Assessment if, the Purchaser having been
given written notice of the receipt of that Tax Assessment in
accordance with the preceding provisions of THIS SUB-CLAUSE, the
Covenantor or the relevant subsidiary has not within 21 days
thereafter received instructions in writing from the Purchaser, in
accordance with the preceding provisions of THIS SUB-CLAUSE, to
make that appeal.
(ii) The actions which the Purchaser may reasonably request under
PARAGRAPH ((i)) OF THIS SUB-CLAUSE shall include (without limitation)
the Covenantor and/or the relevant subsidiary applying to postpone
(so far as legally possible) the payment of any Tax and/or allowing
the Purchaser to take on or take over at its own expense the conduct
of all or any proceedings of whatsoever nature arising in connection
with the Claim in question, and, if the Purchaser takes on or takes
over the conduct of proceedings, the Covenantor shall provide and/or
shall procure that the relevant subsidiary shall provide such
information and assistance as the Purchaser may reasonably require
in connection with the preparation for and conduct of those
proceedings.
(D) (i) Where the Purchaser becomes liable to make any payment under
SUB-CLAUSE ((A)), the due date for the making of that payment
shall be the date that is the last date on which the Covenantor
or, as the case may be, the relevant subsidiary, would have had to
have paid to the appropriate Tax Authority the Tax that has given
rise to the Purchaser's liability under SUB-CLAUSE ((A)) in order to
avoid incurring a liability to interest or a charge or penalty in
respect of that amount of Tax.
22
(ii) If any payment required to be made by the Purchaser under
sub-clause ((A)) is not made by the due date for the making thereof,
then, except to the extent that the Purchaser's liability under
SUB-CLAUSE ((A)) compensates the Covenantor for the late payment by
virtue of its extending to interest and penalties, that payment
shall carry interest from that due date until the date when the
payment is actually made at the Default Rate.
(E) (i) All sums payable by the Purchaser to the Covenantor under
this clause shall be paid free and clear of all deductions or
withholdings whatsoever, save only as may be required by law.
(ii) If any deductions or withholdings are required by law to be made
from any of the sums payable as mentioned in PARAGRAPH ((i)) OF THIS
SUB-CLAUSE, the Purchaser shall be obliged to pay to the Covenantor
such sum as will, after the deduction or withholding has been made,
leave the Covenantor with the same amount as it would have been
entitled to receive in the absence of any such requirement to make a
deduction or withholding.
(iii) If any sum payable by the Purchaser to the Covenantor under
this clause (other than interest under SUB-CLAUSE ((D))) shall be
subject to a liability to Tax in the hands of the Covenantor, the
Purchaser shall be under the same obligation to make an increased
payment in relation to that liability to Tax as if the liability
were a deduction or withholding required by law.
16. DEEMED END OF ACCOUNTING PERIOD
For the purposes of any part of this deed other than CLAUSE 12 (Tax Returns),
the accounting period of each Group Company which began on 1st April, 1997 shall
be deemed to have ended at Completion.
17. REMEDIES AND WAIVERS
(A) No delay or omission on the part of any party to this deed in exercising
any right, power or remedy provided by law or under this deed or any other
documents referred to in it shall:-
(i) impair such right, power or remedy; or
(ii) operate as a waiver thereof.
(B) The single or partial exercise of any right, power or remedy provided by
law or under this deed shall not preclude any other or further exercise
thereof or the exercise of any other right, power or remedy.
(C) The rights, powers and remedies provided in this deed are cumulative and
not exclusive of any rights, powers and remedies provided by law.
23
18. ASSIGNMENT
(A) This deed and the benefits and obligations under it and any part of it
shall not be assignable except that the Purchaser may, upon giving written
notice to the Covenantor, assign the benefit (but not the burden) of this
deed to a member of the IFR Group (a "Group Assignment") or by way of
security to a lender to whom security is given over the Shares (a "Lender
Assignment"), if the terms of any such assignment provide:-
(i) (in the case of a Group Assignment) that any such assignee remains
a member of the IFR Group and that before such assignee ceases to
be a member of the IFR Group, the Purchaser will procure that the
benefit of this deed is assigned to the Purchaser or (upon giving
further written notice to the Covenantor) to another company within
the IFR Group (any such further assignment to be subject to the
same conditions as above); and
(ii) (in the case of a Group Assignment or a Lender Assignment) that if
the liability of the Covenantor shall be increased by reason of
such assignment, the assignee shall be entitled to claim against
the Covenantor only such amount as would equal the liability of the
Covenantor had no assignment taken place.
(B) This deed and the benefits and obligations under it and any part of it
shall not be assignable by the Covenantor except that the Covenantor may,
upon giving written notice to the Purchaser, assign the benefit (but not
the burden) of this deed to a member of the Covenantor's Group provided
that
(i) any such assignee remains a member of the Covenantor's Group; and
(ii) before such assignee ceases to be a member of the Covenantor's
Group, the Covenantor will procure that the benefit of this deed is
assigned to the Covenantor or (upon giving further written notice
to the Purchaser) to another company within the Covenantor's Group
(any such further assignment to be subject to the same conditions
as above); and
(iii) if the liability of the Purchaser shall be increased by reason of
such assignment the assignee shall be entitled to claim against the
Covenantor only such amount as would equal the liability of the
Covenantor had no assignment taken place.
