Dated 13 August 1998
----------------------
(1) XXXXXXXX XXX XXXXXX, XXXXX XXXXXXXX AND OTHERS
(2) THE MARQUEE GROUP, INC.
(3) THE MARQUEE GROUP (UK) LIMITED
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SHARE PURCHASE AGREEMENT
FOR THE SALE AND PURCHASE OF
ALL THE ISSUED SHARE CAPITAL OF
PARK ASSOCIATES LIMITED
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BIRD & BIRD
00 XXXXXX XXXX
XXXXXX XX0X 0XX
Tel: 0000 000 0000
Fax: 0000 000 0000
ref:CMC/RMD/MARQU/002
CONTENTS
1 DEFINITIONS AND INTERPRETATION....................................2
2 SALE OF THE SHARES................................................7
3 CONSIDERATION.....................................................8
4 COMPLETION........................................................9
5 COMPLETION NET ASSET STATEMENT...................................12
6 REPRESENTATIONS AND WARRANTIES...................................14
7 CONFIDENTIALITY..................................................19
8 PROTECTIVE COVENANTS.............................................20
9 ANNOUNCEMENTS....................................................21
10 NOTICES AND RECEIPTS.............................................21
11 RESOLUTIONS AND WAIVERS..........................................22
12 GENERAL..........................................................22
13 WHOLE AGREEMENT..................................................23
14 GOVERNING LAW....................................................23
15 PURCHASERS' WARRANTIES AND COVENANT..............................23
SCHEDULE 1
THE SELLERS, THEIR SHAREHOLDINGS AND CONSIDERATION..........................26
SCHEDULE 2
PARTICULARS OF THE COMPANY..................................................28
SCHEDULE 3
DETAILS OF LEASE............................................................29
SCHEDULE 4
THE WARRANTIES..............................................................30
SCHEDULE 5
PROPERTY LICENCE............................................................58
THIS AGREEMENT is made on the day of 1998
BETWEEN
(1) THE PERSONS WHOSE NAMES AND ADDRESSES ARE SHOWN IN SCHEDULE 1 (each a
"SELLER" and together the "SELLERS");
(2) THE MARQUEE GROUP, INC. a company incorporated under the laws of the
state of Delaware, the principal office of which is at 000 Xxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000, XXX ("MARQUEE INC.");
(3) MARQUEE GROUP (UK) LIMITED, a company incorporated under the laws of
England & Wales with company number 3584251 and whose registered office
is at 00 Xxxxxx Xxxx, Xxxxxx XX0X 0XX ("MARQUEE UK").
RECITALS
(A) Park Associates Limited (the "COMPANY") (certain particulars of which are
set out in Schedule 2) is a private company limited by shares
incorporated in England and Wales on 11 November 1980 under the Companies
Acts 1948 to 1976 having an authorised capital of(pound)1,000,000 divided
into 994,590 "C" ordinary shares, 3,400 "D" ordinary shares and 510 "E"
ordinary shares, all of(pound)1 each and 1200 "F" ordinary shares, 1200
"H" ordinary shares, 300 "G" ordinary shares and 300 "J" ordinary shares
of 50p each, of which 45,900 "C" ordinary shares, 3,400 "D" ordinary
shares, 000 "X" xxxxxxxx xxxxxx , 0000 "F" ordinary shaers, 1200 "H"
ordinary shares, 300 "G" ordinary shares and 300 "J" ordinary shares have
been issued fully paid or credited as fully paid (the "SHARES").
(B) The Sellers are the registered holders and (except in the case of the
Shares held by the Trustees) the beneficial owners of the Shares set
opposite their respective names in Schedule 1.
(C) Marquee (UK) is a wholly owned subsidiary of Marquee Inc. (together the
"PURCHASERS" and "PURCHASER" shall be construed accordingly).
(D) The Sellers wish to sell and, in reliance upon the representations,
warranties, and undertakings set out in this Agreement, the Purchasers
are willing to purchase all the issued share capital of the Company on
the terms and subject to the conditions set out in this Agreement.
OPERATIVE PROVISIONS
1 DEFINITIONS AND INTERPRETATION
1.1 In this Agreement and the Schedules
1
"ACCOUNTS" means all or any one of the audited balance sheet of the
Company as at the Accounts Date and the audited profit and loss account
of the Company for the financial period ended on the Accounts Date and
the notes to such accounts and the directors reports and the other
documents required by law to be annexed thereto;
"ACCOUNTS DATE" means 31 December 1997;
"ANNIVERSARY DATES" means the first, the second, the third, the fourth
and the fifth anniversary of the Effective Date;
"AGREED TERMS" means terms contained in a form which has been agreed and
initialled by or on behalf of the parties for the purpose of
identification immediately prior to the signing of this Agreement;
"BUSINESS DAY " means Monday to Friday inclusive but excluding any day
which is a bank or public holiday in the country concerned;
"CASH CONSIDERATION" means that part of the consideration for the sale of
the Shares as is payable in cash under Clause 3;
"CHANGE OF CONTROL" means the change of control (as defined in Section
840 Taxes Act 1988) of Marquee Inc. (other than as a result of the
acquisition of shares in Marquee Inc. by SFX Entertainment Inc.) and as a
result of such change of control, Xx Xxxxxx Xxxxxxxx ceasing to be
President and Chief Executive Officer of Marquee Inc. (whether
immediately on change of control or subsequently);
"COMMON STOCK" means the shares of no par value in the Common Stock of
Marquee Inc. quoted on the American Stock Exchange;
"COMPLETION" means completion of the sale and purchase of the Shares in
accordance with Clause 4;
"COMPLETION DATE" means the date on which Completion takes place;
"COMPLETION NET ASSET STATEMENT" means the statement of the Net Assets as
at the Effective Date to be prepared in accordance with Clause 5;
"CONSIDERATION" means the Cash Consideration, the Loan Notes and the
Consideration Shares;
"CONSIDERATION SHARES" means the Initial Consideration Shares and the
Deferred Consideration Shares;
"CONSULTANCY AGREEMENT" means a five year consultancy agreement in agreed
terms
2
to be entered into between the Company and Xxxxx XxXxxxxx;
"DEFERRED CONSIDERATION SHARES" means the Common Stock of Marquee Inc. to
be issued to the Sellers in accordance with the provisions of Clause 3.3
and ranking pari passu with the existing Common Stock of Marquee Inc. at
the date of issue;
"DISCLOSURE LETTER" means the letter from the Warrantors to the
Purchasers of the Effective Date and which has been delivered to the
Purchasers prior to the signing of this Agreement;
"EFFECTIVE DATE" means 1 July 1998;
"HOLDING COMPANY" has the meaning given to it in Section 736 and 736A of
the Companies Xxx 0000;
"INITIAL CONSIDERATION SHARES" means the Common Stock of Marquee Inc. to
be issued by Marquee Inc. at Completion pursuant to Clause 3.2(a) and
ranking pari passu with the existing Common Stock of Marquee Inc. at the
date of issue;
"INSOLVENCY ACT" means the Insolvency Xxx 0000;
"ISSUE PRICE" means the average closing price of shares of Common Stock
as printed in the eastern edition of the Wall Street Journal over the 20
trading days ending three days prior to the Effective Date or the
relevant Anniversary Date, as appropriate, (provided that no account
shall be taken of any trading day in respect of which the said edition is
not published) as converted to Pounds Sterling by the application of the
average spot rate of exchange for the purchase of Pounds Sterling with US
Dollars, as published by the eastern edition of the Wall Street Journal
at the close of business on the twenty business days ending three days
prior to the Effective Date or the relevant Anniversary Date, as
appropriate (provided that no account shall be taken of any business day
in respect of which the said eastern edition of the Wall Street Journal
is not published);
"INTELLECTUAL PROPERTY RIGHTS" means all and any patents, trademarks,
service marks, trade names, registered designs, unregistered design
rights, copyrights and rights in confidential information, and all and
any other intellectual property rights, whether registered or
unregistered, and including all applications and rights to apply for any
of the same;
"LEASE" means the leasehold interest details of which are set out in
Schedule 3;
"LOAN NOTES" means the series of (pound)800,000 nominal unsecured loan
notes of Marquee Inc. in the agreed terms;
"MARQUEE INC. SHARES" means those of the Shares as set out in Part B of
Schedule 1
3
to be purchased by Marquee Inc. pursuant to the terms of this Agreement;
"MARQUEE INC.'S STOCKBROKERS" means Continental Stock Transfer & Trust
Company;
"MARQUEE UK SHARES" means those of the Shares as set out in Part A of
Schedule 1 to be purchased by Marquee UK pursuant to the terms of this
Agreement;
"NET ASSETS" means the total current assets of the Company less the total
current liabilities of the Company at 12.01 am on the Effective Date;
"PARTIES" means the parties to this Agreement;
"PERSONAL GUARANTEES" means both (i) the Specific Counter Indemnity
entered into by Struan Xxxxxxxx and Xxxxx XxXxxxxx on 24 October 1996 in
Xxxxxx & Co's standard form and the Charge over Credit Balance entered
into by Xxxxx XxXxxxxx on 24 October 1996 in consideration of Xxxxxx & Co
executing a guarantee of CHF 200,000 and (ii) a Second Legal mortgage
over the property known as Xxxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxx,
Xxxxxxxxxxxxxxx entered into by Xxx Xxxxxx and Mrs M Xxxxxx limited to
the sum of (pound)135,000 and a Specific Counter Indemnity entered into
by Xxx Xxxxxx in Xxxxxx & Co's standard form in consideration of Xxxxxx &
Co executing a guarantee of CHF 200,000, each of Xxxxxx & Co's guarantees
relating to the guarantees provided by Swiss Bank Corporation for CHF
200,000 in favour of Federation Internationale de Football Association
("FIFA") in relation to the FIFA Licenses granted to Struan Xxxxxxxx and
Xxx Xxxxxx.
"PROPERTY LICENCE" means a licence to be granted to the Company by Xxxxx
XxXxxxxx and Xxx X. Xxxxxx in respect of the property known as 0 Xxxxxx
Xxxxxx, Xxxxxxxxxx, a copy of which is set out in Schedule 5.
"PURCHASERS' ACCOUNTANTS" means Ernst & Young;
"PURCHASERS' SOLICITORS" means Bird & Bird, 00 Xxxxxx Xxxx, Xxxxxx XX0X
0XX;
"SELLERS' ACCOUNTANTS" means Xxxxx Xxxxxxxx of 00 Xxxxxx Xxxx Xxxxxxxxxx
XX0 0XX;
"SELLERS' SOLICITORS" means Freeth Xxxxxxxxxx Xxxx Xxxxxxx, 00 Xxxxx
Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx XX0 0XX;
"SERVICE AGREEMENT" means the service agreement in the agreed terms to be
entered into between the Company and Xxx Xxxxxx;
"TAX" shall have the meaning ascribed to it in the Tax Deed;
"TAXES ACT 1988" means the Income and Corporation Taxes Xxx 0000;
4
"TAX DEED" means the deed in relation to tax in the agreed terms;
"TAXATION WARRANTIES" means each and every warranty contained in Section
[D] of Schedule 4;
"TRUSTEES" means Xxxxxxxx Xxx Xxxxxx and Xxxxxxxx Xxxxxx as trustees of
The Xxx Xxxxxx Discretionary Settlement 1998;
"UNTRADEABLE SHARES" means any Initial Consideration Shares or any issued
Deferred Consideration Shares which remain subject to the restrictions of
Clause 3.7;
"WARRANTIES" means all and any of the representations, warranties and
undertakings referred to in Clause 6 and Schedule 4; and
"WARRANTORS" means J. R Xxxxxx and X. XxXxxxxx.
1.2 References in this Agreement to any statutory provisions shall be
construed as references to those provisions as respectively amended,
consolidated or re-enacted (whether before or after the Effective Date)
from time to time and shall include any provisions of which they are
consolidations or re-enactments (whether with or without amendment)
except to the extent that any amendment, consolidation or re-enactment
made after the Effective Date creates or increases the liability of the
parties under this Agreement or the Tax Deed.
