Contract
EXHIBIT
2(b)
CONFIDENTIAL
TREATMENT: HARSCO CORPORATION HAS REQUESTED THAT THE OMITTED PORTIONS OF THIS
DOCUMENT, WHICH ARE INDICATED BY THE ASTERISKS, BE AFFORDED CONFIDENTIAL
TREATMENT PURSUANT TO RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
HARSCO CORPORATION HAS FILED THE OMITTED PORTIONS OF THE DOCUMENT WITH THE
SECURITIES AND EXCHANGE COMMISSION.
29th
DECEMBER 2005
BRAMBLES
U.K. LIMITED
BRAMBLES
FRANCE SAS
BRAMBLES
USA, INC.
BRAMBLES
HOLDINGS EUROPE B.V.
HARSCO
CORPORATION
BRAMBLES
INDUSTRIES LIMITED
FOR
THE SALE AND PURCHASE OF THE NORTHERN HEMISPHERE BUSINESS
OF
BRAMBLES
INDUSTRIAL SERVICES
CONFIDENTIAL
TREATMENT: HARSCO CORPORATION HAS REQUESTED THAT THE OMITTED PORTIONS OF THIS
DOCUMENT, WHICH ARE INDICATED BY THE ASTERISKS, BE AFFORDED CONFIDENTIAL
TREATMENT PURSUANT TO RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.
HARSCO CORPORATION HAS FILED THE OMITTED PORTIONS OF THE DOCUMENT WITH THE
SECURITIES AND EXCHANGE COMMISSION.
THIS
AGREEMENT is
made
on 29th
December, 2005
Between:
(1) |
BRAMBLES
U.K. LIMITED a
company incorporated under the laws of England and Wales with registered
number 04210041 whose registered office is at Cassini House, 00 Xx
Xxxxx’
Xxxxxx, Xxxxxx XX0X 0XX (Xxxxxxxx
XX);
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(2) |
BRAMBLES
FRANCE SAS a
company incorporated under the laws of France under number 542 075
098 RCS
Paris, with a share capital of EUR 20,140,000, whose registered office
is
at Tour Maine Montparnasse, 00 xxxxxx xx Xxxxx, 00000 Xxxxx
(Xxxxxxxx
Xxxxxx);
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(3) |
BRAMBLES
USA, INC.,
a Delaware corporation (Brambles
USA);
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(4) |
BRAMBLES
HOLDINGS EUROPE B.V.,
a
company incorporated under the laws of the Netherlands, registered
with
the trade register of the Dutch chamber of commerce in Amsterdam
with
registration number 34114990, whose registered office is at Xxxxxxxxxxxxxxxx
0 Xxxxxxxxxxxxxxxx 0X.00, 0000 XX, Xxxxxx-Xxxxx, xxx Xxxxxxxxxxx
(Brambles
Holdings Europe);
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(each
a
Seller
and
together the Sellers);
(5) |
HARSCO
CORPORATION, a
Delaware corporation for itself and as agent for each of Multiserv
France
SA, Harsco Europa BV and Harsco Investment Limited (the Purchaser);
and
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(6) |
BRAMBLES
INDUSTRIES LIMITED,
a
company incorporated under the laws of Australia with Australian
Business
Number 22 000 129 868 whose registered office is at Level 00, 0 Xxxxxxxxx
Xxxxx, Xxxxxx, Xxx Xxxxx Xxxxx, 0000, Xxxxxxxxx (the Guarantor).
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Whereas:
(A) Each
of
the Sellers listed in column 1 of Part A
of
Schedule 1
is the
owner of those of the Shares set out opposite its name in column 2 of
Part A
of
Schedule 1 .
(B) With
a
view to the sale and purchase of the Target Companies, the Sellers have agreed
to sell and transfer, and the Purchaser has agreed to purchase and accept the
transfer of, the Shares on the terms and subject to the conditions set out
in
this agreement.
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1
(C) The
Guarantor has agreed to guarantee the obligations of the Sellers under this
agreement.
(D) The
Purchaser is:
a. |
entering
into this agreement insofar as it relates to the French Set of Shares
as
agent for, and is acquiring those Shares out of funds provided by,
the
French Principal;
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b. |
entering
into this agreement insofar as it relates to the UK Set of Shares
and is
acquiring those Shares as agent for, and out of funds provided by
the UK
Principal;
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c. |
entering
into this agreement insofar as it relates to the Dutch Set of Shares,
as
agent for and is acquiring those Shares out of funds provided by,
the
Dutch Principal,
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and
the
Sellers and the Purchaser have accordingly agreed that the benefit of this
agreement insofar as it relates to the Set of Shares in question may be enjoyed
by and be enforceable by the French Principal, the UK Principal and the Dutch
Principal accordingly, and the Purchaser has agreed to guarantee the obligations
of the French Principal, the UK Principal and the Dutch Principal under this
agreement.
IT
IS AGREED as
follows:
1. Sale and
Purchase
1.1 Subject
to and in accordance with this agreement,
each
Seller shall sell and transfer (or procure the sale and transfer of) its Set
of
Shares, and
the
Purchaser shall purchase and accept the transfer of all of the Shares The
Purchaser is purchasing and accepting the transfer of:
(a) |
the
French Set of Shares as agent for the French
Principal;
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(b) |
the
UK Set of Shares as agent for the UK Principal;
and
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(c) |
the
Dutch Set of Shares as agent for the Dutch Principal, it being
acknowledged that the transfer of the Dutch Set of Shares will be
effected
by a separate notarial deed in the name of the Dutch
Principal.
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1.2 The
Shares shall be sold and transferred free from all Encumbrances, and together
with the benefit of all rights and profits attaching to the Shares including
all
rights to dividends and other distributions declared, made or payable on or
after the date of Closing and otherwise with full title guarantee. Ownership
and
risk in the Shares shall pass to the Purchaser or, with respect to the Dutch
Set
of Shares, the Dutch Principal, with effect from Closing.
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2
1.3 Each
Seller waives and undertakes to procure the waiver of all pre-emption rights
over its Set of Shares or any of them to which it or any other person may be
entitled in relation to the sale and purchase of such Shares.
1.4 Nothing
in this agreement shall oblige the Purchaser to purchase any of the Shares
or
otherwise complete this agreement unless the sale and purchase of all of the
Shares is completed simultaneously.
1.5 The
parties acknowledge that the transfers of the Shares shall be completed on
the
basis of the share transfer and other arrangements set out or referred to in
Part A of Schedule 6 .
2. Price
2.1 The
price
for each Set of Shares (being the Final
Price
for such
Set of Shares)
shall be
the amount which results from taking the amount or, in the case of the French
Set of Shares, the aggregate of the amounts, set out opposite the name of the
Seller of that Set of Shares in column 3 of Schedule 2
(being
the Unadjusted
Price for
such
Set of Shares) and:
(a) |
subtracting
the aggregate of the External Debt and the Intra-Group Payables of
each
member of the Relevant Target Group and the amount of the difference
between the Net Working Capital of each member of the Relevant Target
Group and the Estimated Net Working Capital of each member of the
Relevant
Target Group (if such Net Working Capital is less than the Estimated
Net
Working Capital); and
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(b) |
adding
the aggregate of the Cash and the Intra-Group Receivables of each
member
of the Relevant Target Group and the amount of the difference between
the
Net Working Capital of the Relevant Target Group and the Estimated
Net
Working Capital of the Relevant Target Group (if such Net Working
Capital
is greater than the Estimated Net Working
Capital).
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2.2 The
Sellers and the Purchaser agree that:
(a) |
the
Final Price for each Set of Shares shall be calculated after Closing
on
the basis set out in Schedule 12 ;
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(b) |
the
Final Price for each Set of Shares shall be satisfied
by:
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(i) |
payment
to the relevant Seller at Closing of the amount (being the Initial
Price for
such Set of Shares) which is the Unadjusted Price for such Set of
Shares
(i) minus the aggregate of the Estimated External Debt and the Estimated
Intra-Group Payables of each member of the Relevant Target Group
(ii) plus
the aggregate of the Estimated Cash and the Estimated
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Intra-Group
Receivables of each member of the Relevant Target Group; followed
by
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(ii) |
payment
of any Financial Adjustments due from the Purchaser to the relevant
Seller
or from the relevant Seller to the Purchaser, respectively, after
Closing
in respect of such Set of Shares in accordance with the provisions
of Part
D of Schedule 12
(the Financial
Adjustment Provisions);
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(c) |
any
payments required to be made under the Financial Adjustment Provisions
in
respect of a Set of Shares shall, for the avoidance of doubt, be
treated
as adjusting the Initial Price for such Set of Shares, thus resulting
after such adjustment in the Final Price for such Set of
Shares;
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(d) |
the
Final Price for each Set of Shares and, in the case of the French
Sold
Companies, any apportionment thereof between the Shares of each French
Sold Company made in accordance with paragraph (e)
shall, subject to any further adjustment, if applicable, pursuant
to
clause 2.3
be
adopted for all tax reporting purposes;
and
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(e) |
the
Final Price for the French Set of Shares shall be apportioned between
the
Shares in each individual French Sold Company by applying paragraphs
(a)
to
(c)
above mutatis
mutandis
as
if references in those paragraphs and in Schedule 12
to:
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(i) |
the
Final Price were references to the part of the Final Price for the
French
Set of Shares apportioned to the Shares in each individual French
Sold
Company;
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(ii) |
a
Set of Shares were references to the Shares in a French Sold Company;
and
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(iii) |
the
Unadjusted Price were references to the part of the Unadjusted Price
for
the French Set of Shares apportioned to each individual French Sold
Company, as set out in column 3 of Schedule 2 .
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2.3 If
any
payment is made in satisfaction of a liability arising under a Seller Obligation
or a Purchaser Obligation, it shall be made on the following basis:
(a) |
if
such payment relates directly to any particular Set of Shares (or
to any
Target Company or Target Companies in a particular Relevant Target
Group),
it shall so far as possible adjust the price paid for the relevant
Shares
and, to the extent that the adjustment would otherwise reduce that
price
below £1, it shall be treated in accordance with paragraph (b)
as
if it were not so directly related;
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(b) |
if
such payment is not so directly related, it shall
adjust:
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4
(i) |
the
price for such Shares as the Sellers’ Representative and the Purchaser
agree to be appropriate in the circumstances;
or
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(ii) |
if
the Sellers’ Representative and the Purchaser fail to agree the
appropriate Shares for which the price should be adjusted in accordance
with paragraph (i) within 5 Business Days after a request by the
Sellers’
Representative or the Purchaser to the other to do so:
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(A) |
the
price paid for the Shares in Fourninezero Limited;
and
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(B) |
to
the extent that the effect of clause 2.3(b)(ii)(A)
would otherwise be to reduce the price paid for the Shares in Fourninezero
Limited below £1, the price paid for each other Set of Shares on a pro
rata basis according to the Final Price for each such Set of
Shares.
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2.4 Notwithstanding
any other provision of this agreement (including the definition of Relevant
Target Group in Schedule 13 ),
to the
extent that any External Debt, Cash, Net Working Capital, Intra-Group Payables
or Intra-Group Receivables (each an Adjustment
Item)
is
attributable to SMI Lorelev SAS, such Adjustment Item shall be allocated for
the
purposes of apportioning the Final Price for the French Set of Shares between
the Shares in each individual French Sold Company:
(a) |
as
to 54.6% of the amount of such Adjustment Item, to the Shares comprising
shares in SMI Lorelev SAS; and
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(b) |
as
to 45.4% of the amount of such Adjustment Item, to the Shares comprising
shares in BC SAS,
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and
the
parties acknowledge and agree that the Estimated External Debt, Estimated Cash
and Estimated Net Working Capital of the Relevant Target Groups to which SMI
Lorelev SAS and BC SAS belong have been calculated accordingly.
3. Closing
3.1 Closing
shall take place immediately following the signing of this agreement at the
Paris offices of the Sellers’ Solicitors.
3.2 At
Closing (or such other time after Closing as may be specified in Part A
of
Schedule 6 ),
each
of the Sellers and the Purchaser shall deliver or perform (or procure that
there
is delivered or performed) all those documents, items and actions respectively
listed in relation to that party or the members of the Sellers’ Group or the
Purchaser Group (as the case may be) in Part A
of
Schedule 6 .
3.3 The
Tax
Covenant shall come into full force and effect at Closing.
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5
4. Warranties
4.1 Brambles
France warrants to the Purchaser as agent for the French Principal, in relation
only to itself, the French Set of Shares and its Relevant Target Group, in
the
terms of the Warranties. Brambles UK warrants to the Purchaser as agent for
the
UK Principal, in relation only to itself, the UK Set of Shares and its Relevant
Target Group, in the terms of the Warranties. Brambles Holdings Europe warrants
to the Purchaser as agent for the Dutch Principal in relation only to itself,
the Dutch Set of Shares and its Relevant Target Group in the terms of the
Warranties. Brambles USA warrants to the Purchaser in relation only to itself,
the US Set of Shares and its Relevant Target Group in the terms of the
Warranties. The Warranties are given as at the date of this agreement only
and
subject to:
(a) |
any
matters fairly disclosed (with such detail as enables, or ought reasonably
to enable, the Purchaser to identify the nature and scope of the
matters
so disclosed) by or under this agreement, the Disclosure Letter,
any other
Transaction Document or any document contained in the Disclosure
Bundle;
and
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(b) |
the
provisions of Schedule 4 ;
and
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(c) |
the
provisions of the Tax Covenant insofar as they are expressed to apply
to
the Tax Warranties.
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4.2 The
Purchaser acknowledges and agrees that:
(a) |
any
Claims and (to the extent expressly provided in Schedule 4 )
other claims for breach of this agreement shall be subject to the
provisions of Schedule 4 ;
and
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(b) |
at
the time of entering into this agreement, the Purchaser is not actually
aware of any facts or circumstances which could result in a Claim
being
made against the Sellers
or any misrepresentation by or on behalf of the Sellers under this
agreement.
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4.3 None
of
the limitations in this clause 4
or
Schedule 4
shall
apply to any Claim which arises (or to the extent that it is increased) as
a
consequence of fraud or fraudulent misrepresentation by any director or officer
of any member of the Sellers’ Group.
4.4 The
Purchaser warrants to the Sellers as at the date of this agreement in the terms
of the warranties set out in Schedule 5 .
4.5 The
Sellers undertake to indemnify the Purchaser (for itself and on behalf of each
Target Company) against:
(a) |
the
amount of the tax liability suffered or incurred by them under or
relating
to Tax Warrants (Nos. 5265452 and 5260315) against National Recovery
Systems, Inc any and all interest thereon together with any other
reasonable Costs suffered or incurred in connection with or arising
from
such Tax Warrants;
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6
(b) |
any
and all Costs, up to a maximum of £50,000 suffered or incurred by them
arising from or associated with the claims made against Short Bros
(Plant)
Limited or against any of the Target Companies by Xxxxxx Xxxxxxxx
or the
facts referred to therein; and
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(c) |
any
and all Costs (in excess of the amount of the £150,000 provision in
respect thereof included in the UK Accounts) arising out of or associated
with the circumstances that led to the death of Xxxx Xxxxxxx, including
any fines imposed in connection with the related charges brought
by the
Health and Safety Executive, provided
that,
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(i) |
if
the sentencing hearing at which the amount of any fine is to be imposed
hands down its determination after the date on which the Closing
Statement
is agreed or determined in accordance with the provisions of Schedule
12,
the maximum amount payable by the Sellers under this clause 4.5(c)
shall, when aggregated with the amount of the said provision, be
no
greater than £250,000
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(ii) |
if
such sentencing hearing hands down its determination before the date
on
which the Closing Statement is so agreed or determined, the amount
payable
shall be reduced by the amount of the provision (if any) in respect
thereof in the Closing Statement .
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Provided
that the provisions of clause 5.1 (c) shall apply mutatis
mutandis in
respect of the conduct of claims against Target Companies in relation to the
matter referred to in this clause 4.5 (c), except that Sellers agree that they
will not take any action that might delay the handing down of the decision
referred to in such sub-clause, and that they will not appeal or otherwise
dispute any such decision.
5.
Conduct
of claims
5.1 If
the
Purchaser becomes aware of any claim or potential claim by a third party which
might reasonably be expected to result in a Non-Tax Claim being made (a
third
party claim),
the
Purchaser shall, subject to clause 5.2:
(a) |
promptly
(and in any event within 30 days of becoming aware of it) give notice
of
such third party claim to the Sellers containing such details as
the
Purchaser has available to it in respect of and, if available to
the
Purchaser, as are sufficient to enable the Sellers to understand,
the
nature and extent of the third party claim, provided that any failure
by
the Purchaser to give such notice within such period shall not prejudice
the right of the Purchaser to make a Claim in relation to such third
party
claim (although this proviso shall be without prejudice to any rights
for
breach of contract which the Sellers may have as a result of such
failure);
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(b) |
not
make (and procure that each member of the Purchaser Group shall not
make)
any admission of liability, agreement or compromise with any person,
body
or authority in relation to that third party claim without prior
written
approval of the Sellers’ Representative (such consent not to be
unreasonably withheld or delayed);
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(c) |
subject
to the Purchaser or the relevant member of the Purchaser Group being
indemnified by the relevant Seller(s) against all reasonable out
of pocket
costs and expenses incurred in respect of that third party claim
(including any such costs and expenses incurred in performing its
obligations under clause 5.3):
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(i) |
take
(and procure that each member of the Purchaser Group shall take)
such
action as the relevant Seller(s) may reasonably request to avoid,
resist,
dispute, appeal, compromise or defend such third party
claim;
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(ii) |
allow
(or, as appropriate, procure that the relevant member of the Purchaser
Group shall allow) the relevant Seller(s) to take over the conduct
of all
proceedings and/or negotiations of whatsoever nature arising in connection
with the third party claim in question but on the basis that the
relevant
Seller(s) shall not make any admission of liability, agreement or
compromise with any person, body or authority in relation to that
third
party claim without the prior written consent of the Purchaser (such
consent not to be unreasonably withheld or delayed, and provided
that such
consent shall not be required if the relevant Seller(s) have irrevocably
undertaken to the Purchaser to satisfy any amount payable by the
Purchaser
or the relevant member of the Purchaser Group in connection with
such
admission of liability, agreement or compromise);
and
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(iii) |
provide
(or procure that the relevant member of the Purchaser Group shall
provide)
such information and assistance as the relevant Seller(s) may reasonably
require in connection with the preparation for and conduct of any
proceedings and/or negotiations relating to that third party
claim.
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5.2 Nothing
in clause 5.1
shall
oblige the Purchaser to take or to procure that any other member of the
Purchaser Group shall take any action or do anything which, in the reasonable
opinion of the Purchaser, is likely to have a material adverse impact on the
reputation or goodwill of any of the Target Companies or of any member of the
Purchaser Group. If the relevant Seller(s) fails to indemnify the Purchaser
or
relevant member of the Purchaser Group in accordance with clause 5.1(c)
in
respect of a third party claim within 21 days after the Sellers have received
notice of such third party claim containing sufficient details to enable the
Sellers to understand the nature and extent of the third party claim, the
Purchaser shall cease to have any obligations under clause 5.1
in
respect of that third party claim.
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5.3 If
the
Purchaser makes a Claim against the Sellers or notifies the Sellers of any
third
party claim which might lead to such a Claim being made, the Purchaser
shall:
(a) |
make
available to accountants and other representatives appointed by the
relevant Seller(s) such access during normal business hours to the
personnel, records and information of that Target Company as the
relevant
Seller(s) reasonably request in connection with such Claim or third
party
claim (including, for the avoidance of doubt, for the purpose of
remedying
such Claim); and
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(b) |
to
the extent reasonably requested by the relevant Seller(s), use all
reasonable endeavours to procure that the auditors (both past and
then
current) of any relevant Target Company make available their audit
working
papers in respect of audits of the accounts of that Target Company
for any
accounting period relevant to such Claim or third party claim (subject
to
the relevant Seller(s) first providing to such auditors a hold harmless
letter in a form customarily required by such auditors as a condition
to
making their audit working papers available to third
parties).
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6. No
Rights of Rescission or Termination
The
Purchaser shall not be entitled to rescind or terminate this agreement in any
circumstances whatsoever (whether before or after Closing), other than pursuant
to any such rights which arise in respect of fraudulent
misrepresentation.
7. Payment
of Intra-Group Debt
The
provisions of Schedule 11 shall
apply in respect of the payment of Intra-Group Payables and Intra-Group
Receivables.
8. Protective
covenants
8.1
Neither
the Sellers nor any of their Affiliates shall carry on or be engaged in any
Competing Business in the Protected Territories during a period of 2 years
after
the date of this agreement. For this purpose:
(a) |
Competing
Business
means a business which involves the provision of industrial services
to
steel xxxxx and which competes to a material extent with the business
carried on by any of the Target Companies, provided that carrying
on or
being engaged in any Permitted Business shall not be regarded as
a
Competing Business;
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(b) |
Permitted
Business
means, in relation to any member of the Sellers’ Group, any trade or
business (including any part of the Cleanaway, CHEP, Recall and TMF
businesses of the Sellers’ Group) carried on or engaged in by that member
of the Sellers’ Group in the jurisdiction in which such trade or business
is carried on by that member of the Sellers’ Group as at the date of this
agreement;
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(c) |
Protected
Territories
means the United Kingdom, France, the Netherlands and the United
States of
America.
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8.2 Nothing
in this clause shall prevent the Sellers or any of their Affiliates
from:
(a) |
owning
in aggregate between them securities in any company dealt in on a
stock
exchange which do not exceed 10 per cent. in nominal value of the
securities of that company; or
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(b) |
acquiring
by means of a single transaction any one or more companies and/or
businesses (taken together, the Acquired
Business)
where at the time of the acquisition the activities of the Acquired
Business include a Competing Business (the Acquired
Competing Business)
and subsequently carrying on or being engaged in the Acquired Competing
Business, if the turnover attributed to the Acquired Competing Business
in
the twelve month period ending on the last day of the month immediately
preceding the month in which completion of the acquisition of the
Acquired
Business takes place is less than 20 per cent. of the turnover of
the
Acquired Business as a whole in that 12 month period;
or
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(c) |
performing
its obligations under this agreement and/or under any other agreement
which it may enter into with a member of the Purchaser
Group.
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8.3 Neither
the Sellers nor any of their Affiliates shall within a period of 2 years after
the date of this agreement, solicit or endeavour to entice away from any Target
Company or any member of the Purchaser Group, offer employment to or employ,
or
offer or conclude any contract for services with, any person who was employed
by
any Target Company in skilled or managerial work at any time during the 12
months preceding the date of this agreement. This clause shall not prevent
the
Sellers or any of their Affiliates from employing any person who responds to
a
public advertisement for the relevant vacancy placed by or on behalf of the
Sellers or any of their Affiliates if there has been no previous contact
(specifically made with a view to allowing the Sellers or any of their
Affiliates to take advantage of the proviso to this clause) between the Sellers
or any of their Affiliates (or any person acting on their behalf) and such
person.
9. Guarantees
and other Third party assurances
9.1 The
Purchaser:
(a) |
shall
use its best endeavours to procure that within 10 Business Days after
Closing, the members of the Sellers’ Group listed Schedule 10
are released in full from both of the guarantees in favour of HSBC
Bank
plc listed Schedule 10
and if for any reason the same have not been released before the
expiry of
such period of 10 Business Days, undertakes to provide to such members
of
the Sellers’ Group first demand bank guarantees, in such form as they may
reasonably require in respect of the totality of their exposure under
such
guarantees,
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(b) |
shall
use all reasonable endeavours to procure that, as soon as reasonably
practicable after becoming aware of any Third Party Assurance not
listed
in Schedule 10 in respect of any obligations of any Target Company,
each
member of the Sellers’ Group bound by such Third Party Assurance is
released in full from such Third Party Assurance;
and
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(c) |
pending
release of any Third Party Assurance referred to in paragraph (a)
or
(b),
undertakes to the Sellers (for themselves and on behalf of each member
of
the Sellers’ Group) to indemnify the Sellers and each member of the
Sellers’ Group against any and all Costs arising as a result of any breach
by any Target Company of its obligations to which such Third Party
Assurance relates provided that the liability of the Purchaser under
this
clause 9.1(c)
in
respect of such breach shall be no greater than the liability which
such
Target Company has as a result of such
breach.
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9.2 The
Sellers:
(a) |
shall
use all reasonable endeavours to procure that, as soon as reasonably
practicable after becoming aware of any Third Party Assurance in
respect
of any obligations of any member of the Sellers’ Group, each Target
Company bound by such Third Party Assurance is released in full from
such
Third Party Assurance; and
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(b) |
pending
release of any Third Party Assurance referred to in paragraph (a),
undertake to the Purchaser (for itself and on behalf of each Target
Company) to indemnify the Purchaser and each Target Company against
any
and all Costs arising as a result of any breach by any member of
the
Sellers’ Group of its obligations to which such Third Party Assurance
relates.
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10. Retirement
Benefits
Schedule 8
sets out the agreement between the Sellers and the Purchaser in respect of
retirement benefit arrangements for the Employees. The Sellers and the Purchaser
shall comply with their respective obligations set out in Schedule 8 .
11. Tax
11.1 The
Sellers and the Purchaser shall, with effect from Closing, comply with the
provisions of the
Tax
Covenant
11.2 All
sums
payable under this agreement shall be paid free and clear of all deductions
or
withholdings whatsoever save only as provided in this agreement or as may be
required by law.
11.3 If
any
deduction or withholding is required by law from any payment in respect of
a
Purchaser Obligation or a Seller Obligation then, except in relation to
interest, the
Page
11
person
making the payment shall be obliged to pay the other person such additional
sum
as will, after such deduction or withholding has been made, leave the other
person 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.
11.4 If
any
tax authority brings into charge to tax any sum paid by a person to any other
person under this agreement in respect of a Purchaser Obligation or a Seller
Obligation, then, except in relation to interest, the amount so payable shall
be
grossed up by such amount as will ensure that, after payment of the tax so
charged, there will be left a sum equal to the amount that would otherwise
have
been payable had the sum in question not been so charged to tax.
11.5 If
any
person receiving payment (a Recipient)
under
this agreement in respect of a Purchaser Obligation or a Seller Obligation
receives a credit for, refund of or relief from any tax or other monies payable
by it or similar benefit by reason of any deduction or withholding for or on
account of tax or by reason of any tax charged in respect of which there is
a
gross up under clause 11.4,
then it
shall reimburse to the other relevant persons such part of such additional
payments paid to it pursuant to clause 11.3
or
clause 11.4
by such
other persons as the Recipient, acting reasonably, certifies to the other
persons will leave it (after such reimbursement) in no better or worse position
than it would have been in if no deduction or withholding had been required
or
no tax charge had arisen or (where applicable) if the matter giving rise to
the
payment had not arisen.
11.6 If
any
party shall have assigned the benefit in whole or in part of this agreement
in
accordance with the provisions of clause 21,
the
liability of any other person to the other person under clauses 11.3
and
11.4
shall be
limited to that (if any) which it would have been had no such assignment taken
place.
11.7 For
the
avoidance of doubt, clauses 11.3
to
11.6
shall
not apply to the Final Price for any Set of Shares, any Financial Adjustments
or
any payment pursuant to clause 7.
11.8 All
sums
payable under this agreement are (unless expressly stated otherwise) exclusive
of any applicable VAT.
12. Discharge
The
Purchaser shall take such steps as are necessary to procure the discharge by
the
shareholders of the Dutch Target Companies of any person who has ceased to
be a
director of the Dutch Target Companies since the last annual meeting of the
shareholders of the Dutch Target Companies in respect of their management of
the
affairs of the Dutch Target Companies during any period preceding the date
of
Closing (or the date of their earlier resignation, if applicable) to the extent
such management is apparent from the annual accounts of the Dutch Target
Companies, unless information becomes available after Closing that is such
that
discharge cannot reasonably be granted by such shareholder.
Page
12
13. Changes
of name
The
Purchaser undertakes to the Sellers to procure that:
(a) |
as
soon as reasonably practicable after Closing and in any event within
30 days afterwards, the name (or trading style or name) of any Target
Company which consists of or incorporates the words “Brambles” or “BIS” is
changed to a name which does not include the words “Brambles” or “BIS” or
any name which, in the reasonable opinion of the Sellers, is substantially
or confusingly similar; and
|
(b) |
as
soon as reasonably practicable after Closing and in any event within
6
months afterwards, each Target Company shall cease to use or display
the
words “Brambles”, “BIS” or any other trade mark or trade name of the
Sellers’ Group on any signage, stationery, vehicles, advertising or
promotional material in the possession or control of that Target
Company
or in any e-mail address or internet domain name used by any Target
Company.
|
14. Payments
14.1 Any
payment to be made or procured to be made pursuant to this agreement by the
Purchaser or any member of the Purchaser Group shall be made:
(a) |
if
such payment relates to the French Target Companies, in euros to
the
Brambles France Account;
|
(b) |
if
such payment relates to the US Target Companies, in US dollars to
the
Brambles USA Account;
|
(c) |
if
such payment relates to the Dutch Target Companies, in euros to the
Brambles Netherlands Account; or
|
(d) |
if
such payment relates to the UK Target Companies or is not a payment
of a
type described in paragraphs (a)
to
(c),
in sterling to the Brambles UK
Account,
|
in
each
case in immediately available funds by electronic transfer on the due date
for
payment, or to such other account(s) as the Sellers’ Representative shall
nominate in writing. Receipt of such sums in the relevant bank account shall
be
an effective discharge of the obligation of the Purchaser or any member of
the
Purchaser Group to pay such sums to the Sellers or a member of the Sellers’
Group, as the case may be, and neither the Purchaser nor any member of the
Purchaser Group shall be concerned to see to the application or be answerable
for loss or misapplication of such amount.
14.2 Any
payment to be made or procured to be made pursuant to this agreement by the
Sellers or any member of the Sellers’ Group shall be made:
(a) |
if
such payment relates to the French Target Companies, in euros to
such
account as the Purchaser shall nominate in
writing;
|
Page
13
(b) |
if
such payment relates to the US Target Companies, in US dollars to
such
account as the Purchaser shall nominate in
writing;
|
(c) |
if
such payment relates to the Dutch Target Companies, in euros to such
account as the Purchaser shall nominate in writing;
or
|
(d) |
if
such payment relates to the UK Target Companies or is not a payment
of a
type described in paragraphs (a)
to
(c),
in sterling to such account as the Purchaser shall nominate in
writing,
|
in
each
case in immediately available funds by electronic transfer on the due date
for
payment, or such other account as the Purchaser shall nominate in writing.
Receipt
of such sums in the relevant bank account shall be an effective discharge of
the
obligation of the relevant Seller or any member of the Sellers’ Group to pay
such sums to the Purchaser or a member of the Purchaser Group, as the case
may
be, and neither the Sellers nor any member of the Sellers’ Group shall be
concerned to see to the application or be answerable for loss or misapplication
of such amount.
14.3 If
any
sum due for payment under or in accordance with this agreement is not paid
on
the due date (the Due
Date),
the
person in default shall pay Default Interest on that sum (the Due
Sum)
from
but excluding the Due Date to and including the date of actual payment
calculated on a daily basis.
15. Fourninezero
Special Share
15.1 The
Purchaser acknowledges that there is outstanding one special share of £1 (the
Special
Share )
in the
capital of Fourninezero Limited (Fourninezero),
and
that this is held by Xxxxx Xxxxxx Xxxxx (Xx
Xxxxx),
and
that Fourninezero is not therefore a wholly owned subsidiary of Brambles
U.K..
15.2 Brambles
UK hereby warrants and represents that:
(a) |
the
Special Share is held by Xx Xxxxx xubject to the terms of an agreement
between Brambles U.K. and Xx Xxxxx (the Special
Share Agreement),
a true and complete copy of the relevant terms of which is contained
in
the Disclosure Bundle, and that the Special Share Agreement is in
full
force and effect and binding on Xx
Xxxxx;
|
(b) |
all
dividends due to be paid in respect of the Special Share, in accordance
with the Special Share Agreement and the Articles of Association
of
Fourninezero, have been duly paid;
and
|
(c) |
no
further amount will fall to be paid by Foxxxxxxxxxx xo Xx Xxxxx xn
respect
of the Special Share.
|
15.3 Brambles
UK hereby undertakes to the Purchaser as follows:
Page
14
*CONFIDENTIAL
TREATMENT: HARSCO CORPORATION HAS REQUESTED THAT THE OMITTED PORTIONS OF
THIS
DOCUMENT (APPROXIMATELY 5 PAGES), WHICH ARE INDICATED BY THE ASTERISKS, BE
AFFORDED CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 UNDER THE SECURITIES
EXCHANGE ACT OF 1934. HARSCO CORPORATION HAS FILED THE OMITTED PORTIONS OF
THE
DOCUMENT WITH THE SECURITIES AND EXCHANGE COMMISSION.