(C) CLAUSE 2 (Covenant) shall continue to have effect for all purposes in
relation to a Group Company notwithstanding that such Group Company has
ceased to be owned by a member of the IFR Group (a "Group Cessation"),
provided that the liability of the Covenantor in respect of any claim under
that clause made after a Group Cessation shall not exceed the amount of the
liability (if any) which it would have had in respect of such claim had the
claim been made before a Group Cessation and
24
provided further that this clause 18(C) shall not impair or affect in any
way the restrictions on assignment under clause 18(A).
19. FURTHER ASSURANCE
Each of the parties shall from time to time, on being required to do so by
any other party to this deed now or at any time in the future, execute or
procure the execution of all such documents in a form satisfactory to the
party concerned and except as provided elsewhere in, and subject to the terms
of the Agreement, each of the parties shall, at its own expense do or, so far
as it is able, procure to be done, all such acts as the parties may, in each
such case, reasonably consider necessary for giving full effect to this deed
and securing to them the full benefit of the rights, powers and remedies
conferred upon them in this deed.
20. NOTICES
(A) Any notice or other communication given or made under or in connection with
the matters contemplated by this deed shall, unless expressly stated
otherwise, be in writing, other than writing on the screen of a visual
display unit or other similar device which shall not be treated as writing
for the purposes of this clause.
(B) Any such notice or other communication shall be addressed as provided in
sub-clause (C) and sent by personal delivery or by first class post
PROVIDED THAT if, in accordance with the above provisions, any such notice
or other communication is given or made outside Working Hours, such notice
or other communication shall be deemed to be given or made at the start of
Working Hours on the next Business Day.
(C) The relevant addressee and address of each party for the purposes of this
deed, subject to SUB-CLAUSE (D), are:-
NAME OF PARTY ADDRESSEE ADDRESS
The Covenantor Company Secretary ▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
but from 1st March, 1998,
▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇
The Purchaser The Managing Director c/o Marconi Instruments,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇
25
with a copy to A.N. Drake Boodle ▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
(D) A party may notify the other party to this deed of a change to its name,
relevant addressee or address for the purposes of SUB-CLAUSE (C) PROVIDED
THAT such notification shall only be effective on:-
(i) the date specified in the notification as the date on which the
change is to take place; or
(ii) if no date is specified or the date specified is less than five
clear Business Days after the date on which notice is given, the
date falling five clear Business Days after notice of any such
change has been given.
21. COUNTERPARTS
(A) This deed may be executed in any number of counterparts, and by the parties
on separate counterparts, but shall not be effective until each party has
executed at least one counterpart.
(B) Each counterpart shall constitute an original of this deed, but all the
counterparts shall together constitute but one and the same instrument.
22. TIME OF ESSENCE
Save as otherwise expressly provided, time is of the essence of each
provision of this deed.
23. INVALIDITY
If at any time any provision of this deed is or becomes illegal, invalid or
unenforceable in any respect under the law of any jurisdiction, that shall
not affect or impair:-
(A) the legality, validity or enforceability in that jurisdiction of any other
provision of this deed; or
(B) the legality, validity or enforceability under the law of any other
jurisdiction of that or any other provision of this deed.
24. GOVERNING LAW
This deed shall be governed by and construed in accordance with English law.
26
25. JURISDICTION
Each party to this deed irrevocably agrees that any Proceedings against it
may be brought in the courts of England. Nothing contained in this clause
shall limit either party's rights to take Proceedings against the other in
any other court of competent jurisdiction, nor shall the taking of
Proceedings in one or more jurisdictions preclude the taking of Proceedings
in any other jurisdiction, whether concurrently or not, to the extent
permitted by the law of such other jurisdiction.
IN WITNESS WHEREOF this document has been executed and delivered as a deed
the day and year first before written.
Signed as a deed by )
THE GENERAL ELECTRIC )
COMPANY, p.l.c. )
acting by ) .................................. Director
)
and ) ........................ Director/Secretary
Signed as a deed by )
IFR SYSTEMS LIMITED )
acting by ) .................................. Director
)
and ) ........................ Director/Secretary
CONTENTS
--------
PAGE
----
1. INTERPRETATION 1
2. COVENANT 8
3. LIMITS ON CLAUSE 2 10
4. EXCLUSIONS 12
5. MITIGATION 12
6. PAYMENT FOR GROUP RELIEF 13
7. VAT 14
8. OVER-PROVISIONS, RELIEFS, ETC. 15
9. REFUNDS AND CREDITS 16
10. RECOVERY FROM OTHER PERSONS 16
11. CLAIMS PROCEDURE 17
12. TAX RETURNS 18
13. DUE DATE OF PAYMENT 19
14. DEDUCTIONS FROM PAYMENTS, ETC. 19
15. COUNTER COVENANT 20
16. DEEMED END OF ACCOUNTING PERIOD 22
17. REMEDIES AND WAIVERS 22
18. ASSIGNMENT 23
19. FURTHER ASSURANCE 24
20. NOTICES 24
21. COUNTERPARTS 25
22. TIME OF ESSENCE 25
23. INVALIDITY 25
24. GOVERNING LAW 25
25. JURISDICTION 26
DATED FEBRUARY, 1998
THE GENERAL ELECTRIC COMPANY, P.L.C.
(the Covenantor)
and
IFR SYSTEMS LIMITED
(the Purchaser)
--------------------
DEED OF TAX COVENANT
--------------------
▇▇▇▇▇▇▇▇▇ and May
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
(GJA/WNCW)