1.3 Where any Warranty is qualified by the expression "so far as the
Warrantors are aware" or "to the best of the Warrantors' knowledge
information and belief" or any similar expression that statement shall be
deemed to include an additional statement that it has been made after due
and careful enquiry unless stated otherwise. For the purposes of
establishing whether due and careful enquiry has been made the Warrantors
shall be deemed to have given the relevant matter due and careful thought
and to have taken appropriate advice from, and made proper enquiries of,
the other Sellers, the Company's auditors, tax advisors, insurance
brokers, legal advisors and employees but otherwise they shall not be
under any obligation to have taken specialist advice or to have employed
or consulted any third parties.
1.4 The Schedules form part of this Agreement and shall have the same force
and effect as if set out in the body of this Agreement and any reference
to this Agreement shall include the Schedules.
1.5 In this Agreement:-
(a) the masculine gender shall include the feminine and neuter and the
singular number shall include the plural and vice versa;
(b) references to persons shall include bodies corporate, unincorporated
associations
5
and partnerships;
(c) any headings or side notes or, in the case of any legislation
specifically referred to, the inclusion in parentheses of the title
to the relevant Part, Section, Schedule or paragraph contained in
such legislation are for the sake of convenience only and shall not
affect the construction of this Agreement; and
(d) references to any party include a reference to the estate, personal
representative, successor, or permitted assigns of that party; and
(e) a person shall be deemed to be connected with another if that person
is connected with another within the meaning of section 839 of the
Taxes Xxx 0000.
1.6 Except where the contrary is stated, any reference in this Agreement to a
Clause or Schedule is to a Clause or Schedule of this Agreement, and any
reference within a Clause or Schedule to a sub-clause, paragraph or other
sub-division is a reference to such sub-clause, paragraph or other
sub-division so numbered or lettered in that Clause or Schedule.
1.7 In construing this Agreement
(a) the rule known as the ejusdem generis rule shall not apply and
accordingly general words introduced by the word "other" shall not
be given a restrictive meaning by reason of the fact that they are
preceded by words indicating a particular class of acts, matters or
things; and
(b) general words shall not be given a restrictive meaning by reason of
the fact that they are followed by particular examples intended to
be embraced by the general terms.
1.8 All obligations and liabilities under this Agreement or the Tax Deed of
either of the Purchasers shall be joint and several.
2 SALE OF THE SHARES
2.1 Each of the Sellers shall sell with full title guarantee (except for the
Trustees who shall sell with limited title guarantee) those of the Shares
set out opposite his name in Schedule 1 and the Purchasers relying on the
representations, warranties and undertakings of and indemnities by the
Sellers set out in this Agreement shall purchase the Shares on the terms
of this Agreement free from all claims, liens charges encumbrances and
equities and together with all rights attaching or accruing to them.
2.2 Each of the Sellers severally covenants with the Purchasers that save as
accurately and fairly disclosed in the Disclosure Letter:
(a) he has the right to sell and transfer the full legal and beneficial
interest in the
6
Shares set out opposite his name in Part A and/or Part B Schedule 1
(as appropriate) to the Purchasers on the terms set out in this
Agreement; and
(b) on or after Completion he will, at his own cost and expense, execute
and do (or procure to be executed and done by any necessary party)
all such deeds, documents, acts and things as either of the
Purchasers may from time to time reasonably require in order to vest
any of the Shares set opposite his name in Part A or Part B of
Schedule 1 (as appropriate) in the relevant Purchaser or its
assignee or as otherwise may be necessary to give full effect to
this Agreement; and
(c) he has the requisite power and authority to enter into and perform
this Agreement and (as appropriate) the Tax Deed and such entry and
performance will not breach, violate, infringe or otherwise affect
the rights of any person;
(d) this Agreement and (if appropriate) the Tax Deed will, when
executed, constitute binding obligations on him in accordance with
their respective provisions;
(e) the execution and delivery of, and performance by him of his
obligations under, this Agreement and (if appropriate) the Tax Deed
will not constitute a default under any instrument or arrangement
binding on him or otherwise to which he is a party or result in a
breach of any order, judgment or decree of any court or governmental
agency to which he is a party or by which he is bound;
(f) neither he nor any person connected with him has any interest,
directly or indirectly, in any business that has a close trading
relationship with or is or is likely to be competitive with the
business of the Company or in any asset which within the two years
preceding the date of this Agreement has been acquired or disposed
of by or leased to the Company;
(g) there is no option, right of pre-emption, right to acquire,
mortgage, charge, pledge, lien or other form of security or
encumbrance over or affecting any of the Shares set out opposite his
name in either Part A or Part B of Schedule 1 nor is there any
commitment to create or to give any of the foregoing and no person
has claimed to be entitled to any of the foregoing.
2.3 Each of the Sellers hereby waives any rights of pre-emption conferred
upon him by the Articles of Association of the Company or in any other
way in respect of the Shares.
2.4 The parties shall not be obliged to complete the sale and purchase of any
of the Shares unless the sale and purchase of all the Shares is completed
simultaneously in accordance with this Agreement.
3 CONSIDERATION
7
3.1 The consideration for the sale of the Marquee UK Shares to Marquee UK
shall be (pound)1,600,000 and shall consist of the sum of
(pound)1,600,000 payable in cash on Completion (the "Cash Consideration")
and shall be satisfied by the payment by Marquee UK to the Sellers of the
cash amounts as set out in Part A of Schedule 1;
3.2 The consideration for the sale of the Marquee Inc. Shares to Marquee Inc.
shall be (pound)1,400,000, subject to any adjustment pursuant to Clause 5
and shall consist of:
(a) the sum of (pound)400,000 which shall be satisfied by the allotment
and issue as fully paid and non-assessable by Marquee Inc. to the
Sellers of such number of Initial Consideration Shares which, at the
Issue Price, have a value of (pound)400,000 in aggregate;
(b) the sum of (pound)800,000 which shall be satisfied by the allotment
by Marquee Inc. to the Sellers of the Loan Notes;
(c) the sum of (pound)200,000 which shall be satisfied by the allotment
and issue as fully paid and non-assessable by Marquee Inc. to the
Sellers of the Deferred Consideration Shares in accordance with the
provisions of Clause 3.4.
3.3 The Sellers shall be entitled to the Consideration in the proportions
shown in Parts A and B of Schedule 1.
3.4 Subject to any adjustment pursuant to Clause 5 upon each of the
Anniversary Dates Marquee Inc. shall issue to the Sellers such number of
Deferred Consideration Shares as shall, at the Issue Price, have a value
of(pound)40,000 in aggregate and shall deliver to the Sellers definitive
share certificates for such Consideration Shares. Provided that in the
event of any increase in the value of the Deferred Consideration Shares
to be issued on the first Anniversary Date pursuant to Clause 5.8 the
additional Deferred Consideration Shares shall be issued to the
Warrantors in equal proportions.
3.5 In the event of a Change of Control, any Consideration which remains
outstanding pursuant to Clause 3.4, shall be due for payment within 14
days of the date of the Change of Control and shall be satisfied by the
payment of cash to the Sellers in the percentages set out against their
respective names in Part B of Schedule 1 subject always to the proviso in
clause 3.4.
3.6 If Marquee Inc. consolidates, sub-divides or reorganises its share
capital, declares any distribution or makes any issue by way of
capitalisation or rights to holders of its Common Stock during or by
reference to any period relevant for calculating the Issue Price the
amount of Deferred Consideration Shares or the Issue Price will be
adjusted as Marquee Inc's Stockbrokers for the time being (acting
reasonably as experts and not as arbitrators) certify to be in their
opinion fair and reasonable.
3.7 Without the written consent of Marquee Inc. none of the Sellers shall
dispose of, charge or otherwise encumber any interest in any of the
Consideration Shares or any other
8
securities for the time being representing or derived from those shares
(whether by way of consolidation, sub-division, capitalisation or rights
issue or otherwise) during the period of one year from the date of
allotment of the relevant Consideration Shares.
4 COMPLETION
4.1 Completion shall take place immediately following signature and exchange
of this Agreement when:
(a) the Sellers shall deliver or cause to be delivered to the Purchasers
(as appropriate):
(i) transfers of the Shares duly completed in favour of either
Marquee Inc. or Marquee UK (as appropriate) or as it may
direct;
(ii) the share certificates representing the Shares (or an express
indemnity in a form satisfactory to the Purchasers in the
case of any found to be missing);
(iii) all the Statutory and Minute Books of the Company and its
Common Seal and the Certificates of Incorporation on Change
of Names (if any);
(iv) the Tax Deed duly executed by each of the Warrantors;
(v) a letter of resignation (expressed to be with effect from the
end of the meeting) of the Board of the Company referred to
in sub-clause (d) below, from Xxxxx XxXxxxxx resigning office
as Director of the Company, executed as a deed in the agreed
terms;
(vi) the resignation of the auditors of the Company in accordance
with section 394 of the Companies Xxx 0000, confirming that
there are no circumstances connected with their resignation
which should be brought to the notice of the members or
creditors of the Company and that there are no fees due to
them;
(vii) the letter terminating the employment of Xxxxxxxx Xxxxxx as
an employee of the Company;
(viii) the Property Licence duly executed by Xxxxx XxXxxxxx and Xxx
X. Xxxxxx;
(ix) the Service Agreement, duly executed by Xxx Xxxxxx;
(x) the Consultancy Agreement, duly executed by Xxxxx XxXxxxxx;
and
(xi) the Disclosure Letter.
9
(b) the Warrantors shall procure that all indebtedness due from any of
the Warrantors or any person connected with them to the Company
shall have been satisfied in full prior to the Effective Date;
(c) all indebtedness due from the Company to any of the Warrantors (full
particulars of which are contained in the Disclosure Letter but
excluding remuneration accrued but not yet due for payment) shall
have been satisfied in full without payment of interest prior to the
Effective Date;
(d) the Sellers shall cause a meeting of the Board of the Company to be
held at which the Board shall:-
(i) appoint such persons as the Purchasers may nominate as
Directors and Secretary of the Company;
(ii) accept the letters of resignation referred to in sub-clause
(a)(v) and (a)(vi) above;
(iii) vote in favour of the registration of the Purchasers and/or
their nominees as members of the Company subject only to the
production of duly stamped and completed transfers in favour
of the Purchasers and/or their nominees in respect of the
Shares;
(iv) appoint Ernst & Young as auditors;
(e) the parties shall join in procuring that all existing bank mandates
in force for the Company shall be altered (in such manner as the
Purchasers shall at Completion require) so as (inter alia) to
reflect the resignations and appointments referred to above.
(f) the Purchasers shall not be obliged to complete this Agreement
unless the Sellers comply fully with the requirements of paragraphs
(a), (b), (d), and (e) of this Clause;
4.2 Upon completion of all the matters referred to in sub-clause 4.1 Marquee
UK shall:
(a) pay to the Sellers' Solicitors (whose receipt shall be a sufficient
discharge therefor) the Cash Consideration by way of telegraphic
transfer;
(b) deliver to the Sellers' Solicitors a duly executed counterpart of
the Tax Deed;
(c) deliver to the Sellers' Solicitors a duly executed counterpart of
the Disclosure Letter.
4.3 Upon Completion of all the matters referred to in sub-clause 4.1 Marquee
Inc. shall:
10
(a) allot the Initial Consideration Shares and issue the Loan Notes to
the Sellers and deliver to the Sellers' Solicitors definitive share
certificates in respect of the Initial Consideration Shares and
certificates in the agreed terms in respect of the Loan Notes in the
names of the Sellers; and
(b) deliver to the Sellers' Solicitors a duly executed counterpart of:
(i) the Tax Deed;
(ii) the Property Licence;
(iii) the Service Agreement;
(iv) the Consultancy Agreement; and
(v) the Disclosure Letter;
(c) the Sellers shall not be obliged to complete this Agreement unless
the Purchasers have complied fully with their respective
requirements of Clause 4.2 and paragraphs (a) and (b) of this
Clause.
4.4 If in any respect either the Sellers or the Purchasers fail to comply
with all the provisions of Clauses 4.1, 4.2 and 4.3 on the date for
Completion then the other of them may:
(a) defer Completion to a date not more than 28 days after the date for
Completion set by this Clause 4 (and so that the provisions of this
sub-clause 4.4 shall apply to Completion as so deferred); or
(b) proceed to Completion as far as practicable; or
(c) rescind this Agreement (without prejudice to its accrued rights and
remedies).