(a) |
that
it will, as at the end of the financial year of Fourninezero ending
in
2006, exercise its rights to purchase the Special Share from Xx
Xxxxx xnd
will immediately thereafter transfer the same for no consideration
to the
Purchaser or to its order;
and
|
(b) |
that
it will indemnify and hold harmless Fourninezero and the Purchaser
on an
after tax basis in respect of any amounts which Xx Xxxxx xay succeed
in
claiming from Fourninezero under the Articles of Association of
Fourninezero or the Special Share Agreement or otherwise, and against
any
Costs which either may suffer or incur as a result of any claim that
Xx
Xxxxx xay make against either of them in right of the Special Share
or the
Special Share Agreement.
|
15.4 For
the
avoidance of doubt, none of the limitations in Schedule 4
shall
apply to the warranties and representations in clause 15.1
or the
indemnity in clause 15.3(b).
16. *************************
17. Ongoing
access to Accounting Records
The
Purchaser shall procure that until 30 September 2006, the Target Companies
shall
allow members of the Sellers’ Group to have access during normal business hours
to the books, accounts and records of the Target Companies to the extent that
they relate to the business of the Target Companies during the period prior
to
Closing (and, for such purpose, to the JDE accounting system used by the Target
Companies) for the purposes of assisting the Sellers’ Group to prepare the
consolidated statutory accounts for the Sellers’ Group in respect of the 12
month period ending on 30 June 2006.
18. Seller
Guarantee
18.1 In
consideration of the Purchaser entering into this agreement at the Guarantor's
request, the Guarantor unconditionally and irrevocably guarantees to the
Purchaser the due and timely performance and observance by each of the Sellers
of its obligations, and the timely discharge by each Seller of all its
liabilities to the Purchaser under this agreement (including, for the avoidance
of doubt, under the Tax Covenant, and under any indemnity for costs and expenses
entered into after the date hereof pursuant to this agreement).
18.2 Any
monies payable by the Guarantor by reason of the guarantee given under clause
18.1
shall be
promptly paid upon written demand for payment of the same being made by the
Purchaser.
18.3 The
Guarantor unconditionally and irrevocably guarantees to the Purchaser for itself
and as agent for the Principals as a continuing obligation that each of the
Sellers will comply properly and punctually with its obligations under this
agreement (including, for the avoidance of doubt, under the Tax Covenant, and
under any indemnity for costs and expenses entered into after the date hereof
pursuant to this agreement).
Page
15
18.4 The
Guarantor’s liability under clause 18.1
shall
not be discharged or impaired by:
(a) |
any
amendment, variation or assignment of this agreement or any waiver
of its
terms;
|
(b) |
any
release of, or granting of time or other indulgence to, the Sellers
or any
third party; or
|
(c) |
any
winding up, dissolution, reconstruction, legal limitation, incapacity
or
lack of corporate power or authority or other circumstances affecting
any
of the Sellers (or any act taken by the Purchaser in relation to
any such
event);
|
(d) |
the
Purchaser exercising its rights under clause 21.2
to
assign all or any of its rights under this
agreement;
|
(e) |
any
other fact or circumstance which (apart from this clause 18.4(e))
would discharge a surety or
guarantor.
|
19. Purchaser
Guarantee
19.1 In
consideration of the Sellers entering into this agreement at the Purchaser's
request, the Purchaser unconditionally and irrevocably guarantees the due and
timely performance and observance by each of the French Principal, the UK
Principal and the Dutch Principal (the Principals)
of
their respective obligations, and the timely discharge by each Principal of
all
its liabilities to the Sellers under this agreement (including, for the
avoidance of doubt, under the Tax Covenant, and under any indemnity for costs
and expenses entered into after the date hereof pursuant to this
agreement).
19.2 Any
monies payable by the Purchaser by reason of the guarantee given under clause
19.1
shall be
promptly paid upon written demand for payment of the same being made by the
Sellers’ Representative.
19.3 The
Purchaser unconditionally and irrevocably guarantees to the Sellers as a
continuing obligation that each of the Principals will comply properly and
punctually with its obligations under this agreement(including, for the
avoidance of doubt, under the Tax Covenant, and under any indemnity for costs
and expenses entered into after the date hereof pursuant to this
agreement).
19.4 The
Purchaser’s liability under clause 19.1 shall not be discharged or impaired
by:
(a) |
any
amendment, variation or assignment of this agreement or any waiver
of its
terms;
|
Page
16
(b) |
any
release of, or granting of time or other indulgence to, the Principals
or
any third party; or
|
(c) |
any
winding up, dissolution, reconstruction, legal limitation, incapacity
or
lack of corporate power or authority or other circumstances affecting
any
of the Principals (or any act taken by the Sellers in relation to
any such
event);
|
(d) |
the
Sellers exercising their respective rights under clause 21.2
to
assign all or any of their respective rights under this agreement;
or
|
(e) |
any
other fact or circumstance which (apart from this clause 18.4(e))
would discharge a surety or
guarantor.
|
20. Announcements
20.1 Neither
the Sellers nor the Purchaser shall make or issue any public announcement,
circular or other formal disclosure (an Announcement)
in
connection with the existence or the subject matter of this agreement or any
of
the other Transaction Documents (and the Sellers and the Purchaser shall procure
that none of its Affiliates makes or issues any such Announcement) in each
case
without the prior written approval of the other (such approval not to be
unreasonably withheld or delayed).
20.2 The
restriction in clause 20.1
shall
not apply to the extent that an Announcement:
(a) |
contains
information which is in the public domain (otherwise than as a result
of a
breach of clause 20.1);
or
|
(b) |
is
required by law or by any Governmental Entity of competent jurisdiction
to
whose rules the party making the Announcement is subject, whether
or not
having the force of law, provided that where any Announcement is
made in
reliance on this exception, the party making the Announcement shall
use
its reasonable endeavours to consult with the other party in advance
as to
the form, content and timing of any such
Announcement.
|
21. Assignment
21.1 No
party
shall (nor shall it purport to) assign, transfer, charge or otherwise deal
with
all or any of its rights under this agreement nor grant, declare, create or
dispose of any right or interest in it without the prior written consent of
(in
the case of the Purchaser) the Sellers’ Representative or (in the case of the
Guarantor or the Sellers) the Purchaser. Any purported assignment in
contravention of this clause 21
shall be
void.
21.2 The
restriction in clause 21.1
shall
not apply to any assignment by:
(a) |
the
Purchaser of all or any of its rights under this agreement to any
other
continuing member of the Purchaser Group; or
|
Page
17
(b) |
the
Guarantor or any Seller of all or any of its rights under this agreement
to any other continuing member of the Sellers’ Group,
|
provided
that, if any such assignee ceases to be a member of the Purchaser Group or
the
Sellers’ Group (as the case may be), the assigning party shall procure that,
before such assignee so ceases, it shall re-assign those rights to the assigning
party or assign those rights to a continuing member of the Purchaser Group
or
the Sellers’ Group (as the case may be).
21.3 No
assignment in accordance with this clause 21
shall
have the effect of making the liability of any member of the Purchaser Group
or
the Sellers’ Group under this agreement greater than such liability would have
been had the assignment not occurred.
21.4 The
restriction in clause 21.1
does not
for the avoidance of doubt apply to the Purchaser's entry into this Agreement
and its acquisition of Shares as agent for respectively the French Principal,
the UK Principal and the Dutch Principal.
22. Further
Assurances
22.1 Each
of
the Sellers and the Purchaser agrees to execute (or procure the execution of)
such further documents as may be required by law or as may be necessary to
implement and give effect to this agreement.
22.2 The
Sellers agree to provide to the Purchaser, as soon as practicable after Closing,
an original of the mortgage release for the property at 0000 Xxxxxxxxxxxx
Xxxxxxxxx, Xxxx Xxxxxxx, Xxxxxxx.
22.3 In
the
absence of specific agreement to the contrary, each party shall be responsible
for its own costs and expenses (including, for the avoidance of doubt, those
of
its Affiliates) incurred in giving effect to the provisions of clause
22.1.
23. Costs
23.1 Subject
to clause 23.2
and
except as otherwise provided in this agreement, each of the Sellers and the
Purchaser shall be responsible for its own costs, charges and other expenses
(including those of their Affiliates) incurred in connection with the
negotiation, preparation, entering into and completion of this agreement and
the
other Transaction Documents.
23.2 The
Purchaser or its Affiliates shall bear all stamp, notarisation fees or other
documentary or transaction duties, stamp duty reserve tax, and any other
transfer taxes arising as a result, or in consequence, of this agreement or
of
any of the other Transaction Documents or of their respective
implementation.
Page
18
24. Notices
24.1 Any
notice or other communication to be given by any party to any other party under,
or in connection with, this agreement shall be in writing and signed by or
on
behalf of the party giving it. It shall be served by sending it by fax to the
number set out in clause 24.2,
or
delivering it by hand, or sending it by pre-paid recorded delivery, special
delivery or registered post, to the address set out in clause 24.2
and in
each case marked for the attention of the relevant party set out in
clause 24.2
(or as
otherwise notified from time to time in accordance with the provisions of this
clause 24).
Any
notice so served by hand, fax or post shall be deemed to have been duly
given:
(a) |
in
the case of delivery by hand, when
delivered;
|
(b) |
in
the case of fax, at the time of
transmission;
|
(c) |
in
the case of prepaid recorded delivery, special delivery or registered
post, at 10am on the second Business Day following the date of
posting
|
provided
that in each case where delivery by hand or by fax occurs after 6pm on a
Business Day or at any time on a day which is not a Business Day, service shall
be deemed to occur at 9am on the next following Business Day.
References
to time in this clause are to local time at the address to which the relevant
notice is sent.
24.2 The
addresses and fax numbers of the parties for the purpose of
clause 24.1
are as
follows:
Sellers
Address: | Brambles U.K. Limited |
Level 40, 0 Xxxxxxxxx Xxxxx, Xxxxxx, Xxx Xxxxx Xxxxx, 0000, Xxxxxxxxx | |
Fax: | x00 0 0000 0000 |
For
the
attention of: Senior
Vice President Legal and Mergers & Acquisitions, Brambles Industries
Limited
Purchaser Harsco
Corporation
Address: | 000 Xxxxxx Xxxxxx Xxxx |
Camp Hill, Pa 17013 | |
Fax: | 000 00000 0000 |
For
the
attention of: General
Counsel
Page
19
Guarantor
Address: | Brambles Industries Limited |
Level
40, 0 Xxxxxxxxx Xxxxx, Xxxxxx, Xxx Xxxxx Xxxxx, 0000,
Xxxxxxxxx
|
|
Fax: | x00 0 0000 0000 |
For
the
attention of: Senior
Vice President Legal and Mergers & Acquisitions, Brambles Industries
Limited
24.3 A
party
may notify any other party to this agreement of a change to its name, relevant
addressee, address or fax number for the purposes of this clause 24,
provided that such notice shall only be effective on:
(a) |
the
date specified in the notice as the date on which the change is to
take
place; or
|
(b) |
if
no date is specified or the date specified is less than five Business
Days
after the date on which notice is given, the date which is the fifth
Business Day after notice of any change has been
given.
|
24.4 In
proving such service it shall be sufficient to prove that the envelope
containing such notice was properly addressed and delivered either to the
address shown thereon or into the custody of the postal authorities as a
pre-paid recorded delivery, special delivery or registered post letter, or
that
the notice was transmitted by fax to the fax number of the relevant party set
out in this clause 24
(or as
otherwise notified under it).
24.5 The
parties agree that the provisions of this clause 24
shall
not apply to the service of any claim form, application notice, order, judgment
and any other document relating to or in connection with any arbitration
proceedings.
24.6 All
notices, demands, requests, statements, certificates or other communications
under this agreement shall be in English unless otherwise agreed in
writing.
25. Sellers’
Representative
25.1 Each
of
the Sellers hereby appoints Brambles U.K. Limited as the Sellers’ Representative
and authorises and empowers the Sellers’ Representative as its true and lawful
agent and attorney in fact to act on behalf of and represent the Sellers where
action is required of the Sellers’ Representative under this agreement. Brambles
U.K. Limited hexxxx xcknowledges and agrees to act as the Sellers’
Representative upon the terms of this agreement.
25.2 The
Sellers’ Representative may be replaced by the Sellers at any time and from time
to time.
Page
20
25.3 Each
Seller agrees that its rights under this agreement where action is required
by
the Sellers’ Representative, other than the rights of the Sellers under clause
25.2,
may
only be exercised on its behalf by the Sellers’ Representative and that any such
exercise by a Seller on its own behalf shall be of no effect. Any provision
of
this agreement which requires or provides for any act or performance by the
Sellers’ Representative shall be deemed to include an undertaking by the Sellers
to procure that the Sellers’ Representative shall promptly carry out such act or
performance.
25.4 Each
of
the Sellers hereby agrees and declares that any consent, notice, document,
deed,
matter and thing which is given, made, executed or done by the Sellers’
Representative pursuant to this agreement shall be as good, valid and effectual
as if the same had been given, made, executed or done by the Sellers personally
and each Seller hereby ratifies any act that the Sellers’ Representative may
lawfully do or cause to be done pursuant to this agreement.
25.5 The
Purchaser shall be entitled at any time to rely on any written document
purporting to be signed by or on behalf of the Sellers’ Representative without
enquiry as to the genuineness of the document or any signature on it or as
to
the authority of the person or persons signing the document and shall be
entitled to rely upon all statements made by the Sellers’ Representative as to
matters relating to this agreement without enquiry. The Sellers hereby
unconditionally and irrevocably authorise the Sellers’ Representative to execute
or do or procure to be executed or done, all such acts or documents as the
Sellers’ Representative may in its absolute discretion consider to be necessary
or desirable to give effect to this agreement.
26. Conflict
with other Agreements
26.1 In
the
event of any conflict between this agreement and any other agreement relating
to
the Proposed Transactions, this agreement shall prevail (as between the parties
to this agreement and as between any other members of the Sellers’ Group, on the
one hand, and any other members of the Purchaser Group, on the other)
unless:
(a) |
such
other agreement expressly states that it (or any part of it) overrides
this agreement in any respect and all of the Sellers and the Purchaser
are
either also parties to that other agreement or the Sellers’ Representative
and the Purchaser otherwise expressly agree in writing that such
other
agreement shall override this agreement in that respect;
or
|
(b) |
the
contrary is expressly provided elsewhere in this
agreement.
|
27. Entire
Agreement
27.1 This
agreement and the other Transaction Documents together
set out the entire agreement and understanding between the parties in respect
of
the sale and purchase of the Shares. This agreement and the other Transaction
Documents supersede all prior agreements, understandings or arrangements
(whether oral or written) relating to the sale
Page
21
and
purchase of the Shares, which prior agreements, understandings and arrangements
shall cease to have any further force or effect. It is agreed that:
(a) |
no
party has entered into this agreement or any other Transaction Document
in
reliance upon, nor shall any party have any claim or remedy in respect
of,
any statement (including any statement of intent or opinion),
representation, warranty, promise, forecast, estimate, projection,
undertaking, assurance, collateral contract or other provision made
or
provided by or on behalf of any other party (or any of its Connected
Persons) which is not expressly set out in this agreement or any
other
Transaction Document;
|
(b) |
any
terms or conditions which may be implied by law in any jurisdiction
in
relation to the Proposed Transactions shall be excluded or, if incapable
of exclusion, any rights or remedies in relation to them shall be
irrevocably waived;
|
(c) |
the
only right or remedy of a party in relation to any statement,
representation, warranty, undertaking, assurance, collateral contract
or
other provision set out in this agreement or any other Transaction
Document shall be for breach of this agreement or the relevant Transaction
Document (including damages or injunctive relief in respect thereof)
to
the exclusion of all other rights and remedies;
and
|
(d) |
except
for any liability which a party (or any of its Connected Persons)
has
under or in respect of any breach of this agreement or any of the
other
Transaction Documents, no party (or any of its Connected Persons)
shall
owe any duty of care or
have any liability in tort or otherwise to any other party (or its
respective Connected Persons) in respect of, arising out of, or in
any way
relating to the Proposed
Transactions,
|
provided
that this clause shall not exclude any liability for (or remedy in respect
of)
fraudulent misrepresentation.
The
agreements and undertakings in this clause 27
are
given and received by each party on its own behalf and as agent for each of
its
Connected Persons. Each party acknowledges that the other party gives and
receives such agreements and undertakings as agent with the full knowledge
and
authority of each of its Connected Persons. For the purpose of this clause,
Connected
Persons
means
(in relation to a party) the officers, employees, agents and advisers of that
party or any of its Affiliates.
28. Waivers,
Rights and Remedies
Except
as
otherwise provided in this agreement, no failure or delay by any party in
exercising any right or remedy provided by law or under or pursuant to this
agreement or any other Transaction Document shall impair such right or remedy
or
operate or be construed as a waiver or variation of it or preclude its exercise
at any subsequent time and no single or partial exercise of any such right
or
remedy shall preclude any further exercise of it or the exercise of any other
remedy.
Page
22
29. General
29.1 This
agreement may be executed in any number of counterparts and by the parties
to it
on separate counterparts, each of which is an original but all of which taken
together shall constitute one and the same instrument.
29.2 No
amendment, variation or waiver of this agreement (or of any of the other
Transaction Documents) shall be valid unless it is in writing and duly executed
by or on behalf of the Sellers’ Representative and the Purchaser. The expression
variation
shall
include any variation, supplement, deletion or replacement howsoever
effected.
Unless
expressly agreed, no variation shall constitute a general waiver of any
provision of this agreement, nor shall it affect any rights, obligations or
liabilities under or pursuant to this agreement which have already accrued
up to
the date of variation, and the rights and obligations under or pursuant to
this
agreement shall remain in full force and effect except and only to the extent
that they are so varied.
29.3 Each
of
the provisions of this agreement and the other Transaction Documents is
severable. If any such provision is held to be or becomes illegal, invalid
or
unenforceable in any respect under the law of any jurisdiction:
(a) |
so
far as it is illegal, invalid or unenforceable, it shall be given
no
effect and shall be deemed not to be included in this agreement or
the
relevant Transaction Document but it shall not affect or impair the
legality, validity or enforceability in that jurisdiction of any
other
provisions of this agreement or the relevant Transaction Document
(or of
the provisions of this agreement or other Transaction Document in
any
other jurisdiction); and
|
(b) |
the
parties shall use all reasonable endeavours to replace it with a
valid and
enforceable substitute provision or provisions but differing from
the
replaced provision as little as possible and the effect of which
is as
close to the intended effect of the illegal, invalid or unenforceable
provision.
|
29.4 A
person
who is not a party to this agreement shall have no right under the Contracts
(Rights of Third Parties) Act 1999 (or equivalent legislation in any other
jurisdiction) to enforce any of its terms.
29.5 The
rights of the Purchaser under this agreement:
(a) |
in
relation to Brambles France and the French Set of Shares are intended
to
and shall benefit the French Principal which is a party to this agreement
by virtue of the Purchaser having entered into it as agent of the
French
Principal;
|
(b) |
in
relation to Brambles UK and the UK Set of Shares are intended to
and shall
benefit the UK Principal which is a party to this agreement by virtue
of
the Purchaser having entered into it as agent of the UK Principal;
and
|
Page
23
(c) |
in
relation to Brambles Holdings Europe and the Dutch Set of Shares
are
intended to and shall benefit the Dutch Principal which is a party
to this
agreement by virtue of the Purchaser having entered into it as agent
of
the Dutch Principal,
|
and
where
such rights are expressed to benefit any such person as aforesaid all such
rights (including without limitation the right to bring a claim for breach
of
the Warranties), may be enforced by such person directly against the relevant
Seller to the fullest extent permissible by law.
30. Interpretation
Words
and
expressions used in this agreement shall have the meanings set out in
Schedule 13
unless
the context requires otherwise.
31. Settlement
of disputes
31.1 In
the
event of any dispute, controversy or claim arising out of or in connection
with
this agreement or any other Transaction Document other than a dispute to which
Part C
of
Schedule 12
applies
(a Dispute),
either
the Sellers or the Purchaser may serve formal written notice on the other that
a
Dispute has arisen (a Notice
of Dispute).
31.2 The
Sellers and the Purchaser shall use all reasonable endeavours for a period
of
twenty Business Days from the date on which the Notice of Dispute is served
by
one party on the other party (or such longer period as may be agreed in writing
between the parties) to resolve the Dispute on an amicable basis.
31.3 If
the
parties are unable to resolve the Dispute by amicable negotiation within the
time period referred to in clause 31.2,
the
Dispute may be referred by the Sellers or the Purchaser to senior executives
of
the Sellers’ Group and the Purchaser Group nominated by the respective Chief
Executive Officers of the Guarantor and the Purchaser who shall attempt, for
a
period of ten Business Days from the expiry of the time period referred to
in
clause 31.2,
to
resolve the Dispute. In the event that those senior executives are unable to
resolve the Dispute within the stated time period (or such longer period as
may
be agreed in writing between the parties), the Dispute shall be referred to
arbitration in accordance with clause 31.4.
31.4 Subject
to clauses 31.1
to
31.3,
the
Dispute shall be referred to and finally resolved by arbitration under the
Rules
of Arbitration of the International Chamber of Commerce by a sole arbitrator
appointed in accordance with those Rules. The
seat
of arbitration shall be London, England. The language to be used in the arbitral
proceedings shall be English. The parties shall have the right to seek interim
relief from a court of competent jurisdiction, at any time before and after
the
arbitrator has been appointed, up until the arbitrator has made his final
award.
Page
24
32. Governing
law
This
agreement and the legal relationships established by or otherwise arising in
connection with this agreement shall be governed by, and interpreted in
accordance with, English law.
Page
25
SCHEDULE 1
SELLERS,
SHARES AND TARGET
COMPANIES
Part A The
Shares
1
Seller
|
2
Set
of Shares
|
Brambles
U.K. Limited
|
99
ordinary shares of £1 each in the share capital of Fourninezero
Limited
|
Brambles
France SAS
|
5,000
shares in the share capital of Becema SAS
72,500
shares in the share capital of Solomat Industrie SA
10,000
shares in the share capital of BC SAS
6,006
shares in the share capital of SMI Lorelev SAS
|
Brambles
USA, Inc.
|
100
common shares of US$1 each in the share capital of Brambles Steel
Services, Inc.
|
Brambles
Holdings Europe B.V.
|
18,200
shares in the share capital of Brambles Steel Services B.V.
|
Part B Details
of those Target Companies whose Shares are being
sold under this agreement
1.
|
Name:
|
Fourninezero
Limited
|
2.
|
Date
of Incorporation:
|
30/1/1975
|
3.
|
Place
of Incorporation:
|
England
and Wales
|
4.
|
Class
of Company:
|
Private
Limited with share capital
|
5.
|
Registered
Number:
|
01198490
|
6.
|
Registered
Office:
|
Cassini
House, 00 Xx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX
|
Page
26
7.
|
Directors:
|
Xxxxxxxx
Xxxx Xxxxx
Xxxx
Xxxxx Xxxxxxx
|
8.
|
Company
Secretary:
|
Xxxxx
Xxxx Xxxxxxx Xxxxxxx
|
9.
|
Authorised
Capital:
|
£100
|
10.
|
Issued
Capital:
|
£100
|
11.
|
Registered
Shareholders:
|
Brambles
U.K. Limited (99 ordinary shares)
Xxxxx
Xxxxxx Xxxxx (1 special share)
|
12.
|
Accounting
Reference Date:
|
30
June
|
13.
|
Auditors:
|
PricewaterhouseCoopers
LLP
|
14.
|
Tax
Residence:
|
UK
|
15.
|
Status:
|
Holding
company
|
|
||
1.
|
Name:
|
Becema
SAS
|
2.
|
Date
of Incorporation:
|
19
January 1990
|
3.
|
Place
of Incorporation:
|
Thionville,
France
|
4.
|
Class
of Company:
|
Société
par actions simplifiée
|
5.
|
Registered
Number:
|
352
978 316, RCS Thionville
|
6.
|
Registered
Office:
|
000,
Xxxxx xx Xxxxxx - 00 000 Xxxxxxxx, Xxxxxx
|
7.
|
Chairman
|
Brambles
France SAS
|
8.
|
General
Manager (directeur
general):
|
Xxxxxxx
Xxxxxx
|
9.
|
Share
Capital:
|
EUR
200,000
|
10.
|
Shareholders:
|
Brambles
France SAS
|
11.
|
Accounting
Reference Date:
|
30
June
|
12.
|
Auditors:
|
PricewaterhouseCoopers
Xx
Xxxx Xxxxxxxxxxxxx
|
Page
27
13.
|
Tax
Residence:
|
France
|
14.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
Solomat
Industrie SA
|
2.
|
Date
of Incorporation:
|
10
November 1997
|
3.
|
Place
of Incorporation:
|
Dunkerque,
France
|
4.
|
Class
of Company:
|
Société
anonyme
|
5.
|
Registered
Number:
|
402
187 090 RCS Dunkerque
|
6.
|
Registered
Office:
|
Xxx
Xxxxxxx Xxxxxxx - Xxxx xxxxxxxxxxxx- 00 000 Xxxxxx Xxxxxx,
Xxxxxx
|
7.
|
Chairman
|
Xxxx-Xxxxx
Xxxxxxx
|
8.
|
General
Manager (directeur
general):
|
Xxxxxxx
Xxxxxx
|
9.
|
Share
Capital
|
EUR
1,160,000
|
10.
|
Shareholders:
|
Brambles
France SAS - 72,500 shares
|
11.
|
Accounting
Reference Date:
|
30
June
|
12.
|
Auditors:
|
PricewaterhouseCoopers
|
13.
|
Tax
Residence:
|
France
|
14.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
BC
SAS
|
2.
|
Date
of Incorporation:
|
8
June 1977
|
3.
|
Place
of Incorporation:
|
Metz,
France
|
4.
|
Class
of Company:
|
Société
par actions simplifiée
|
5.
|
Registered
Number:
|
305
588 980 RCS Thionville
|
6.
|
Registered
Office:
|
000X,
xxxxx xx Xxxxxx - 00 000 Xxxxxxxx, Xxxxxx
|
Page
28
7.
|
Chairman
|
Brambles
France SAS
|
8.
|
Share
Capital:
|
EUR
200,000
|
9.
|
Registered
Shareholders:
|
Brambles
France SAS
|
10.
|
Accounting
Reference Date:
|
30
June
|
11.
|
Auditors:
|
PricewaterhouseCoopers
Xx
Xxxx Xxxxxxxxxxxxx
|
12.
|
Tax
Residence:
|
France
|
13.
|
Status:
|
Holding
company
|
|
||
1.
|
Name:
|
SMI
Lorelev SAS
|
2.
|
Date
of Incorporation:
|
25
September 1984
|
3.
|
Place
of Incorporation:
|
Thionville,
France
|
4.
|
Class
of Company:
|
Société
par actions simplifiée
|
5.
|
Registered
Number:
|
B
330 641 002 RCS Thionville
|
6.
|
Registered
Office:
|
000X,
xxxxx xx Xxxxxx - 00 000 Xxxxxxxx, Xxxxxx
|
7.
|
Chairman
|
Brambles
France SAS
|
8.
|
General
Manager (directeur
general):
|
Xxxxxxx
Xxxxxx
|
9.
|
Share
Capital:
|
EUR
200,000
|
10.
|
Shareholders:
|
BC
SAS - 4,994 shares
Brambles
France SAS - 6,006 shares
|
11.
|
Accounting
Reference Date:
|
30
June
|
12.
|
Auditors:
|
PricewaterhouseCoopers
|
13.
|
Tax
Residence:
|
France
|
14.
|
Status:
|
Trading
company
|
Page
29
1.
|
Name:
|
Brambles
Steel Services, Inc.
|
2.
|
Date
of Incorporation:
|
6
April 2000
|
3.
|
Place
of Incorporation:
|
Delaware,
U.S.A.
|
4.
|
Class
of Company:
|
Corporation
|
5.
|
Delaware
File Number:
|
3208294
|
6.
|
Registered
Agent
|
The
Corporation Trust Company
|
7.
|
Registered
Office:
|
Corporation
Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000,
X.X.X.
|
8.
|
Directors:
|
Xxx
Xxxxxxxx
Xxxxxxx
Xxxxxxx
Xxxxxx
Xxxxxx III
|
9.
|
Company
Secretary:
|
Xxxxxx
Xxxxxx XXX
|
10.
|
Authorised
Capital:
|
1000
shares of US$1 each
|
11.
|
Issued
Capital:
|
100
shares
|
12.
|
Registered
Shareholders:
|
Brambles
USA, Inc.
|
13.
|
Accounting
Reference Date:
|
30
June
|
14.
|
Auditors:
|
PricewaterhouseCoopers
|
15.
|
Tax
Residence:
|
Indiana,
U.S.A.
|
16.
|
Status:
|
Holding
company
|
|
||
1.
|
Name:
|
Brambles
Steel Services B.V.
|
2.
|
Date
of Incorporation:
|
14/3/75
|
3.
|
Place
of Incorporation:
|
Netherlands
|
4.
|
Class
of Company:
|
Private
Limited
|
5.
|
Registered
Number:
|
34036230
|
6.
|
Registered
Office:
|
Xxxxxxxxxxxxxxxx
0, Xxxxxxxxxxxxxxxx 0X.00, 0000 XX Xxxxxx-Xxxxx, xxx
Xxxxxxxxxxx
|
Page
30
7.
|
Directors:
|
Xxxxx
Xxxxx Xxxxxxx
Xxxxxx
Xxxxx
|
8.
|
Proxyholder:
|
Xxxxxxxx
Xxxxxxxxx Xxxxxx
|
9.
|
Authorised
Capital:
|
EUR
91,000
|
10.
|
Issued
Capital:
|
EUR
18,200
|
11.
|
Registered
Shareholders:
|
Brambles
Holdings Europe B.V.
|
12.
|
Accounting
Reference Date:
|
30
June
|
13.
|
Auditors:
|
PricewaterhouseCoopers
|
14.
|
Tax
Residence:
|
Netherlands
|
15.
|
Status:
|
Trading
company
|
Part C Details
of the Subsidiaries
of the Target Companies
1.
|
Name:
|
Short
Bros (Plant) Limited
|
2.
|
Date
of Incorporation:
|
25/2/49
|
3.
|
Place
of Incorporation:
|
England
and Wales
|
4.
|
Class
of Company:
|
Private
Limited with share capital
|
5.
|
Registered
Number:
|
00465057
|
6.
|
Registered
Office:
|
Cassini
House, 00 Xx Xxxxx Xxxxxx, Xxxxxx XX0X 0XX
|
7.
|
Directors:
|
Xxxxxxxx
Xxxx Xxxxx
Xxxx
Xxxxx Xxxxxxx
Xxxxx
Xxxxx Xxxxxxxxx
Xxxxxxx
Xxxxxx Xxxxx
|
8.
|
Company
Secretary:
|
Xxxxx
Xxxx Xxxxxxx Xxxxxxx
|
Page
31
9.
|
Authorised
Capital:
|
£1,010,000
|
10.
|
Issued
Capital:
|
£10,000
|
11.
|
Registered
Shareholders:
|
Fourninezero
Limited
|
12.
|
Accounting
Reference Date:
|
30
June
|
13.
|
Auditors:
|
PricewaterhouseCoopers
LLP
|
14.
|
Tax
Residence:
|
UK
|
15.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
XX
Xxxx SAS
|
2.
|
Date
of Incorporation:
|
14/2/91
|
3.
|
Place
of Incorporation:
|
Dunkerque
- France
|
4.
|
Class
of Company:
|
Société
par actions simplifiée
|
5.
|
Registered
Number:
|
379
875 107 RCS Dunkerque
|
6.