4.5 Marquee Inc. shall procure as soon as reasonably practicable following
Completion (and in any event within 7 days after Completion) the full and
unconditional release of the Personal Guarantees and Marquee Inc. shall
fully indemnify the Warrantors and Struan Xxxxxxxx and Xxx X. Xxxxxx
against any liability, loss, cost or claim arising out of or in
connection with the Personal Guarantees at any time after the Effective
Date.
5 COMPLETION NET ASSET STATEMENT
5.1 The Sellers and the Purchasers shall as soon as practical and in any
event within five days of the date of Completion instruct the Sellers'
Accountants at the cost of Marquee Inc. to:
(a) prepare the Completion Net Asset Statement using the accounting
policies and methods used in the preparation of the Accounts
together with an opinion by the
11
Sellers' Accountants that the Completion Net Asset Statement
presents on these accounting policies and methods a true and fair
view of the Net Assets of the Company at the Effective Date;
(b) submit the Completion Net Asset Statement in draft to the parties
within 30 days from Completion.
5.2 The Purchasers and the Sellers shall use their best endeavours to procure
that the Sellers' Accountants and the Purchasers' Accountants shall have
access to all the books and records of the Company for the purposes of
enabling them to prepare or check, as the case may be, the draft
Completion Net Asset Statement.
5.3 Upon the completion of the preparation of the draft Completion Net Asset
Statement by the Sellers' Accountants the draft Completion Net Asset
Statement shall be presented to the Purchasers' Accountants for their
approval. Marquee Inc. shall procure that the Purchasers' Accountants
communicate their decision as to whether or not they approve the draft
Completion Net Asset Statement to the Sellers and Marquee Inc. within 14
days of such presentation ("THE APPROVAL PERIOD") and shall, in the event
of non approval, specify with reasonable particularity the reasons for
non approval. In the event that the Purchasers' Accountants fail to
communicate their decision to the Sellers and Marquee Inc. within the
Approval Period they shall be deemed to have approved the draft
Completion Net Asset Statement.
5.4 In the event that the Purchasers' Accountants do not approve the draft
Completion Net Asset Statement within the Approval Period the Sellers and
Marquee Inc. shall use their best endeavours to procure that the Sellers'
Accountants and the Purchasers' Accountants meet together promptly and in
any case within a period of 14 days of the end of the Approval Period to
resolve any dispute that has arisen between them with regard to the draft
Completion Net Asset Statement.
5.5 Any dispute with respect to the draft Completion Net Asset Statement
which is not settled within 28 days of the end of the Approval Period
shall (unless the Sellers and Marquee Inc. otherwise agree in writing) be
referred for final determination to an Independent Accountant nominated
jointly by the Sellers and Marquee Inc. (or failing such nomination
within ten days of one party serving notice upon the other party to make
such nomination) nominated at the request of either party by the
President for the time being of the Institute of Chartered Accountants in
England and Wales. The Independent Accountant shall be instructed to
render his decision (which shall be communicated in writing to the
Sellers and Marquee Inc. and shall be final and binding on the Sellers
and Marquee Inc.) within 21 days of his appointment. The fees and costs
of the Independent Accountant shall be borne and paid by the Sellers and
Marquee Inc. in such proportions as the Independent Accountant shall
consider appropriate. The parties shall provide to the Independent
Accountant all such information assistance and documentation as he may
reasonably require.
5.6 Upon the approval of the Completion Net Asset Statement under Clause 5.3
or 5.4 or the determination of any dispute under Clause 5.5 the Sellers
and Marquee Inc. shall use
12
their best endeavours to procure that the Sellers' Accountants and the
Purchasers' Accountants immediately issue to the Sellers' Solicitors and
the Purchasers' Solicitors respectively the Completion Net Asset
Statement signed by the Sellers' Accountants and the Purchasers'
Accountants respectively in the form so approved, resolved or decided
which shall in the absence of manifest error be final and binding on the
Sellers and the Purchasers.
5.7 In the event that the Completion Net Asset Statement shows that the value
of the Net Assets is less than (pound)0 then the Consideration shall be
deemed to be reduced by an amount equal to the shortfall and the amount
of such reduction will be deducted from the first instalment and (as
necessary) each succeeding instalment of the Consideration payable under
Clause 3.4 until the full amount of the reduction has been satisfied; and
5.8 In the event that the Completion Net Asset Statement shows that the value
of the Net Assets is greater than (pound)0 then the Consideration shall
be deemed to be increased by an amount equal to the surplus and the
amount of such increase shall be added to the first instalment of the
Consideration payable under Clause 3.4.
6 REPRESENTATIONS AND WARRANTIES
6.1 The Warrantors hereby jointly and severally represent, warrant and
undertake to the Purchasers and each of them that:
(a) except as accurately and fairly disclosed to the Purchasers in the
Disclosure Letter, each of the statements set out in Schedule 4 is
true and accurate as at the Effective Date; and
(b) all information contained in the Disclosure Letter is true and
accurate as at the Effective Date and fairly presented and nothing
of which the Warrantors were aware as at the Effective Date has been
omitted from the Disclosure Letter which renders any of that
information misleading as at the Effective Date.
6.2 Each of the Warranties set out in the several paragraphs of Schedule 4 is
separate and independent and except as expressly provided to the contrary
in this Agreement is not limited:
(a) by reference to any other paragraphs of Schedule 4; or
(b) by anything in this Agreement or the Tax Deed;
and (save as provided in Clause 6.22 below) none of the Warranties
shall be treated as qualified by any actual or constructive
knowledge on the part of the Purchaser or any of its agents.
6.3 Each of the Warrantors agree with the Purchasers (as trustee for the
Company and its employees) to waive any rights or claims which he may
have against the Company and
13
its employees in respect of any misrepresentation, inaccuracy or omission
in or from any information or advice supplied or given to the Warrantors
by any of the Company or its employees in connection with the giving of
the Warranties and the preparation of the Disclosure Letter.
6.4 Without restricting the rights of the Purchasers or the ability of the
Purchasers to claim damages on any basis available to them in the event
of any breach of any of the Warranties, the Warrantors undertake with the
Purchasers that the Warrantors will, pay to the Purchasers within 7 days
of the earlier of agreement between the Warrantors and the Purchasers
and, in default of such agreement, final determination by order of a
court of competent jurisdiction a sum by way of damages as so agreed or
fully determined as being the amount necessary to put the Purchasers into
the position which would have existed if the Warranties had been true and
accurate and had not been misleading or breached (as the case may be)
together with all costs and expenses reasonably and properly incurred by
the Purchasers as a result of such breach.
6.5 In the event that the Purchasers obtain judgment (without leave to appeal
being granted) against the Warrantors or reaches agreement with the
Warrantors in respect of any claim for breach of the Warranties pursuant
to the Tax Deed or otherwise pursuant to this Agreement (other than a
claim arising under sub-clauses 2.1 (c) (d) and (e) of the Tax Deed) then
any amount which shall have been agreed or finally adjudged or determined
to be owing by the Warrantors to the Purchasers shall, where and to the
full extent possible, be satisfied by the cancellation of any outstanding
Loan Notes or any Untradeable Shares held by the Warrantors or by way of
deduction from any instalment (each an "OUTSTANDING INSTALMENT") of the
Consideration due to the Warrantors which remains to be satisfied
pursuant to Clause 3.4 and in the following order of priority:
(a) firstly by way of cancellation of any outstanding Loan Notes held by
the Warrantors (and pro rata as between the Warrantors) and by
deduction from the value of any Outstanding Instalment due to the
Warrantors, taking the Loan Notes and Outstanding Instalments in
reverse order of maturity, and in the case of any Loan Notes and
Outstanding Instalments which fall due for redemption or
satisfaction on the same date the deduction from the value of the
relevant Outstanding Instalment shall take place in priority to the
cancellation of the relevant Loan Notes;
(b) thereafter by the Warrantors offering and the Purchaser accepting
the cancellation of any issued Deferred Consideration Shares held by
the Warrantors which remain subject to the restrictions contained in
Clause 3.7 (and pro rata as between the Warrantors); and
(c) thereafter by the Warrantors offering and the Purchasers accepting
the cancellation of any Initial Consideration Shares held by the
Warrantors which remain subject to the restrictions contained in
Clause 3.7 (and pro rata as between the Warrantors)
14
and for the purposes of paragraphs (b) and (c) of this Clause the
value attributable to the relevant Untradeable Shares for the
purposes of such cancellation shall be their Issue Price.
6.6 The Purchasers shall be entitled to take action in respect of any breach
or non-fulfilment of any of the representations, warranties,
undertakings, covenants or agreements on the part of the Warrantors or
any of them contained in or made pursuant to this Agreement both before
and after Completion and (save as provided in Clause 6.22 below) such
action may be taken after Completion in respect of any breach or
non-fulfilment discoverable by the Purchasers on or before Completion and
Completion shall not constitute a waiver of any of the Purchasers'
rights.
6.7 The Warrantors shall have no liability for a claim for breach of the
Warranties where the amount of such claim is less than (pound)5,000 and
the liability of the Warrantors in respect of the Warranties:
(a) shall not (when aggregated with any liability under the Tax Deed)
(i) arise unless the amount of all claims (ignoring for this
purposes any individual claims of less than (pound)5,000 each) made
in respect of the Warranties and/or the Tax Deed (or which would
have been made but for the operation of this paragraph or the
corresponding provision in the Tax Deed) exceeds (pound)50,000 or
(ii) exceed the sum of (pound)3,000,000 as adjusted pursuant to
Clause 5; and
(b) shall terminate (but without prejudice to the rights and obligations
of the parties under the Tax Deed);
(i) on the seventh anniversary of the Effective Date in respect
of those matters set out in Part D (Taxation) of Schedule 4;
and
(ii) on 30 April 2000 in respect of all other matters contained in
Schedule 4;
provided that the limitations contained in this Clause 6.7 shall not
apply to any claim which (or the delay in discovery of which) is a
consequence of fraud, dishonesty or wilful concealment on the part
of the Warrantors, their agents or advisors.
6.8 Any payment made (or suffered by cancellation or deduction pursuant to
Clause 6.5) by the Warrantors for any breach of the Warranties or a
liability under the Tax Deed shall be deemed to be a reduction in the
Consideration.
6.9 The Warranties are given subject to any matters accurately and fairly
disclosed in the Disclosure Letter and to the contents of the documents
contained in the indexed bundle annexed thereto and any other specific
information relating to the Company of which either of the Purchasers has
actual (but not imputed or implied) knowledge at the date
15
hereof.
6.10 No liability shall arise on the part of the Warrantors in respect of any
breach of the Warranties:
(a) which arises as a result of any liability to Tax arising or being
increased as a result of any change in the basis or method of
calculation of Tax after the Effective Date with retrospective
effect;
(b) which arises as a result of any retrospective increase in rates of
Tax introduced after the Effective Date;
(c) which arises as a result of any legislation or other governmental
regulation not in force at the Effective Date; whether or not having
retroactive or retrospective effect;
(d) which arises as a result of any voluntary act, omission or
transaction of either of the Purchasers or the Company after
Completion which is outside the ordinary course of business of the
Company;
(e) which arises as a result of any act, transaction, or omission
carried out by the Warrantors at either of the Purchasers' request
and direction unless necessary to comply with any applicable law or
statutory regulation enacted prior to the Effective Date;
(f) which would not have arisen but for any winding up or cessation
after Completion of any business or trade carried on by the Company
except to the extent that such winding up or cessation is caused by
the subject matter of one or more claims under the Warranties and/or
under the Tax Deed;
(g) which arises as a result of any act, omission, transaction or
arrangement of the Company after the Effective Date (whether or not
in the ordinary course of business of the Company) pursuant to a
legally binding obligation incurred on or before the Effective Date
details of which have been accurately and fairly disclosed in the
Disclosure Letter;
(h) where and to the extent that specific provision or reserve
(including provision for deferred tax) is made for the matter giving
rise to the liability in the Accounts or in the calculation of Net
Assets for the purposes of the Completion Net Asset Statement;
(i) arising solely from a change after Completion of the Company's
accounting policy or practice or a change of the accounting
reference date of the Company.
6.11 To the extent that any breach of the Warranties is capable of remedy the
Purchasers shall first afford the Warrantors 28 days to remedy the breach
complained of and for
16
such purposes the Purchasers at the Warrantors' cost shall make available
to the Warrantors all assistance and all papers documents and information
in its possession, custody and control which the Warrantors may
reasonably require.
6.12 In the event that the Company or either of the Purchasers shall become
aware of any matter which is likely to constitute a breach of Warranty
the Purchasers shall as soon as reasonably practicable notify in writing
the Warrantors giving reasonable details of such matter and if so
requested by the Warrantors and at the Warrantors' cost shall provide
copies of available relevant documentation and thereafter shall keep the
Warrantors informed of developments and communications relating thereto.
In any event notice of any claim under the Warranties must be served by
the Purchasers on the Warrantors in writing specifying in reasonable
detail the nature of the claim and the breach that results (having regard
to the information then available to the Purchasers) and where reasonably
practicable the amount claimed before the date specified in Clause 6.7(b)
and any claim shall (if not previously satisfied or withdrawn) be deemed
to have been waived or withdrawn at the expiration of nine months after
the date upon which written notice thereof is given to the Warrantors (or
such longer period as the Warrantors may permit) unless legal proceedings
shall already have been issued against and served on the Warrantors.
6.13 Subject to the Warrantors indemnifying and securing the Purchaser and the
Company to their reasonable satisfaction against any liabilities, costs
or expenses which may be incurred in taking such action the Purchasers
shall take or procure that the Company takes such action as the
Warrantors may reasonably request to dispute, compromise or defend any
claim or demand giving rise to the claim for breach of Warranty or to
mitigate any resulting loss.
6.14 Where the Company or the Purchasers or any of them is entitled (whether
by reason of insurance or otherwise) to recover from a third party any
sum in respect of the damage or liability the subject of a claim under
the Warranties the Purchasers shall if so required by the Warrantors
(subject to the Warrantors indemnifying and securing the Purchaser and
the Company to their reasonable satisfaction against any liabilities,
costs or expenses which may be incurred in taking such action) procure
that the Company takes action as the Warrantors may reasonably require to
enforce such recovery and any claim against the Warrantors shall be
limited (in addition to the other limitations on the liability of the
Warrantors referred to in this Clause 6) to the amount by which the
amount of the Purchasers' claim as a result of such breach shall exceed
the amount so recovered (less any reasonable costs, charges and expenses
properly incurred by the Purchasers or the Company in connection
therewith).
6.15 Where in relation to any matter which has been the subject of any claim
for breach of the Warranties the Purchasers or the Company shall recover
any sum (whether by payment, discount, credit or otherwise) referable to
that matter the Purchasers shall forthwith repay to the Warrantors any
sums paid by the Warrantors in respect of such claim (or an appropriate
part thereof) not exceeding the sum recovered.
6.16 If and to the extent that the Warrantors make a payment to a Purchaser in
respect of any
17
breach of the Warranties relating to any liabilities in respect of which
a Purchaser or the Company have a right to reimbursement (in whole or in
part) against any third party the Purchasers shall upon the request of
the Warrantors assign or procure to be assigned to them for no
consideration but at the cost of the Warrantors the benefit of the right
of reimbursement.
6.17 In the event of the Warrantors being liable to either of the Purchasers
under the Warranties in respect of an obligation of the Company to pay
Tax and in certain circumstances the payment of Tax will be repaid to the
Company or some other liability to Tax reduced directly in consequence
(in whole or in part) of the payment of Tax by the Company the liability
of the Warrantors shall be reduced and any amount paid to either of the
Purchasers by the Warrantors in respect of the liability to Tax shall be
refunded when and to the extent that the Company actually receives such
repayment or reduction in liability and the Purchasers shall procure that
the Company makes all reasonable claims to obtain the repayment or
reduction when it becomes aware that it is entitled to do so.
6.18 Any breach of the Warranties shall give rise only to an action in damages
by the Purchasers.
6.19 The provisions of Clause 2.2 of the Tax Deed shall additionally apply in
relation to any claim which could be made under the taxation warranties
as it applies to a claim under the Tax Deed.
6.20 Nothing herein shall in any way diminish the Purchasers' common law duty
to mitigate their loss.
6.21 The Purchasers undertake to retain or procure the retention by the
Company of all such books, records, accounts, correspondence and other
papers of the Company as are material in the context of the liability of
the Warrantors under the Warranties or the Tax Deed during the
subsistence of the liability of the Warrantors under the Warranties or
(as the case may be) the Tax Deed.
6.22 The Purchasers jointly and severally warrant and undertake to and for the
benefit of the Warrantors that (having made due enquiry of its advisors)
they are not aware of any fact, circumstance or information as at the
Effective Date upon the basis of which either of them has or may have a
claim against the Warrantors and/or Sellers under this Agreement or any
of the other documents referred to herein other than under sub- clauses
2.1(c), (d) and (e) of the Tax Deed (whether for breach of the Warranties
or under the Tax Deed or on any other account whatsoever). The Purchasers
acknowledge that the Warrantors are entering into this Agreement on the
basis that the foregoing warranty is true and accurate in all respects
and, without restricting the rights of the Warrantors, the Purchasers
hereby agree that in the event of such warranty being found to have been
broken, misleading or untrue by reason of either of the Purchasers being
at the time of the Effective Date aware of any such fact, circumstance or
information then the Purchasers shall have no right to make any claim
against the Warrantors and/or
18
the Sellers under this Agreement or any of the other documents referred
to herein in respect of such fact, circumstance or information.
7 CONFIDENTIALITY
7.1 Each of the Sellers hereby undertakes to each of the Purchasers (for
themselves and each as trustee for the Company) that he will:
(a) not at any time after the date of this Agreement (save as required
by law or regulatory authority) divulge or communicate to any person
other than to officers or employees of the Company whose province it
is to know the same or on the instructions of the Board of Directors
of the Company any confidential information concerning the business,
accounts, finance or contractual arrangements or other dealings
transactions or affairs of the Company which may have come to his
knowledge prior to Completion; and
(b) use his reasonable endeavours to prevent publication or disclosure
of any confidential information concerning such matters;
provided that such undertakings shall cease to have effect in
relation to any confidential information which comes into the public
domain otherwise than through the fault of any of the Sellers.
8 PROTECTIVE COVENANTS
8.1 Each Warrantor covenants with each of the Purchasers (for themselves and
each as trustee for the Company) that he will not, in the case of
J.R.Xxxxxx for a period of 5 years from the Effective Date or in the case
of X.XxXxxxxx for a period of 2 years from the Effective Date:
(a) be concerned in any business carrying on business within the United
Kingdom of Great Britain and Northern Ireland (and the Channel
Islands and the Isle of Man) or within the Republic of Ireland which
is competitive or likely to be competitive with any of the
businesses carried on by the Company at Completion; or
(b) except on behalf of the Company canvass or solicit orders for
services similar to those being provided by the Company at
Completion from any person who is at Completion or has been at any
time within the year prior to Completion a customer of the Company;
or
(c) induce or attempt to induce any supplier of the Company to cease to
supply, or to restrict or vary the terms of supply, to the Company;
or
(d) induce or attempt to induce any employee of the Company to leave the
employment of the Company; or
19
(e) use or (in so far as it lies within his control) allow to be used
(except by the Company) any trade name used by the Company at
Completion or any other name intended or likely to be confused with
such a trade name.
8.2 For the purposes of this Clause:
(a) a Warrantor is concerned in a business if he carries it on as
principal or agent or if:
(i) he is a partner, director, employee, seconde, consultant or
agent in, of or to any person who carries on the business; or
(ii) he has any direct or indirect financial interest (as
shareholder or otherwise) in any person who carries on the
business disregarding any financial interest of a person in
securities which are listed on the American Stock Exchange or
the London Stock Exchange or traded on the Alternative
Investment Market, if that person, the remaining Sellers and
any person connected with him or them are interested in
securities which amount to less than three per cent of the
issued securities of that class and which, in all
circumstances, carry less than three per cent of the voting
rights (if any) attaching to the issued securities of that
class.
8.3 Each of the restrictions in each paragraph or sub-clause above shall be
enforceable by the Purchaser independently of each of the others and its
validity shall not be affected if any of the others is invalid; if any of
those restrictions is void but would be valid if some part of the
restrictions were deleted the restriction in question shall apply with
such modification as may be necessary to make it valid without in any way
extending the scope of the restrictions.
8.4 The Warrantors acknowledge that the above provisions of this Clause are
no more extensive than is reasonable to protect the Purchasers as the
purchasers of the Shares.
8.5 If any provision of this Agreement or of any other agreement or
arrangement of which it forms part is subject to registration under the
Restrictive Trade Practices Xxx 0000, it shall not take effect until the
day after particulars of the agreement or arrangement have been given to
the Director General of Fair Trading under section 24 of that Act.
9 ANNOUNCEMENTS
Neither the Sellers nor the Purchasers shall make or permit any person
connected with any of them to make any announcement concerning the sale and
purchase of the Shares or any ancillary matter before, on or after Completion
except as required by law or other applicable regulation or with the written
approval of the other, such approval not to be unreasonably withheld or
delayed.
20
10 NOTICES AND RECEIPTS
10.1 Any notice or other document to be served under this Agreement may be
delivered or sent by first class registered post (or airmail if to a
destination outside the country where it is despatched) or facsimile
process to the party to be served at his address appearing in this
Agreement or at such other address as he may have notified to the other
parties in accordance with this Clause.
10.2 Any notice or document shall be deemed to have been served:
(a) if delivered, at the time of delivery; or
(b) if posted, at 10.00 am on the second or (if sent to a destination
outside the country where it is despatched) seventh business day in
the country of the recipient after it was put into the post; or
(c) if sent by facsimile process, at the expiration of 2 hours after the
time of despatch, if despatched before 3.00 pm on any business day
in the country of the recipient, and in any other case at 10.00 am
on the business day in the country of the recipient following the
date of despatch.
10.3 In proving service of a notice or document it shall be sufficient to
prove that delivery was made or that the envelope containing the notice
or document was properly addressed and posted as a prepaid registered
post or airmail letter or that the facsimile message was properly
addressed and despatched as the case may be.
10.4 The receipt of the Sellers' Solicitors for any sum or document to be paid
or delivered to a Seller will discharge the Purchasers' obligation to pay
or deliver it to that Seller.
10.5 The Purchasers agree that service or delivery of any documents on either
of them (including service of any proceedings) may be effected by service
upon the Purchasers' Solicitors in accordance with this Clause 10.
11 RESOLUTIONS AND WAIVERS
11.1 In relation to the Company the Sellers shall procure the convening of all
meetings, the giving of all waivers and consents and the passing of all
resolutions as are necessary under the Companies Xxx 0000, its Articles
of Association or any agreement or obligations affecting it to give
effect to this Agreement.
11.2 For so long after Completion as it remains the registered holder of any
of the Shares each of the Sellers will hold them and any distributions,
property and rights hereafter deriving from them in trust for Marquee
Inc. or Marquee UK (as appropriate) and will deal with the Shares and any
distributions, property and rights hereafter deriving from them as
Marquee Inc. or Marquee UK (as appropriate) directs and will on request
by Marquee Inc. or Marquee UK (as appropriate) execute an instrument of
proxy or other
21
document which enables Marquee Inc. or Marquee UK (as appropriate) or its
representative to attend and vote at any meeting of the Company.
12 GENERAL
12.1 Each of the obligations, warranties and undertakings set out in this
Agreement which is not fully performed at Completion will continue in
force after Completion.
12.2 None of the rights or obligations under this Agreement may be assigned or
transferred without the prior written consent of all the parties.
12.3 Where any obligation, representation, warranty or undertaking in this
Agreement is expressed to be made, undertaken or given by the Sellers,
they shall be jointly and severally responsible in respect of it unless
otherwise stated.
12.4 The Purchasers may release or compromise in whole or in part the
liability of any of the Sellers under this Agreement or grant any time or
other indulgence without affecting the liability of any other of the
Sellers.
12.5 Time is of the essence in relation to this Agreement.
12.6 Each party shall pay the costs and expenses incurred by him or it in
connection with the entering into and completion of this Agreement.