|
Registered
Office:
|
0
xxx Xxxxxxx Xxxxxxxx, 00000 Xxxxxx Xxxxxx, Xxxxxx
|
7.
|
Chairman
|
Brambles
France SAS
|
8.
|
General
Manager (directeur
general):
|
Xxxxxxx
Xxxxxx Xxxxx Xxxxxx
|
9.
|
Share
Capital:
|
EUR
200,000
|
10.
|
Shareholders:
|
BC
SAS
|
11.
|
Accounting
Reference Date:
|
30
June
|
12.
|
Auditors:
|
PricewaterhouseCoopers
|
13.
|
Tax
Residence:
|
France
|
14.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
National
Recovery Systems, Inc.
|
2.
|
Date
of Incorporation:
|
22
July 1993
|
Page
32
3.
|
Place
of Incorporation:
|
Delaware,
U.S.A.
|
4.
|
Class
of Company:
|
Corporation
|
5.
|
Delaware
File Number:
|
2344780
|
6.
|
Registered
Agent
|
The
Corporation Trust Company
|
7.
|
Registered
Office:
|
Corporation
Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000,
X.X.X.
|
8.
|
Directors:
|
Xxx
Xxxxxxxx
Xxxxxxx
Xxxxxxx
Xxxxxx
Xxxxxx III
|
9.
|
Company
Secretary:
|
Xxxxxx
Xxxxxx XXX
|
10.
|
Authorised
Capital:
|
1000
shares of US$1 each
|
11.
|
Issued
Capital:
|
930
shares
|
12.
|
Registered
Shareholders:
|
Brambles
Steel Services, Inc.
|
13.
|
Accounting
Reference Date:
|
30
June
|
14.
|
Auditors:
|
PricewaterhouseCoopers
|
15.
|
Tax
Residence
|
Indiana,
U.S.A.
|
16.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
Great
Lakes Recovery Systems, Inc.
|
2.
|
Date
of Incorporation:
|
20
June 1995
|
3.
|
Place
of Incorporation:
|
Delaware,
U.S.A.
|
4.
|
Class
of Company:
|
Corporation
|
5.
|
Delaware
File Number:
|
2517358
|
6.
|
Registered
Agent
|
The
Corporation Trust Company
|
7.
|
Registered
Office:
|
Corporation
Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000,
X.X.X.
|
8.
|
Directors:
|
Xxx
Xxxxxxxx
Xxxxxxx
Xxxxxxx
Xxxxxx
Xxxxxx III
|
Page
33
9.
|
Company
Secretary:
|
Xxxxxx
Xxxxxx XXX
|
10.
|
Authorised
Capital:
|
1,000
shares, par value - none
|
11.
|
Issued
Capital:
|
53.73
shares
|
12.
|
Registered
Shareholders:
|
National
Recovery Systems, Inc.
|
13.
|
Accounting
Reference Date:
|
30
June
|
14.
|
Auditors:
|
PricewaterhouseCoopers
|
15.
|
Tax
Residence
|
Michigan,
U.S.A.
|
16.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
E.C.R.,
Inc.
|
2.
|
Date
of Incorporation:
|
26
July 1993
|
3.
|
Place
of Incorporation:
|
Delaware,
U.S.A.
|
4.
|
Class
of Company:
|
Corporation
|
5.
|
Delaware
File Number:
|
2345175
|
6.
|
Registered
Agent
|
The
Corporation Trust Company
|
7.
|
Registered
Office:
|
Corporation
Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000,
X.X.X.
|
8.
|
Directors:
|
Xxx
Xxxxxxxx
Xxxxxxx
Xxxxxxx
Xxxxxx
Xxxxxx III
|
9.
|
Company
Secretary:
|
Xxxxxx
Xxxxxx XXX
|
10.
|
Authorised
Capital:
|
10,000
shares, par value - none
|
11.
|
Issued
Capital:
|
1,000
shares
|
12.
|
Registered
Shareholders:
|
National
Recovery Systems, Inc.
|
13.
|
Accounting
Reference Date:
|
30
June
|
14.
|
Auditors:
|
PricewaterhouseCoopers
|
Page
34
15.
|
Tax
Residence
|
Indiana,
U.S.A.
|
16.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
Xxxxxxxx
Recovery, Inc.
|
2.
|
Date
of Incorporation:
|
10
September 1993
|
3.
|
Place
of Incorporation:
|
Delaware,
U.S.A.
|
4.
|
Class
of Company:
|
Corporation
|
5.
|
Delaware
File Number:
|
2350528
|
6.
|
Registered
Agent
|
The
Corporation Trust Company
|
7.
|
Registered
Office:
|
Corporation
Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000,
X.X.X.
|
8.
|
Directors:
|
Xxx
Xxxxxxxx
Xxxxxxx
Xxxxxxx
Xxxxxx
Xxxxxx III
|
9.
|
Company
Secretary:
|
Xxxxxx
Xxxxxx XXX
|
10.
|
Authorised
Capital:
|
1,000
shares, par value - none
|
11.
|
Issued
Capital:
|
53.73
shares
|
12.
|
Registered
Shareholders:
|
National
Recovery Systems, Inc.
|
13.
|
Accounting
Reference Date:
|
30
June
|
14.
|
Auditors:
|
PricewaterhouseCoopers
|
15.
|
Tax
Residence
|
Pennsylvania,
U.S.A.
|
16.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
Ashland
Recovery, Inc.
|
2.
|
Date
of Incorporation:
|
29
December 2004
|
3.
|
Place
of Incorporation:
|
Delaware,
U.S.A.
|
4.
|
Class
of Company:
|
Corporation
|
Page
35
5.
|
Delaware
File Number:
|
FEIN
00-0000000
|
6.
|
Registered
Agent
|
The
Corporation Trust Company
|
7.
|
Registered
Office:
|
Corporation
Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000,
X.X.X.
|
8.
|
Directors:
|
Xxx
Xxxxxxxx
Xxxxxxx
Xxxxxxx
Xxxxxx
Xxxxxx III
|
9.
|
Company
Secretary:
|
Xxxxxx
Xxxxxx XXX
|
10.
|
Authorised
Capital:
|
1,000
shares, par value - none
|
11.
|
Issued
Capital:
|
100
shares
|
12.
|
Registered
Shareholders:
|
National
Recovery Systems, Inc.
|
13.
|
Accounting
Reference Date:
|
30
June
|
14.
|
Auditors:
|
PricewaterhouseCoopers
|
15.
|
Tax
Residence
|
Kentucky,
U.S.A.
|
16.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
National
Briquette Corporation
|
2.
|
Date
of Incorporation:
|
10
September 1993
|
3.
|
Place
of Incorporation:
|
Delaware,
U.S.A.
|
4.
|
Class
of Company:
|
Corporation
|
5.
|
Delaware
File Number:
|
2350663
|
6.
|
Registered
Agent
|
The
Corporation Trust Company
|
7.
|
Registered
Office:
|
Corporation
Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000,
X.X.X.
|
8.
|
Directors:
|
Xxx
Xxxxxxxx
Xxxxxxx
Xxxxxxx
Xxxxxx
Xxxxxx III
|
9.
|
Company
Secretary:
|
Xxxxxx
Xxxxxx XXX
|
Page
36
10.
|
Authorised
Capital:
|
75,000
shares of US$1 each
|
11.
|
Issued
Capital:
|
5,373
shares
|
12.
|
Registered
Shareholders:
|
National
Recovery Systems, Inc.
|
13.
|
Accounting
Reference Date:
|
30
June
|
14.
|
Auditors:
|
PricewaterhouseCoopers
|
15.
|
Tax
Residence
|
Indiana,
U.S.A.
|
16.
|
Status:
|
Trading
company
|
|
||
1.
|
Name:
|
Xxxxx
Xxxxxxxx Transport B.V.
|
2.
|
Date
of Incorporation:
|
11/6/96
|
3.
|
Place
of Incorporation:
|
Netherlands
|
4.
|
Class
of Company:
|
Private
Limited
|
5.
|
Registered
Number:
|
37075751
|
6.
|
Registered
Office:
|
Xxxxx
Dorregeest 7, 1921HA Akersloot
|
7.
|
Directors:
|
Xxxxxx
Xxxxx
|
8.
|
Proxyholder:
|
Xxxxxxxx
Xxxxxxx Xxxxx
|
9.
|
Authorised
Capital:
|
EUR
90,756.04
|
10.
|
Issued
Capital:
|
EUR
18,151.21
|
11.
|
Registered
Shareholders:
|
Brambles
Steel Services B.V.
|
12.
|
Accounting
Reference Date:
|
30
June
|
13.
|
Auditors:
|
PricewaterhouseCoopers
|
14.
|
Tax
Residence:
|
Netherlands
|
15.
|
Status:
|
Trading
company
|
Page
37
SCHEDULE 2
UNADJUSTED
PRICE AND APPORTIONMENT
INTENTIONALLY
OMITTED
Page
38
SCHEDULE 3
SELLERS
WARRANTIES
Part A General/Commercial
1. The
Sellers, the Shares
and the Target Companies
1.1 Authorisations,
valid obligations, filings and consents
(a) |
Each
Seller has obtained all corporate authorisations and all other applicable
governmental, statutory, regulatory or other consents, licences,
authorisations, waivers or exemptions (Approvals)
required to empower it to enter into and perform its obligations
under
this agreement and any other Transaction Document to which it is
a party
where failure to obtain such Approval would adversely affect its
ability
to enter into or perform its obligations under this agreement or
the other
Transaction Documents in accordance with their
terms.
|
(b) |
This
agreement and the other Transaction Documents which are to be entered
into
by each Seller will, when executed, constitute valid and binding
obligations of that Seller.
|
(c) |
Entry
into and performance by each Seller of this agreement and/or any
other
Transaction Document to which it is a party will not breach the provisions
of its memorandum and articles of association, certificate of
incorporation, by-laws or equivalent constitutional documents in
its
jurisdiction of incorporation where such breach would adversely affect
its
ability to enter into or perform its obligations under this agreement
and/or any other Transaction Document to which it is a party in accordance
with their terms.
|
(d) |
Neither
entry by each Seller into this agreement nor entry into, and
implementation of, the Proposed Transactions by each Seller
will:
|
(i) |
result
in a breach of any applicable laws or regulations in its jurisdiction
of
incorporation, including for the avoidance of doubt the provisions
of
articles L.432-1 of the French Labour Code (Code
du Travail),
which require, inter
alia,
that a opinion (avis)
be
obtained prior to any decision in connection with the Proposed
Transactions becoming final, and in any event prior to the date hereof,
from any relevant employee representatives with respect to the Proposed
Transactions; or
|
(ii) |
amount
to a breach of any order, decree or judgment of any court or any
Governmental Entity in its jurisdiction of
incorporation,
|
Page
39
where,
in
each case, such breach would adversely affect its ability to enter into or
perform its obligations under this agreement and/or any other Transaction
Document to which it is a party.
1.2 The
Sellers,
the Shares and the Target Companies
(a) |
Each
Seller is and each of the Target Companies is validly incorporated,
in
existence and duly registered and/or in good standing (as applicable)
under the laws of their respective jurisdictions of incorporation
and, in
the case of each Target Company, has full power under its memorandum
and
articles of association, articles or certificate of incorporation
or
equivalent constitutional documents in its jurisdiction of incorporation
to conduct its business as conducted at the date of this
agreement.
|
(b) |
All
the Shares and all of the shares in each of the Subsidiaries are
fully
paid or properly credited (under the applicable legislation in the
jurisdiction of incorporation of the relevant Target Company) as
fully
paid and each Seller is in the case of the Target Companies listed
in
Part A
of
Schedule 1 the
sole legal and beneficial owner, free from all Encumbrances, of the
number
of shares in the relevant Target Company set opposite that Seller’s name
in column 2 of Part A
of
Schedule 1 .
|
(c) |
No
member of the Sellers’ Group nor any Target Company has entered into any
agreement or arrangement (other than this agreement) pursuant to
which any
person has the right (exercisable now or in the future and whether
contingent or not) to call for the issue, allotment, conversion or
transfer of any share or loan capital in any Target
Company.
|
(d) |
Each
Seller is entitled to transfer or procure the transfer of its Set
of
Shares on the terms set out in this
agreement.
|
(e) |
The
Shares constitute the whole of the issued and allotted (or, to the
extent
appropriate, registered) share capital of the Target Companies listed
in
column 2 of Part A
of
Schedule 1 .
|
(f) |
The
information in respect of each of the Target Companies set out in
Part A
of
Schedule 1
and (insofar as such information relates to the identity of the
shareholders, directors or legal representatives of any Target Company
or
to the share capital of any Target Company) in Part B
and Part C
of
Schedule 1
is
complete and accurate.
|
(g) |
The
information in respect of each of the Target Companies set out in
Part B
and Part C
of
Schedule 1
(insofar as such information relates to matters other than those
described
in paragraph (f)
above) is accurate in all material
respects.
|
Page
40
(h) |
Every
share in the capital of every Subsidiary is owned legally and
beneficially, free from all Encumbrances, by a Target Company listed
in
Part B of
Schedule 1
and no member of the Sellers’ Group nor any Target Company has entered
into any agreement or arrangement whereby any person has the right
(exercisable now or in the future and whether contingent or not)
to call
for the issue, allotment, conversion or transfer of any share or
loan
capital in any Subsidiary.
|
(i) |
No
member of the Sellers’ Group provides any industrial services in Europe
(including the United Kingdom) or North America which compete in
any
material respect with (or which would, if carried on by a third party
in
the same jurisdiction as the business of any of the Target Companies,
have
the potential to compete in any material respect with) the industrial
services provided by any Target
Company.
|
1.3 Other
interests
No
Target
Company owns or has any interest of any nature whatsoever in any shares,
debentures or other securities issued by any undertaking (other than another
Target Company listed in Schedule 1 )
or in
any partnership or joint venture.
2. Financial Matters
2.1 The
UK Accounts
The
UK
Accounts have been prepared in accordance with applicable law and regulations
in
England and give a true and fair view of the state of affairs of each of the
UK
Target Companies and of their respective assets and liabilities as at the
Accounts Date and of the results thereof for the financial year ended on the
Accounts Date, and have been prepared in accordance with UK GAAP and on a
consistent basis in all material respects (save to the extent required by law,
any applicable regulation, or generally accepted accounting principles) with
the
statutory accounts for such companies for the financial year ended on 30 June
2004.
2.2 The
French Accounts
The
French Accounts have been prepared in accordance with applicable law and
regulations in France and give a true and fair view (it being understood that
this expression is to be taken as meaning for the purposes of the French
Accounts, the same as “sont
réguliers, sincères et donnent une image fidèle”)
of the
state of affairs of each of the French Target Companies as at the Accounts
Date
and of their respective results for the financial year ended on the Accounts
Date and have been prepared in accordance with generally accepted accounting
principles of France and on a consistent basis in all material respects (save
to
the extent required by law, any applicable regulation, or generally accepted
accounting principles) with the statutory accounts for such companies for the
financial year ended on 30 June 2004.
Page
41
2.3 The
Dutch Accounts
The
Dutch
Accounts have been prepared in accordance with applicable law and regulations
in
the Netherlands (save only that the same have not yet been the subject of a
report from auditors) and give a true and fair view of the state of affairs
of
Brambles Steel Services B.V. as at the Accounts Date and of its results for
the
financial year ended on the Accounts Date and have been prepared in accordance
with generally accepted accounting principles of the Netherlands and on a
consistent basis in all material respects (save to the extent required by law,
any applicable regulation, or generally accepted accounting principles) with
the
accounts for such companies for the two financial years ended on 30 June
2004.
2.4 The
US Accounts
The
US
Accounts have been prepared for the purposes of preparing the consolidated
statutory UK accounts for the Sellers’ Group in respect of the 12 month period
ended on the Accounts Date and are an aggregation (without consolidation
adjustments) of individual company accounts for each of the US Target Companies
which give a true and fair view of the respective state of affairs of such
respective US Target Companies as at the Accounts Date, and of their results
for
the financial year ended on the Accounts Date and have been prepared in
accordance with UK GAAP and on a consistent basis in all material respects
(save
to the extent required by law, any applicable regulation, or generally accepted
accounting principles) with the equivalent accounts for such companies for
the
two financial years ended on 30 June 2004, provided that the US Accounts have
not been prepared so as to comply with any applicable laws and regulations,
have
not been the subject of a report by auditors, and, not being statutory accounts
under English law do not contain all of the disclosures required in relation
to
such accounts pursuant to the Companies Act 1985.
2.5 Position
since Accounts Date
(a) |
Since
the Accounts Date:
|
(i) |
the
business of each of the Target Companies has been carried on in the
ordinary course and there has been no material adverse change in
the
financial or trading position of any Target
Company;
|
(ii) |
no
dividend or other distribution (whether in cash, stock or in kind)
has
been declared, authorised, paid or made, nor has there been any reduction
of paid-up share capital, by any Target Company (except for any dividends
provided for in the June 30
Accounts);
|
(iii) |
no
share or loan capital has been issued or agreed to be issued by any
Target
Company;
|
Page
42
(iv) |
no
Target Company has repaid any Financial Debt (other than Intra-Group
Payables) in advance of its stated
maturity;
|
(v) |
no
Target Company has made or agreed to make any material payment or
entered
into any material transaction or commitment or incurred any material
liability except in the ordinary course of its trading and for full
value;
|
(vi) |
no
Target Company has acquired or agreed to acquire any business or
material
asset other than in the ordinary course of
business;
|
(vii) |
the
businesses of the Target Companies have not been materially and adversely
affected by the loss of any important customer(s) or source(s) of
supply
or any abnormal factor(s) not affecting similar businesses to the
businesses of the Target Companies to the same or a similar
extent.
|
2.6 Statutory
books
(a) |
The
statutory books of each Target Company required to be kept by applicable
laws in its jurisdiction of incorporation have been maintained in
all
material respects in accordance with such laws and are properly written
up
to date and there has been no notice of any proceedings to correct
or
rectify any registers therein.
|
(b) |
No
Target Company has, since the Accounts Date, passed any resolution
of its
members other than resolutions relating to the routine business of
annual
general meetings.
|
(c) |
A
copy of the memorandum and articles of association, by-laws or equivalent
constitutional documents of each of the Target Companies are contained
in
the Disclosure Bundle and such copies are true, complete and
accurate.
|
(d) |
Each
Target Company has complied in all material respects with the provisions
of the United Kingdom Companies Act 1985 (or equivalent legislation
in its
jurisdiction of incorporation) and all returns, particulars, resolutions
and other documents required under any legislation to be delivered
on
behalf of a Target Company to the registrar of companies or to any
equivalent authority in its jurisdiction of incorporation have been
properly made and delivered within the requisite time
limits.
|
2.7 Powers
of attorney
No
powers
of attorney or other authorities by which a person may enter into an agreement,
arrangement or obligation for or on behalf of a Target Company have been given
and remain outstanding (other than the authority for a director, other officer
or employee (but not an alternate or shadow director) of a Target Company
Page
43
to
enter
into an arrangement, agreement or obligation in the usual course of that
person’s duties).
2.8 Dormant
and holding companies
(a) |
Where
the status of any Target Company is shown in Part B
or
Part C
of
Schedule 1
as
“Dormant company”, that Target Company does not carry on any trading
activities and has no material assets or
liabilities.
|
(b) |
Where
the status of any Target Company is shown in Part B
or
Part C
of
Schedule 1
as
“Holding company”, that Target Company does not carry on any trading
activities and has no material assets or liabilities other than its
shareholdings in any Subsidiary.
|
3. Financial
Debt
3.1 External
Financial Debt
(a) |
None
of the Target Companies has outstanding any Financial Debt owing
by it to
any person outside the Sellers’
Group.
|
(b) |
No
amounts are owing to any Target Company other than Intra-Group Receivables
and trade debts incurred in the ordinary course of business, and
no Target
Company has agreed to make any loan or
advance.
|
(c) |
So
far as the Sellers are aware, no Target Company has agreed to become
bound
by any guarantee, indemnity or suretyship save in respect of the
obligations of any other Target
Company.
|
(d) |
No
Target Company has created nor agreed to create and nor is there
subsisting any Encumbrance (other than a Permitted Encumbrance) over
all
or any of its property assets undertaking goodwill reserves or share
capital.
|
(e) |
The
assets of each Target Company are free from any Encumbrances (other
than
Permitted Encumbrances).
|
3.2 Intra-Group
Debt
None
of
the Target Companies has outstanding any Financial Debt or other debt owing
by
it to any member of the Sellers’ Group other than the Intra-Group
Payables.
4. Regulatory matters
4.1 Licences
All
licences, consents, permissions and authorities which are material to the
carrying on by any Target Company of its business and which are required by
applicable law or
Page
44
regulation
to enable any Target Company to carry on its business and/or use its assets
effectively in the places and in the manner in which such business is now
carried on and/or assets are presently used (Licences)
have
been obtained by the relevant Target Company; the Disclosure Bundle contains
true and complete copies of each Licence; all Licences are in full force and
effect and have been complied with by the relevant Target Company in all
material respects; and so far as the Sellers are aware, there are no
circumstances indicating that any Licence is likely to be suspended, cancelled,
revoked or not renewed in the ordinary course.
4.2 Compliance
In
the
two year period preceding the date of this agreement:
(a) |
each
Target Company has conducted its business and corporate affairs in
accordance with its memorandum and articles of association, by-laws
or
other equivalent constitutional documents in its jurisdiction of
incorporation;
|
(b) |
each
Target Company has conducted its business and corporate affairs in
all
material respects in accordance with all applicable laws and regulations;
and
|
(c) |
there
has been no material default by any Target Company under any order,
decree
or judgment of any court or any Governmental Entity in any
jurisdiction.
|
4.3 Grants
and allowances
No
Target
Company has received any investment or other grants and allowances or loans
or
financial aid of any kind from any Governmental Entity on terms that such
grants, allowances, loans or financial aid may become repayable by any Target
Company after the date of this agreement.
5. The
Business Assets
For
the
purposes of this paragraph 5,
an
asset
shall
mean an asset which carries a value in the June 30 Accounts, has been acquired
by any Target Company since the Accounts Date or otherwise constitutes a
material (defined as any item having a replacement value of £50,000 or more)
item of operating plant and machinery used in the business of the Target
Companies, but does not include any of the Properties or any Intellectual
Property Rights owned or used by the Target Companies.
5.1 Ownership
and possession
The
assets are:
(a) |
the
absolute property of the Target Companies;
and
|
(b) |
in
the possession or under the control of the Target
Companies.
|
Page
45
5.2 Disposal
of assets
No
Target
Company has (outside the ordinary and normal course of business) disposed of,
or
agreed to dispose of, any asset.
5.3 Leasing
and hire purchase arrangements
No
Target
Company is a party to any lease, hire or hire purchase agreement in respect
of
any operating plant and machinery which requires a monthly lease, hire or rental
payment by such Target Company of more than £5,000 and has an original term of 6
months or more.
6. Contractual matters
6.1 Material contracts
(a) |
There
is not outstanding any agreement to which a Target Company is a party
which:
|
(i) |
by
virtue of the Proposed Transactions and the Transaction Documents,
will or
is likely to result in:
|
(A) |
any
other party being relieved of any material obligation or becoming
entitled
to exercise any material right (including any right of termination
or any
material right of pre-emption or other option);
or
|
(B) |
any
Target Company being in material default under any such
agreement.
|
(ii) |
was
entered into otherwise than in the ordinary course of business of
such
Target Company as carried on at the date of this agreement; or
|
(iii) |
is
not on arm’s length terms.
|
(b) |
The
Disclosure Bundle contains complete and up to date copies of each
contract
for the provision of services by a Target Company which provides
for
revenues of more than £500,000 per annum. Such contracts are all in force
and the copies thereof which are contained in the Disclosure Bundle
contain full details of the contractual termination date and of the
terms
of any renewals thereof.
|
6.2 Defaults
(a) |
No
Target Company has, in the two year period preceding the date of
this
agreement:
|
Page
46
(i) |
received
written notice that it is in material default under any material
contract;
or
|
(ii) |
given
written notice that any counterparty to any material contract is
in
material default under such material
contract.
|
(b) |
So
far as the Sellers are aware, no Target Company nor any counterparty
to
any material contract is in material breach of any material contract
which
remains unremedied.
|
For
the
purposes of this Warranty 6.2,
material
contract
means a
contract which provides for revenues of a Target Company in excess of £300,000
per annum or requires expenditure by a Target Company in excess of £100,000 per
annum (in the case of a contract with a term of less than one year or which
the
Target Company concerned may terminate on notice of one year or less) and
£50,000 per annum (in the case of any other contract requiring expenditure by
a
Target Company.
7. Insurance
7.1 Details
of existing insurances
(a) |
The
following documents contain particulars of all of the insurances
maintained by or covering each Target Company (the Insurances)
and the particulars of the Insurances contained in such documents
(taken
together) are complete and accurate in all material
respects:
|
(i) |
the
summary of group policies referred to at document number [ ] in the
Disclosure Bundle, the regional summaries for Europe and the USA
in
respect of the Target Companies referred to at document number [
] in the
Disclosure Bundle and local summaries for the United Kingdom, the
Netherlands, France and the United States of America referred to
at
document number [ ] in the Disclosure Bundle;
and
|
(ii) |
the
copy insurance policies referred to at document numbers [ ] to [
]
(inclusive) of the Disclosure
Bundle.
|
(b) |
The
list of claims loss runs referred to at document number [ ] in the
Disclosure Bundle is, in all material respects, a complete and accurate
record of the claims history of each Target Company in respect of
the
periods specified therein.
|
7.2 Insurance
claims
With
the
exception of claims referred to in the list of claims loss runs referred to
above, no Target Company (nor any member of the Sellers’ Group on behalf of any
Target Company) has made any claim in excess of £250,000 under any of the
Insurances which is still outstanding nor, so far as the Sellers are aware,
are
there any circumstances likely to give rise to such a claim.
Page
47
7.3 General
(a) |
Each
Target Company is an insured under each of the Insurances applicable
to it
as referred to in clause 7.1(a).
|
(b) |
Any
employer's liability and public liability policies listed in the
documents
mentioned in paragraphs 7.1(a)(i) and (ii) above but copies of which
are
not contained in the Disclosure Bundle are all written on an occurrence
basis.
|
(c) |
All
premiums invoiced in respect of the Insurances as at Closing have
been
paid and, so far as the Sellers are aware, nothing has been done
or
omitted to be done which has made or could make any of the Insurances
void
or voidable or adversely affect the ability of any of the Target
Companies
to make recovery from the Financial Services Compensation Scheme
where
appropriate.
|
(d) |
Any
deductible (or claim, if the amount of the claims is less than the
amount
of the deductible) requested by the relevant insurer to be paid in
respect
of full or partial settlements made by insurers prior to Closing
have been
reimbursed to insurers.
|
8. Litigation and investigations
8.1 Litigation
No
Target
Company is a claimant or defendant in or otherwise a party to any material
litigation, arbitration or administrative proceedings which are in progress
and,
so far as the Sellers are aware, there are no circumstances likely to lead
to
any such litigation, arbitration or administrative proceedings.
8.2 Investigations
No
Target
Company has in the two year period preceding the date of this agreement received
notice in writing that it is the subject of any investigation, inquiry or
prosecution by any Governmental Entity (other than investigations or inquiries
undertaken by a Governmental Entity on a routine basis) and, so far as the
Sellers are aware, there are no circumstances likely to lead to any such
investigation, inquiry or prosecution.
8.3 Court
orders
(a) |
There
are no unfulfilled or unsatisfied judgements or court orders outstanding
against any Target Company.
|
(b) |
No
distress, distraint, charging order, garnishee order, execution or
other
process which a court or a similar body may use to enforce payment
of a
debt has, during the two year period preceding the date of this agreement,
been levied or applied for in respect of the whole or any part of
the
property, assets or undertaking of any Target
Company.
|
Page
48
8.4 Competition
No
Target
Company is a party to (or concerned in) any agreement, arrangement, connected
practice or course of conduct which: (i) falls within Article 81 and/or Article
82 of the EC Treaty; or (ii) falls within Article 53 and/or Article 54 of the
Agreement on the European Economic Area; or (iii) falls within the prohibitions
contained in Chapter I or Chapter II of the Competition Act 1998 (UK); or (iv)
otherwise infringes the competition legislation or practice of any
jurisdiction.
9. Insolvency etc.
9.1 Winding
up
No
order
has been made, petition presented, meeting convened or resolution passed for
the
winding up of any of the Sellers or any Target Company or for the appointment
of
any provisional liquidator (or equivalent in the jurisdiction of its
incorporation) and no Target Company has received any notice under nor is it
or
could it be deemed unable to pay its debts for the purposes of Section 123
of
the Insolvency Act 1986 of the United Kingdom or any equivalent legislation
in
the jurisdiction of its incorporation.
9.2 Administration
and receivership
Neither
any of the Sellers nor any Target Company has received any written notice
concerning the appointment of a receiver (including any administrative receiver
or the equivalent to a receiver or administrative receiver in the relevant
jurisdiction) in respect of the whole or any part of the property, assets and/or
undertaking of any Target Company, nor has any distress, execution or other
process been levied in respect of a Target Company's undertaking or assets
or
any part thereof.
9.3 Voluntary
arrangement etc.
Neither
any of the Sellers nor any Target Company or any of their direct or indirect
holding companies has made or proposed any voluntary arrangement with any of
its
creditors under section 1 of the Insolvency Act 1986 of the United Kingdom
or
any equivalent legislation in the jurisdiction of its
incorporation.
9.4 Voidable
transactions
So
far as
the Sellers are aware, no Target Company has been a party to any transaction
with any third party which in the event of such third party going into
liquidation or an administration order or a bankruptcy order being made in
relation to it or to him, would be liable to be set aside (in whole or in part)
as a transaction at an undervalue or a preference.
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49
Part B IP/IT
1. Intellectual
Property Rights
(a) |
The
Disclosure Bundle contains copies of all material licences of Intellectual
Property Rights granted to and by
any Target Company (Material
IP Licences)
and neither any Target Company nor, so far as the Sellers are aware,
any
counterparty to a Material IP Licence, is in material breach of any
Material IP Licence.
|
(b) |
No
member of the Sellers’ Group owns any Intellectual Property Rights which
are licensed to any Target Company (whether formally or informally)
by any
member of the Sellers’ Group.
|
(c) |
Neither
the Sellers nor a Target Company has, in the two year period preceding
the
date of this agreement, received a written notice alleging that the
operations of any Target Company infringe the Intellectual Property
Rights
of a third party or sent a written notice alleging that a third party
is
infringing the Business IP and, so far as the Sellers are aware,
none of
the activities of any Target Company infringe any Intellectual Property
Rights of a third party.
|
(d) |
The
Business IP comprises all of the material Intellectual Property which
is
necessary for the operation of the business of each Target Company
as
carried on prior to Closing.
|
2. Information
Technology
(a) |
The
IT Systems are owned by, or licensed or leased to, a Target Company
and
comprise all of the material information and communication technologies
which are necessary for the operation of the business of such Target
Company as carried on prior to
Closing.
|
(b) |
Copies
or full details of all material licences and leases relating to the
IT
Systems have been disclosed in the Disclosure Bundle (Material
IT Licences)
and neither any Target Company nor, so far as the Sellers are aware,
any
counterparty to a Material IT Licence, is in material breach of such
Material IT Licence.
|
(c) |
None
of the IT Systems are dependant on any information and communication
technologies belonging to or used by any member of the Sellers’ Group,
save only that the Target Companies are party to Sellers’ Group
arrangements as specified in the Disclosure Letter (the Seller
Group IT arrangements).
The Sellers undertake (without the limitations referred to in Schedule
4)
to procure that such Seller Group IT arrangements continue to be
made
available to the Target Companies for not less than 12 weeks after
Closing, at a charge which shall be pro-rated according to the value
of
the contracts concerned and which shall be no greater than the amount
currently charged by the Seller’s Group to the Target Companies concerned,
and otherwise on the same terms as currently
apply.
|
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(d) |
In
the two year period preceding the date of this agreement, there have
been
no downtimes, equipment breakdowns or malfunctions, data losses,
failures
or other defects in the IT Systems which have had a material adverse
effect on the business of any of the Target Companies. So far as
the
Sellers are aware, there are no circumstances which are likely to
give
rise to any such disruption.
|
3. Data
Protection
No
Target
Company has, in the two year period preceding the date of this agreement,
received a written notice alleging that a Target Company has not complied with
applicable data protection laws.
Part C Real
Estate
1. General
(a) |
The
Properties comprise all the land and buildings owned, leased, controlled,
occupied or used by any Target Company or in relation to which any
Target
Company has any right, interest or
liability.
|
(b) |
The
information in respect of the Properties set out in Schedule 7
is
true, accurate and not misleading in any material
respect.
|
(c) |
So
far as the Sellers are aware, the Properties benefit from all necessary
rights and easements for the use and occupation of the Target Companies’
businesses.
|
2. Possession
and occupation
A
Target
Company is in possession of the whole of each of the Properties, none of which
is vacant, and no other person is in or actually or conditionally entitled
to
possession, occupation, use or control of any of the Properties subject, in
the
case of any Property which is leasehold, to the terms of the relevant lease
and,
in the case of any Property which is occupied under licence, to the terms of
the
relevant licence.
3. Title
(a) |
There
is no Encumbrance in or over or affecting any of the
Properties.
|
(b) |
No
Property is affected by a subsisting contract for sale or other
disposal.
|
(c) |
A
Target Company is the sole beneficial owner of, and otherwise absolutely
entitled to, each of the Properties and the proceeds of sale
thereof.
|
(d) |
No
Target Company has terminated, surrendered, assigned or otherwise
parted
with its interest in any of the Properties which are leasehold or
occupied
under licence and no Target Company has received notice from a
counterparty to any such lease or licence intending to terminate
any lease
or licence under which any such Property is leased or
occupied.
|
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51
(e) |
The
documents necessary to prove the relevant Target Company's title
to the
Properties are in the exclusive possession and control of the Target
Companies.
|
(f) |
Each
Target Company is in a position to sell or assign each freehold or
leasehold Property with full title guarantee save as identified in
Schedule 7
where no agreement is in place and subject to the terms of the relevant
lease (where appropriate).
|
(g) |
No
Dutch Target Company owns any real property in the Netherlands. No
Dutch
Target Company holds any rights in rem in respect of any real property
in
the Netherlands.
|
4. Adverse Interests
(a) |
None
of the Properties is subject to adverse rights, restrictions, covenants
or
any matter which materially adversely affects the relevant Target
Company’s ability to continue to carry on its existing business from any
Property in substantially the same manner as at
present.
|
(b) |
No
Target Company is in breach of any material covenant, restriction,
condition or obligation (whether statutory or otherwise) affecting
the
Properties.
|
5. Disputes
So
far as
the Sellers are aware, there are no current disputes, claims or demands relating
to or in respect of the Properties or their use.
6. Leasehold Properties
In
relation to such of the Properties as are leasehold (which includes tenancy
arrangements) or occupied under a licence:
(a) |
no
Target Company has received notice alleging any breach or default
of any
covenants, conditions and agreements contained in the relevant leases
and/or licences, on the part of the tenant or occupier (as the case
may
be);
|
(b) |
no
rent and/or licence fee is or could be currently under review;
and
|
(c) |
no
Target Company has commuted any rent or other payment or paid any
rent or
other payment ahead of the due date for payment;
|
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52
7. Use/Construction
(a) |
So
far as the Sellers are aware, all permissions and consents necessary
for
the proper and existing use of each of the Properties (including
planning
permission and zoning consents from the relevant authorities) have
been
obtained for any works carried out at the Properties and use of the
Properties.
|
(b) |
So
far as the Sellers are aware, there have been no infringements of
laws or
regulations concerning buildings, extensions, major alterations or
major
engineering works carried out, erected or made to any of the freehold
Properties within 12 years preceding the date of this
agreement.
|
Part D Taxation
Chapter
1: General
For
the
purposes of paragraph 4
of this
Part D, the expression VAT
legislation
shall
include the United Kingdom Value Added Tax Act 1994 and all other enactments
in
relation to VAT and all notices, provisions and conditions made or issued
thereunder, including the terms of any agreement reached with HM Commissioners
of Revenue and Customs. Paragraph 4
shall
apply, with appropriate modifications (including the definition of VAT
legislation), to any equivalent sales or turnover tax in any jurisdiction other
than the United Kingdom or the United States of America to which any Target
Company is subject.
1. Returns
Each
Target Company has duly, and within any appropriate time limits, made all
material returns and supplied all other material information required to be
supplied to all relevant tax authorities within the last six years, and any
such
returns and other information were and remain accurate in all material respects
and were made and supplied on a proper basis.
2. Disputes
and investigations
No
Target
Company is involved in any material current dispute with any tax authority
or is
or has in the last six years been the subject of any investigation or
non-routine visit by any tax authority, and no Target Company has become liable
to pay any penalty, surcharge, fine or interest in respect of tax where such
penalty, surcharge, fine or interest exceeds £50,000.
3. Residence
Each
Target Company is and has at all times in the last six years been resident
in
its country of incorporation for tax purposes and is not and has not at any
time
in that period been treated as resident in any other country’s jurisdiction for
any tax purpose (including any double taxation arrangement).
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53
4. Value
added tax
In
relation to each Target Company (other than the USA Companies, as defined in
the
Tax Covenant):
(a) |
it
is registered for the purposes of VAT, has been so registered at
all times
in the last six years that it has been required to be registered
by VAT
legislation, and such registration is not subject to any conditions
imposed by or agreed with the relevant tax
authority;
|
(b) |
it
has complied with and observed in all material respects the terms
of VAT
legislation in the last six years;
|
(c) |
it
is not routinely in arrears with any payment or returns
thereunder;
|
(d) |
it
has not been required by HM Commissioners of Customs and Excise (or
any
tax authority performing the same functions in a jurisdiction other
than
the United Kingdom or the United States of America) to give any
security;
|
(e) |
save
in the case of any French Company (as defined in the Tax Covenant),
it is
not, and has never been or agreed to be, an agent, manager, factor
or
representative for the purposes of section 47 or 48 of the United
Kingdom
Value Added Tax Act 1994 (or any equivalent legislation in a jurisdiction
other than France, the United Kingdom or the United States of America):
and
|
(f) |
in
the case of any French Company (as defined in the Tax Covenant),
it is not
jointly and severally liable to pay, pursuant to Article 289 A or
293 A of
the Xxxxxx xxxxxxx tax code (code général des impôts), any VAT due by
another taxable person.
|
5. Special
Arrangements
No
tax
authority has operated or agreed to operate any special arrangement (being
an
arrangement which is not based on relevant legislation or any published
practice) in relation to the affairs of any Target Company (other than any
USA
Company, as defined in the Tax Covenant).
6. Withholding
Save
as
disclosed in the Disclosure Letter with express reference to this warranty
6 of
this Part D of Schedule 3, no Target Company will be required to withhold or
account for any Tax (whether in its jurisdiction of incorporation or otherwise)
on the repayment of amounts due at Closing by that Target Company to any other
Target Company or member of the Seller’s Group and no Target Company has any
unsatisfied liability to account for or withhold tax on the repayment of any
such amount made or effected prior to Closing.
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54
7. Stamp
duty/capital duty
(a) |
All
documents in the possession or under the control of each Target Company
or
to the production of which any Target Company is entitled which establish
or are necessary to establish the title of any Target Company to
any
material asset, or by virtue of which any Target Company has any
material
right, have been duly stamped and any applicable stamp duties or
similar
duties or charges in respect of such documents have been duly accounted
for and paid.
|
(b) |
All
duties, fees and penalties payable in respect of the capital of each
Target Company (including any premium over nominal value at which
any
share was issued) have been duly accounted for and paid, and there
are no
circumstances under which any relief obtained against payment of
any such
amount could be withdrawn.
|
8. Records
and Information
Each
Target Company, or (in respect of a USA Company, as defined in the Tax Covenant)
the USA Seller (as defined in the Tax Covenant) is in possession and control
of
all material records and documentation that it is obliged to hold, preserve
and
retain for the purposes of any tax and of sufficient material information to
enable it to compute correctly its liability to tax insofar as it relates to
any
event occurring on or before Closing, and no interest or penalties shall arise
to any Target Company in respect of a failure to compute correctly such a
liability to tax as a result of a lack of sufficient information.
9. Continuing
Commitments
All
material sums payable under any contractual obligation incurred by any Target
Company prior to Closing and which will continue to bind the Target Company
after Closing (not being a commitment which the Target Company may lawfully
terminate on less than 30 days’ notice at any time after Closing without having
to pay any amount in the form of a penalty or break fee on such termination)
will be deductible in computing the profits of the Target Company for
corporation tax purposes, other than those contractual obligations which are
considered permanently non-deductible for U.S. federal income tax
purposes.
10. Transfer
Pricing
All
material transactions entered into between any Target Companies prior to Closing
and which will continue to have effect after Closing are on arm’s length
terms.
Chapter
2: United
Kingdom
For
the
purposes of this Chapter 2 of Part D, UK
Companies
means
Fourninezero Limited and Short Bros (Plant) Limited.
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55
11. United
Kingdom Grouping
(a) |
Neither
the execution nor the performance of, nor any action taken in pursuance
of, this agreement, nor any other event, transaction, act or omission
since the Accounts Date will result in any asset of a UK Company
being
deemed to have been disposed of and reacquired under section 179
of the
United Kingdom Taxation of Chargeable Gains Act 1992 or paragraph
58 of
Schedule 29 to the United Kingdom Finance Act
2002.
|
(b) |
The
Disclosure Letter gives full details of any surrender or claim of
any
amount by way of group relief by any UK Company, including any receipt
or
payment (or any entitlement to receive or obligation to make a payment)
in
respect thereof, where such surrender or claim has not become final
or
determined for any reason or has been the subject of a notice of
enquiry.
|
(c) |
Neither
UK Company is or has been treated as a member of a group for the
purposes
of VAT.
|
12. No
Non-UK Trade
Neither
UK Company carries on any trade or has any sources of income or profit outside
the United Kingdom or has in the last six years transferred part or all of
any
trade carried on outside the United Kingdom to a company not resident in the
United Kingdom pursuant to section 140A of the United Kingdom Taxation of
Chargeable Gains Act 1992.
13.
Stamp Duty
(a) |
Neither
UK Company has claimed any relief from stamp duty under section 42
of the
United Kingdom Finance Act 1930 which may be withdrawn under the
provisions of section 111 of and Schedule 34 to the United Kingdom
Finance
Act 2002 (whether as a result of Closing or any event occurring
thereafter).
|
(b) |
Neither
UK Company has claimed any relief from stamp duty under section 76
of the
United Kingdom Finance Act 1986 which may be withdrawn under the
provisions of section 113 of and Schedule 35 to the United Kingdom
Finance
Act 2002 (whether as a result of Closing or any event occurring
thereafter).
|
Chapter
3: United States of
America
For
the
purposes of this Chapter 3 of Part D, Closing
Date,
USA
Companies
and
USA
Company
have the
meanings given to them in the Tax Covenant.
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56
14. Returns
etc.
(a) |
No
adjustments relating to the tax returns (as defined in the Tax Covenant)
of any of the USA Companies have been proposed by any applicable
tax
authority that have not yet been
resolved.
|
(b) |
There
are no pending or, to the best of the Sellers’ knowledge, threatened
actions or proceedings for the assessment or collection of Taxes
against
any of the USA Companies that have not yet been
resolved.
|
(c) |
There
are no outstanding waivers or agreements extending the applicable
statute
of limitations for any period with respect to any Taxes of any of
the USA
Companies.
|
(d) |
No
tax authorities are presently conducting any audits or other examinations
of any tax returns (as defined in the Tax Covenant) of the USA
Companies.
|
(e) |
There
are no encumbrances for Taxes upon the assets or properties of any
of the
USA Companies except for statutory liens for Taxes not yet
due.
|
(f) |
None
of the USA Companies is a party to, is bound by, or has any obligation
under, any material Tax sharing agreement or material Tax indemnification
agreement, and none of the USA Companies have any potential liability
or
obligation to any person as a result of, or pursuant to any such
agreement, contract or arrangement.
|
(g) |
As
of the Closing Date, none of the USA Companies is required to include
in
income for a period beginning after the Closing Date any adjustment
pursuant to Section 481(a) of the U.S. Tax Code (or any similar or
corresponding provision or requirement of state, local or foreign
income
Tax law), by reason of the voluntary change in accounting method
(nor has
any taxing authority proposed any such adjustment or change of accounting
method) for a taxable period ending on or before the Closing
Date.
|
(h) |
No
closing agreements, private letter rulings, technical advice memoranda,
dispensations, concessions or similar agreements or rulings have
been
entered into or issued by any tax authority with respect to any of
the USA
Companies within five years of the date of this agreement that would
adversely affect the Taxes of the USA Companies for a period beginning
after the Closing Date (including, for these purposes, if the relevant
agreement, ruling, memorandum, arrangement or undertaking were withdrawn),
and no such agreement or ruling is currently
pending.
|
(i) |
Since
August 1, 2002, no claim has been made in writing in any jurisdiction
where any of the USA Companies does not file tax returns (as defined
in
the Tax Covenant) that any such entity is, or may be, subject to
Tax by
that jurisdiction.
|
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57
(j) |
No
USA Company will be required to include any material item of income
in, or
exclude any material item of deduction from, taxable income for any
taxable period (or portion thereof) ending after the Closing Date
as a
result of any:
|
(i) |
"closing
agreement" as described in Section 7121 of the U.S. Tax Code (or
any
corresponding or similar provision or state, local or foreign income
Tax
law) executed on or prior to the Closing
Date;
|
(ii) |
instalment
sale or open transaction disposition made on or prior to the Closing
Date;
or
|
(iii) |
prepaid
amount received on or prior to the Closing Date, other than in the
ordinary course of business.
|
(k) |
No
USA Company has distributed stock of another person, or has had its
stock
distributed by another person within the last two years, in a transaction
that was purported or intended to be governed in whole or in part
by
Section 355 or 361 of the U.S. Tax
Code.
|
Chapter
4: Netherlands
For
the
purposes of this Chapter 4 of Part D, Dutch
Companies
means
Brambles Steel Services B.V. and Xxxxxx Xxxxxxxx Transport B.V.
15. Mergers
None
of
the Dutch Companies has been involved in a business merger, share-for-share
merger, legal merger or legal demerger (split), including but not limited to
transactions within the meaning of the Articles 14, 14a or 14b of the
Netherlands Corporate Income Tax Act and/or 3.55, 3.56 or 3.57 of the
Netherlands Income Tax Act (or the predecessors of these articles under the
Netherlands Income Tax Act 1964).
16. Corporate
Income Tax
(a) |
All
losses, interest and other sums of an expense nature, paid, payable
or
accruable by any of the Dutch Target Companies and all sums payable
or
accruable under any obligation incurred by any Dutch Target Company
prior
to Closing and which will continue to bind any Dutch Target Company
after
Closing, will be deductible for the purposes of corporate income
tax,
either in computing the profits of any Dutch Company or in computing
the
corporate income tax chargeable on
it.
|
(b) |
None
of the Dutch Companies has formed a reinvestment reserve or an
equalisation reserve within the meaning of Article 3.53 of the 2001
Netherlands Income Tax Act (or the predecessors of this article under
the
Netherlands Income Tax Act 1964) or a reserve for self-insured risk
under
the Netherlands Income Tax Act
1964.
|
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58
(c) |
None
of the Dutch Companies has debt claims that are treated as equity
of such
Dutch Company for Tax purposes pursuant to section 10, subsection
1, under
d of the Netherlands Corporate Income Tax
Act.
|
(d) |
None
of the Dutch Companies has claimed any write-down by virtue of Article
13ca of the Netherlands Corporate Income Tax
Act.
|
(e) |
None
of the Dutch Companies has a participation (deelneming)
in an entity that is engaged in business activities outside the
Netherlands, where previously these activities were the activities
of this
or any company which was a member of the same group of companies
as the
relevant Dutch Company or any affiliate
thereof.
|
(f) |
In
case of a liquidation of any participation (deelneming)
of a Dutch Company, any Dutch Company that holds the shares in such
participation is entitled to a deductible loss for corporate income
tax
purposes equal to the difference between (i) the total, or the
proportionate part, as the case may be, of the liquidation proceeds
derived from the liquidation of such participation, minus the fair
market
value of the shares in any other participation that are a part of
such
liquidation proceeds, and (ii) the book value of that participation
as
shown in or adopted for the purposes of the relevant June 30
Accounts.
|
(g) |
None
of the Dutch Companies has made an election to report its taxable
income
for corporate income tax purposes in a currency other than Euro or
has
requested the tax inspector to bring an action that served to hedge
a
currency exchange risk on a participation, under the participation
exchange.
|
Chapter
5: France
For
the
purposes of this Chapter 5 of Part D, French
Companies
means
Becema SAS, Solomat Industrie SA, BC SAS, SMI Lorelev SAS and XX Xxxx
SAS.
17. French
tax
(a) |
Each
of the French Companies has duly, and within any appropriate time
limits,
complied with its obligations under Article 54 septies
of
the Xxxxxx xxxxxxx tax code (code
général des impôts).
|
(b) |
All
French Companies have duly complied with the provisions of Article
39 of
French law no. 2004-1485 and, in particular (but without limitation),
have
in due time complied with the relevant accounting requirements in
order to
avoid the application at the increased rate of 5% of the “exit tax”
introduced by such Article.
|
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59
Part E Environmental
Matters
1. compliance
with environmental laws
(a) |
Each
of the Target Companies has complied in all material respects with
all
Environmental Laws and Environmental Consents relating to any activities
or operations carried on by the Target Companies on or before the
date of
this agreement at any site owned or occupied by any Target Company
as at
the date of this agreement (an Existing
Site),
and no remedial action is required pursuant to any Environmental
Law in
relation to the release at any Existing Site of any Hazardous Substances
by any Target Company.
|
(b) |
So
far as the Sellers are aware, each of the Target Companies has complied
in
all material respects with all Environmental Laws relating to any
activities or operations carried on by the Target Companies on or
before
the date of this agreement at any site (other than an Existing Site)
owned
or occupied by any Target Company at any time during the 5 year period
preceding the date of this agreement and no remedial action is required
pursuant to any Environmental Law in relation to the release during
such
period at any such site of any Hazardous Substances by any Target
Company.
|
(c) |
No
material claims, investigations or proceedings have been made or
commenced, nor have any been communicated to a Target Company as
being
pending and nor, so far as the Sellers are aware, are any threatened
against any Target Company, with respect to any breach of Environmental
Laws or Environmental Consents, or the release of Hazardous Substances,
pollutants or wastes in the
Environment.
|
(d) |
No
written notices have been received by nor, so far as the Sellers
are
aware, have any written complaints been made against, any Target
Company
alleging or specifying any material breach of any Environmental Laws
or
Environmental Consents, or the release of Hazardous Substances, pollutants
or wastes into the Environment by such Target
Company.
|
2. environmental
consents
All
Environmental Consents which are material to and are required for the carrying
on of any activities by any Target Company have been obtained by the relevant
Target Company and are being complied with in all material respects; and so
far
as the Sellers are aware, there are no circumstances indicating that any such
material Environmental Consent is likely to be suspended, cancelled, revoked
or
not renewed in the ordinary course.
Part F Employment
1. Disclosure
The
Disclosure Letter has attached to it copies of the standard terms and conditions
of employment applicable to all categories of Employees of the Target Companies
and in
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60
relation
to all Employees earning total annual remuneration (excluding bonuses and
overtime) in excess of £30,000, the Disclosure Bundle contains true and accurate
particulars of their names, dates of continuous employment, including all
remuneration payable and other benefits provided or which any Target Company
is
bound to provide (whether now or in the future) to such Employee and includes
true and accurate particulars of all share option, profit sharing, incentive
and
bonus arrangements and any liquidated damages, change of control provisions
and/or enhanced redundancy or other severance schemes or practices (whether
contractual or custom and practice) to which any Target Company is a
party.
2. Termination
of Employment
No
Employee whose total annual remuneration (excluding bonuses) is in excess of
£40,000 has given or received written notice or, so far as the Sellers are
aware, threatened in writing to give notice terminating his employment and
no
person has been offered employment with an annual remuneration (excluding
bonuses) in excess of £40,000 commencing after Closing.
3. Service
Contracts
There
is
no service contract between any Target Company and any of its Employees which
cannot be terminated by the relevant Target Company on 3 months' notice or
less
to be given at any time without compensation being payable (other than statutory
redundancy pay) and no Employee will be entitled by reason of this transaction
to any one-off payment or to terminate his employment with any Target Company
on
other than his contractual notice.
4. Trades
Unions
(a) |
None
of the Target Companies is a party to, or has in the two year period
preceding the date of this agreement, received a formal request to
enter
into any agreement or arrangement with any trades union, works council
or
staff association.
|
(b) |
Brambles
Steel Services B.V. has in the last 2 years not received any claims
or
complaints in writing from any of its Employees regarding the fact
that
Brambles Steel Services B.V. does not have a works council within
the
meaning of the Dutch Works Council
Act.
|
5. US
Target Companies
(a) |
All
current employees of the US Target Companies are legally authorized
to
work in the United States. All US Target Companies have completed
and
retained the necessary employment verification paperwork under the
Immigration Reform and Control Act ("IRCA"), and all US Target Companies
have complied with the anti-discrimination provisions of
IRCA.
|
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61
(b) |
No
US Target Company has pending or has received written notice of intent
to
file any material unfair labor practice, charge or complaint or other
proceedings involving labor relations issues (including any union
organization or decertification activities, strikes or work stoppages
or
material grievances or arbitrations), nor has there been any such
activity
in the past two years.
|
6. Incentive
Schemes
No
Target
Company has, nor has any of them agreed to introduce, any share incentive
scheme, share option scheme or profit sharing, bonus, commission or other such
incentive scheme for any Employee or past employee of any of the Target
Companies.
7. Disputes
with Employees
There
is
no outstanding claim (including appeals and outstanding judgements) with a
potential liability in excess of £50,000 against any Target Company by any
person who is an Employee or has been an employee of any Target Company. The
Sellers are not aware of any circumstances that would give rise to such claim.
8. Records
Each
Target Company has maintained current records regarding the service of each
Employee and, to the extent required by law, in respect of every past employee
(including but not limited to details of the terms of employment, payments
of
statutory sick pay and maternity pay, disciplinary and grievance matters, health
and safety matters, income tax and social security contributions, wage and
time
records). Each
Target Company has made the appropriate filings with the relevant governmental
agencies in connection with any such records or their being maintained, or
has
been granted appropriate authorisations to maintain such records by the relevant
governmental agencies.
9. Payments
All
salary payments and other remuneration (including for the avoidance of doubt
but
without limitation pension contributions, insurance premiums, national insurance
contributions, income tax payments, bonuses and commission for all Employees
will be paid up to date as at Closing, excluding any such salary payments or
remuneration due in respect of the then current pay period and each Target
Company has accrued fully in the June 30 Accounts for all holiday pay due to
the
Employees.
10. Collective
Dismissals
No
dismissals of more than 20 employees in any period of 90 days have been carried
out by a Target Company within the two year period preceding the date of this
agreement.
Page
62
11. Increase
in Payments
No
Target
Company is a party to any agreement or arrangement or practice imposing a legal
obligation on it to increase the rates of remuneration or level of benefits
of
or to make any bonus or incentive payments or any benefits in kind or any
payments under a profit sharing scheme (or similar arrangement) to or on behalf
of any of its Employees or former or future employees whether now or at any
future date which would increase the annual overall payroll costs of the Target
Companies by more than 2% compared with the aggregate annual payroll costs
of
the Target Companies for the financial year which ended on 30 June 2005. No
Target Company is in negotiations with trade unions, works councils or any
staff
associations about the rates of remuneration or level of benefits affecting
10
per cent. or more of its Employees or future employees, nor are there any such
negotiations scheduled to take place or outstanding.
12. Unlawful
Discrimination
In
the
two year period preceding the date of this agreement, there has in relation
to
the Target Companies been no finding of, or recommendation in respect of,
unlawful discrimination made by an employment tribunal nor any investigation
by
any body responsible for investigating or enforcing matters relating to unlawful
discrimination.
13. Health
and Safety
In
the
two year period preceding the date of this agreement, no improvement or
prohibition notice has been served on any Target Company by any body responsible
for Health and Safety.
14. Industrial
Disputes
In
the
two year period preceding the date of this agreement, no Target Company has
been
involved in any strike, lock-out, go-slow, work-to-rule or other form of
industrial dispute and so far as the Sellers are aware there are no facts or
circumstances which might lead to any such industrial dispute.
15. Compliance
Each
Target Company has at all times complied in all material respects with its
obligations with regard to any Employee, any party to a collective bargaining
agreement or any works council and whether arising under law, any collective
bargaining agreement or any employment contract.
Page
63
Part G Retirement
Benefits
1. Definitions
Unless
otherwise defined in Schedule 13 ,
definitions used in this Part G are defined in paragraph 13.
2. Retirement
Benefits/Seller Plans
Other
than under the Seller Plans and the Industry-Wide Plans disclosed in the
Disclosure Letter (and any State Social Security Plans or mandatory
complementary plans in the relevant jurisdiction), neither the Sellers nor
any
Target Company nor any member of the Sellers’ Group provides or contributes to
or is liable or contingently liable to provide or contribute to the provision
of
Retirement Benefits for or in respect of any Employee or any former employee
or
director of any Target Company.
3. No
Proposals
Other
than as described in the Disclosure Letter, no proposal has been announced
and
no agreement has been made to establish any other arrangement for providing
any
Retirement Benefits for or in respect of any Employee, former employee or
director of any Target Company and the Sellers are not aware of any proposal
to
announce or enter into any such agreement.
4. Disclosure
of Documents
The
Disclosure
Bundle contains copies of all documents containing material provisions currently
governing each Seller Plan and all current announcements provided to Employees
and membership data relating to the Employees with respect to each Seller Plan
has been disclosed to the Purchaser. Each such disclosed document is true,
complete, accurate and contains no material inaccuracies, errors or
omissions.
5. Approval
Any
Seller Plan that is capable of Approval is Approved as at the date of this
agreement and, so far as the Sellers are aware, nothing has been done or omitted
to be done and there are no circumstances which would or might result in any
Seller Plan ceasing to have Approval.
6. Payments
in Respect of the Seller Plans
The
Disclosure Bundle contains full, up to date and accurate information as to
the
rates at which contributions (including insurance premiums) to each Seller
Plan
are paid.
Page
64
7. Due
Payment
All
amounts due to be paid to or in respect of the Seller Plans and/or to any State
Social Security Plan and/or to Industry-Wide Plan by any Target Company or,
in
respect of the Employees, any member of the Sellers’ Group on or before the date
of this agreement (including all insurance premiums, taxes and expenses) have
been duly paid in full on the due dates for such payments.
8. Disputes
and Investigations
Other
than routine claims for benefits, in respect of the Employees, there are, other
than as described in the Disclosure Letter, no actions, suits, claims, disputes,
complaints or proceedings outstanding, pending or threatened in writing against
any Seller Plan or, so far as the Sellers are aware, against the trustees,
managers, administrators, custodians or fiduciaries of any Seller Plan or
against any Target Company or member of the Sellers’ Group in respect of any act
or omission arising out of or in connection with any Seller Plan or
Industry-Wide Plan.
9. Life
Assurance
Except
as
disclosed in the Disclosure Letter, all benefits (other than refunds of
contributions) payable on death of an Employee are fully insured under a policy
effected with an insurance company.
10. Defined
Benefits
None
of
the Target Companies in the United Kingdom have in the past participated in
and
nor do any of the Target Companies have any unpaid liability in respect of
a
retirement benefit arrangement which provides Retirement Benefits on a defined
benefit basis and no assurance, promise or guarantee has been made to any
Employee, former employee or director of any Target Company of a particular
level or amount of benefits to be provided for or in respect of
him.
11. General
11.1 The
Target Companies have complied with their statutory obligations to provide
pension benefits or access to pension benefits to Employees, former employees
and directors of any Target Company.
11.2 The
Seller Plans are currently administered in all material respects in accordance
with the powers and provisions of their relevant governing documentation and
are
currently administered in accordance with and comply with all applicable
legislation and the general requirements of applicable laws, regulations or
requirements.
Page
65
12. Retiree
Medical/Death Benefits
12.1 Other
than as described in the Disclosure Letter, no US Target Company provides
welfare benefits, including, without limitation, death or medical benefits,
to
Employees, former employees or directors beyond termination of service or
retirement other than pursuant to coverage mandated by law.
13. Definitions
In
this
Part G:
Approval
means
approval or qualification by and/or due registration with the appropriate
taxation, social security, supervisory, fiscal or other applicable Governmental
Entities in the relevant state or jurisdiction, in order to obtain tax approved,
favoured or qualified status in the relevant jurisdiction, and Approved shall
be
construed accordingly;
funded in
relation to any Seller Plan, means that assets are accumulated under or in
respect of that plan before the corresponding benefits start being paid. For
the
purposes of this definition, assets
shall
mean assets which are separate from those of the employer and shall exclude
any
accounting or internal balance sheet provision;
Industry-Wide
Plan
means
any scheme, plan, fund or arrangement which provides Retirement Benefits to
or
in respect of Employees in which employers may participate even if they are
not
within the same corporate group as the other participating employers whether
under a collective bargaining agreement or otherwise;
Retirement
Benefit means
any
pension, allowance, lump sum, gratuity or similar benefit provided or to be
provided on or after retirement, death, disability or leaving service (whether
voluntary or not) in respect of an Employee’s employment. This does not include
post retirement medical and dental and other healthcare and welfare benefits,
termination indemnities and any benefits provided under an arrangement the
sole
purpose of which is to provide benefits on the accidental injury or death of
an
Employee;
Seller
Plan means,
in
any jurisdiction, any scheme, fund, arrangement, plan or agreement (whether
funded or unfunded) under which the Sellers, any member of the Sellers’ Group or
any Target Company provides, is liable or contingently liable to provide or
has
agreed to provide (or to which the Sellers, any member of the Sellers’ Group or
any Target Company contributes, is liable or contingently liable to contribute
or has agreed to contribute to the provision of) any Retirement Benefits for
or
in respect of any Employee but excluding any State Social Security Plan,
mandatory complementary pension plan or Industry-Wide Plan;
State
Social Security Plan
means
any Retirement Benefit plans that are operated by state entities to which the
Target Companies and/or, in respect of the Employees, the Sellers are required
to contribute under public laws, statutes or regulations; and
Page
66
unfunded
in
relation to any Seller Plan, means a Seller Plan which is not
funded.
Page
67
SCHEDULE 4
LIMITATIONS
ON LIABILITY
1. Time
Limits
The
Sellers shall not be liable for any Non-Tax Claim unless the Sellers receive
from the Purchaser written notice containing reasonably specific details of
the
Non-Tax Claim including the Purchaser’s estimate (on a without prejudice basis)
of the amount of such Non-Tax Claim:
(a) |
prior
to the expiry of two years next following the date of Closing, in
the case
of a Non-Tax Claim other than an Environmental Claim or a Title
Claim;
or
|
(b) |
prior
to the expiry of five years following the date of Closing, in the
case of
an Environmental Claim,
|
provided
that for the avoidance of doubt, no such limits as to time shall apply in
relation to a Title Claim.
2. Thresholds
for Claims
The
Sellers shall not be liable for:
(a) |
any
single Claim (other than a Claim for breach of the Warranty contained
in
paragraph 6 of Part D
of
Schedule 3 )
unless the amount of the liability pursuant to that single Claim
or claim
exceeds £50,000; for these purposes individual Claims arising from the
same, substantially the same or similar and related facts or circumstances
shall be aggregated to form one and the same Claim;
and
|
(b) |
any
single Claim (other than a Claim for breach of the Warranty contained
in
paragraph 6 of Part D
of
Schedule 3 )
unless the aggregate amount of the liability of the Sellers for all
such
Claims not excluded by sub-paragraph (a) exceeds £1,000,000 in which case
the Sellers shall be liable for all such Claims and not merely the
excess
over £1,000,000.
|
No
such
limit shall apply in relation to a Title Claim.