12.7 This Agreement may be executed in any number of counterparts, all of
which, taken together shall constitute one and the same Agreement and any
party may enter into this Agreement by executing a counterpart.
13 WHOLE AGREEMENT
13.1 This Agreement and the documents referred to in it contain the whole
agreement between the parties relating to the transactions contemplated
by this Agreement and supersede all previous agreements, arrangements and
understandings between the parties relating to these transactions.
13.2 The parties acknowledge that in agreeing to enter into this Agreement he
or it has not relied on any representation, warranty or other assurance
except those set out in this Agreement and waives all rights and
remedies, which, but for this Clause might be available to it in respect
of such representation, warranty or other assurance provided that nothing
in this Clause shall limit or exclude any liability for fraudulent
misrepresentation.
14 GOVERNING LAW
This Agreement is governed by and shall be construed in accordance with
English law. Each of the parties submits to the exclusive jurisdiction of
the English courts for all
22
purposes relating to this Agreement.
15 PURCHASERS' WARRANTIES AND COVENANT
15.1 Marquee Inc. covenants that it shall use its reasonable endeavours to
file the reports required to be filed by it under the US Securities
Xxxxxxxx Xxx 0000, as amended (the "EXCHANGE ACT") and the rules and
regulations of the US Securities and Exchange Commission (the
"COMMISSION") thereunder, and it shall, if feasible, take such further
action as any holder of Consideration Shares may reasonably request, all
to the extent required from time to time to enable such holder to sell
Consideration Shares without registration under the US Securities Act of
1933 (the "SECURITIES ACT") within the limitation of the exemptions
provided by (a) Rule 144 under the Securities Act, as such Rule may be
amended from time to time or (b) any similar rules or regulations
hereafter adopted by the Commission. Upon the written request of any
holder of Consideration Shares, the Purchaser shall deliver to such
holder a written statement as to whether it has complied with such
requirements.
15.2 Provided that a period of at least 2 years has elapsed since the later of
the date any Consideration Shares were acquired from Marquee Inc. or an
affiliate of Marquee Inc. (within the meaning of Rule 144 under the
Securities Act), Marquee Inc. shall, upon the request of any holder
thereof who is not an affiliate of Marquee Inc. and has not been an
affiliate of Marquee Inc. during the preceding 3 months, use its
reasonable efforts (subject to applicable law) to arrange for the
exchange of the certificates representing such Consideration Shares for
new certificates omitting any legend relating to restrictions on the
transfer of such Consideration Shares.
15.3 The Purchasers hereby jointly and severally warrant and represent to the
Sellers that:
(a) neither the execution of this Agreement by the Purchasers or the
Loan Notes by Marquee Inc. nor the completion of the transaction as
contemplated by this Agreement will violate, conflict with or result
in the breach of any term, limitation in or provisions of, or
constitute a default (or an event that, with the giving of notice or
the lapse of time or both, would constitute a default) under the
terms, provisions or conditions of the constitutional documents of
the Purchasers or any agreement to which either of the Purchasers
are a party or by which the Purchasers are bound, or violate any
order, writ, injunction, decree, statute, rule or regulation
applicable to the Purchasers;
(b) no consent or approval by, notice to or registration with any
governmental or other authority is required on the part of either of
the Purchasers in connection with the execution of this Agreement or
the Loan Notes or the completion of the transaction as contemplated
in it;
(c) the Consideration Shares, when issued pursuant to this Agreement,
shall be duly authorised, validly issued, fully paid and
nonassessable and the certificates
23
representing the Consideration Shares and the Loan Notes, when
delivered pursuant to this Agreement, shall be in due and proper
form and shall be duly and validly executed by the officers of
Marquee Inc. named thereon;
(d) the execution, delivery and performance by the Purchasers of the
Agreement and the Loan Notes, and all other documents contemplated
hereby and thereby, the fulfilment of and the compliance with the
respective terms and provisions hereof and thereof, and the
consummation by the Purchasers of the transactions contemplated
hereby and thereby, have been duly authorised by the Board of
Directors of the Purchasers (as appropriate, which authorisation has
not been modified or rescinded and is in full force and effect) and
no other corporate action is necessary for either of the Purchasers
to enter into this Agreement and the Loan Notes, and all other
documents contemplated hereby and thereby, and to consummate the
transactions contemplated hereby and thereby;
(e) where appropriate, this Agreement and the Loan Notes constitute
valid and binding obligations of the Purchasers, enforceable against
such of the Purchasers (as appropriate) in accordance with their
respective terms;
IN WITNESS of which this Agreement has been executed by the parties or their
duly authorised representatives on the date which appears first on page 1.
24
SCHEDULE 1
THE SELLERS, THEIR SHAREHOLDINGS AND CONSIDERATION
PART A
CASH CONSIDERATION
CLASS OF NO. OF PAYABLE
NAME ADDRESS SHARES SHARES
Xxxxxxxx Xxx Xxxxxxxxx Lodge, Westhorpe, C 18,020 (pound)534,000
Xxxxxx Southwell, Nottinghamshire
Xxxxx XxXxxxxx 3 Manor Court C 22,140 (pound)656,000
Xxxxxxxxxx on the Xxxxx,
Xxxxxxxxxxxxxx
XX00 0XX
Trustees of the Xxx Xxxxxxxxx Lodge, C 5740 (pound)170,000
Xxxxxx Westhorpe,
Discretionary Southwell,
Settlement 1998 Nottinghamshire
Xxxx Xxxxxxx Fairways, Titlarks Road, Ascot H 275 (pound)44,000
Xxxxxxxxx XX0 0XX
25
Xxxxx Xxxxx Xxxxx Xxxx, Church Lane, H 150 (pound)24,000
Xxxxxxxxxxx, Xxxxxx, Xxxxxxxxx
XX00 0XX
Xxxx Xxxxxxx Xxx Xxxx Xxxxx, Xxxxxxx Xxxx, X 000 (xxxxx)00,000
Xxxxxx, Xxxxxxx
XX0 0XX
Xxxxx Xxx Xxxx Xxxxxxx, Xxx Xxxx, X 000 (xxxxx)00,000
Bunnens Xxxxxxxxxx, Xxxxxxxxxx
XX00 0XX
Struan Xxxxxxxx Xxxx X, Xxx Xxxxxxxx, Xxx Xxxx, X 200 (pound)32,000
Xxxx Xxxxxxxxx, Xxxxxxxxxx,
XX0 0XX
Xxxxxx Xxxxxxxx 0 Xx Xxxxxx Xxxxxxxx, Xxxxxx Xxxxx, H 100 (pound)16,000
Xxxxxxxxxx
XX00 0XX
Xxxx Xxxxxxx 00 Xxxx Xxxxx Xxxx H 100 (pound)16,000
Xxxxxxxxx, Xxxxxx XX00 0XX
Xxxxx XxXxxxxx 5 Foxes Close J 300 (pound)48,000
Xxxxxxxxx Xxxx
Xxx Xxxx, Xxxxxxxxxx
XX0 0XX
TOTAL (POUND)1,6000,000
26
PART B
INITIAL CONSIDERATION LOAN NOTES % OF ANY DEFERRED
CLASS OF NO. OF SHARES PAYABLE PAYABLE CONSIDERATION
NAME ADDRESS SHARES SHARES PAYABLE
Xxxxxxxx Xxx Xxxxxxxxx Lodge, D 1760 (pound)176,000 (pound)352,000 NIL
Xxxxxx Westhorpe, Southwell, E 264 NIL NIL 44%
Nottinghamshire
Xxxxx XxXxxxxx 3 Manor Court D 1640 (pound)164,000 (pound)328,000 NIL
Xxxxxxxxxx on the E 246 NIL NIL 41%
Xxxxx, Xxxxxxxxxxxxxx
XX00 0XX
Xxxx Xxxxxxx Fairways, Titlarks Road, F 275 (pound)11,000 (pound)22,000 2.75%
Xxxxx
Xxxxxxxxx XX0 0XX
Xxxxx Xxxxx Xxxxx Xxxx, Church F 150 (pound)6,000 (pound)12,000 1.5%
Lane, Xxxxxxxxxxx,
Xxxxxx, Xxxxxxxxx
XX00 0XX
27
Xxxx Xxxxxxx Old Pond House, F 100 (pound)4,000 (pound)8,000 1.0%
Xxxxxxx Xxxx, Xxxxxx,
Xxxxxxx
XX0 0XX
Xxxxx Xxx Xxxx Xxxxxxx, Xxx Xxxx, X 000 (xxxxx)00,000 (pound)22,000 2.75%
Bunnens Xxxxxxxxxx,
Xxxxxxxxxx
XX00 0XX
Struan Xxxxxxxx Flat J, The Boundary, F 200 (pound)8,000 (pound)16,000 2.0%
Xxx Xxxx, Xxxx
Xxxxxxxxx, Xxxxxxxxxx,
XX0 0XX
Xxxxxx Xxxxxxxx 0 Xx Xxxxxx Xxxxxxxx, F 100 (pound)4,000 (pound)8,000 1.0%
Xxxxxx Xxxxx,
Xxxxxxxxxx
XX00 0XX
Xxxx Xxxxxxx 00 Xxxx Xxxxx Xxxx X 000 (pound)4,000 (pound)8,000 1.0%
Xxxxxxxxx, Xxxxxx
XX00 0XX
Xxxxx XxXxxxxx 5 Foxes Close G 300 (pound)12,000 (pound)24,000 3.0%
Xxxxxxxxx Xxxx
Xxx Xxxx, Xxxxxxxxxx
XX0 0XX
28
TOTAL (POUND)400,000 (POUND)800,000 100%
29
SCHEDULE 2
PARTICULARS OF THE COMPANY
(1) Company Number: 1527571
(2) Share Capital: (i) Authorised:- (pound)1,000,000
(ii) Issued:- (pound)51,310
(3) Registered Holders: See Schedule 1
(4) Registered Office: 0 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxxxx, XX0 0XX
(5) Directors: Xxxxxxxx Xxx Xxxxxx
Xxxxx XxXxxxxx
(6) Secretary: Xxxxxxxx Xxx Xxxxxx
(7) Auditors: Xxxxx Xxxxxxxx
(8) Accounting reference date: 31 December
30
SCHEDULE 3
DETAILS OF LEASE
PARTIES
Ice Developments Limited (1) and Park Associates Limited (2).
PROPERTY
Part of the Xxxxx Xxxxx, 00 Xxxxx Xxxxxxx Xxxx, XX0 as shown on the plan to the
Lease.
RENT PER ANNUM
(pound)7,750
TERM
From 8 September 1997 to 7 September 2002.
31
SCHEDULE 4
THE WARRANTIES
A. General
B. Accounts/Financial
C. Business
D. Tax
E. Intellectual Property etc
F. Directors/Employees etc
A. GENERAL
A.1 THE RECITALS AND THE SCHEDULES
The information relating to the Sellers and the Company contained in
the Recitals and Schedules 1 and 2 to this Agreement is true and
accurate.
A.2 AUTHORITY AND CAPACITY
A.2.1 The execution and delivery of, and the performance by, each
Seller of its obligations under this Agreement and the Tax Deed
will not:
(a) relieve any other party to a contract with the Company of its
obligations or enable that party to vary or terminate its
rights or obligations under that contract; or
(b) result in the creation or imposition of any lien, charge or
encumbrance of any nature on any of the property or assets of
the Company.
A.3 MEMORANDUM AND ARTICLES OF ASSOCIATION
The copy of the Memorandum and Articles of Association of the Company
delivered by the Warrantors to the Purchasers is true complete and
accurate in all respects and has embodied in it or annexed to it true,
accurate and complete copies of all resolutions agreements and consents
required by law to be so embodied or annexed.
A.4 COMPLIANCE WITH COMPANIES ACTS
A.4.1 As far as the Warrantors are aware the Company and its respective
officers (in their capacities as such) have complied with the
provisions of the Companies Xxx 0000 and in particular (without
prejudice to the generality of the foregoing) all documents
required to be filed with the Registrar of Companies in respect
of the Company have been duly filed.