3. Claim
to be withdrawn unless litigation commenced
Any
Non-Tax Claim shall (if it has not been previously satisfied, settled or
withdrawn) be deemed to have been withdrawn unless legal proceedings in respect
of it have been commenced by both being issued and served within nine months
of
notice having been given by the Purchaser in accordance with paragraph
1
of this
Schedule 4
(except
where the Non-Tax Claim relates to a contingent liability in which case it
shall
be deemed to have been withdrawn unless legal proceedings in respect of it
have
been commenced by
Page
68
being
both issued and served within nine months of it having become an actual
liability). No new Non-Tax Claim may be made in respect of the facts, matters,
events or circumstances giving rise to any such withdrawn Non-Tax
Claim.
No
such
limit as to time shall apply in relation to a Title Claim.
4. Maximum
limit for all Claims
The
aggregate amount of the liability of each Seller shall not exceed:
(a) |
in
the case of all Claims (other than Title Claims and Tax Claims),
20 per cent. of the aggregate of the Unadjusted Prices for all Sets
of Shares;
|
(b) |
in
the case of Tax Claims, 50 per cent. of the aggregate of the
Unadjusted Prices for all Sets of Shares;
and
|
(c) |
in
the case of Title Claims, the aggregate of the Unadjusted Prices
for all
Sets of Shares,
|
provided
that in any event, the aggregate amount of the liability of each Seller for
all
Claims and all claims for breach of this agreement (other than in respect of
clause 9.2(b)) shall not exceed the aggregate of the Unadjusted Prices for
all
Sets of Shares.
5. Claims
only to be brought under relevant Warranties
The
Purchaser acknowledges and agrees that the only Warranties given in relation
to:
(a) |
taxation
or any related claims, liabilities or other matters (Tax
Matters)
are those set out in Part D
of
Schedule 3
and each of the other Warranties shall be deemed not to be given
in
relation to Tax Matters; and
|
(b) |
Environmental
Matters or any related claims, liabilities or other matters (Environmental
Related Matters)
are those set out in Part E
of
Schedule 3
and each of the other warranties shall de deemed not to be given
in
relation to Environmental Related
Matters,
|
provided
that the restrictions in this paragraph 5
shall
not apply in relation to any Claim for breach of the Warranty contained in
paragraph 8.1
of
Part A
of
Schedule 3 .
6. Matters
disclosed or taken into account in adjustments
The
Sellers shall not be liable for any Non-Tax Claim if and to the extent that
the
fact, matter, event or circumstance giving rise to such Non-Tax Claim is
disclosed, allowed, provided or reserved for in the June 30 Accounts or the
Closing Statement.
Page
69
7. Contingent
liabilities
If
any
Non-Tax Claim is based upon a liability which is contingent only, the Sellers
shall not be liable to make any payment unless and until such contingent
liability gives rise to an obligation to make a payment (but, subject as
provided in paragraph 1 of this Schedule 4 ,
without
prejudice to the right of the Purchaser to give notice of that Non-Tax Claim
and
to issue and serve proceedings in respect of it before such time).
8. No
liability for Non-Tax Claims arising from acts or omissions of
Purchaser
The
Sellers shall not be liable for any Non-Tax Claim which would not have arisen
but for any voluntary act, omission or transaction carried out:
(a) |
after
the date of this agreement by the Purchaser or any member of the
Purchaser
Group or its respective officers, employees or agents or successors
in
title; or
|
(b) |
before
Closing by any member of the Sellers’ Group or any Target Company at the
written direction or request of or on behalf of the Purchaser or
any
member of the Purchaser Group.
|
9. Nothing
to restrict Purchaser’s duty to mitigate
Nothing
in this Schedule 4
shall in
any way restrict or limit the general obligation at law of the Purchaser and,
following Closing, any member of the Purchaser Group to mitigate any loss or
damage which it may suffer in consequence of any breach by the Sellers of any
of
the Warranties or any fact, matter, event or circumstance likely to give rise
to
a Claim.
10. Recovery
from third parties
Where
the
Sellers have made a payment to the Purchaser in relation to any Non-Tax Claim
and the Purchaser or any member of the Purchaser Group has a right of
reimbursement against any other person in respect of the subject matter of
that
Non-Tax Claim, the Purchaser shall:
(a) |
promptly
notify the Sellers of that fact;
and
|
(b) |
provide
(or procure that any relevant member of the Purchaser Group provides)
such
information as the Sellers may reasonably require;
and
|
(c) |
take
(or procure that any relevant member of the Purchaser Group shall
take)
all steps or proceedings as the Sellers may reasonably require to
enforce
such right, provided that nothing in this paragraph 10
shall oblige the Purchaser to take or to procure that any other member
of
the Purchaser Group shall take any action or do anything which, in
the
reasonable opinion of the Purchaser, is likely to have a material
adverse
impact on the reputation or goodwill of any of the Target Companies
or of
any member of the Purchaser Group.
|
Page
70
If
the
Purchaser or any member of the Purchaser Group shall be reimbursed any amount
in
respect of the subject matter of that Non-Tax Claim, the Purchaser shall
immediately pay the Sellers an amount equal to the amount reimbursed less any
reasonable costs of recovery. Thereafter, that Non-Tax Claim shall be limited
(in addition to the limitations on the liability of the Sellers referred to
in
this Schedule 4 )
to the
amount by which the loss or damage suffered by the Purchaser as a result of
such
breach exceeds the amount so recovered.
11. Sums
or benefits received by Purchaser
Without
prejudice to paragraph 10
of this
Schedule 4 ,
this
paragraph shall apply if the Sellers make any payment to the Purchaser in
relation to any Non-Tax Claim (the Damages
Payment)
and the
Purchaser or any member of the Purchaser Group receives any sum or benefit
otherwise than from the Sellers or any member of the Sellers’ Group (whether by
payment, discount, credit, relief or otherwise including from any tax authority)
which would not have been received but for the circumstance giving rise to
that
Non-Tax Claim. The Purchaser shall (or shall procure that the relevant member
of
the Purchaser Group shall), once it or the relevant member of the Purchaser
Group has received such sum or benefit, immediately repay to the Sellers
an
amount
equal to such
sum
or benefit (net of taxation thereon and reasonable costs of recovery) or, if
less, the Damages Payment (except to the extent that the amount of such sum
or
benefit has been taken into account in calculations in the Damages Payment
pursuant to clause 11.5).
12. Claims
which would have been covered by Sellers’ insurance
The
Sellers shall not be liable in respect of any Non-Tax Claim to the extent that
the amount of such Non-Tax Claim is covered by any Insurance in force at the
date of this agreement to the extent that such policy is a “claims made”
insurance rather than an “occurrence” insurance, and would have continued to be
so covered if such Insurance, to the extent it was effected by or for the
benefit of the Target Companies, had been maintained after Closing on no less
favourable terms than those existing at the date of this agreement.
13. No
liability for legislation or changes in rates of tax
The
Sellers shall not be liable for any Non-Tax Claim if and to the extent it is
attributable to or the amount of such Non-Tax Claim is increased as a result
of:
(a) |
any
legislation not in force at the date of this
agreement;
|
(a) |
any
change of law (or any change in interpretation on the basis of case
law),
regulation, directive, requirement or administrative practice which
takes
effect retroactively; or
|
(b) |
any
change in the rates of taxation in force at the date of this
agreement.
|
Page
71
14. No
double recovery
The
Purchaser shall not be entitled to recover damages or obtain payment,
reimbursement, restitution or indemnity more than once in respect of any one
liability, loss, cost, shortfall, damage, deficiency, breach or other set of
circumstances which gives rise to more than one Claim.
15. Purchaser’s
knowledge
The
Sellers shall not be liable for any Claim if and to the extent that the
Purchaser is actually aware at the date of this agreement:
(a) |
of
the fact, matter, event or circumstance which is the subject matter
of the
Claim; and
|
(b) |
that
the fact, matter, event or circumstance could amount to a
Claim.
|
16. Sellers
to have opportunity to remedy breaches
A
breach
of the Warranties which is capable of remedy shall not entitle the Purchaser
to
compensation unless the Sellers are given written notice of the breach by the
Purchaser and such breach is not remedied within thirty (30) days after the
date
on which such notice is served on the Sellers.
Page
72
SCHEDULE 5
PURCHASER
WARRANTIES
1. The
Purchaser is validly incorporated, in existence and duly registered under the
laws of its jurisdiction and has full power to conduct its business as conducted
at the date of this agreement.
2. The
Purchaser has obtained all corporate authorisations and all other applicable
governmental, statutory, regulatory or other consents, licences, authorisations,
waivers or exemptions (Approvals)
required to empower it to enter into and perform its obligations under this
agreement and any other Transaction Document to which it is a party where
failure to obtain such Approval would adversely affect its ability to enter
into
or perform its obligations under this agreement or the other Transaction
Documents in accordance with their terms.
3. This
agreement and the other Transaction Documents which are to be entered into
by
the Purchaser will, when executed, constitute valid and binding obligations
of
the Purchaser.
4. Entry
into and performance by the Purchaser of this agreement and/or any other
Transaction Document to which it is a party will not breach the provisions
of
its memorandum and articles of association, certificate of incorporation,
by-laws or equivalent constitutional documents in its jurisdiction of
incorporation where such breach would adversely affect its ability to enter
into
or perform its obligations under this agreement and/or any other Transaction
Document to which it is a party in accordance with their terms.
5. Neither
entry by the Purchaser into this agreement nor entry into, and implementation
of, the Proposed Transactions by the Purchaser will:
(a) |
result
in a breach of any applicable laws or regulations in its jurisdiction
of
incorporation; or
|
(b) |
amount
to a breach of any order, decree or judgment of any court or any
Governmental Entity in its jurisdiction of
incorporation,
|
where,
in
each case, such breach would adversely affect its ability to enter into or
perform its obligations under this agreement and/or any other Transaction
Document to which it is a party.
6. Neither
entry into this agreement nor entry into, and implementation of, the Proposed
Transactions will result in a requirement for the Purchaser to obtain any
consent or approval, or give any notice to or make any registration with, any
Governmental Entity which has not been obtained or made as at the date of this
agreement.
Page
73
7. No
order
has been made, petition presented or meeting convened for the winding up of
the
Purchaser or any of its direct or indirect holding companies, or for the
appointment of any provisional liquidator or equivalent in their respective
jurisdictions of incorporation (or other process whereby the business is
terminated and the assets of the company concerned are distributed amongst
the
creditors and/or shareholders or other contributors), and there are no cases
or
proceedings under any applicable insolvency, reorganisation or similar laws
in
any relevant jurisdiction, and no events have occurred which, under applicable
laws, would justify any such cases or proceedings.
8. Neither
the Purchaser nor any member of the Purchaser Group is subject to any order,
judgment, direction, investigation or other proceedings by any Governmental
Entity which would adversely affect the Purchaser’s ability to enter into or
perform its obligations under this agreement and/or any other Transaction
Document to which it is a party in accordance with their terms.
Page
74
SCHEDULE 6
CLOSING
ARRANGEMENTS
Part A Closing
Obligations
Sellers’
Obligations
1. The
Sellers shall deliver or procure that there is delivered to the Purchaser (or
made available to the Purchaser’s reasonable satisfaction):
(a) |
duly
executed transfers or stock powers into the name of the Purchaser
(or its
nominees) in respect of all the Shares;
|
(b) |
the
share certificates or equivalent documents in any applicable jurisdiction
relating to all the Shares and all the shares in any Subsidiary in
respect
of which certificates were issued or are required by law to be issued
and,
in the case of share certificates in respect of any Shares where
endorsement of share certificates is required to validly transfer
the
Shares concerned, such certificates being properly endorsed so as
to
transfer the Shares to the Purchaser (or its
nominees);
|
(c) |
in
respect of each Target Company, the certificate of incorporation,
common
seal (if it exists), share register, shareholders' register or stock
ledger, share transfer register, memorandum and articles of association,
bye laws and share certificate book (with any unissued share certificates)
and all minute books and other statutory books (which shall be written
up
to but not including Closing) or such equivalent items in the relevant
jurisdiction as are kept by the relevant Target
Company;
|
(d) |
in
respect of SMI Lorelev SAS, a certified copy of the minutes of a
general
shareholders' meeting held prior to Closing approving the transfer
by
Brambles France SAS to the Purchaser of all the Shares of SMI Lorelev
SAS
owned by Brambles France SAS, in accordance with the provisions of
the
by-laws of SMI Lorelev SAS;
|
(e) |
a
certified copy of a notice sent by registered letter with acknowledgement
of receipt requested to SGA SAS by Brambles France SAS prior to Closing,
advising SGA SAS of the change of control of Solomat Industrie SA
in
accordance with Section 20.4 of the subcontracting agreement entered
into
between Solomat Industrie SA and SGA SAS on April 16,
2004;
|
(f) |
a
letter of resignation in the Agreed Form duly executed by each of
the
directors and legal representatives listed in Part B
of
this Schedule 6
in
respect of their respective positions as directors or legal
representatives of the Target Companies set out opposite their respective
names;
|
Page
75
(g) |
a
copy (certified by a duly appointed officer as true and correct)
of a
written resolution of the board of directors of each of Brambles
Steel
Services B.V. and Xxxxxx Xxxxxxxx Transport B.V. terminating the
general
proxies of Xx X.X. Xxxxxx and Xx X.X. Xxxxx
respectively;
|
(h) |
a
letter of resignation in the Agreed Form duly executed by each of
the
company secretaries listed in Part C
of
this Schedule 6
in
respect of their position as company secretary of the Target Companies
set
out opposite their respective names;
|
(i) |
a
copy (certified by a duly appointed officer as true and correct)
of a
resolution of the board of directors of each Seller or a formal decision
of any other duly authorised appropriate legal representative (or,
if
required by the law of its jurisdiction or its articles of association,
by-laws or equivalent constitutional documents, of its shareholders)
authorising the execution of and the performance by that Seller of
its
obligations under this agreement and each of the other Transaction
Documents to be executed by it;
|
(j) |
irrevocable
powers of attorney in the Agreed Form executed by the registered
holder of
the Shares in Fourninezero Limited authorising the Purchaser or its
nominees to exercise all voting and other rights attaching to the
Shares
until registration of the Purchaser or such nominees as the holder(s)
thereof;
|
(k) |
a
letter to each of the bankers of the Target Companies in the Agreed
Form,
signed by sufficient duly authorised signatories, cancelling the
existing
mandates of the Target Companies in respect of any directors who
are not
Employees; and
|
(l) |
a
copy of the minutes of the meetings of the workers' councils of each
of
Solomat Industrie SA, SMI Lorelev SAS and XX Xxxx SAS clearly stating
that
their advice referred to in paragraph 1.1(d)(i) of Part A
of
Schedule 3
has been provided;
|
(m) |
a
good standing certificate for each of the US Target Companies;
and
|
(n) |
a
certified copy of a signed tax group exit agreement (convention de
sortie
d'intégration fiscale) between Brambles France SAS and the French
Companies (as defined in the Tax
Covenant).
|
2. The
Sellers shall procure that at or before Closing, a meeting of the board of
directors of each UK Target Company is held at which:
(a) |
the
resignations of the directors and company secretary of such UK Target
Company referred to in paragraph 1 above shall be accepted and the
persons
listed opposite the name of such UK Target Company in Part D
and Part E
of
this Schedule 6
shall be appointed directors and the company secretary respectively
|
Page
76
of
such UK Target Company, such resignations
and appointments to take effect from Closing;
and
|
(b) |
in
the case of Fourninezero Limited, the transfer of the Shares of
Fourninezero Limited shall be approved for registration subject only
to
Closing having occurred and such transfers having been duly
stamped.
|
Purchaser
Obligations
3. The
Purchaser shall:
(a) |
deliver
(or procure that there is delivered) to the Sellers a copy of a resolution
(certified by a duly appointed officer as true and correct) of the
board
authorising the execution of and the performance by the Purchaser
of its
obligations under this agreement and each of the other Transaction
Documents to be executed by it; and
|
(b) |
pay
to each Seller an amount equal to the Initial Price for that Seller’s Set
of Shares in accordance with clause 2.2(b)(i).
The payment in respect of the French Set of Shares shall be made
as agent
for the French Principal, the payment in respect of the UK Set of
Shares
shall be made as agent for the UK Principal and the payment in respect
of
the Dutch Set of Shares shall be made as agent for the Dutch
Principal.
|
General
4. The
Sellers and the Purchaser shall execute and deliver to each other (or shall
procure that their respective Affiliates named as parties thereto execute and
deliver) a short form agreement (acte
réiteratif)
in the
Agreed Form for French transfer tax purposes only entered into between Brambles
UK, Brambles France, Brambles USA, MultiServ Group Limited, MultiServ France
SA
and the Purchaser.
5. Brambles
Holdings Europe and the Dutch Principal shall, and Brambles Holdings Europe
shall procure that Brambles Steel Services B.V. shall, effect the transfer
of
the Shares in Brambles Steel Services B.V. by means of the execution of a
notarial deed of sale and transfer in the Agreed Form in the presence of Xx.
Xxxxxx Xxxxxxx, civil law notary (notaris)
of
Freshfields Bruckhaus Xxxxxxxx, officiating in Amsterdam, or a substitute civil
law notary (notaris)
nominated by him (the Notary).
For
this purpose, Brambles Holdings Europe and the Dutch Principal shall, and
Brambles Holdings Europe shall procure that Brambles Steel Services B.V. shall,
deliver to the Notary duly executed powers of attorney in the Agreed
Form.
6. With
reference to the Guidelines adopted by the Royal Notarial Professional
Organisation ("Koninklijke
Notariële Beroepsorganisatie")
concerning forms of cooperation between civil law notaries among themselves
or
with attorneys, the Purchaser expressly agrees that Freshfields Bruckhaus
Xxxxxxxx may advise the Sellers in connection with, and may act on behalf of
the
Sellers with
respect to this agreement and
Page
77
the
Proposed Transactions, and any agreements and/or any disputes related to or
resulting from this agreement and/or the Proposed Transactions.
7. All
documents and items delivered at Closing pursuant to this 1
shall be
held by the recipient to the order of the person delivering the same until
such
time as Closing shall be deemed to have taken place in accordance with
paragraph 8
below.
8. Simultaneously
with:
(a) |
delivery
of all documents or items required to be delivered at Closing (or
waiver
of the delivery thereof by the person entitled to receive the relevant
document or item);
|
(b) |
receipt
of electronic funds transfers to the bank accounts required by clause
14.1
in
immediately available funds of the Initial
Price payable in respect of each Set of Shares;
and
|
(c) |
compliance
with paragraph 9
below,
|
the
documents and items delivered in accordance with this Schedule 6 shall
cease to be held to the order of the person delivering the same and Closing
shall be deemed to have taken place.
9. At
Closing, the Sellers and the Purchaser shall carry out their respective
obligations pursuant to clause 7
(Payment
of Intra-Group Debt).
Page
78
Part B Directors/Chairmen
Required to Resign
Director/Chairman
Name
|
Target
Company
|
Jurisdiction
of incorporation
|
Xxxx
Xxxxx Xxxxxxx
|
Xxxxxxxxxxxx
Limited
|
England
and Wales
|
Short
Bros (Plant) Limited
|
England
and Wales
|
|
Solomat
Industrie SA
|
France
|
|
Brambles
France SAS
|
Becema
SAS
|
France
|
BC
SAS
|
France
|
|
SMI
Lorelev SAS
|
France
|
|
XX
Xxxx SAS
|
France
|
|
Solomat
Industrie SA
|
France
|
|
Xxx
Xxxxxxxx
|
Brambles
Steel Services, Inc.
|
Delaware,
U.S.A.
|
National
Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
Great
Lakes Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
E.C.R.,
Inc.
|
Delaware,
U.S.A.
|
|
Braddock
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
Ashland
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
National
Briquette Corporation
|
Delaware,
U.S.A.
|
|
Solomat
Industrie SA
|
France
|
|
Xxxxxxx
Xxxxxxx
|
Brambles
Steel Services, Inc.
|
Delaware,
U.S.A.
|
National
Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
Great
Lakes Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
Page
79
E.C.R.,
Inc.
|
Delaware,
U.S.A.
|
|
Braddock
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
Ashland
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
National
Briquette Corporation
|
Delaware,
U.S.A.
|
|
Xxxxxx
Xxxxxx III
|
Brambles
Steel Services, Inc.
|
Delaware,
U.S.A.
|
National
Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
Great
Lakes Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
E.C.R.,
Inc.
|
Delaware,
U.S.A.
|
|
Braddock
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
Ashland
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
National
Briquette Corporation
|
Delaware,
U.S.A.
|
|
Xxxxx
Xxxxx Xxxxxxxxx
|
Short
Bros (Plant) Limited
|
England
and Wales
|
TMF
Operating
|
Solomat
Industrie SA
|
France
|
Xxxxxxx
Xxxxxxxx
|
Solomat
Industrie SA
|
France
|
Xxxxx
Xxxxxxx
|
Solomat
Industrie SA
|
France
|
Part C Company
Secretaries Required to Resign
Secretary
Name
|
Target
Company
|
Jurisdiction
of incorporation
|
Xxxxx
Xxxx Xxxxxxx Xxxxxxx
|
Fourninezero
Limited
|
England
and Wales
|
Short
Bros (Plant) Limited
|
England
and Wales
|
|
Xxxxxx
Xxxxxx III
|
Brambles
Steel Services, Inc.
|
Delaware,
U.S.A.
|
National
Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
Page
80
Great
Lakes Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
E.C.R.,
Inc.
|
Delaware,
U.S.A.
|
|
Braddock
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
Ashland
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
National
Briquette Corporation
|
Delaware,
U.S.A.
|
Page
81
Part D Directors/Chairmen
Required to be Appointed
Director/Chairman
Name
|
Target
Company
|
Jurisdiction
of incorporation
|
Xxxxxxxxx
X Xxxxxxxxx
|
Brambles
Steel Services, Inc.
|
Delaware,
U.S.A.
|
National
Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
Great
Lakes Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
E.C.R.,
Inc.
|
Delaware,
U.S.A.
|
|
Braddock
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
Ashland
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
National
Briquette Corporation
|
Delaware,
U.S.A.
|
|
Xxxxxxx
X Xxxxxxxx
|
Brambles
Steel Services, Inc.
|
Delaware,
U.S.A.
|
National
Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
Great
Lakes Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
E.C.R.,
Inc.
|
Delaware,
U.S.A.
|
|
Braddock
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
Ashland
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
National
Briquette Corporation
|
Delaware,
U.S.A.
|
|
Xxxxxxx
Xxxxxxx
|
Brambles
Steel Services, Inc.
|
Delaware,
U.S.A.
|
National
Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
Great
Lakes Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
|
E.C.R.,
Inc.
|
Delaware,
U.S.A.
|
|
Braddock
Recovery, Inc.
|
Delaware,
U.S.A.
|
Page
82
Ashland
Recovery, Inc.
|
Delaware,
U.S.A.
|
|
National
Briquette Corporation
|
Delaware,
U.S.A.
|
|
Xxxx
Xxxxxxxxx
|
Fourninezero
Limited
|
England
and Wales
|
Short
Bros (Plant) Limited
|
England
and Wales
|
|
Xxxxxxx
Xxxxx
|
Becema
SAS
|
France
|
BC
SAS
|
France
|
|
SMI
Lorelev SAS
|
France
|
|
XX
Xxxx SAS
|
France
|
|
Solomat
Industrie SA
|
France
|
|
Xxxx
Xxxxxxxxxxx
|
Brambles
Steel Services B.V.
|
Netherlands
|
Part B Company
Secretaries Required to be Appointed
Secretary
Name
|
Target
Company
|
Jurisdiction
of incorporation
|
Xxxxx
XxxXxxxxx
|
Xxxxxxxxxxxx
Limited
|
England
and Wales
|
Short
Bros (Plant) Limited
|
England
and Wales
|
|
Xxxx
X Xxxxxx
|
Brambles
Steel Services, Inc.
|
Delaware,
U.S.A.
|
Xxxx
X Xxxxxx
|
National
Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
Xxxx
X Xxxxxx
|
Great
Lakes Recovery Systems, Inc.
|
Delaware,
U.S.A.
|
Xxxx
X Xxxxxx
|
E.C.R.,
Inc.
|
Delaware,
U.S.A.
|
Xxxx
X Xxxxxx
|
Xxxxxxxx
Recovery, Inc.
|
Delaware,
U.S.A.
|
Xxxx
X Xxxxxx
|
Ashland
Recovery, Inc.
|
Delaware,
U.S.A.
|
Xxxx
X Xxxxxx
|
National
Briquette Corporation
|
Delaware,
U.S.A.
|
Page
83
SCHEDULE 7
PROPERTIES
Part A
United
Kingdom
Property
Address
|
Legal
Owner
|
Title
Number
|
Freehold
/ Leasehold
|
Lease
Date
|
Original
parties
|
Lease
Term
|
Rent
|
MR
Xxxxxxxx
Queensway
Llanwern
aka
Metal Recovery Heckett Site
|
Short
Bros (Plant) Limited
|
N/A
|
Informal
arrangement
|
N/A
|
Corus
UK Limited (1) Short Bros (Plant) Limited (2)
|
N/A
|
None
|
Blue
Buildings
Xxxxxxxxx
Xxxx Port Xxxxxx
|
Short
Bros (Plant) Limited
|
WA541630
|
Freehold
|
N/A
|
N/A
|
N/A
|
N/A
|
Yard
at Xxxxxxxxx’x Xxxx Port Xxxxxx (UKLHP)
|
Short
Bros (Plant) Limited
|
Leasehold
|
|||||
MR
Offices and Workshop Port Talbot (UKLHP)
|
Short
Bros (Plant) Limited
|
N/A
|
Leasehold
Lease - unsigned
|
N/A
|
Corus
UK Limited (1) Short Bros (Plant) Limited (2)
|
No
information
|
None
|
Slab
Offices and Workshop Port Talbot (UKLHP)
|
Short
Bros (Plant) Limited
|
N/A
|
Leasehold
|
N/A
|
Corus
UK Limited (1) Short Bros (Plant) Limited (2)
|
No
information
|
None
|
00
Xxxxx Xxxx Scunthorpe
|
Short
Bros (Plant) Limited
|
HS95696
|
Leasehold
|
6
May 1974
|
1.
The Council of the Borough of Scunthorpe
|
90
Years
|
[·]
|
Page
84
Property
Address
|
Legal
Owner
|
Title
Number
|
Freehold
/ Leasehold
|
Lease
Date
|
Original
parties
|
Lease
Term
|
Rent
|
2.
British Steel Corporation
|
|||||||
Old
Docks Road Port Talbot (UKLHP)
|
Short
Bros (Plant) Limited
|
N/A
|
Leasehold
|
30
September 1997
|
Associated
British Ports (1) Short Bros (Plant) Limited (2)
|
21
years expiring 24 March 2018
|
£6,000
pa
|
Anode
Cast House
Tristre
Works Llanelli (UKLHP)
|
Short
Bros (Plant) Limited
|
N/A
|
Leasehold
|
Undated,
unsigned
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
5
years from 13 January 2003
|
£1
pa
|
Harbour
Office Sinter Plant Port Talbot
|
Short
Bros (Plant) Limited
|
N/A
|
Licence
(not completed)
|
N/A
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
No
information
|
£25.00
per month
|
Bos
Plant Drum Filter House Port Talbot
|
Short
Bros (Plant) Limited
|
N/A
|
Informal
arrangement
|
N/A
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
Contract
runs to 1 November 2011
|
|
Briquetting
Plant, VLN Building Port Talbot
|
Short
Bros (Plant) Limited
|
N/A
|
Provided
under service contract
|
2
May 1996
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
Contract
runs to 1 November 2011
|
None
|
Grange
Coke Ovens Port Talbot
|
Short
Bros (Plant) Limited
|
N/A
|
Licence
|
No
information
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
No
information
|
£25.00
per month
|
Page
85
Property
Address
|
Legal
Owner
|
Title
Number
|
Freehold
/ Leasehold
|
Lease
Date
|
Original
parties
|
Lease
Term
|
Rent
|
Morfa
Bank Port Talbot
|
Short
Bros (Plant) Limited
|
N/A
|
Licence,
not signed
|
January
1984
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
No
information
|
|
Contractors
Compound garage Unit D Port Talbot
|
Short
Bros (Plant) Limited
|
N/A
|
Licence
|
No
information
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
No
information
|
£25.00
per month
|
Line
C Trostre
|
Short
Bros (Plant) Limited
|
N/A
|
Licence
|
2002
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
Perpetually
renewable
|
£40
per month
|
Corby
Business Unit
|
Short
Bros (Plant) Limited
|
N/A
|
Provided
under service contract
|
Start
of contract
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
End
of service contract
|
None
|
Shotton
Business Unit
|
Short
Bros (Plant) Limited
|
N/A
|
Informal
agreement
|
Possible
start of contract
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
End
of service contract
|
None
|
Scunthorpe
Coke Processing Plant
|
Short
Bros (Plant) Limited
|
N/A
|
Provided
under service contract
|
Start
of contract
|
Corus
UK Limited (1)
Short
Bros (Plant) Limited(2)
|
End
of service contract
|
None
|
Page
86
Property
Address
|
Legal
Owner
|
Title
Number
|
Freehold
/ Leasehold
|
Lease
Date
|
Original
parties
|
Lease
Term
|
Rent
|
Teeside
OC4
|
Short
Bros (Plant) Limited
|
N/A
|
Provided
under service contract
|
Start
of contract
|
Teeside
Cast Products (1) Brambles Industries Limited (2)
|
End
of contract
|
None
|
Southbank
workshop facility
|
Short
Bros (Plant) Limited
|
N/A
|
Provided
under service contract
|
Start
of contract
|
Teeside
Cast Products (1) Brambles Industries Limited (2)
|
End
of contract
|
None
|
Lletty
Xxxxxx Tip Cwm Cynon Mouintain Ash
|
Short
Bros (Plant) Limited
|
N/A
|
Page
87
Part B
France
Property
Address
|
Legal
Owner
|
Title
Number
|
Freehold
/ Leasehold
|
Lease
Date
|
Original
parties
|
Lease
Term
|
Rent
|
0,
xxx Xxxxxxx Xxxxxxx
Xxxx
Xxxxxxxxxxxx
00000
Grande Synthe
=
land
|
BC
|
Lot
16, section C n° 1699 & 1703
|
Freehold
|
N/A
|
N/A
|
N/A
|
N/A
|
0,
xxx Xxxxxxx Xxxxxxx
Xxxx
Xxxxxxxxxxxx
00000
Grande Synthe
=building
(Portakabin) + leasehold improvements
|
Solomat
|
Freehold
|
N/A
|
N/A
|
N/A
|
N/A
|
|
19,
bvd de la Mérindole
la
Grand Colle
00000
Xxxx xx Xxxx
=
land + building
|
BC
|
Lot
19 A Section B 1429 Grand Colle Haut
|
Freehold
|
N/A
|
N/A
|
N/A
|
N/A
|
000X,
xxxxx xx Xxxxxx
00000
Terville
=building
|
BC
|
Section
9
N°
207/91
Bitterfeld
|
Freehold
|
N/A
|
N/A
|
N/A
|
N/A
|
201A,
route de Verdun
57180
Terville
=land
|
BC
|
Ban
de Terville Ft 1751
section
9
N°
167/75, 208/91, 234/80, 335/102, 341/74 Bitterfeld
|
Freehold
|
N/A
|
N/A
|
N/A
|
N/A
|
Page
88
Part C
Netherlands
Property
Address
|
Legal
Owner
|
Title
Number
|
Freehold
/ Leasehold
|
Lease
Date
|
Original
parties
|
Lease
Term
|
Rent
|
Xxxxxxxxxxxxxxxx
0 aannemerscentrum
6E-01
1951
JZ Velsen-Noord
Netherlands
|
Corus
Staal BV
|
Locally
known under number: 26/60/61/SP2368
|
Leasehold
[“License
to establish a business”]
|
“License
to establish a business” granted by Corus Staal BV on 1 January
1993
|
Corus
Staal B.V.
|
“License
to establish a business” expires on 1 January 2006, can be renewed for
periods of one year
|
For
2005:
EUR
84,091.12 (ex Dutch VAT)
|
Page
89
Part D
United
States of America
Property
Address
|
Legal
Owner
|
Property
Number
|
Freehold
/ Leasehold
|
Lease
Date
|
Original
parties
|
Lease
Term
|
Rent
|
0000
Xxxxxxxxxxxx Xxxx, Xxxx Xxxxxxx, XX
|
National
Briquette Corporation
|
00-00-0000-0000
00-00-0000-0000
|
Freehold
|
N/A
|
N/A
|
N/A
|
N/A
|
0000
Xxxxxxxxxxxx Xxxx., Xxxx Xxxxxxx, XX
|
National
Briquette Corporation (Lessee)
|
Unknown
|
Leasehold
|
16
June 2005
|
NBC
& Elgin, Joliet & Eastern Railway Company
|
year
to year
|
$1,092
pa
|
0000
Xxxxxxxxxxxx Xxxx., Xxxx Xxxxxxx, XX
|
Marco
Real Estate (Lessor)
|
Unknown
|
Use
of right of way
|
1
July 2005
|
NRS
& Marco Real Estate
|
year
to year
|
$600
pa
|
#0
Xxxxxxx Xxxxx, Xxxxxx, XX
|
Great
Lakes Recovery Systems, Inc. (Lessee)
|
Unknown
|
Leasehold
|
Month
to month
|
GLRS
& USX Corporation (formerly National Steel)
|
Month
to month
|
$1
pa
|
0000
Xxxxxxx Xx., Xxxx Xxxxxxx, XX
|
E.C.R.