32
A.4.2 The Statutory Books and Minute Books of the Company have been
properly written up and contain a true accurate and complete
record of the matters which should be dealt with in such books
and no notice or allegation that any of them is incorrect or
should be rectified has been received.
A.4.3 All returns and particulars, resolutions and other documents
which the Company is required by law to file with or deliver to
the Registrar of Companies have been correctly made up and duly
filed or delivered.
A.5 OWNERSHIP OF THE SHARES
A.5.1 The Shares constitute the whole of the issued and allotted share
capital of the Company.
A.5.2 No person is entitled, or has claimed to be entitled, to require
the Company to issue any share or loan capital either now or at
any future date whether contingently or not.
A.6 SUBSIDIARIES, ASSOCIATIONS AND BRANCHES
The Company:
A.6.1 does not hold or beneficially own and has not agreed to acquire
any securities of any other corporation (whether incorporated in
the United Kingdom or elsewhere); or
A.6.2 is not and has not agreed to become a member of any partnership
or other unincorporated association, joint venture or consortium
(other than recognised trade associations); or
A.6.3 does not have outside the United Kingdom any branch or any
permanent establishment.
A.7 OWNERSHIP OF ASSETS
A.7.1 The Company owns all the assets necessary to enable it to
continue to run its business in the manner and on the scale in
which it has been conducted in the year preceding the date of
this Agreement.
A.7.2 Particulars of all fixed assets acquired or agreed to be acquired
by the Company since the Accounts Date are set out in the
Disclosure Letter.
A.7.3 Except for current assets offered for sale or sold in the
ordinary course of trading, the Company has not since the
Accounts Date disposed of any of the assets included in the
Accounts or any assets acquired or agreed to be
33
acquired since the Accounts Date.
A.7.4 None of the property, assets, undertaking, goodwill or uncalled
capital of the Company is subject to any encumbrance (including,
without limitation, any debenture, mortgage, charge, lien,
deposit by way of security, xxxx of sale, lease, hire-purchase,
credit-sale or other agreement for payment on deferred terms,
option or right of pre-emption) or any agreement or commitment to
give or create any of the foregoing.
A.8 VULNERABLE TRANSACTIONS
A.8.1 The Company has not been party to a transaction pursuant to or as
a result of which an asset owned, purportedly owned or otherwise
held by it is liable to be transferred or re-transferred to
another person or which gives or may give rise to a right of
compensation or other payment in favour of another person in the
event of the insolvency of any person other than the Company.
A.8.2 No transaction at an undervalue (within the meaning of section
423 of the Insolvency Act 1986) (a) relating to any of the Shares
or (b) to which the Company has been a party, has been effected
prior to the date of this Agreement.
A.9 COMPLIANCE WITH STATUTES
As far as the Warrantors are aware the Company has not, nor has any of
its respective officers, agents or employees (during the course of their
duties), done or omitted to do anything which is a contravention of any
statute, order, regulation or the like giving rise to any fine, penalty
or other liability on the part of the Company.
A.10 LICENCES AND CONSENTS
The Company has all licences (including statutory licences) and consents
necessary to own and operate its assets and to carry on its business as
it does at present and none of the Warrantors is aware of anything that
might prejudice the continuation or renewal of any of those licences or
consents.
A.11 INSIDER CONTRACTS
A.11.1 The Company is not party to any contract or arrangement in which
any of the Warrantors or any person connected with any of them is
interested, directly or indirectly.
A.11.2 The Company is not party to, nor has its profits or turnover
during the five financial periods ended on the Accounts Date been
affected by, any contract
34
or arrangement which is not of an entirely arm's length nature.
A.11.3 None of the Sellers nor any person connected with any of them is
a party to any outstanding agreement or arrangement for the
provision of finance, goods, services or other facilities to or
by the Company or in any way relating to the Company or its
affairs.
A.12 LITIGATION
A.12.1 The Company is not engaged in any litigation or arbitration
proceedings and there are no such proceedings pending or
threatened by the Company.
A.12.2 The Warrantors do not know of anything which is likely to give
rise to any litigation or arbitration proceedings by or against
the Company.
A.12.3 As far as the Warrantors are aware the Company is not the subject
of any investigation or inquiry by any governmental,
administrative or regulatory body.
A.13 INSOLVENCY
A.13.1 No receiver or administrative receiver has been appointed in
respect of the Company or in respect of the whole or any part of
the assets or undertaking of the Company.
A.13.2 No administration order has been made and no petition has been
presented for such an order in respect of the Company.
A.13.3 No meeting has been convened at which a resolution will be
proposed nor has any resolution been passed nor has any petition
been presented or order made for the winding up of the Company.
A.13.4 The Company has not stopped or suspended payment of its debts,
become unable to pay its debts (within the meaning of Section 123
of the Insolvency Act) or otherwise become insolvent.
A.13.5 No unsatisfied judgment, order or award is outstanding against
the Company and no written demand under Section 123(1)(a) of the
Insolvency Act has been made against the Company and no distress
or execution has been levied on, or other process commenced
against, any asset of the Company.
A.13.6 No voluntary arrangement has been proposed under Section 1 of the
Insolvency Act in respect of the Company.
A.13.7 No circumstances have arisen which entitle any person to take any
action, appoint any person, commence proceedings or obtain any
order of the type
35
mentioned in paragraphs A.13.1 to A.13.6.
36
B. ACCOUNTS/FINANCIAL
B.1 ACCOUNTS
B.1.1 The Accounts:
(a) have been prepared under the historic cost convention (as
modified for the revaluation of land and buildings) and in
accordance with generally accepted accounting principles and
practices, the Companies Xxx 0000 and other applicable
statutes and regulations; and
(b) correctly state the assets of the Company and give a true
and fair view of the state of affairs of the Company as at
the Accounts Date and of the profit or loss of the Company
for the period ended on the Accounts Date.
B.1.2 Without prejudice to the generality of the Warranty
contained in paragraph B.1.1, the Accounts:
(a) comply with the requirements of the Companies Xxx 0000 and
of any other relevant legislation;
(b) have been prepared on a consistent accounting basis with the
corresponding audited accounts of the Company for the
preceding financial year;
(c) are not affected by and do not include any unusual or
non-recurring items;
(d) contain either adequate provision to cover, or full
particulars in notes of, all the known liabilities and other
financial commitments (whether ascertained or contingent and
whether or not quantified or disputed) of the Company as at
the Accounts Date;
(e) make proper and adequate provision for:
(i) all bad and doubtful debts;
(ii) depreciation and obsolescence in respect of plant
machinery fixtures and fittings and vehicles;
(iii) all amounts required to be deducted from any payments
made to any person whether under the Pay As You Earn
regulations legislation relating to National
Insurance Contributions relating to Statutory Sick
Pay or any
37
other legislation whatsoever.
B.1.3 The debts included in the Accounts have realised or will realise,
in the ordinary course of collection, their nominal amounts less
any provision for bad and doubtful debts included in the
Accounts.
B.1.4 As far as the Warrantors are aware no debt owing to the Company
at the date of this Agreement (other than debts included in the
Accounts) will not in the ordinary course of collection realise
its nominal amount plus any accrued interest.
B.1.5 There is no material difference between the accounting and
taxation treatment of any item in the Accounts and of any asset
acquired since the Accounts Date.
B.1.6 The Company is the owner free from encumbrances or other third
party rights in the nature of security or title retention of all
its undertaking and assets which are included or which ought to
have been included in the Accounts or which have been acquired
since the Accounts Date and all such assets are in its possession
or under its control.
B.2 MANAGEMENT ACCOUNTS
The unaudited management accounts of the Company for the period of five
months ended 31 May 1998 (a copy of which is attached to the Disclosure
Letter) have been prepared on a consistent basis and do not misstate to a
material extent the assets and liabilities of the Company and its results
for the period ended 31 May 1998.
B.3 ACCOUNTING RECORDS
All proper and necessary accounting and other books and records
(including all invoices and other records required for value added tax
purposes) of the Company relating to its financial and trading position
have been fully properly and accurately written up on a proper and
consistent basis.
B.4 POSITION SINCE THE ACCOUNTS DATE
Since the Accounts Date:
B.4.1 the business of the Company has been carried on in the ordinary
and usual course and there has not been any material change in
the nature of the assets and liabilities shown in the Accounts;
B.4.2 there has been no deterioration in the turnover, or trading
prospects of the Company;
38
B.4.3 no directors fees have been paid and no resolution (whether by
the appropriate Board of Directors or by the appropriate General
Meeting) that such fees be paid in respect of the current or any
previous financial year has been proposed or passed by the
Company;
B.4.4 the Company has not disbursed any cash except in the ordinary
course of its business and all amounts received by the Company
have been deposited with the Company's bankers and appear in the
appropriate books of account;
B.4.5 no dividends or other distributions have been declared, paid or
made by the Company;
B.4.6 the Company has not entered into any capital transaction as
vendor, purchaser, lessor or lessee or otherwise undertaken any
material commitment on its capital account.
B.5 BORROWINGS ETC
B.5.1 The Company has not received notice (whether formal or informal)
from any person who is currently, or who has at any time since
the Accounts Date been a lender to it requiring repayment of any
indebtedness or intimating the enforcement by any such lender of
any security which it may hold over any assets of the Company and
the Warrantors are not aware of any circumstances likely to give
rise to any such notice being given or which would enable any
such notice to be given.
B.5.2 The total amount borrowed by the Company from its bankers does
not exceed its overdraft facilities as set out in the Disclosure
Letter.
B.5.3 Since the Accounts Date the Company has not lent any money which
has not been repaid to it or acquired the benefit of any debt
(present or future) save for debts in respect of the normal
course of trading.
B.5.4 The Company has no outstanding loan capital nor any money
borrowed (other than under the overdraft facilities disclosed in
relation to 5.2 above), including money raised by factoring.
B.5.5 The Company has no outstanding liability (whether present or
future) in respect of any guarantee or indemnity.
B.5.6 Since the Accounts Date the Company has paid each of its
creditors on or before the relevant due date for payment (save
for any disputed amounts) and has not made any agreement to
postpone or delay any payment of its debts and "paid" in this
context means that either cash has been paid or a cheque has been
given or despatched to the relevant creditor and has not been
cancelled by the Company.
39
B.6 PLANT AND EQUIPMENT
Of the plant, machinery, fixtures, fittings, equipment, vehicles,
furniture, materials and other assets (not being current assets) included
in the Accounts or acquired by the Company since the Accounts Date:
B.6.1 none has been sold or disposed of at a figure lower than book
value or an open market arm's length value whichever is the
higher;
B.6.2 none has been or has been agreed to be let on hire or hire
purchase or sold on deferred terms; and
B.6.3 none was acquired at a price in excess of market value at the
time of acquisition.
B.7 GOVERNMENT GRANTS
The Company is not subject to any arrangement for receipt or repayment of
any grant, subsidy or financial assistance from any government department
or other body.
B.8 BANK ACCOUNTS
The statement of the Company's bank accounts and of the credit or debit
balances on them attached to the Disclosure Letter is correct as at the close
of business on 29 June 1998 and the Company does not have any other bank or
deposit account (whether in credit or overdrawn) not included in the statement
and since the date of that statement there has not been any payment out of any
of the accounts except for payments in the ordinary course of business and the
balance on the accounts is not substantially different from the balances shown
on the statement.
40
C. BUSINESS
C.1 SUPPLIERS AND CUSTOMERS
The Warrantors have no reason to believe (but without having made any
enquiry of any third party) that any supplier customer or person who has
had regular dealings with the Company within the twelve months prior to
the Effective Date will cease dealing with the Company or may
substantially reduce its dealings with the Company after Completion as a
result of the acquisition by the Purchasers of the Company.
C.2 TRADING CONTRACTS AND OUTSTANDING OFFERS
C.2.1 The Company has observed and performed in all material respects
the terms and conditions on its part to be observed and
performed under its current trading contracts.
C.2.2 The Company will not be required after the Effective Date to
undertake any work or supply any goods or services under a
contract entered into on or before the Effective Date except on
normal commercial terms.
C.2.3 No offer, tender or the like which is capable of being converted
into an obligation of the Company by an acceptance or other act
of some other person is outstanding, except in the ordinary
course of its business.