Inc. (Lessee)
|
Unknown
|
Leasehold
|
19
October 1993
|
ECR
& Mittal Steel (formerly Inland Steel)
|
Annual
evergreen
|
Page
90
Property
Address
|
Legal
Owner
|
Property
Number
|
Freehold
/ Leasehold
|
Lease
Date
|
Original
parties
|
Lease
Term
|
Rent
|
c/o
USX-Xxxxx Xxxxxxx Plant, Xxxxxxxx Ave., Braddock, PA
|
Xxxxxxxx
Recovery, Inc. (Lessee)
|
Unknown
|
Leasehold
|
19
January 1993
|
BRI
& USX Corporation
|
Expires
31 August 2006
|
$1
pa
|
Xx.
00 Xxxxx, Building 000 Xxxxxxxxx Xxxxx, Xxxxxxx XX
|
Ashland
Recovery, Inc. (Lesee)
|
Unknown
|
Leasehold
|
2
February 2005
|
ARI
& AK Steel Corporation
|
Expires
25 September 2012
|
$12
pa
|
Page
91
SCHEDULE 8
RETIREMENT
BENEFITS
1. |
Unless
otherwise defined below, definitions used in this Schedule 8 are
defined
in paragraph 11 of Schedule 3 and Schedule
13.
|
2. |
Subject
to the requirements of applicable law in the relevant jurisdiction,
the
Sellers and the Purchaser agree as
follows:
|
(a)
|
Employees
who are members of an Industry-Wide Plan as at Closing will continue
to be
members of such Industry-Wide Plan;
|
(b)
|
the
Purchaser shall, in respect of Employees in the United Kingdom, arrange
for each Employee to be offered within one month of Closing, membership
with effect from Closing of a stakeholder pension arrangement nominated
by
the Purchaser (the Purchaser
Stakeholder).
Such offer of membership (an Offer
of Membership)
should be copied to the Sellers’ Representative (apart from any details
which the Purchaser is prohibited by applicable data protection laws
in
the UK from disclosing to the Sellers) and shall be in
writing;
|
(c)
|
the
Purchaser shall arrange for those Employees in the United Kingdom
who
accept an Offer of Membership (the UK
Employee Members)
within three months of it being made to be admitted to membership
of the
Purchaser Stakeholder with effect from Closing and Purchaser undertakes
in
respect of each UK Employee Member to contribute to or in respect
of the
UK Employee Member at the Agreed Contribution
Rate;
|
(d)
|
to
the extent that any Employees are not covered by paragraph 2(a),
or
paragraph 2(b) above, the Purchaser shall arrange for each Employee
to be
offered within one month of Closing, membership with effect from
Closing
of a Retirement Benefit arrangement operated or nominated by the
Purchaser
(the Purchaser
Plan).
Such offer of membership (an Offer
of Membership)
should be copied to the Sellers’ Representative (apart from any details
which the Purchaser is prohibited by applicable data protection laws
from
disclosing to the Sellers) and shall be in
writing;
|
(e)
|
the
Purchaser shall arrange for those Employees who accept an Offer of
Membership (the Employee
Members)
within three months of it being made to be admitted to membership
of the
Purchaser Plan with effect from Closing and undertakes in respect
of each
Employee Member to ensure that the Purchaser shall provide Retirement
Benefits in respect of service with the Purchaser for 12 months following
Closing, which are broadly equivalent in value to the benefits provided
or
offered to or in respect of
|
Page
92
|
the
Purchaser shall arrange for those Employees who accept an Offer
of
Membership (the Employee
Members)
within three months of it being made to be admitted to membership
of the
Purchaser Plan with effect from Closing and undertakes in respect
of each
Employee Member to ensure that the Purchaser shall provide Retirement
Benefits in respect of service with the Purchaser for 12 months
following
Closing, which are broadly equivalent in value to the benefits
provided or
offered to or in respect of the Employees under the relevant
Seller Plan
immediately prior to Closing assuming for these purposes that
the
Employees were active members of the such Seller
Plan.
|
In
this
Schedule 8 :
Agreed
Contribution Rate
means
the rate of employer contributions the relevant Target Company has agreed to
pay
to or in respect of the Employees in the United Kingdom under the Brambles
Pension Match arrangement; and
Brambles
Pension Match
means
the stakeholder pension arrangement to be established with effect on and from
1
January 2006 for or in respect of the employees of the Seller’s Group in the
United Kingdom.
Page
93
SCHEDULE 9
TAX
COVENANT
1. Interpretation
1.1 In
this
Schedule the following definitions shall have the following
meanings:
Accounts
means
the financial statements of each of the Target Companies for the year ended
on
the Accounts Date which have been audited by the date of this agreement or
are
in the Agreed Form if they have not been audited by that date, together with
any
notes, reports, statements or documents included in or annexed or attached
to
them (provided, however, that the amount of any current tax receivable in the
Accounts of the USA Companies shall be regarded as nil);
Closing
Date means
the
date on which Closing takes place;
Corporation
Tax means
in
respect of the United Kingdom corporation tax charged pursuant to section 6
of
the Taxes Act, in respect of France corporation tax (impôt
sur les sociétés)
charged
pursuant to section 205 et
seq. of
the
Xxxxxx xxxxxxx tax code (and the additional social contributions charged
pursuant to sections 235 ter
ZA
and ZC
of the Xxxxxx xxxxxxx tax code, as applicable), in respect of the Netherlands
corporate income tax charged pursuant to article 1 et
seq. of
the
Netherlands Corporate Income Tax Act 1969 and in respect of any other country
any corresponding tax on profits, gains, franchise, net worth or gross-receipts
imposed by a tax authority of that country or any political subdivision
thereof;
Dutch
Companies means
Brambles Steel Services B.V. and Xxxxx Xxxxxxxx Transport B .V.;
Dutch
Seller means
Brambles Holdings Europe B.V.;
event means
any
act, transaction or omission;
French
Companies means
Becema SAS, Solomat Industrie SA, BC SAS, SMI Lorelev SAS and XX Xxxx
SAS;
French
Seller means
Brambles France SAS;
French
Seller tax liability means
a
tax liability of any French Company;
Overprovision means,
applying the accounting policies, principles and practices adopted in relation
to the preparation of the Accounts (and ignoring the effect of any change in
law
made after the Closing Date, any action taken by the Purchaser or any Target
Company after the Closing Date or any relief arising after the Closing Date),
the amount
Page
94
by
which
any contingency or provision in the Accounts relating to tax, other than
deferred tax, is overstated;
Purchaser’s
Group means
the
Purchaser and any other company or companies which either are or become after
Closing, or have within the six years ending at Closing been, treated as members
of the same group (including the same tax group - intégration
fiscale
- for
French tax purposes pursuant to section 223 A et
seq. of
the
Xxxxxx xxxxxxx tax code - Code
général des impost -
and fiscale
eenheid
for
Dutch tax purposes pursuant to article 15 of the Netherlands Corporate Income
Tax Act 1969) as, or otherwise connected, related to or associated in any way
with, the Purchaser for any tax purpose;
Purchaser's
relief means:
(a) |
any
relief arising to any Target Company to the extent that it arises
in
respect of an event occurring or period commencing after the Closing
Date,
was included in the Accounts as an asset (other than in respect of
deferred tax) or was taken into account in computing any provision
for tax
(other than deferred tax) appearing in the Accounts or which, but
for the
presumed availability of such relief, would have appeared in the
Accounts;
or
|
(b) |
any
relief arising to any member of the Purchaser’s Group (other than any
Target Company);
|
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 or saving of tax, and any reference to the use or set-off of relief shall
be
construed accordingly;
Retained
Group means
each of the Sellers and any other company or companies (other than any Target
Company) which either are or become after Closing, or have within the six years
ending at Closing been, treated as members of the same group (including the
same
tax group - intégration
fiscale
- for
French tax purposes pursuant to section 223 A et
seq. of
the
Xxxxxx xxxxxxx tax code - Code
général des impost -
and fiscale
eenheid
for
Dutch tax purposes pursuant to article 15 of the Netherlands Corporate Income
Tax Act 1969) as, or otherwise connected, related to or associated in any way
with, any Seller for any tax purpose;
Short
Bros Receivable means
the
right of Short Bros (Plant) Limited to receive a repayment of UK corporation
tax
in an amount of £992,204 as set out in the statutory accounts of Short Bros
(Plant) Limited for the twelve month period ended on 30 June 2005, plus any
interest thereon;
Surrender
means
the
surrender of losses or other amounts eligible for group relief in accordance
with Chapter IV of Part X of the Taxes Act;
Page
95
tax, Tax and
taxation
mean
(a) taxes on income, profits and gains, and (b) all other taxes, levies,
duties, imposts, charges and withholdings in the nature of taxation, including
any excise, capital stock, gross receipts, occupancy, property, value added,
sales, use, net worth, transfer, franchise and payroll taxes and any national
insurance or social security contributions, or assessments of tax of any nature
whatsoever, together with all penalties, charges and interest relating to any
of
the foregoing or to any late or incorrect return in respect of any of them
(save
insofar as attributable to the unreasonable delay or default after Closing
of
any Target Company or the Purchaser);
tax
authority means
any
taxing or other authority (whether within or outside the United Kingdom)
competent to impose any tax liability;
tax
claim means:
(a) |
the
issue of any notice, demand, assessment, 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 (including the imposition, or any document
referring to the possible imposition, of any withholding of or on
account
of tax); or
|
(b) |
the
preparation or submission of any notice, return, assessment, letter
or
other document by the Purchaser, any Target Company or any other
person,
|
from
which it appears that a tax liability may be incurred by or may be imposed
on
any Target Company, being a tax liability which could give rise to a liability
for the relevant Seller under this Schedule or under the Tax Warranties (whether
alone or in conjunction with other Claims);
tax
liability
means:
(a) |
a
liability of a Target Company to make or suffer an actual payment
of tax
or in respect of tax (which, for the avoidance of doubt, shall include
a
payment in respect of a Surrender and, as regards the French Companies,
a
payment to any Company of the relevant Retained Group made pursuant
to a
tax sharing agreement (convention
d’intégration fiscale)
or a tax group exit agreement (convention
de sortie d’intégration fiscale));
|
(b) |
the
use or set-off of any Purchaser's relief in circumstances where,
but for
such use or set-off, a Target Company would have had an actual liability
to tax in respect of which the Purchaser would have been able to
make a
claim against the relevant Seller under this Schedule (the amount
of the
tax liability for these purposes being deemed to be equal to the
amount of
the actual liability to tax that is saved by the use or set-off of
the
Purchaser’s relief); provided that for the purposes of this Schedule it
shall be assumed that reliefs other than any Purchaser’s relief are, to
the extent allowed by law, used in priority to any Purchaser’s relief, but
only to the extent that a Purchaser's relief within
sub-
|
Page
96
-paragraph
(a) of the definition of Purchaser’s relief in this paragraph 1.1
will not be lost or reduced where it is not so used;
and
|
(c) |
the
loss, reduction, cancellation or clawback of any relief where such
relief
either was included in the Accounts as an asset (other than in respect
of
deferred tax) or was taken into account in computing any provision
for tax
(other than deferred tax) appearing in the Accounts or which, but
for the
presumed availability of such relief, would have appeared in the
Accounts;
|
tax
return or
Tax
Return means
any
return or report (including elections, declarations, disclosures, schedules,
estimates, information returns, and amended returns and reports) required to
be
made to any tax authority, including any related accounts, computations and
attachments;
Taxes
Act means
the
United Kingdom Income and Corporation Taxes Act 1988;
USA
Companies
means
Brambles Steel Services, Inc. and its direct or indirect subsidiaries, and
USA
Company
shall be
construed accordingly;
USA
Seller
means
Brambles USA, Inc; and
USA
Seller tax liability
means a
tax liability of any USA Company.
1.2 Persons
shall be treated as connected
for the
purposes of this Schedule if they are connected within the meaning of
section 839 of the Taxes Act.
1.3 Persons
shall be treated as related
for the
purpose of this Schedule if they are subsidiaries, participations or controlled
companies within the meaning of sections L 223-1 to L 223-5 of the
French code of commerce.
1.4 In
this
Schedule, for the purposes of determining whether:
(a) |
a
tax liability or relief has arisen,
or
|
(b) |
a
Target Company is or becomes entitled to a right to repayment or
receives
an actual repayment of tax,
|
in
either
case, in respect of a period ended on or before Closing or in respect of a
period commencing after Closing, an accounting period of the Target Company
concerned shall be deemed to have ended on Closing.
1.5 In
this
Schedule, for the purposes of determining whether:
(a) |
any
income, profits or gains have been earned, accrued or received,
or
|
(b) |
an
event has occurred,
|
Page
97
in
either
case, on or before Closing or after Closing, an accounting period of the Target
Company concerned shall be deemed to have ended on Closing.
1.6 Any
reference in this Schedule to a particular United Kingdom legislative provision
or set of United Kingdom legislative provisions shall be treated as including
a
reference to any corresponding legislative provision or set of legislative
provisions in any relevant jurisdiction other than the United
Kingdom.
1.7 Any
reference in this Schedule to the relevant
Seller
shall,
in relation to a Target Company, be treated as being an exhaustive reference
to
the Seller which is the direct or indirect owner of the shares in that Target
Company as at the date of this agreement.
1.8 Any
reference to the Accounts
in
this
Schedule shall, in relation to tax other than Corporation Tax (or any penalties,
charges or interest relating thereto or to any late or incorrect return in
respect thereof), be treated as referring instead to the Closing Statement.
For
the avoidance of doubt, therefore, any reference to the Accounts in paragraph
14
shall
not be treated as referring instead to the Closing Statement.
1.9 Where
there is any inconsistency between the provisions in this Schedule and the
provisions elsewhere in this agreement, the provisions in this Schedule shall
prevail for the purposes of construing this agreement.
1.10
Any
reference in this Schedule to income, profits or gains having been earned,
accrued or received on or before a particular time or events occurring on or
before a particular time shall include income, profits or gains or events
deemed, for the purposes of any tax, to have been so earned, accrued or received
or to have so occurred.
1.11 The
reference in paragraph 3.1(d)
to a
transaction, action or omission carried out or effected in
the ordinary course of business
of a
Target Company shall, without limitation, not include:
(a) |
any
disposal (or deemed disposal for any tax purpose) of assets other
than
trading stock by that Target
Company;
|
(b) |
any
change in the use of an asset by that Target
Company;
|
(c) |
anything
which has the result of requiring disposal value to be brought into
account, or which crystallises a balancing charge, for capital allowances
purposes (or has any similar effect under the laws of any relevant
jurisdiction other than the United Kingdom);
|
(d) |
anything
which causes that Target Company to become liable to pay interest
or
penalties in respect of tax; and
|
(e) |
anything
which causes that Target Company to become liable to pay tax primarily
chargeable against or attributable to any other
person.
|
Page
98
1.12 The
Sellers shall not be entitled to recover any amount in respect of a claim under
paragraph 4 (Overprovisions), paragraph 7 (Tax Refunds) or paragraph 11
(Recovery from Third Parties/Savings) to the extent that a Seller has already
recovered an amount under this Schedule in respect of the same subject
matter.
2. Covenant
to pay
Each
of
the relevant Sellers hereby jointly and severally covenants with the Purchaser
to pay to the Purchaser an amount equivalent to any tax liability arising in
respect of, by reference to or in consequence of:
(a) |
any
income, profits or gains earned, accrued or received on or before
Closing;
and
|
(b) |
any
event which occurred on or before Closing (including, without limitation,
Closing itself);
|
together
with any costs and expenses referred to in paragraph 5.
3. Exclusions
3.1 The
covenants contained in paragraph 2
shall
not cover any tax liability to the extent that:
(a) |
provision
or reserve in respect of that tax liability has been made in the
Accounts
(including provision or reserve for payment in respect of a Surrender
to
which the tax liability relates), or the tax liability was taken
into
account in computing any asset in respect of tax appearing in the
Accounts
or which, but for the presumed existence of such liability, would
have
appeared in the Accounts; or
|
(b) |
the
tax liability was paid or discharged before Closing, or such payment
or
discharge was taken into account in computing any asset appearing
in the
Accounts or which, but for the presumed payment or discharge, would
have
appeared in the Accounts; or
|
(c) |
the
tax liability arises as a result of any change in rates of tax made
after
the Closing Date or of any change in law (or a change in interpretation
on
the basis of case law), regulation, directive or requirement, or
the
practice of any tax authority, occurring after the Closing Date;
or
|
(d) |
the
tax liability would not have arisen but for a transaction, action
or
omission carried out or effected by the Purchaser or any Target Company,
or any other person connected with or related to any of them, at
any time
after Closing, except that this exclusion shall not apply where any
such
transaction, action or omission:
|
(i) |
is
carried out or effected by the Target Company concerned pursuant
to a
legally binding commitment created on or before Closing;
or
|
Page
99
(ii) |
is
carried out or effected by the Target Company concerned in the ordinary
course of business of such Target Company
as carried on at Closing; or;
|
(e) |
the
tax liability arises as a result of a change after Closing in the
length
of any accounting period for tax purposes of any Target Company,
or a
change after Closing in any accounting policy or tax reporting practice
of
any Target Company
(other than a change which is necessary in order to comply with the
law or
generally accepted accounting principles applicable to the relevant
Target
Company at Closing); or
|
(f) |
notice
of a claim in respect of the tax liability (other than a French Seller
tax
liability) in a form complying with the provisions of
paragraph 9.1
is
not given to the relevant Seller prior to the sixth anniversary of
the end
of the accounting period of the Target Company concerned in which
Closing
occurs, or (where the claim is not previously settled, satisfied
or
withdrawn) proceedings in respect thereof are not issued to and (to
the
extent possible) served upon the relevant Seller in England within
the
nine-month period following such anniversary and pursued with reasonable
diligence thereafter; or
|
(g) |
notice
of a claim in respect of a French Seller tax liability in a form
complying
with the provisions of paragraph 9.1 is
not given to the French Seller prior to the date which is thirty
(30) days
after the end of the third calendar year following the calendar year
in
which the recording period of the relevant French Company ended;
or
|
(h) |
such
tax liability arises as a result of any Target Company failing to
submit
the returns and computations required to be made by them or not submitting
such returns and computations within the appropriate time limits
or
submitting such returns and computations otherwise than on a proper
basis,
in each case after Closing and otherwise than as a result of any
default
or failure of the relevant Seller in carrying out, or in failing
to carry
out, its obligations under paragraph 12;
or
|
(i) |
the
tax liability arises as a result of the failure of the Purchaser
to comply
with its obligations contained in paragraph 9,
12
or
14
hereof; or
|
(j) |
any
relief other than a Purchaser’s relief is available, or is for no
consideration made available by any member of the Retained Group,
to any
Target Company to set against or otherwise mitigate the tax liability
(and
so that any relief that is so available in relation to more than
one tax
liability to which this Schedule applies shall be deemed, so far
as
possible, to be used in such a way as to reduce to the maximum extent
possible the relevant Seller’s total liability hereunder);
or
|
(k) |
the
tax liability would not have arisen but
for:
|
Page
100
(i) |
the
making of a claim, election, surrender or disclaimer, the giving
of a
notice or consent, or the doing of any other thing under the provisions
of
any enactment or regulation relating to tax, in each case after Closing
and by the Purchaser or any Target Company, or any person connected
with
or related to any of them, and otherwise than at the direction of
the
relevant Seller pursuant to paragraph 12
or
in compliance with the Purchaser's obligations under paragraph 12;
or
|
(ii) |
the
failure or omission on the part of any Target Company after Closing
(otherwise than at the direction of the relevant Seller pursuant
to
paragraph 12)
to make any such valid claim, election, surrender or disclaimer,
or to
give any such notice or consent or to do any other such thing, either
as
the relevant Seller may validly require in respect of periods or
matters
for which it has conduct under paragraph 12
or
paragraph 14
or, in respect of periods or matters for which it does not have conduct,
in circumstances where the making, giving or doing of which was taken
into
account in the preparation of the Accounts and the need for the making,
giving or doing of which is notified to the Purchaser in writing
no less
than 30 days before the date on which it can be validly made, given
or
done; or
|
(l) |
the
tax liability arises in respect of, by reference to or in consequence
of
any actual (as opposed to deemed) income, profits or gains earned,
accrued
or received after Closing and which have not been taken into account
in
the preparation of the Closing
Statement.
|
3.2 The
French Seller shall have no liability under any part of this agreement for
any
French Seller tax liability which would result from a simple transfer of income
or expenses from one fiscal year to another, save to the extent that it
comprises an amount in respect of interest or penalties. For the avoidance
of
doubt, the French Seller shall remain liable for any tax liability consisting
not only of interest and/or penalties, including any corporate income tax
liability resulting from the transfer of income and expenses from one fiscal
year to another which, under section 38.4bis of the Xxxxxx xxxxxxx tax code
(code
général des impôts),
would
not result only in interest or penalties and any future tax liability resulting
from the loss of the right to depreciate the full value of a French Company’s
assets.
3.3 The
Sellers shall have no liability to the Purchaser under any part of this
agreement in respect of any non-availability, inability to use, or loss or
restriction of any relief (failure
of relief)
where
such failure of relief does not give rise to a tax liability to which
paragraph 2
applies.
3.4 The
tax
consequences of the exit of the French Companies from the French Seller's French
tax group (intégration
fiscale),
(including with respect to tax adjustments (réintégrations
de sortie de groupe),
indemnification for the loss of tax attributes, down-payment of taxes, future
tax audits and reassessment of the taxable result of the French
Page
101
Companies
for the tax consolidated years) are governed by a tax group exit agreement
(convention
de sortie d'intégration fiscale),
dated
the same date as this agreement, by and between Brambles France SAS and the
French Companies (the Tax
Group Exit Agreement).
For
the avoidance of doubt, it is specified that any payments in respect of Tax
or
penalties that a French Company will have to make to Brambles France SAS or
any
other member of the Retained Group pursuant to the Tax Group Exit Agreement
will
constitute a tax liability to which the covenants to pay and exclusions provided
for by paragraphs 2 and 3 hereof will be applicable. It is further specified
that payments to be made post-Closing by the French Companies to Brambles France
SAS pursuant to paragraph 15 hereof and to the Tax Group Exit Agreement for
down-payment of Taxes do not constitute post-Closing tax liabilities to which
paragraph 2 hereof would be applicable, and that, as is provided in the Tax
Group Exit Agreement, the Sellers will have no obligation to indemnify the
French Companies for losing their right to carry forward tax losses as a result
of their exit from the French tax group.
3.5 The
provisions of paragraph 3.1
shall
also operate to limit or reduce the liability of the Sellers in respect of
claims under the Tax Warranties and any other Warranty insofar as it relates
to
tax, save that they shall not operate to limit or reduce the liability of the
Sellers in respect of a claim under paragraph 17(a) of Part D of Schedule 3
to
the extent that the liability would not have arisen but for any disposal (or
deemed disposal for any tax purpose) after Closing of any asset other than
trading stock by a French Company.
4. Overprovisions
4.1 The
relevant Seller may require the auditors for the time being of a Target Company
to certify, at its request and expense, the existence and amount of any
Overprovision in relation to that Target Company and the Purchaser shall
provide, or procure that each Target Company provides, any information or
assistance required for the purpose of production by the auditors of a
certificate to that effect.
4.2 Subject
to paragraph 4.4
below:
(a) |
any
Overprovision shall first be set against any payment then due from
any
Seller under this Schedule or for breach of any Tax
Warranty;
|
(b) |
to
the extent that there is an excess, a payment shall promptly be made
to
the relevant Seller equal to the aggregate of any payment or payments
previously made by any Seller under this Schedule or for breach of
any Tax
Warranty (and not previously refunded under this Schedule) up to
the
amount of the excess; and
|
(c) |
to
the extent that there is any remaining excess, it shall be carried
forward
and set off against any future liability of any Seller under this
Schedule
or for breach of any Tax Warranty (with the intent that, if there
is no
such future liability, such excess shall be retained by the Target
Companies and/or the Purchaser).
|
Page
102
4.3 Either
the relevant Seller or the Purchaser may, at its own expense, require any
certificate produced in accordance with paragraph 4.1
above to
be reviewed by the auditors for the time being of the relevant Target Company
in
the event that there are relevant circumstances or facts of which it was not
aware, and which were not taken into account, at the time when such certificate
was produced, and to certify whether the certificate remains correct or whether
it should be amended.
4.4 If
the
certificate is amended following a request under paragraph 4.1,
the
revised amount of Overprovision shall be substituted for the purposes of
paragraph 4.2,
and any
adjusting payment that is required shall be made within 15 Business Days of
the
amendment of the certificate.
5. Costs
and expenses
The
covenants contained in paragraph 2
shall
extend to all reasonable costs and expenses properly incurred by the Purchaser
in connection with a successful claim made under that paragraph, or in
satisfying or settling any tax liability in accordance with
paragraph 9
in
respect of which a successful claim is made under paragraph 2.
6. Double
recovery
The
Purchaser shall not be entitled to recover any amount pursuant to this Schedule
in respect of any claim to the extent that the Purchaser or any Target Company
has already recovered any amount in respect of such claim under the Warranties
or under any other provision of this Agreement or pursuant to any other
agreement with any Seller or any company connected with any Seller, or to the
extent that recovery has already been made under this Schedule in respect of
the
same subject matter.
7. Tax
Refunds
7.1 (i)
In
respect of Corporation Tax, upon receipt by the relevant Seller of a statement
from a tax authority or the relevant Seller’s tax advisers (obtained at the
relevant Seller’s expense) of any right to receive or actual receipt of any
amount by way of repayment of tax or interest on overpaid tax or repayment
supplement, and (ii) in respect of tax other than Corporation Tax, upon the
Purchaser or any Target Company becoming aware thereof, the Purchaser shall
promptly notify the relevant Seller of any right to receive or actual receipt
of
such amount, in each of (i) and (ii) being an amount to which a Target Company
(or as the case may be, the Purchaser or any member of the Purchaser's Group,
on
behalf or in respect of any of the French Companies) is or becomes entitled
or
receives in respect of an event occurring or period (or part period) ending
on
or prior to the Closing Date (including any repayment attributable to a
Surrender in respect of a period or part period ending on or prior to the
Closing Date whenever such Surrender is effected), where or to the extent that
such amount was not included in the Accounts as an asset (save for an amount
relating to the Short Bros Receivable), does not arise from the use of a
Purchaser’s relief and is not a payment or relief to which
paragraph 11
below
applies (a tax
refund).
Page
103
7.2 Any
tax
refund actually obtained after the Closing Date, whether by repayment or set-off
(and less any reasonable costs of obtaining it and any tax payable thereon)
and
provided that (in the case of a tax refund in respect of Corporation Tax) the
relevant Seller receives a statement referred to in paragraph 7.1
above,
shall be dealt with as follows:
(a) |
the
amount of the tax refund shall be set against any payment then due
under
this Schedule or for breach of any Tax Warranty from any
Seller;
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(b) |
to
the extent that there is an excess, a payment shall promptly be made
to
the relevant Seller equal to the aggregate of any payment or payments
previously made by any Seller under this Schedule or for breach of
any Tax
Warranty (and not previously refunded under this Schedule) up to
the
amount of the excess; and
|
(c) |
where
the tax refund relates to the Short Bros Receivable or the amount
of the
tax refund is more than US$100,000, a payment shall promptly be made
to
the relevant Seller equal to the amount of any excess remaining after
the
application of sub-paragraph (b)
above; and
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(d) |
where
sub-paragraph (c)
above does not apply to the tax refund, any excess remaining after
the
application of sub-paragraph (b)
above shall
be carried forward and set off against any future liability of any
Seller
under this Schedule of for the breach of any Tax Warranty (with the
intent
that, if there is no such future liability, such excess shall be
retained
by the Target Companies and/or the
Purchaser).
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7.3 Paragraph 11.4
shall
apply in respect of any sum payable to any Seller under this
paragraph 7
which is
not paid by the later of the date fifteen Business Days after the relevant
tax
refund is obtained by the Target Company concerned and, in the case of a tax
refund in respect of Corporation Tax, the date on which the relevant Seller
receives a statement referred to in paragraph 7.1
above
(the
due date)
as it
applies to any sum not paid by the Purchaser on the due date of payment
specified in paragraph 11.2.
8. Secondary
Liabilities
8.1 The
Purchaser severally covenants with each of the Sellers to pay to the relevant
Seller (or, if there is no relevant Seller, to each of the Sellers in the same
proportion as the price for its respective Set of Shares at the relevant time,
as determined by clause 2.1, bears to the aggregate price for all of the Sets
of
Shares at that time and as so determined) an amount equivalent to any tax or
any
amount on account of tax which any member of the Retained Group is required
to
pay as a result of a failure by any Target Company, or any other member of
the
Purchaser’s Group, to discharge that tax.
8.2 Each
of
the relevant Sellers severally covenants with the Purchaser to pay to the
Purchaser (or, if there is no relevant Seller, each of the Sellers severally
covenants with the Purchaser to pay to the Purchaser, in the same proportion
as
the price for its
Page
104
respective
Set of Shares at the relevant time, as determined by clause 2.1, bears to the
aggregate price for all of the Sets of Shares at that time and as so determined)
an amount equivalent to any tax or any amount on account of tax which any Target
Company, or any other member of the Purchaser’s Group, is required to pay as a
result of a failure by any member of the Retained Group to discharge that
tax.
8.3 The
Dutch
Seller and the Purchaser (each of which is the relevant
party
where it
is the covenantor) hereby covenant to each other to pay to the other party,
to
the extent not already covered in this agreement and by way of adjustment to
the
consideration for the sale of the relevant Shares, an amount equivalent to
any
credit (verrekening)
by the
Dutch tax authorities under article 24(2) of the Dutch Tax Collection Act 1990
in respect of any Dutch tax which, but for the application of the aforementioned
article, would have been due and payable by the relevant party (or any other
member of the Retained Group or the Purchaser’s Group, as the case may be) and
where the other party (or any other member of the Purchaser’s Group or the
Retained Group, as the case may be) loses an amount that, but for this credit,
would have been available to it as a relief.
8.4 The
Purchaser covenants with the Dutch Seller to pay to the Dutch Seller an amount
equivalent to any tax or any amount on account of tax in respect of, by
reference to or in consequence of any income, profits or gains earned, accrued
or received by a Dutch Company, as determined in accordance with the rules
of
article 15ah of the Corporate Income Tax Act 1969, which the Dutch Seller or
any
other member of the Retained Group is required to pay or which results in a
loss
of an amount that, but for this tax, would have been available to it as a
relief.
8.5 The
covenants contained in paragraphs 8.1
to
8.4
inclusive shall:
(a) |
extend
to any reasonable costs incurred in connection with such tax or a
claim
under any of those paragraphs;
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(b) |
(in
the case of paragraphs 8.1
and 8.4
and the covenant by the Purchaser under paragraph 8.3)
not apply to tax to the extent that the Purchaser could claim payment
in
respect of it under paragraph 2
(or would have been able to claim but for paragraph 3.1(f)
or
3.1(g)),
except to the extent that a payment has been made pursuant to
paragraph 0
and the tax to which it relates was not paid by the Target Company
concerned; and
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(c) |
not
apply to tax to the extent it has been recovered under any relevant
statutory provision (and the Purchaser or the Sellers, as the case
may be,
shall procure that no such recovery is sought to the extent that
payment
is made hereunder).