C.3 MATERIAL CONTRACTS
The Company is not party to any contract, arrangement, or obligation
which, whether by reason of its nature, term, scope, price or otherwise,
which:
C.3.1 is not in the ordinary course of its business; or
C.3.2 is incapable of performance in accordance with its terms within
six months of the date on which it was entered into or
undertaken; or
C.3.3 is expected to result in a loss to the Company on completion of
performance; or
C.3.4 is of an unusually onerous nature or cannot be fulfilled or
performed by the Company on time and without undue or unusual
expenditure of money and effort.
C.3.5 requires an aggregate consideration payable by the Company in
excess of (pound)10,000; or
C.3.6 involves payment by the Company by reference to fluctuations in
the Index of Retail Prices or any other index; or
41
C.3.7 requires payment of any sum by the Company in any currency other than
sterling; or
C.3.8 is for the provision of management or similar services to the Company and
which is not terminable by it on less than three months' notice without
compensation.
C.4 AGENCIES, ETC.
The Company is not party to any agreement or arrangement which restricts
its freedom to carry on the whole or any part of its business in any part
of the world in such manner as it thinks fit.
C.5 ANTI-COMPETITIVE ARRANGEMENTS
C.5.1 The Company is not at the Effective Date, a party to any
agreement, arrangement, concerted practice or course of conduct
which:
(a) is subject to registration under the Restrictive Trade
Practices Acts 1976 and 1977;
(b) contravenes the provisions of the Resale Prices Xxx 0000
or any secondary legislation or adopted under the Fair
Trading Xxx 0000;
(c) infringes Article 85 or 86 of the Treaty establishing the
European Economic Community or any other anti-trust or
similar legislation in any jurisdiction in which the
Company carries on business or has assets or sales; or
(d) is void or unenforceable (whether in whole or in part) or
may render the Company liable to proceedings under any
such legislation as is referred to in paragraphs (a) to
(c) above.
C.5.2 The Company has not given any undertaking and no order has been
made against or in relation to the Company pursuant to any
anti-trust or similar legislation in any jurisdiction in which
the Company carries on business or has assets or sales.
C.6 PLANT IN WORKING ORDER
All vehicles and computer equipment owned or used by the Company:
C.6.1 is in satisfactory working order;
C.6.2 has been properly serviced and maintained;
42
C.6.3 is not surplus to the Company's requirements; and
C.6.4 is in the possession of the Company.
C.7 INSURANCE
C.7.1 All the assets and undertaking of the Company of an insurable
nature are and have at all material times been insured in
amounts representing their full replacement or reinstatement
value against fire and other risks normally insured against by
persons carrying on the same classes of business as those
carried on by the Company and the Company is now and has at all
material times been adequately covered against accident, damage,
injury, third party loss, loss of profits and other risks
normally covered by insurance.
C.7.2 The list of current policies of insurance of the Company
attached to the Disclosure Letter is true and complete and no
premium due to be paid and payable in respect of any policy is
outstanding.
C.7.3 There are no circumstances which would or might entitle the
Company to make a claim under any policy of insurance or which
under the terms of any policy of insurance would or might be
required to be notified to the insurers and there are no pending
claims under any policy of insurance which have not been
admitted by the insurers.
C.7.4 No liability in respect of any claim made or pending against the
Company will exceed in amount the limit of insurance cover in
force for the benefit of the Company against such a claim and
there is no insurance policy under which the Company may be
required to bear any excess provision out of its own funds.
C.8 PROPERTIES
Except in respect of the Property Licence and the Lease, the Company has
no right or interest in land property or buildings.
C.9 NO POWERS OF ATTORNEY
The Company has not granted any power of attorney or similar authority
which remains in force.
43
D. TAXATION
In this Part D of Schedule 4 "tax" and "tax authority" shall have the same
meanings as they have for the purposes of the Tax Deed, and clause 1 of the Tax
Deed shall apply for the purposes of this Part D of Schedule 4.
D.1 GENERAL
D.1.1 Tax returns
All necessary information, notices, computations and returns
which are required by law to have been submitted by the Company
to the Inland Revenue, H M Customs and Excise and any other
relevant tax or excise authorities, whether of the United
Kingdom or elsewhere, have been submitted within the prescribed
time limits including for the avoidance of doubt all claims,
disclaimers and elections which on or before the Effective Date
are required by law to have been made, given or delivered for
tax purposes. All such information, notices, computations and
returns submitted to the Inland Revenue, H M Customs and Excise
and such other authorities were at the date to which they were
made up true and accurate in all material respects and are not
the subject of any material dispute with such authorities.
D.1.2 Tax liabilities
(a) All tax prior to the Effective Date for which the Company
is liable or for which it is liable to account has been
duly paid (insofar as such tax ought to have been paid) and
the Company has made full provision in the Accounts in
respect of all tax for which it will or may become
chargeable or accountable in respect of all accounting
periods or other tax periods ending on or before the
Accounts Date.
(b) The Company has properly and punctually deducted and
accounted for tax which it has been required by law to
deduct or for which it has been required to account in
respect of any payments made or deemed to have been made by
it. In particular the Company has properly operated the
PAYE system and has duly made all deductions and payments
required to be made in respect of national insurance
contributions (including employer's contributions).
D.1.3 Penalties and interest
The Company has not within the past twelve months paid or become
liable to pay, nor, so far as the Warrantors are aware, are
there any circumstances by reason of which it is likely to
become liable to pay, any penalty, fine, surcharge or interest
in respect of tax.
44
D.1.4 Investigations
There is no material dispute or disagreement outstanding nor so
far as the Warrantors are aware is any contemplated at the
Effective Date with any tax authority regarding:
(a) the computation of any gains, profits or losses of the
Company for tax purposes;
(b) any liability or potential liability to tax (including
penalties or interest) recoverable from the Company; or
(c) the availability to the Company of any relief from tax.
D.1.5 Deductions
All rents, interest and annual payments paid or payable by the
Company since the Accounts Date are wholly allowable as
deductions or charges in computing income for the purposes of
corporation tax.
D.1.6 Residence
The Company is, and has since its incorporation been, resident
for tax purposes only in the United Kingdom.
D.1.7 No transactions between persons under common control.
No transactions or arrangements involving the Company have taken
place or are in existence which are such that any of the
provisions of s.770 to s.773 Taxes Act 1988 have been or, so far
as the Warrantors are aware, could be applied to them.
D.1.8 Loans
The Company is not a party to any loan relationship (within the
meaning of s.81 Finance Act 1996) which has an unallowable
purpose (within the meaning of paragraph 13 of Schedule 9 to
that Act) and the Company applies an authorised accounting
method within s.85 of that Act in relation to its treatment in
the Accounts of all loan relationships to which the Company is a
party.
D.1.9 Disclosure Letter
The Disclosure Letter lists all concessions, agreements and/or
other formal or informal arrangements with any tax authority
(other than such as are published by a tax authority in the UK)
from which the Company has or will benefit, or
45
by which the Company is bound and (in either case) which are
being applied at the Effective Date.
D.1.10 Records
The Company maintains proper and up to date information and
records of all transactions and activities in which it has been
involved and of its tax affairs which will or are likely to be
relevant in calculating any tax liability of the Company:
(a) for any accounting or other period ending, or in respect
of any event occurring, on or before the Effective Date
in relation to which no final agreement relating to tax
has yet been reached with the relevant tax authority; and
(b) for any such period ending or event occurring after the
Effective Date; and
(c) as required by law.
D.1.11 Expenses
The aggregate amount of payments or expenditure made or incurred
by the Company since the Accounts Date (other than dividends and
disclosed capital expenditure) which will not be wholly
deductible in computing the taxable profits of the Company or
which will not be a charge on an income for the purposes of
corporation tax is consistent with the level of such payments in
previous accounting periods.
D.1.12 Assets
(a) The Company has not since the Accounts Date disposed of
any asset otherwise than in the ordinary course of its
trade.
(b) In respect of any disposal by the Company immediately
following the Effective Date of an asset which it owned
at the Effective Date:
(i) for a consideration equal to the value of that asset
taken for the purposes of the Accounts (if it was
owned by the Company on the Accounts Date) the tax
liability thereby incurred would not exceed the
amount taken into account in computing the provision
for deferred tax as stated in the Accounts; and
(ii) for a consideration equal to that for which the
asset was acquired (if it was acquired after the
Accounts Date) no liability to tax would arise.
46
D.1.13 The Company has not on or before the Effective Date been party
to any scheme or arrangement:
(a) in respect of which any tax clearance has not been
obtained which could have been obtained; or
(b) which was or included a reorganisation or reduction of
share capital of the Company.
D.1.14 The Company has not been party to any scheme or arrangement as a
result of which on the future disposal of any asset owned on the
Effective Date the allowable loss or chargeable gain otherwise
arising or any liability to tax is liable to be adjusted by any
tax authority.
D.1.15 The Company has not carried out or been engaged in any
transaction or arrangement in respect of which there has been or
may have been substituted for the consideration given or
received by the Company (including a nil consideration) a
different consideration for tax purposes and the Company has no
obligation to enter into any such transaction or arrangement in
the future.
D.2 CAPITAL ALLOWANCES
D.2.1 All expenditure which the Company has incurred or is liable to
incur under any subsisting commitment on the provision of plant
or machinery has qualified or will qualify (if not deductible as
a trading expense) for capital allowances.
D.2.2 All allowances available to the Company in respect of capital
expenditure incurred prior to the Effective Date or to be
incurred under any subsisting commitment will be available in
computing the taxable profits of the Company.
D.2.3 The Company has not elected to have any asset treated as a
short-life asset under s.37 Capital Allowances Xxx 0000.
D.2.4 None of the assets of the Company is or may be a long-life asset
within the meaning of Xxxxxxx 0X xx Xxxx XX Xxxxxxx Xxxxxxxxxx
Xxx 0000.
D.2.5 The Disclosure Letter contains accurate details of the written
down values for the purposes of capital allowances of the
capital assets of the Company (including industrial buildings,
plant and machinery and patents) as at the Accounts Date.
D.2.6 The Company is not in dispute with any person as to any
entitlement to capital allowances under s.51 Capital Xxxxxxxxxx
Xxx 0000 and at the Effective Date as far as the Warrantors are
aware there are no circumstances which might give rise to such a
dispute.
47
D.3 CAPITAL GAINS
D.3.1 No election under s.35(5) Taxation of Chargeable Gains Xxx 0000
has been made in relation to the Company.
D.3.2 The Company is not a member of a group of companies as defined
in s.170 Taxation of Chargeable Gains Xxx 0000.
D.4 STAMP DUTY
All documents in the possession of the Company and in the
enforcement of which the Company may be interested have been
duly stamped. There is no liability to any fine or penalty in
respect of stamp duty or stamp duty reserve tax nor as far as
the Warrantors are aware are there any circumstances which may
result in the Company becoming liable to any such fine or
penalty.
D.5 VALUE ADDED TAX
D.5.1 Registration
The Company is duly registered for the purposes of value added
tax.
D.5.2 VAT group
The Company is not treated for value added tax purposes as a
member of any group of companies.
D.5.3 Exemption
The Company is not partially exempt for the purposes of value
added tax.
D.5.4 The Company is not the owner or to be treated as the owner of a
capital item to which Part XV Value Added Tax Regulations 1995
applies.
D.5.5 Neither the Company nor any relevant associate of the Company
(within the meaning of paragraph 3 (7) of Schedule 10 Value
Added Tax Act 1994) has been a party to any arrangements
relating to an election in accordance with paragraph 2 and 3 of
Schedule 10 Value Added Tax Xxx 0000 nor are they liable nor is
it likely that they will be liable to a self-supply charge
within the meaning of paragraphs 5 and 6 of Schedule 10 Value
Added Tax Xxx 0000.
D.6 CAPITAL TRANSFER TAX AND INHERITANCE TAX
D.6.1 No transfer of value (as defined by the Inheritance Tax Act
1984) or disposal by way of gift (within the meaning of s.102
Finance Act 1986) has at any time
48
been made by the Company.
D.6.2 The Company has not been entitled to an interest in possession
in settled property (as defined for the purposes of inheritance
tax).
D.6.3 No Inland Revenue charge (as defined in s.237 Inheritance Tax
Act 1984) is outstanding over any asset of the Company or in
relation to any of the shares in the capital of the Company.