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8.6 Paragraphs 9.1, 9.3
and 10
(conduct
of disputes and due date for payment) shall apply to the covenants contained
in
paragraphs 8.1
to
8.4
inclusive as they apply to the covenants contained in
paragraph 2,
replacing references to the Sellers by the Purchaser (and vice versa) where
appropriate and making any other necessary modifications.
Page
105
9. Notification
of claims and conduct of disputes
9.1 If
the
Purchaser or any Target Company, or any other member of the Purchaser's Group,
becomes aware of any tax claim, the Purchaser shall give notice to the relevant
Seller of that tax claim (including any details reasonably available at the
time
of such tax claim, the due date for any payment and the time limits for any
appeal or any other relevant response, and so far as practicable the amount
of
the claim under this Schedule or under the Tax Warranties in respect thereof)
as
soon as reasonably practicable (and, if there is a time limit of 30 days or
less
in which an appeal or other action must be taken in respect of the tax claim,
in
any event not more than ten Business Days after the Purchaser or the Target
Company or other member of the Purchaser's Group concerned becomes aware of
such
claim). Subject to the relevant Seller having indemnified the Purchaser and
the
relevant Target Company to the Purchaser’s reasonable satisfaction against any
reasonable costs and expenses that they may thereby properly incur, the
Purchaser shall take (or procure that the Target Company concerned shall take)
such action as the relevant Seller may reasonably request to avoid, dispute,
resist, appeal, compromise or defend any tax claim (whether notified by the
Purchaser, or being a tax claim of which the relevant Seller was already aware)
and any adjudication in respect thereof. The relevant Seller shall have the
right (if it wishes) to control any proceedings taken in connection with such
action, and shall in any event be kept fully informed of any actual or proposed
developments (including any meetings) and shall be provided with copies of
all
correspondence and documentation relating to such tax claim or action, and
such
other information, assistance and access to records and personnel as it
reasonably requires.
9.2 Subject
to paragraph 9.3,
the
Purchaser shall procure that no tax claim, action or issue in respect of which
any Seller could be required to make a payment under this Schedule or for breach
of any Tax Warranty is settled or otherwise compromised without that Seller’s
prior written consent, such consent not to be unreasonably withheld or delayed,
and the Purchaser shall, and shall procure that each Target Company, any other
member of the Purchaser's Group and any of their respective advisers shall,
not
submit any correspondence or return or send any other document to any tax
authority where the Purchaser or any such person is aware or could reasonably
be
expected to be aware that the effect of submitting such correspondence or return
or sending such document would or could be to put such tax authority on notice
of any matter which could give rise to, or could increase, a claim under this
Schedule or for breach of any Tax Warranty, without first affording the relevant
Seller a reasonable opportunity to comment thereon and without taking account
of
such comments so far as it is reasonable to do so.
9.3 If
the
relevant Seller does not request the Purchaser to take any appropriate action
within 30 days of notice to the relevant Seller, the Purchaser shall be free
to
satisfy or settle the relevant tax liability on such terms as it may reasonably
think fit.
9.4 If
the
relevant Seller takes up its right under paragraph 9.1
to
control the conduct of a tax claim, the Purchaser shall promptly be kept fully
informed of all material matters pertaining to the tax claim and shall be
entitled to see copies of all relevant correspondence relating thereto. If
the
relevant Seller takes up its rights under paragraph
Page
106
9.1
as
aforesaid, the relevant Seller shall not (and shall procure that its agents
shall not) compromise, settle, admit or otherwise deal with any such proceedings
(or any matter in issue therein) without the consent of the Purchaser (not
to be
unreasonably withheld or delayed), PROVIDED THAT it is hereby agreed that the
Purchaser will be deemed automatically to have consented where the compromise,
settlement, admission or dealing is consistent with the practice of the Target
Companies for periods ending on or prior to Closing (save to the extent required
by law, any applicable regulation or generally applicable accounting
principles). The Purchaser and the relevant Seller agree that, if the Purchaser
refuses (or unreasonably withholds or delays giving) its consent to any
compromise, settlement, admission or dealing, the provisions of clause 31
(Settlement of Disputes) shall apply to the matter in dispute.
10. Due
date of payment and interest
10.1 Subject
to paragraph 10.2,
each
Seller shall pay to the Purchaser any amount payable by it under this Schedule
on or before the date which is the later of the date ten Business Days after
demand is made therefor by the Purchaser and two Business Days before the first
date on which the tax in question becomes due and payable to the tax authority
demanding the same. Provided that:
(a) |
if
the date on which the tax becomes due and payable is deferred following
application to the relevant tax authority, the date for payment by
each
Seller shall be two Business Days before such later date when the
amount
of tax is finally and conclusively determined (and for this purpose,
an
amount of tax shall be deemed to be finally determined when, in respect
of
such amount, an agreement under section 54 of the United Kingdom
Taxes Management Act 1970 or any legislative provision corresponding
to
that section is made, or a decision of a court or tribunal is given
or any
binding agreement or determination or an enforceable decision of
a tax
authority imposing a payment of tax is made, from which either no
appeal
lies or in respect of which no appeal is made within the prescribed
time
limit, ignoring the power of any person to allow appeals out of time);
and
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(b) |
if
a payment or payments to the relevant tax authority prior to the
date
otherwise specified by this paragraph would avoid or minimise interest
or
penalties, each Seller may at its option pay the whole or part of
the
amount due to the Purchaser on an earlier date or dates, and the
Purchaser
shall procure that the tax in question (or the appropriate part of
it) is
promptly paid to the relevant tax
authority.
|
A
Seller
may make a direct payment in respect of the tax liability in question to the
relevant tax authority (including through use of certificates of tax deposit
or
the equivalent), and that Seller’s liability to the Purchaser shall be treated
as reduced or eliminated accordingly.
10.2 Where
a
claim under this Schedule relates to the use or set-off of a Purchaser’s relief,
the relevant Seller shall pay to the Purchaser the amount due from it under
this
Schedule in respect thereof on the later of the date which is two Business
Days
before the
Page
107
first
date on which tax which would not have been payable but for such use or set-off
becomes due and payable to the tax authority demanding the same, and ten
Business Days after demand is made therefor by the Purchaser, such demand to
be
accompanied by reasonably sufficient evidence provided by the Purchaser or
its
tax advisers (obtained or procured to be obtained by and at the expense of
the
Purchaser) of such use or set-off and as the relevant Seller requires to
ascertain that it has a liability of a stated amount in respect of such claim
and that tax has, or will on a specified date, become due and payable as
aforesaid.
10.3 Where
a
claim under this Schedule relates to the loss, reduction, cancellation or
clawback of any such relief as is referred to in sub-paragraph (c) of the
definition of tax liability, the relevant Seller shall pay to the Purchaser
the
amount due from it under this Schedule in respect thereof on the later of the
date which is 5 Business Days after the date on which such relief is lost,
reduced, cancelled or clawed back or, if later, the date which is ten Business
Days after the date on which demand is made therefor by the Purchaser, such
demand to be accompanied by reasonably sufficient evidence provided by the
Purchaser or its tax advisers (obtained or procured to be obtained by and at
the
expense of the Purchaser) of such loss, reduction, cancellation or clawback
and
as the relevant Seller requires to ascertain that it has a liability of a stated
amount in respect of such claim.
10.4 Any
sum
not paid by a Seller on the due date for payment specified in
paragraph 10.1
or 10.2
shall
bear Default Interest (which shall accrue from day to day after as well as
before any judgment for the same) from the due date to and including the day
of
actual payment of such sum, compounded six monthly, provided that Default
Interest shall not accrue to the extent that the Seller’s liability under
paragraph 2
or
paragraph 5
extends
to interest or penalties arising after the due date. Any interest due under
this
paragraph shall be paid on the demand of the Purchaser on or following the
date
of payment of such sum.
11. Recovery
from third parties/tax savings
11.1 If
any
payment is made by a Seller under this Schedule or for breach of any Tax
Warranty in respect of a tax liability or other matter and the Purchaser or
any
Target Company (or any person connected with or related to any of them,
including any member of the Purchaser's Group) either receives, or is entitled
or may be entitled either immediately or at some future date to recover or
obtain, from any person (other than the Purchaser or any Target Company or
any
such connected person) a payment or relief which would not have arisen but
for
the tax liability or other matter in question or the circumstances giving rise
thereto (including without limitation in circumstances where a tax liability
arises because a deduction or other relief assumed to be available in preparing
the Accounts is in fact available only in a subsequent period or periods),
then:
(a) |
the
Purchaser shall notify that Seller of that fact as soon as reasonably
possible after the Purchaser or any Target Company becomes aware
of the
same and, if so required by the Seller and subject to the Seller
having
first indemnified the Purchaser and the relevant Target Company against
any reasonable costs and
|
Page
108
expenses
that they may thereby properly incur, shall take (or shall procure
that
the Target Company or other person concerned shall take) such action
as
the Seller may reasonably request to enforce such recovery or to
obtain
such payment or relief (keeping the Seller fully informed of the
progress
of any action taken and providing it with copies of all relevant
correspondence and documentation);
and
|
(b) |
if
the Purchaser or the Target Company or other person (including any
member
of the Purchaser's Group) concerned receives or obtains such a payment
or
relief, the Purchaser shall pay to that Seller the amount received
or the
amount that the Purchaser or the Target Company or other person concerned
(including any member of the Purchaser's Group) will save by virtue
of the
payment or the relief (less any reasonable costs of recovering or
obtaining such payment or relief and any tax actually suffered thereon)
(the Benefit)
to the extent that the amount of the Benefit does not exceed the
aggregate
payments previously made by any Seller under this Schedule and for
breach
of any Tax Warranty, and except where any amount so saved would otherwise
have given rise to a claim under this Schedule or for breach of any
Tax
Warranty (in which event no such claim shall be made). Any amount
of the
Benefit not so paid to the Seller shall be carried forward and set
off
against any future claims against any Seller under this Schedule
or for
breach of any Tax Warranty.
|
11.2 Any
payment required to be made by the Purchaser pursuant to
paragraph 11.1
shall be
made:
(a) |
in
a case where the Purchaser or the Target Company or other person
concerned
(including any member of the Purchaser's Group) receives a payment,
within
ten Business Days of the receipt thereof;
and
|
(b) |
in
a case where the Purchaser or the Target Company or other person
concerned
(including any member of the Purchaser's Group) obtains a relief,
on or
before the date on which tax would have become recoverable by the
appropriate tax authority but for the use of such
relief.
|
11.3 The
Purchaser shall procure that any such relief as is referred to in
paragraph 11.2(b)
is used
in priority to any other relief. The Seller referred to in paragraph
11.1
shall be
entitled, at its own cost, to require that the auditors of the relevant Target
Company and/or other person (including any member of the Purchaser's Group)
shall certify the amount and date of use of such relief for the purposes of
this
paragraph 11.
11.4 Any
sum
not paid by the Purchaser on the due date of payment specified in
paragraph 11.2
shall
bear Default Interest (which shall accrue from day to day after, as well as
before, any judgment for the same) from the due date to and including the day
of
actual payment of such sum, compounded six monthly. Such interest shall be
paid
on the demand of the Seller referred to in paragraph 11.1.
Page
109
12. Management
of pre-Closing tax affairs
Interpretation
12.1 In
this
paragraph 12
and in
paragraphs 13
and
16:
accounting
period means
any
period by reference to which any income, profits or gains, or any other amounts
relevant for the purposes of tax, are measured or determined;
pre-Closing
tax affairs means
the
tax affairs of the Target Companies for which the relevant Seller in question
is
responsible under this paragraph 12;
tax
documents means
the
tax returns, claims and other documents which the relevant Seller in question
is
required to prepare on behalf of or with respect to the Target Companies under
paragraphs 12.2(a)
and
12.2(b);
time
limit means
the
latest date on which a tax document can be executed or delivered to a relevant
tax authority either without incurring interest or a penalty, or in order to
ensure that such tax document is effective; and
16th
Standard Condition
means
article
16 of the standaardvoorwaarden
as
listed in the exhibit to the Resolution of 30
September 1991, nr. DB91/2309.
Rights
and Obligations of the Sellers
12.2 Subject
to and in accordance with the provisions of this paragraph, the relevant Seller
or its duly authorised agents shall, in respect of all accounting periods ending
on or before Closing, in a manner consistent with the past practice of the
Target Companies in relation to the relevant matters (save to the extent
required by law, any applicable regulation or generally applicable accounting
principles) and at the relevant Seller’s own cost:
(a) |
prepare
the tax returns of each of the Target Companies for the purposes
of
Corporation Tax;
|
(b) |
(subject
to paragraph 14)
prepare on behalf of the Target Companies all claims, elections,
surrenders, disclaimers, notices and consents for the purposes of
Corporation Tax; and
|
(c) |
(subject
to paragraph 9)
deal with all matters relating to Corporation Tax which concern or
affect
any of the Target Companies, including the conduct of all negotiations
and
correspondence and the reaching of all agreements relating thereto
or to
any tax documents, but excluding payment of
tax.
|
12.3 The
relevant Seller or its duly authorised agents shall deliver all tax documents
which are required to be signed by or on behalf of any Target Company to the
Purchaser for authorisation, signing and submission to the relevant tax
authority, provided that the
Page
110
Purchaser
shall not be obliged to sign or authorise any tax document which it does not
consider (acting reasonably) is complete or accurate in all material respects.
If a time limit applies in relation to any tax document, the relevant Seller
shall ensure that the Purchaser receives the tax document no later than ten
Business Days (or, in the case of a tax return, thirty Business Days) before
the
expiry of the time limit.
12.4 The
relevant Seller shall procure that:
(a) |
the
Purchaser receives copies of all written correspondence with any
tax
authority insofar as it is relevant to the pre-Closing tax
affairs;
|
(b) |
the
Purchaser is afforded the opportunity to comment within a reasonable
period of time on any tax document or other non-routine correspondence
prior to its submission to the relevant tax authority, and the relevant
Seller shall take into account any such comments made by the Purchaser
as
the relevant Seller (acting reasonably) considers to be reasonable,
and
the parties hereby agree that, if the relevant Seller refuses to
take into
account any comment made by the Purchaser in relation to any return
and
the Purchaser (acting reasonably) disagrees with such matter, the
disagreement shall be a dispute for the purpose of clause 31 (Settlement
of Disputes) and the provisions of that clause shall apply thereto;
|
(c) |
no
tax document is submitted to any tax authority which is misleading
or, so
far as the relevant Seller is aware, not true and accurate in all
material
respects; and
|
(d) |
it
does not agree any material matter relating to its tax affairs with
any
tax authority (in a way which is not consistent with its past practice,
save to the extent required by law, any applicable regulation or
generally
applicable accounting principles) without the consent of the Purchaser
(not to be unreasonably withheld or delayed). If the Purchaser refuses
(or
unreasonably withholds or delays giving) its consent under this paragraph
(d),
the matter shall be considered a dispute for the purposes of clause
31
(Settlement of Disputes) and the provisions of that clause shall
apply
accordingly.
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Obligations
of the Purchaser
12.5 The
Purchaser shall procure that:
(a) |
the
relevant Seller and its duly authorised agents are afforded such
access
(including the taking of copies) to the books, accounts and records
of the
Target Companies and such other assistance as it or they reasonably
require to enable the relevant Seller to discharge its obligations
under
this Schedule and to enable the relevant Seller and any member of
the
Retained Group to comply with its own tax obligations or facilitate
the
management or settlement of its own tax
affairs;
|
(b) |
the
Target Companies and any other members of the Purchaser’s Group shall
properly retain and maintain the books, accounts and records of the
Target
|
Page
111
Companies
and any other members of the Purchaser’s Group shall properly retain and
maintain the books, accounts and records of the Target Companies
until the
applicable statutory limitation period expires (giving effect to
any
extension thereof) and shall abide by all record retention agreements
entered into with any tax authority and shall give the respective
Seller
reasonable written notice prior to transferring, destroying, or
discarding
any such books, accounts and records and, if that Seller so requests,
shall allow that Seller to take possession of such books, accounts
and
records;
|
(c) |
the
relevant Seller is promptly sent a copy of any communication from
any tax
authority insofar as it relates to the pre-Closing tax
affairs;
|
(d) |
unless
at the direction of the relevant Seller or its duly authorised agents
pursuant to paragraph 12.2
or
any other provision of this Schedule, no voluntary action is taken
by any
Target Company or any other member of the Purchaser’s Group after Closing
(whether by disclaiming any relief, withdrawing or revoking any claim,
disclaimer or consent or otherwise) which would or is likely either
to
prejudice or reduce the availability of any relief surrendered or
to be
surrendered between any Target Company and any member of the Retained
Group, or otherwise adversely to affect the tax position of any member
of
the Retained Group;
and
|
(e) |
there
is given to such person or persons as may for the time being be nominated
by the relevant Seller authority to conduct pre-Closing tax affairs,
and
that such authority is confirmed to any relevant tax
authority.
|
12.6 The
Purchaser shall (subject to paragraph 12.3
above or
paragraph 12.9 below) be obliged to procure that the Target Companies shall
cause any tax document delivered to it under paragraph 12.3
to be
authorised and signed without delay and without amendment, and submitted to
the
appropriate tax authority without delay (and in any event within any relevant
time limit).
12.7 The
Purchaser shall not voluntarily communicate with the Dutch tax authorities
in
connection with the possible application of the 16th
Standard
Condition or article 15ai of the Netherlands Corporate Income Tax Act 1969
and,
in the event that the Dutch tax authorities raise questions in connection
therewith, the Purchaser shall not send any communication to the Dutch tax
authorities in relation thereto without the consent of the Dutch Seller (such
consent not to be unreasonably withheld or delayed). The Purchaser agrees that
it will submit all of its tax returns on the basis that article 15ai of the
Netherlands Corporate Income Tax Act 1969 and the 16th Standard Condition do
not
apply to the Dutch fiscal unity which existed between the Dutch Seller and
a
Dutch Company prior to Closing, unless the Purchaser has no reasonable position
to do so.
12.8 If
the
Dutch tax authorities determine that, other than as a result of a breach of
the
Purchaser’s obligations under paragraph 12.7, the 16th
Standard
Condition or article 15ai of the Netherlands Corporate Income Tax Act 1969
applies as a result of Closing to the Dutch fiscal unity which existed between
the Dutch Seller and a Dutch Company prior to Closing, then the Purchaser
covenants to pay to the Dutch Seller, by way of an
Page
112
adjustment
to the consideration for the sale of the relevant Shares and on or before the
date ten Business Days after demand is made therefor by the Dutch Seller, an
amount equal to the Dutch Tax Benefit, if and when actually realised. For the
purposes of this paragraph 12.8, the “Dutch
Tax Benefit”
is
the
amount of the actual decrease of corporate income tax due which arises to a
Dutch Company (or, as the case may be, to the fiscal unity which a Dutch Company
has joined or will join) as a consequence of the application of the
16th
Standard
Condition or article 15ai of the Netherlands Corporate Income Tax Act 1969
giving rise to a greater depreciation base in its assets.
Rights
of the Purchaser
12.9 The
Purchaser shall be under no obligation to procure the authorisation, signing
or
submission to a tax authority of any tax document delivered to it under
paragraph 12.3
which it
considers in its reasonable opinion to be false or misleading in a material
respect, but for the avoidance of doubt shall be under no obligation to make
any
enquiry as to the completeness or accuracy thereof and shall be entitled to
rely
entirely on the relevant Seller and its agents.
13. Conduct
of other Tax Affairs
13.1 Subject
to paragraph 9
and the
following sub-paragraphs, the Purchaser or its duly authorised agents shall
have
sole conduct of all tax affairs of the Target Companies which are not
pre-Closing tax affairs and shall be entitled to deal with such tax affairs
in
any way in which it in its absolute discretion considers fit, provided that
the
Purchaser shall ensure that all such tax affairs relating to periods prior
to
Closing are dealt with in an expeditious manner.
13.2 In
respect of any accounting period for Corporation Tax purposes commencing prior
to Closing and ending after Closing (the Straddle
Period)
and in
respect of any accounting period commencing prior to Closing for the purposes
of
any other tax, the Purchaser shall procure that the tax returns of each Target
Company shall be prepared on a basis which is consistent with the manner in
which the tax returns of that Target Company were prepared for all accounting
periods ending prior to Closing (save to the extent required by law, any
applicable regulation or generally applicable accounting
principles).
13.3 The
Purchaser shall procure that the Target Companies provide to the relevant Seller
all tax returns for Corporation Tax purposes relating to the Straddle Period
no
later than 30 Business Days before the date on which such tax returns are
required to be filed with the appropriate tax authority without incurring
interest or penalties. The Purchaser shall further procure that, before the
tax
returns are submitted to the appropriate tax authority, the Target Companies
shall take into account any such comments made by the relevant Seller as the
Purchaser (acting reasonably) considers to be reasonable, to the extent that
those comments do not relate solely to matters occurring
after Closing.
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113
13.4
The
relevant Seller shall provide such assistance as the Purchaser shall reasonably
request in preparing all tax returns of the Target Companies relating to the
Straddle Period.
14. Surrenders
between the Retained Group and the Target
Companies
14.1 Subject
to the following provisions of this paragraph 14,
and
without prejudice to the generality of paragraph 12,
the
Purchaser shall procure that the Target Companies shall, in respect of any
time
or period falling on or prior to the Closing Date (which for the purposes of
this paragraph 14
shall
include, for the avoidance of doubt, any overlapping period pursuant to section
403A of the Taxes Act), make, give or enter into such claims, elections,
surrenders, notices or consents (whether unconditional or conditional, whether
or not forming part of any other return or tax document, whether provisional
or
final, and including amendments to or withdrawals of earlier claims, elections,
surrenders, notices or consents, whether or not made before or after Closing)
as
the relevant Seller shall direct in connection with
any
Surrender by or to any member of the Retained Group to or by (as the case may
be) any of the Target Companies. No payment shall be made after the date of
this
agreement in respect of any such Surrender by or to any member of the Retained
Group to or by any of the Target Companies except to the extent set out in
the
following provisions of this paragraph 14.
14.2 If
and to
the extent that:
(a) |
any
Target Company has paid Corporation Tax (otherwise than in circumstances
where a claim has been or could be made under paragraph 2
in
respect thereof), and a Surrender effected pursuant to
paragraph 14.1
or
any Surrender effected prior to Closing has the effect of causing
a
repayment after Closing of some or all of that tax (with or without
any
repayment supplement within the meaning of section 825 of the Taxes
Act or interest under section 826 of that Act);
or
|
(b) |
but
for a Surrender effected pursuant to paragraph 14.1
or
prior to Closing (and ignoring the effect of any Purchaser’s relief, to
the extent allowed by law), any Target Company would have had a liability
to Corporation Tax in respect of which the Purchaser would not have
been
able to make a claim under paragraph 2;
or
|
(c) |
provision
for Corporation Tax is made in the Accounts, and a Surrender has
the
effect of discharging all or part of the liability represented by
that
provision (save to the extent that payment has been made in respect
of
such Surrender, including without limitation by way of book entry,
on or
before Closing);
or
|
(d) |
provision
for payment in respect of a Surrender is made in the Accounts (save
to the
extent that such payment has been made, including without limitation
by
way of book entry,
on
or before Closing),
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Page
114
the
Purchaser shall procure that, in respect of any such Surrender to which a member
of the Retained Group is a party, a payment for group relief (within the meaning
of section 402(6) of the Taxes Act) shall be made to the relevant member of
the
Retained Group by the Target Company concerned.
14.3 The
amount of any such payment as is referred to in paragraph 14.2
shall be
equal to:
(a) |
in
a case where paragraph 14.2(a)
applies, the amount of Corporation Tax so repaid (together with any
repayment supplement or interest), less any amount of such repayment
(or
repayment supplement or interest) the right to which was included
as an
asset in the Accounts, and less Corporation Tax suffered on such
interest;
or
|
(b) |
in
a case where paragraph 14.2(b)
applies, the amount of Corporation Tax which would have been required
to
be paid but for the Surrender (ignoring the effect of any Purchaser’s
relief, to the extent allowed by law);
or
|
(c) |
in
a case where paragraph 14.2(c)
applies, the amount of Corporation 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;
or
|
(d) |
in
a case where paragraph 14.2(d)
applies, the amount in respect of which provision is made in the
Accounts.
|
14.4 Any
payment under paragraph 14.3
shall be
made:
(a) |
in
a case where paragraph 14.2(a)
applies, on the date two Business Days after the date on which such
repayment is received, or would be received but for some event or
action
within paragraph 14.5
or
but for being offset by some other tax liability;
or
|
(b) |
in
a case where paragraph 14.2(b),
14.2(c)
or
14.2(d)
applies, on the later of the date on which such tax would have become
due
and payable (or, if such date is not a Business Day, the next following
Business Day) and ten Business Days after the date on which notice
is
given by the relevant Seller to the Purchaser of such
Surrender,
|
and
interest shall be charged on any amount not paid on the due date as provided
in
paragraph 11.4.
14.5 In
ascertaining the amount of any payment under paragraph 14.3,
and the
time of such payment, no account shall be taken of any event or action occurring
after Closing (including any loss arising in a period ending after Closing)
which has or could have the effect:
Page
115
(a) |
in
a case where paragraph 14.3(a)
applies, of deferring, reducing or eliminating any repayment to any
Target
Company (or the receipt of any repayment supplement or
interest);
|
(b) |
in
a case where paragraph 14.3(b),
14.3(c)
or
14.3(d)
applies, of deferring, reducing or eliminating tax which would otherwise
have become payable,
|
and
in
such a case paragraph 14.2
shall
apply as if such event or action had not occurred.
14.6 Where,
in
respect of a relevant accounting period (within the meaning of section 102
of
the United Kingdom Finance Act 1989) ended on or before the Closing Date,
section 102(4) applies in relation to:
(a) |
a
surrendering company in the Retained Group and a recipient company
which
is any Target Company, then to the extent
that:
|
(i) |
an
amount corresponding to tax which the recipient company is deemed
to have
paid by virtue of section 102(4)(a) has been provided for in the
Accounts
or has previously been paid by the recipient company (otherwise than
in
circumstances where a claim has been or could be made under
paragraph 0
of
this Schedule in respect thereof) (in each case the amount
saved);
or
|
(ii) |
provision
is made in the Accounts for payment in respect of the surrender (save
to
the extent that such payment has been made in respect of such surrender,
including without limitation by way of book entry, on or before
Closing),
|
the
Purchaser shall procure that a payment for a transferred tax refund (within
the
meaning of section 102(7)) shall be made to the relevant member of the Retained
Group of an amount equal to the amount saved or the amount provided (as the
case
may be);
or
(b) |
a
surrendering company which is any Target Company and a recipient
company
in the Retained Group, then to the extent that the right to the relevant
tax refund has been included as an asset in the Accounts (the refund
amount),
the relevant Seller shall procure that a payment for a transferred
tax
refund (within the meaning of section 102(7)) shall be made to the
relevant Target Company equal to the refund
amount.
|
14.7 Any
payment for a transferred tax refund pursuant to paragraph 14.6
above
shall be made:
(a) |
in
a case where paragraph 14.6(a)
applies, on the later of the date on which the tax provided for in
the
Accounts, or saved by the surrender, would have become due and payable
but
for the application of section 102 or, if the tax has been paid,
the
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116
day
following the day on which the amount saved is repaid by the relevant
tax
authority (or, if such date is not a Business Day, the next following
Business Day) and ten Business Days after demand is made therefor
by the
relevant member of the Retained Group;
or
|
(b) |
in
a case where paragraph 14.6(b)
applies, on the date on which the tax refund in question would have
been
received by the Target Company concerned but for the application
of
section 102,
|
and
interest shall be charged on any amount not paid on the due date as provided
in
paragraph 11.4
(where
paragraph 14.6(a)
applies)
or paragraph 10.4
(where
paragraph 14.6(b)
applies).
14.8 If
a
payment is made under paragraph 14.2
or 14.6
and the
Surrender or transfer of tax refund to which it relates is subsequently
determined to have been invalid or ineffective to any extent or excessive,
then
the payment so made (or so much of it as relates to such part of the Surrender
or transfer found to be invalid or ineffective or excessive) shall be refunded
as soon as practicable thereafter, together with interest at LIBOR from the
date
of payment until the date of the refund.
14.9 The
parties shall procure that, except as provided in the foregoing provisions
of
this paragraph 14,
no
payment in respect of any Surrender or any transfer of tax refund shall be
made
or repaid by or to a member of the Retained Group to or by any Target Company
after Closing, except as may be required by law or (in the case of a repayment)
to the extent required (as specified by the relevant Seller, acting reasonably)
to ensure that a payment previously made is not taxable. In the event that
any
payment or repayment is in fact made by or to a member of the Retained Group
to
or by any Target Company after Closing, otherwise than as provided in paragraphs
14.2
to
14.8
above
(save
where a repayment made pursuant to paragraph 14.8
arises
as a result of an insufficiency of profits in the relevant company),
then:
(a)
|
if
such amount is received by a Target Company, the Purchaser will promptly
pay an equivalent amount to the relevant Seller;
and
|
(b)
|
if
such amount is received by a member of the Retained Group, the relevant
Seller will promptly pay an equivalent amount to the
Purchaser,
|
in
each
case by way of adjustment to the consideration for the appropriate Set of
Shares.
14.10 Paragraph 7
(tax
refunds) shall not apply to any tax refund to the extent that a payment is
made
under this paragraph 14
to any
member of the Retained Group which is attributable to that tax
refund.
14.11 Paragraph 2
shall
not apply to any tax liability to the extent that a payment is made under this
paragraph 14
by any
member of the Retained Group in respect of that tax liability.
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117
14.12 In
the
event that provision for payment in respect of a Surrender is made in the
Accounts, or a provision is made which may be either in respect of payment
for a
Surrender or for Corporation Tax then, to the extent the Surrender is not
validly made or is ineffective, that provision shall (to that extent) be
treated, for the purposes of paragraphs 3.1(a)
and
4,
as a
provision in respect of the tax liability which would otherwise have been
eliminated by the Surrender.
14.13 For
the
avoidance of doubt, the provisions of this paragraph 14 shall not apply to
any Target Companies other than Fourninezero Limited and Short Bros (Plant)
Limited.
15. Instalment
Payments in France
The
Purchaser shall procure that the French Companies which are, as at the last
day
of the tax period preceding that in which Closing occurs, members of the French
Seller’s French tax group (intégration
fiscale)
pursuant to section 223 A et
seq. of
the
Xxxxxx xxxxxxx tax code (code
général des impôts)
shall
comply with their obligations resulting from the Tax Group Exit Agreement
(convention
de sortie d’intégration fiscale)
with
respect to down-payments of taxes covered by the French tax
consolidation.
16. United
States Tax Considerations
16.1 Tax
Indemnification.
Subject
to the exclusions of paragraphs 3.1 and 3.3, the USA Sellers jointly and
severally covenant to pay to the Purchaser an amount equal to any payment of
Taxes, and any losses, damages, costs or expenses of the Purchaser attributable
to:
(a) |
all
Taxes imposed on the USA Companies for any taxable period ending
on or
prior to the Closing Date (a "Pre-Closing Period"), and, with respect
to
any period that begins on or before and that ends after the Closing
Date
(in each case, a "Straddle Period"), the portion of such Straddle
Period
deemed to end on and include the Closing Date (in the manner determined
pursuant to paragraph 16.3);
|
(b) |
all
Taxes imposed on the USA Companies under United States Treasury
Regulations Section 1.1502-6 (and all corresponding provisions of
state,
local or foreign law) as a result of being a member of any federal,
state,
local or foreign consolidated, combined, unitary, or similar group
of
which the USA Seller is the common parent;
and
|
(c) |
all
Taxes of any person (other than another USA Company) imposed on the
USA
Companies as a transferee or successor, by contract or pursuant to
any
law, rule or regulation which Taxes relate to an event or transaction
occurring before Closing.
|
16.2 Tax
Returns.
Page
118
(a) |
The
USA Seller shall timely prepare and file (or cause preparation and
filing
of) with the appropriate tax authority all Tax Returns for the USA
Companies (including any consolidated, combined or unitary Tax Returns
for
groups in which a USA Company is a member, but excluding any
Non-Corporation Tax Returns) for Pre-Closing Periods, and shall pay
all
Taxes shown to be due thereon.
|
(b) |
The
Purchaser shall timely prepare and file (or cause preparation and
filing
of) with the appropriate tax authority all Tax Returns for the USA
Companies for all Straddle Periods, and shall pay all Taxes shown
to be
due thereon. All Straddle Period Tax Returns shall be prepared and
filed
in a manner consistent with past practice, and no position shall
be taken,
election made or method adopted that is inconsistent with positions
taken,
elections made or methods used in preparing and filing similar Tax
Returns
for prior periods, except as required by law. The Purchaser shall
deliver
to the USA Seller all Straddle Period Tax Returns (with copies of
any
relevant schedules, work papers and other documentation then available)
for the USA Seller's review and approval not less than thirty (30)
days
prior to the due date thereof (including extensions),
and shall make such revisions as are reasonably requested by the
USA
Seller. If
the USA Seller agrees with the Straddle Period Tax Return as revised,
the
USA Seller shall pay to the Purchaser an amount equal to the Taxes
shown
on such Straddle Period Tax Return to be attributed to the pre-closing
portion of such Straddle Period under paragraph 16.3,
except for those Taxes excluded under paragraphs 3.1 and 3.3. Such
payment
shall occur not later than two (2) business days before the due date
for
the payment of Taxes with respect to such Straddle Period Tax Return.
Any
disputes regarding the preparation of, or payment with respect to,
any
Straddle Period Tax Return shall be resolved in the manner set forth
in
paragraph 16.10.
|
(c) |
The
Purchaser shall timely prepare and file (or cause preparation and
filing
of) with the appropriate tax authority all Tax Returns due after
the
Closing Date with respect to Taxes for all Pre-Closing Periods and
Straddle Periods, other than Corporation Taxes of the USA Companies
("Non-Corporation Tax Returns"), and shall pay all Taxes shown to
be due
thereon. All Non-Corporation Tax Returns shall be prepared and filed
in a
manner consistent with past practice, and no position shall be taken,
election made or method adopted that is inconsistent with positions
taken,
elections made or methods used in preparing and filing similar Tax
Returns
for prior periods, except as required by law. The Purchaser shall
deliver
to the USA Seller all Non-Corporation Tax Returns (with copies of
any
relevant schedules, work papers and other documentation then available)
for the USA Seller's review and approval not less than thirty (30)
days
prior to the due date thereof (including extensions),
and shall make such revisions as are reasonably requested by the
USA
Seller. If
the USA Seller agrees with the Non-Corporation Tax Return as revised,
the
USA Seller shall pay to the Purchaser an amount equal to the Taxes
shown
on such Non-Corporation Tax Return (or, in the case of a Non-Corporation
Tax Return which is also a Straddle Period Tax Return, an amount
equal to
the Taxes shown on such Tax Return attributed to
the
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Page
119
pre-closing
portion of such Straddle Period under paragraph 16.3),
except for those Taxes excluded under paragraphs 3.1 and 3.3. Such
payment
shall occur not later than two (2) Business Days before the due
date for
the payment of Taxes with respect to such Non-Corporation Tax Return.
Any
disputes regarding the preparation of, or payment with respect
to, any
Non-Corporation Tax Return shall be resolved in the manner set
forth in
paragraph 16.10.
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16.3 Straddle
Period.
For
purposes of this paragraph 16, in order to apportion appropriately any Taxes
relating to a Straddle Period, the parties hereto shall, to the extent permitted
or required under applicable law, treat the Closing Date as the last day of
the
taxable year or period of the USA Companies for all Tax purposes. In any case
where applicable law does not permit the USA Companies to treat the Closing
Date
as the last day of the taxable year or period, the portion of any Taxes that
are
allocable to a pre-closing portion of any Straddle Period shall be:
(a) |
in
the case of Taxes imposed on a periodic basis with respect to the
business
or assets of the USA Companies the amount of such Taxes for the entire
Straddle Period multiplied by a fraction, the numerator of which
is the
number of calendar days in the portion of the Straddle Period ending
on
and including the Closing Date, and the denominator of which is the
number
of calendar days in the entire Straddle Period;
and
|
(b) |
in
the case of Taxes not described in clause (i) (such as Taxes that
are
either (A) based upon or related to income or receipts, or (B) imposed
in
connection with any sale or other transfer or assignment of property),
deemed equal to the amount that would be payable if the taxable year
or
period ended on the Closing Date. Notwithstanding the foregoing,
any Taxes
relating to any transactions not in the ordinary course of business
that
occur after the Closing on the Closing Date shall be treated as occurring
on the day after the Closing Date to the extent permitted by United
States
Treasury Regulations Section 1.1502-76(b)(1)(ii)(B) (or any comparable
provision of state, local or foreign
law).
|
16.4 Tax
Cooperation and Assistance.
The
USA
Seller and the Purchaser shall reasonably cooperate, and shall cause their
respective affiliates (including, in the case of the Purchaser after the Closing
Date, the USA Companies), officers, employees, agents, auditors and
representatives reasonably to cooperate, in preparing and filing all Tax
Returns, including maintaining and making available to each other all records
necessary in connection with Taxes and in resolving all disputes and audits
with
respect to all taxable periods relating to Taxes. At the request of the USA
Seller or the Purchaser, as the case may be, the other party will furnish all
Tax information relating to the USA Companies within ninety (90) days prior
to
the due date (including extensions) for any Tax Returns required to be filed
by
such party pursuant to paragraph 16.2.
The USA
Seller, the Purchaser and their affiliates will need access, from
Page
120
time
to
time, after the Closing Date, to certain accounting and Tax records and
information relating to the USA Companies; therefore, each party shall (and
shall cause their affiliates to) (i) properly retain and maintain such records
until the applicable statute of limitations expires (giving effect to any
extension thereof) and to abide by all record retention agreements entered
into
with any tax authority, (ii) give each other party reasonable written notice
prior to transferring, destroying, or discarding any such books and records
and,
if a party so requests, shall allow that party to take possession of such books
and records, and (iii) allow each other party and its agents and representatives
(and agents and representatives of any of its affiliates), at times and dates
mutually acceptable to the parties, to inspect, review and make copies of such
records it may deem necessary or appropriate from time to time, such activities
to be conducted during normal business hours and at the expense of the
inspecting party.
16.5 Refunds
and Credits
Any
refund or credit of Taxes attributable to any Pre-Closing Period or any
pre-closing portion of a Straddle Period shall be dealt with in the manner
set
forth in paragraphs 7.2(a) to (d) inclusive. Any refund or credit of Taxes
of
the USA Companies for any taxable period beginning after the Closing Date shall
belong to and vest in the Purchaser. The Purchaser shall, if the USA Seller
so
requests and at the USA Seller's expense, cause the USA Companies to file for
and obtain any refunds or credits to which the USA Seller is entitled under
this
paragraph 16.5. The Purchaser and the USA Companies shall permit the USA Seller
to control the prosecution of any such refund claim and, where deemed
appropriate by the USA Seller, shall authorize by appropriate powers of attorney
such persons as the USA Seller shall designate to represent the USA Companies
with respect to such refund claim. Each party shall, or shall cause its
affiliates to, forward to any other party entitled under this paragraph 16.5
to
any refund or credit of Taxes any such refund within ten (10) days after such
refund is received or reimburse such other party for any such credit within
ten
(10) days after the credit is allowed or applied against other Tax liability.
The parties shall treat any payments under the preceding sentence as an
adjustment to the purchase price, unless a determination with respect to the
Purchaser or any of its affiliates causes any such payment not to be treated
as
an adjustment to the purchase price for United States federal income Tax
purposes.
16.6 Tax
Contests
In
the
event any tax authority informs any party of any proposed or actual audit,
examination, adjustment, claim, assessment, or demand (a "Tax Audit") concerning
the amount of Taxes of the USA Companies with respect to any Pre-Closing Period
or Straddle Period, the party so informed shall notify each other party of
such
matter within ten (10) Business Days after receiving such notice. No failure
or
delay in informing the other party shall reduce or otherwise affect the
obligations or liabilities of any party hereto, except to the extent such
failure or delay shall have adversely affected the recipient party's ability
to
defend against any liability or claim with respect to such Taxes. Any notice
shall be accompanied by a copy of any written notice or other document
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121
received
from the applicable tax authority with respect to such matter. The USA Seller
shall have the sole right to control, at its expense, the contest of the
portions of any audits, disputes, administrative, judicial or other proceedings
relating to Taxes of the USA Companies for any Pre-Closing Period; provided,
however, that if the USA Seller elects to control the contest, the USA Companies
and the Purchaser shall have the right, at their expense, to participate in
such
contest. For avoidance of doubt, the Purchaser and the USA Companies (and not
the USA Seller) shall have the sole right to control the contest of the portion
of any audits, disputes, administrative, judicial or other proceedings relating
to the taxes of the USA Companies for all Straddle Periods; provided, however,
that the USA Seller, at its expense, shall have the right to participate in
such
contest as it may pertain to the pre-closing portion of such Straddle Period.
No
party hereto shall agree, settle or compromise any issue related to Taxes of
the
USA Companies with respect to any Pre-Closing Period or any Straddle Period,
which settlement or compromise would have any adverse impact on the liability
for Taxes hereunder of the other party, without consulting in good faith with
such other party, provided, however, that any dispute with respect to a decision
to agree, settle or compromise any issue related to Taxes of a consolidated,
combined or unitary group whose members include a company which is not a USA
Company with respect to any Pre-Closing Period shall be resolved in the USA
Seller's sole discretion. Any disputes with respect to a decision to agree,
settle or compromise any other issue referred to above shall be resolved in
the
manner set forth in paragraph 16.10.
16.7 Adjustments
If
any
Tax Audit results in an increase in Taxes either to the USA Seller (including
an
increase in the USA Seller’s indemnification obligation under this paragraph 16)
or to the Purchaser (including the USA Companies which Taxes are not indemnified
under this paragraph 16), as the case may be (the “Taxed Party”), and a
corresponding relief to the other party (the “Benefiting Party”), the Benefiting
Party shall pay to the Taxed Party (or shall reduce the Taxed Party’s
indemnification obligation by) an amount equal to the net present value of
such
relief. Any payment due under this paragraph 16.7
shall be
made promptly, but in no event later than 10 days following the date on which
the Taxed Party makes a payment to the appropriate tax authority pursuant to
such Tax Audit.
16.8 Tax
Sharing Agreements
Any
tax
sharing agreement between the USA Seller and the USA Companies is terminated
as
of the Closing Date and will have no further effect for any taxable year
(whether the current year, a future year, or a past year).
16.9 Carrybacks
The
Purchaser shall cause the USA Companies to forego the carryback of any item
of
Tax credit, regular net operating loss, alternative minimum tax net operating
loss, capital loss or any other similar item generated in taxable periods
beginning after the Closing Date to any Pre-Closing Period.
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122
16.10 Disputes
Any
dispute covered by this paragraph 16.10 shall be resolved by an independent
accounting firm. The parties shall instruct such firm to reach its conclusion
regarding any such dispute within a reasonable period of time (not to exceed
thirty days) after its appointment. The report of the independent accounting
firm shall be , binding and conclusive on the USA Seller and the Purchaser.
The
fees and expenses of such firm shall be borne equally by the USA Seller and
the
Purchaser.
16.11 Exclusivity
This
paragraph 16 (along with paragraphs 1.1, 3.1, 3.3, 3.5 and 7.2(a) to (d)
inclusive) shall be the sole and exclusive provision governing matters relating
to the Taxes of the USA Companies, and no other provision of this Schedule
shall
apply to the USA Companies.
16.12 Survival
The
USA
Sellers’ indemnification obligations under this paragraph 16 shall survive until
the expiration of the applicable statute of limitations (including any
extensions thereof) and shall have no further effect thereafter; provided that
if a claim or notice for indemnification is given under this paragraph prior
to
any such expiration date, the claim with respect to such indemnification shall
continue indefinitely until such claim is resolved.
17. Netherlands
The
Dutch
Seller and the Purchaser shall procure that, if there are any losses
attributable to the Dutch Companies, the Dutch Seller and the Dutch Companies
shall file a request pursuant to article 15af of the Netherlands Corporate
Income Tax Act 1969 that, following the dissolution of the Dutch Companies
from
the fiscal unity with the Dutch Seller, all tax losses of the fiscal unity
attributable to the Dutch Companies shall be available to the Dutch Companies
to
offset future taxable income.
Page
123
SCHEDULE 10
THIRD
PARTY ASSURANCES
GIVEN BY XXXXXXX’ GROUP
1. Joint
and
several guarantee dated 27 July 2001 given by Brambles Industries Limited and
Brambles Industries plc in favour of HSBC Bank plc, to the extent that such
guarantee relates to drawings made under irrevocable and unconditional standby
letter of credit for drawings up to an aggregate amount of £1,200,000 issued by
HSBC Bank plc on 1 August 2005 in favour of Zurich International (UK) Limited
and/or Zurich Insurance Company and/or Zurich Insurance Ireland Limited in
connection with amounts payable by Short Bros (Plant) Limited under employers
liability insurance programme.
2. Joint
and
several guarantee dated 27 July 2001 given by Brambles Industries Limited and
Brambles Industries plc in favour of HSBC Bank plc, to the extent that such
guarantee relates to payment obligations of National Recovery Systems, Inc.
under Credit Default Swap Transaction entered into between National Recovery
Systems, Inc. and HSBC Bank plc (Derivatives Operations) on 2 February
2005.
Page
124
SCHEDULE 11
INTRA-GROUP
DEBT
Part A
Payment
of Intra-Group Debt
Payment
at Closing of Estimated Intra-Group Debt
1. At
Closing:
(a) |
the
Purchaser shall procure that each Target Company pays to the Sellers
(for
themselves or, as the case may be, as agent for the members of the
Sellers’ Group to which the relevant Intra-Group Payables are owed) an
amount equal to the aggregate of the Estimated Intra-Group Payables
(if
any) owed by that Target Company, and the Estimated Intra-Group Payables
shall be treated as discharged to the extent of that
payment;
|
(b) |
the
Sellers shall (for themselves or, as the case may be, as agent for
each
relevant member of the Sellers’ Group) pay to the Purchaser (as agent for
the Target Companies to which the relevant Intra-Group Receivables
are
owed) an amount equal to the aggregate of the Estimated Intra-Group
Receivables (if any) owed by any member of the Sellers’ Group, and the
Estimated Intra-Group Receivables shall be treated as discharged
to the
extent of that payment.
|
2. Any
payment of Estimated Intra-Group Payables or Estimated Intra-Group Receivables
pursuant to paragraph 1
of this
Schedule shall be deemed to be a payment first, to the extent possible, of
all
interest accrued on the relevant Intra-Group Payable or Intra-Group Receivable
and thereafter of the relevant principal amount.
Final
repayment of Intra-Group Debt
3. When
the
Closing Statement has been finally agreed or determined in accordance with
Part
C of Schedule 12 :
(a) |
if
the actual amount of any Intra-Group Payable is greater than the
applicable Estimated Intra-Group Payable or any Intra-Group Receivable
is
less than the applicable Estimated Intra-Group Receivable, then the
Purchaser shall procure that the relevant Target Company pays to
the
Sellers (for themselves or, as the case may be, as agents for the
relevant
member of the Sellers’ Group) an amount equal to the
difference;
|
(b) |
if
the actual amount of any Intra-Group Payable is less than the applicable
Estimated Intra-Group Payable or any Intra-Group Receivable is greater
than the Estimated Intra-Group Receivable, then the Sellers shall
(for
themselves or, as the
|
Page
125
case
may be, as agents for the relevant member of the Sellers’ Group) pay to
the Purchaser (as agent for the relevant Target Company) an amount
equal
to the difference.
|
Any
amount payable under this paragraph 3
shall be
paid with interest on such amount for the period from (but excluding) the date
of Closing to (but including) the due date for payment under
paragraph 4
calculated on a daily basis. The rate of interest shall be:
(c) |
if
the relevant Intra-Group Payable or Intra-Group Receivable is owed
by or
to a UK Target Company, the one month sterling LIBOR rate as published
in
the London edition of the Financial Times on the date of
Closing;
|
(d) |
if
the relevant Intra-Group Payable or Intra-Group Receivable is owed
by or
to a French Target Company, the one month Euro LIBOR rate as published
in
the London edition of the Financial Times on the date of
Closing;
|
(e) |
if
the relevant Intra-Group Payable or Intra-Group Receivable is owed
by or
to a Dutch Target Company, the one month Euro LIBOR rate as
published in the London edition of the Financial Times on the date
of
Closing; or
|
(f) |
if
the relevant Intra-Group Payable or Intra-Group Receivable is owed
by or
to a US Target Company, the one month US dollar LIBOR rate as published
in
the London edition of the Financial Times on the date of
Closing.
|
4. Any
payments to be made pursuant to paragraph 3
shall be
made within 5 Business Days of the date on which the Closing Statement is agreed
or determined in accordance with C of Schedule 12 .
Such
payment shall be made in accordance with clause 14.1
or
14.2,
as the
case may be.
Part B
Estimated
Intra-Group Payables
INTENTIONALLY
OMITTED
Part C
Estimated
Intra-Group Receivables
INTENTIONALLY
OMITTED
Page
126
SCHEDULE 12
POST-CLOSING FINANCIAL ADJUSTMENTS
Part A: Preliminary
1. In
preparing the Closing Statement:
(a) |
the
items and amounts to be included in the calculation of External Debt,
Cash, Net Working Capital, Intra-Group Payables and Intra-Group
Receivables for the purposes of the Closing Statement shall be identified
by applying the relevant definition in Schedule 13
(subject, where applicable, to the provisions of Part A
of
this Schedule);
|
(b) |
in
applying each such definition and the provisions of Part A
of
this Schedule and determining which items and amounts are to be included
in the Closing Statement, if and to the extent that the treatment
or
characterisation of the relevant item or amount or type or category
of
item or amount:
|
(i) |
is
dealt with in the specific accounting treatments set out in Part
B of this
Schedule (the Specific
Accounting Treatments),
the relevant Specific Accounting Treatment(s) shall
apply;
|
(ii) |
is
not dealt with in the Specific Accounting Treatments but is dealt
with in
the accounting principles, policies, treatments, practices and
categorisations used in the preparation of the June 30 Accounts (the
Accounting
Principles),
the applicable Accounting Principle(s) shall apply (including in
relation
to the exercise of accounting discretion and judgement);
and
|
(iii) |
is
not dealt with in either the Specific Accounting Treatments or the
Accounting Principles, UK GAAP shall
apply.
|
2. None
of
the following are included in External Debt, Cash, Net Working Capital,
Intra-Group Payables or Intra-Group Receivables and, accordingly, shall not
be
included in the Closing Statement:
(a) |
any
record of, or provision or accrual for, any liability of any Target
Company in respect of pension, retirement indemnity or other
post-retirement benefits;
|
(b) |
any
amount in respect of deferred tax (whether as a liability or an
asset);
|
Page
127
(c) |
any
amount in respect of corporation tax, group relief or any other amount
in
respect of tax on income, profits or gains (whether as a creditor,
provision, debtor or otherwise);
and
|
(d) |
any
amounts in respect of liabilities (contingent or otherwise) for which
the
Sellers are obliged to indemnify the Purchaser and/or any of the
Purchaser’s Affiliates under the terms of the Transaction
Documents.
|
Part B: Specific
Accounting Treatments
The
following Specific Accounting Treatments shall apply in the preparation of
the
Closing Statement:
1. Information
available for Closing Statement.
Information available up until the earlier of the date of delivery of an
Objection Notice from the Purchaser under paragraph 2
of
Part C
of this
Schedule 12
and the
date of agreement or determination of the Closing Statement shall be taken
into
account insofar as it provides evidence of the state of affairs of the Target
Companies at Closing. The Closing Statement will reflect the position of the
Target Companies as at Closing and will not take into account the effects of
any
post-Closing reorganisations or, in any way, the post-Closing intentions or
obligations of the Purchaser.
2. No
re-appraisal of asset values.
The
Closing Statement shall not re-appraise the value of any of the assets of the
Target Companies as a result of the change in their ownership (or any changes
in
the business of the Target Companies since Closing following such change in
ownership) except only as specifically set out in this Schedule.
Part C:
Closing
Statement
1. The
Sellers shall, after Closing, prepare a
draft
statement (the Closing
Statement)
showing
the External Debt, Cash and Net Working Capital of each Relevant Target Group
and the Intra-Group Payables and Intra-Group Receivables of each Target Company.
The Closing Statement shall be in the form set out in Exhibit 1.
The
Sellers shall deliver the draft Closing Statement to the Purchaser within 30
Business Days after Closing.
2. The
Purchaser shall notify the Sellers in writing (an Objection
Notice)
within
15 Business Days after receipt whether or not it accepts the draft Closing
Statement for the purposes of this agreement. An Objection Notice shall set
out
in detail the Purchaser’s reasons for such non-acceptance and specify the
adjustments which, in the Purchaser’s opinion, should be made to the draft
Closing Statement in order for it to comply with the requirements of this
agreement. Except
for the matters specifically set out in the Objection Notice, the Purchaser
shall be deemed to have agreed the draft Closing Statement in full.
Page
128
3. If
the
Purchaser
serves an Objection Notice in accordance with paragraph 2,
the
Sellers and the Purchaser shall use all reasonable efforts to meet and discuss
the objections of the Purchaser and to agree the adjustments (if any) required
to be made to the draft Closing Statement, in each case within 10 Business
Days
after receipt by the Sellers of the Objection Notice.
4. If
the
Sellers and the Purchaser do not reach agreement within 10 Business Days of
receipt by the Sellers of the Objection Notice, then the matters in dispute
may
be referred (on the application of either the Sellers or the Purchaser) to
senior executives of the Sellers’ Group and the Purchaser Group nominated by the
respective Chief Executive Officers of the Guarantor and the Purchaser (the
Senior
Executives).
The
Senior Executives shall use all reasonable efforts to meet and discuss the
objections of the Purchaser and to agree the adjustments (if any) required
to be
made to the draft Closing Statement, in each case within 10 Business Days after
referral of the matters in dispute to them.
5. If
the
Purchaser is satisfied with the draft Closing Statement (either as originally
submitted or after adjustments agreed between the Sellers and the Purchaser
pursuant to paragraph 3
or
4)
or if
the Purchaser fails to give a valid Objection Notice within the 10 Business
Day
period referred to in paragraph 2,
then
the draft Closing Statement (incorporating any agreed adjustments) shall
constitute the Closing Statement for the purposes of this
agreement.
6. If
the
Senior Executives do not reach agreement within 10 Business Days after referral
of the matters in dispute to them in accordance with paragraph 4,
then
the matters in dispute may be referred (on the application of either the Sellers
or the Purchaser) for determination by KPMG LLP or its affiliated firm in the
relevant jurisdiction or, if that firm is unable or unwilling to act, by such
other independent firm of chartered accountants of international standing as
the
Sellers and the Purchaser shall agree or, failing agreement, appointed by the
President for the time being of the Institute of Chartered Accountants in
England and Wales (the Firm).
The
Firm shall be requested to make its decision within 25 Business Days (or such
later date as the Sellers’ Representative, the Purchaser and the Firm agree in
writing) of confirmation and acknowledgement by the Firm of its appointment.
The
following provisions shall apply once the Firm has been appointed:
(a) |
the
Sellers and Purchaser shall each prepare a written statement within
10
Business Days of the Firm’s appointment on the matters in dispute which
(together with the relevant supporting documents) shall be submitted
to
the Firm for determination
and copied at the same time to the
other;
|
(b) |
following
delivery of their respective submissions, the Purchaser and the Sellers
shall each have the opportunity to comment once only on the other’s
submission by written comment delivered to the Firm not later than
10
Business Days after receipt of the other’s submission and, thereafter,
neither the Sellers nor the Purchaser shall be entitled to make further
statements or submissions except
|
Page
129
insofar
as the Firm so requests (in which case it shall, on each occasion,
give
the other party (unless otherwise directed) 10 Business Days to
respond to
any statements or submission so
made);
|
(c) |
in
giving its determination, the Firm shall state what adjustments (if
any)
are necessary, solely for the purposes of this agreement, to the
draft
Closing Statement in respect of the matters in dispute in order to
comply
with the requirements of this agreement and to determine finally
the
Closing Statement;
|
(d) |
the
Firm shall act as an expert (and not as an arbitrator) in making
its
determination which shall, in the absence of manifest error, be final
and
binding on the parties
and, without prejudice to any other rights which they may respectively
have under this agreement, the parties expressly waive, to the extent
permitted by law, any rights of recourse they may otherwise have
to
challenge it.
|
7. The
Sellers and the Purchaser shall each be responsible for their own costs in
connection with the preparation, review and agreement or determination of the
Closing Statement. The fees and expenses of the Firm shall be borne equally
between the Sellers and the Purchaser or in such other proportions as the Firm
shall determine.
8. To
enable
the Sellers to meet their obligations under this Schedule 12 ,
the
Purchaser shall provide to the Sellers full access to the books and records,
employees and premises of the Target Companies and, where relevant, of the
Purchaser for the period from the date of Closing to the date that the draft
Closing Statement is agreed or determined. If the Purchaser serves an Objection
Notice, it shall ensure that the Sellers shall be given reasonable access to
the
Purchaser's working papers relating to the adjustments proposed in the Objection
Notice and any other submissions by or on behalf of the Purchaser in relation
to
the Closing Statement. The Purchaser shall co-operate fully with the Sellers
and
shall permit the Sellers to take copies (including electronic copies) of the
relevant books and records and shall provide all assistance reasonably requested
by the Sellers to facilitate the preparation of the Closing
Statement.
9. When
the
Closing Statement has been agreed or determined in accordance with the preceding
paragraphs, then the amounts shown in the Closing Statement as External Debt,
Cash and Net Working Capital of each Relevant Target Group and the Intra-Group
Payables and Intra-Group Receivables of each Target Company shall be final
and
binding for the purposes of this agreement.
Part D: Financial
Adjustments
1. When
the
Closing Statement has been finally agreed or determined in accordance with
this
Schedule 12 ,
the
following adjustments shall be made to the Initial Price of each Set of
Shares.
Page
130
External
Debt
2. In
relation to any Set of Shares:
(a) |
if
the External Debt of the Relevant Target Group is less than the Estimated
External Debt of the Relevant Target Group, then the Purchaser shall
pay
an amount equal to the difference to the Seller of that Set of Shares;
or
|
(b) |
if
the External Debt of the Relevant Target Group is greater than the
Estimated External Debt of the Relevant Target Group, then the Seller
of
that Set of Shares shall pay an amount equal to the difference to
the
Purchaser.
|
Cash
3. In
relation to any Set of Shares:
(a) |
if
the Cash of the Relevant Target Group is greater than the Estimated
Cash
of the Relevant Target Group, then the Purchaser shall pay an amount
equal
to the difference to the Seller of that Set of Shares;
or
|
(b) |
if
the Cash of the Relevant Target Group is less than the Estimated
Cash of
the Relevant Target Group, then the Seller of that Set of Shares
shall pay
an amount equal to the difference to the
Purchaser.
|
Net
Working Capital
4. In
relation to any Set of Shares:
(a) |
if
the Net Working Capital of the Relevant Target Group is greater than
the
Estimated Net Working Capital of the Relevant Target Group, then
the
Purchaser shall pay an amount equal to the difference to the Seller
of
that Set of Shares; or
|
(b) |
if
the Net Working Capital of the Relevant Target Group is less than
the
Estimated Net Working Capital of the Relevant Target Group, then
the
Seller of that Set of Shares shall pay an amount equal to the difference
to the Purchaser.
|
Intra-Group
Debt
5. In
relation to Intra-Group Payables and Intra-Group Receivables owed by or to
any
member of the Relevant Target Group (the Relevant
Target Company):
(a) |
if
any Intra-Group Payable is greater than the applicable Estimated
Intra-Group Payable or if any Intra-Group Receivable is less than the
applicable Estimated Intra-Group Receivable, then the Seller of the
Set of
Shares which comprises Shares in a Target Company that is a member
of the
same Relevant Target Group as the Relevant Target Company shall pay
to the
Purchaser an amount equal to the
difference;
|
Page
131
(b) |
if
any Intra-Group Payable is less than the applicable Estimated Intra-Group
Payable or if any Intra-Group Receivable is greater than the
applicable Estimated Intra-Group Receivable, then the Purchaser shall
pay
to the Seller of the Set of Shares which comprises Shares in a Target
Company that is a member of the same Relevant Target Group as the
Relevant
Target Company an amount equal to the
difference.
|
General
6. Any
payment required to be made pursuant to paragraph 5
of this
Part D
shall be
paid by the relevant Seller or the Purchaser (as the case may be) together
with
an amount equal to interest on such payment at the applicable interest rate
set
out in paragraphs (a)
to
(d)
below
for the period from (but excluding) the date of Closing to (and including)
the
due date for payment pursuant to the relevant clause, calculated on a daily
basis:
(a) |
if
the relevant Intra-Group Payable or Intra-Group Receivable is owed
by or
to a UK Target Company
the one month sterling LIBOR rate as published in the London edition
of
the Financial Times on the date of
Closing
|
(b) |
if
the relevant Intra-Group Payable or Intra-Group Receivable is owed
by or
to a French Target Company, the one month Euro LIBOR rate as published
in
the London edition of the Financial Times on the date of
Closing
|
(c) |
if
the relevant Intra-Group Payable or Intra-Group Receivable is owed
by or
to a Dutch Target Company, the one month Euro LIBOR rate as published
in
the London edition of the Financial Times on the date of Closing;
or
|
(d) |
if
the relevant Intra-Group Payable or Intra-Group Receivable is owed
by or
to a US Target Company the one month US dollar LIBOR rate as published
in
the London edition of the Financial Times on the date of
Closing.
|
7. The
Sellers and Purchaser agree that, once the Closing Statement has been agreed
or
determined in accordance with the provisions of Part C
of this
Schedule 12 ,
the
sums which each is respectively obliged to pay pursuant to this Part D
shall be
aggregated and, if in the same currency, set off against each other. Whichever
of the Sellers or Purchaser is then left with any payment obligation under
this
Part D shall make the applicable payment(s) within 5 Business Days of the
date on which the Closing Statement is agreed or so determined. Any such payment
shall be made in accordance with the provisions of clause 14.1
or
14.2,
as the
case may be.
Page
132
SCHEDULE 13
INTERPRETATION
INTENTIONALLY
OMITTED
Page
133
AS
WITNESS this
agreement has been signed on behalf of the parties the day and year first before
written.
/s/
XXXXX XXXXX XXXXXXXXX
|
) |
as
attorney
|
) |
for
and on behalf of
|
) |
BRAMBLES
U.K. LIMITED
|
) |
|
|
/s/
XXXXX XXXXX XXXXXXXXX
|
) |
as
attorney
|
) |
for
and on behalf of
|
) |
BRAMBLES
FRANCE SAS
|
) |
|
|
/s/
XXXXX XXXXX XXXXXXXXX
|
) |
as
attorney
|
) |
for
and on behalf of
|
) |
BRAMBLES
USA, INC.
|
) |
/s/
XXXXX XXXXX XXXXXXXXX
|
) |
as
attorney
|
) |
for
and on behalf of
|
) |
BRAMBLES
HOLDINGS EUROPE B.V.
|
) |
/s/
XXXXXXXX XXX XXXXXX XXXXXX
|
) |
for
and on behalf of
|
) |
HARSCO
CORPORATION
|
) |
/s/
XXXXX XXXXX XXXXXXXXX
|
) |
as
attorney
|
) |
for
and on behalf of
|
) |
BRAMBLES
INDUSTRIES LIMITED
|
) |
Page
134
EXHIBIT A
FORM
OF COMPLETION STATEMENT
INTENTIONALLY
OMITTED
Page
135
EXHIBIT B
LINE
ITEMS IN HYPERION ACCOUNTS FOR CALCULATING NET WORKING
CAPITAL
INTENTIONALLY
OMITTED
Page
136
EXHIBIT C
REGISTERED
IP RIGHTS OWNED BY TARGET COMPANIES
INTENTIONALLY
OMITTED
Page
137
EXHIBIT D
INTENTIONALLY
OMITTED
Page
138