D.6.4 As far as the Warrantors are aware there are no circumstances in
existence whereby the power mentioned in s.212 (1) Inheritance
Tax Act 1984 could be exercised in relation to the shares or any
assets of the Company.
D.7 CLOSE COMPANIES
D.7.1 The Company is a close company for tax purposes as defined in
s.414 Taxes Xxx 0000.
D.7.2 The Company is not, nor has it at any time been, a close
investment-holding company as defined in s.13A Taxes Xxx 0000.
D.7.3 The Company has not since 5 April 1965 done anything so as to
give rise to an assessment under s.419 (as extended by s.422)
Taxes Xxx 0000 (loan to participators and associates).
D.8 DISTRIBUTIONS
D.8.1 The Company has not since its incorporation:
(a) made any distribution or deemed distribution within the
meanings of ss.209, 210 or 418 Taxes Act 1988
(distributions and deemed distributions) except as
provided for in its audited accounts;
(b) repaid, redeemed or purchased or agreed to repay, redeem
or purchase any of its share capital, or capitalised or
agreed to capitalise in the form of redeemable shares or
debentures, any profits or reserves of any class or
description.
D.8.2 The Company has not issued any share capital which is of a
relevant class as defined in s.249(2) Taxes Xxx 0000 nor does
the Company own any such share capital (shares carrying the
right to bonus share capital).
D.8.3 The Company has not issued any security (as defined in s.254(1)
Taxes Act 1988) outstanding on the Effective Date in
circumstances such that any interest or other payment payable in
respect of it may be treated as a distribution under s.209 Taxes
Xxx 0000.
49
E. INTELLECTUAL PROPERTY ETC
E.1 SECRET OR CONFIDENTIAL INFORMATION OR PROPERTY
The Company has not at any time (save in the ordinary course of business
or to its professional advisers) disclosed to any person other than the
Purchasers:
E.1.1 any of its secret or confidential information or property
(including, without limitation, financial and technical
information, designs, drawings, plans, statistics, documents,
files, records and papers); or
E.1.2 any other information relating to its business or affairs the
disclosure of which might or could cause loss or damage to or
adversely affect the Company; or
E.1.3 any secret or confidential information relating to its
manufacturers, suppliers, customers, clients and agents or to
any other person who has or has had any dealings with it.
E.2 INTELLECTUAL PROPERTY RIGHTS
E.2.1 The Company does not own, use, infringe or require to use any
letters patent, trade xxxx, service xxxx, registered design,
registrable business name, copyright or similar Intellectual
Property Right.
E.2.2 Full details of all registered Intellectual Property Rights
(including applications to register the same) and all
commercially significant unregistered Intellectual Property
Rights owned or used by the Company are set out in the
Disclosure Letter.
E.2.3 The Company is the sole legal and beneficial owner of or
applicant for the Intellectual Property Rights referred to in
paragraph E.2.2 above free of all encumbrances.
E.2.4 Full details are set out in the Disclosure Letter of all licence
and other agreements relating to Intellectual Property Rights to
which the Company is a party (whether as licensor or licensee)
or which relate to any Intellectual Property Right owned by the
Company. The Company is not in breach of any such agreement and,
so far as the Warrantors are aware, no third party is in breach
of any such agreement.
E.2.5 All the Intellectual Property Rights described in paragraph
E.2.3 above and all agreements disclosed in relation to
paragraph E.2.4 above are valid and subsisting and nothing has
been done or omitted to be done by the Company, and the
Warrantors are unaware of any act or omission of any third
party, which would jeopardise the validity or subsistence of any
of such Intellectual Property Rights or such agreements.
50
E.2.6 The Company owns or has licensed to it all Intellectual Property
Rights it requires to carry on its business as such business has
been carried on during the year prior to the Effective Date and
such rights and the Company's ability to use such rights will
not be affected by the acquisition of the Company by the
Purchasers.
E.2.7 The Warrantors are not aware of any unauthorised use by any
person of any Intellectual Property Rights or confidential
information of the Company.
E.3 COMPUTER KNOW-HOW AND MARKETING INFORMATION
E.3.1 For the purposes of paragraphs E.3.2, E.3.3 and E.3.4 below:
(a) "Computer Know-How" means all information (including that
comprised in or derived from data, discs, tapes, manuals,
source codes, flow-charts and specifications) relating to
the use or programming of any computer which is not
intended by the persons in possession of the information
for use by unauthorised persons and any computer software
in whatever form held; and
(b) "Marketing Information" means all information relating to
the marketing of any products or services (including
customer names and lists, sales targets, sales
statistics, market share statistics, marketing surveys
and reports, marketing research and any advertising or
other promotional materials).
E.3.2 All Computer Know-How and Marketing Information used by the
Company is owned by or is the subject of a valid grant of rights
to the Company and is not subject to any restriction which
materially and adversely affects the Company's ability to use it
for the purposes of its business.
E.3.3 The Company has not disclosed nor is obliged to disclose any
Computer Know- How or Marketing Information of a confidential
nature to any person other than its employees save in the
ordinary course of business.
E.3.4 The Company is not in breach of any agreement under which any
Computer Know-How or Marketing Information was or is to be made
available to it.
E.4 DATA AND RECORDS
E.4.1 All the records and systems (including but not limited to
computer systems), data and information of the Company are
recorded, stored, maintained or operated or otherwise held by
the Company and are not wholly or partly dependent on any
facilities or means (including any electronic, mechanical or
photographic process, computerised or otherwise) which are not
under the
51
exclusive ownership and control of the Company.
E.4.2 The Company has not disclosed to any third party any such
records, control or other systems, data and information as is
referred to in subparagraph E.4.1 above save in the ordinary
course of business or to its professional advisers.
E.4.3 As far as the Warrantors are aware the Company has complied with
all relevant requirements of the Data Protection Xxx 0000,
including the following:
(a) the data protection principles established in that Act;
(b) requests from data subjects for access to data held by
it; and
(c) the requirements relating to the registration of data
users.
E.4.4 The Company has not received a notice or allegation from either
the data protection registrar or a data subject alleging
non-compliance with the data protection principles or
prohibiting the transfer of data to a place outside the United
Kingdom.
E.4.5 No individual has claimed or will have the right to claim
compensation from any of the Company under that Act for loss or
unauthorised disclosure of data prior to the Effective Date.
E.5 BUSINESS NAMES
The Company does not carry on business under a name other that
its own corporate name.
E.6 YEAR 2000
E.6.1 All computer software used by the Company is Year 2000
compliant.
52
F. EMPLOYEES
F.1 PARTICULARS OF EMPLOYEES
F.1.1 The persons whose names are set out in the list attached to the
Disclosure Letter are all the employees of the Company and the
particulars of their employment set out in that list are
accurate. No person who was formerly employed by any company has
a right to return to work.
F.1.2 The terms and conditions of employment of all employees of the
Company are set out in the employment contract copies of which
are enclosed with the Disclosure Letter.
F.1.3 All subsisting contracts of employment to which the Company is a
party are terminable by it on three months' notice or less
without compensation (other than compensation in accordance with
the Employment Rights Act 1996).
F.1.4 No employee of the Company has been given notice of termination
of his employment (or had his employment terminated without
notice) since the Accounts Date and no employee of the Company
has left its employment of his own accord since that date or
indicated his intention of doing so.
F.1.5 Full particulars are contained in the Disclosure Letter of any
outstanding offer of employment made to any person by the
Company and there is no person who has accepted an offer of
employment made by the Company but whose employment has not yet
started.
F.1.6 Full particulars are contained in the Disclosure Letter of any
agreement for the provision of consultancy services or the
services of personnel to the Company and of the terms applicable
to the secondment to the Company of any person.
F.2 SALARY COSTS
F.2.1 Since the Accounts Date no change has been made (or agreed) in
the rate of remuneration or the emoluments or pension benefits
of any employee of the Company.
F.2.2 Since the Accounts Date no change has been made (or agreed) in
the rate of remuneration or the emoluments or pension benefits
of any director or ex- director of the Company and no change has
been made (or agreed) in the terms of engagement (including as
to the level of fees) of any director of the Company.
F.3 COMPENSATION AND OTHER SUMS DUE TO EMPLOYEES
F.3.1 The Company does not have any liability to pay compensation for
loss of office
53
or employment to any present or former officer or employee or to
make any payment under the provisions of the Employment Rights
Xxx 0000, the Sex Discrimination Acts 1975 and 1986, the Race
Relations Xxx 0000, the Disability Discrimination Xxx 0000, the
Equal Pay Xxx 0000 and/or Article 119 of the Treaty of Rome and
no such sums have been paid since the Accounts Date.
F.3.2 Except in respect of normal accruals of remuneration or
emoluments of employment, no sum is payable to or for the
benefit of any employee or director of the Company.
F.3.3 The Company has no obligation to make any payment on redundancy
in excess of the statutory redundancy payment and the Company
has not operated any discretionary practice of making any such
excess payments.
F.4 NO BONUS SCHEMES
There is no scheme or arrangement in operation by or in relation to the
Company under which any employee or other person is entitled to a
commission or remuneration of any other sort calculated by reference to
the whole or part of the turnover, profits or sales of the Company.
F.5 LABOUR RELATIONS
F.5.1 There is not and during the three years preceding the Effective
Date there has not been any industrial action affecting the
Company and to the best of the knowledge, information and belief
of the Warrantors there are no facts or circumstances which are
likely to give rise to such industrial action.
F.5.2 The Company is not a party to any collective agreement or trade
dispute (within the meaning of the Trade Union and Labour
Relations (Consolidations) Act 1992)) or any dismissal
procedures agreement (within the meaning of the Employment
Rights Act 1996) or any proceedings before any court or tribunal
under or by virtue of the provisions of the said Act of 1992 and
to the best of the knowledge, information and belief of the
Warrantors there are no facts or circumstances which are likely
to give rise to the Company becoming a party to any such
agreement or becoming involved in any such dispute or
proceedings.
F.5.3 The Company has in all material respects complied with its
obligations to employees and former employees and any relevant
trade union. No claim has been made or threatened against the
Company or against any person whom the Company is or may be
liable to compensate or indemnify and no enquiry or
investigation has been made or threatened by the Commission for
Racial Equality, the Equal Opportunities Commission or any
health and safety enforcement body, in respect of any act,
event, omission or other matter arising
54
out of or in connection with:
(a) any application for employment by any person;
(b) the employment or termination of employment of any
person;
(c) any retirement/death/disability benefit or any other
benefit of whatever type;
and, after making due and careful enquiries, the Warrantors are
not aware of any circumstance which may give rise to any such
claim or investigation.
F.6 LOANS TO EMPLOYEES
The Company has not made any loan or advance to any of its present or
future officers or employees which is outstanding.
F.7 NO PENSION SCHEMES
The Company has not in the two years before the Effective Date paid,
provided or contributed towards, and the Company is not under any
obligation or commitment (whether or not legally enforceable) to pay,
provide or contribute towards, any retirement/death/disability benefit
for or in respect of any present or past employee (or any spouse, child
or dependant of any of them) of the Company or of any predecessor in
business of the Company.
55
G. LEASE
G.1 TITLE
G.1.1 The Lease is the only property, owned, controlled, used or
occupied by the Company and the Company is in exclusive
occupation of it.
G.1.2 The property comprised in and demised by the Lease is in this
clause referred to as the 'Property'.
G.1.3 So far as the Warrantors are aware all consents necessary to the
grant of the lease under which the Company holds the Property
were obtained.
G.1.4 The Company has paid the rent under the Lease and observed and
performed the covenants on the part of the lessee and the
conditions contained in the lease (which expression includes
underleases) under which the Property is held and the last
demands for rent (or receipts if issued) were unqualified and to
the best of the Seller's knowledge and belief the Lease is valid
and in full force.
G.1.5 Consent required from the landlord's mortgagee to the grant of
the Lease was obtained.
G.1.6 There are no notices negotiations or proceedings pending in
relation to rent reviews nor is any rent liable at the Effective
Date to be reviewed.
G.1.7 There is no obligation to reinstate the Property by removing or
dismantling any alteration made to the same by the Company or so
far as the Warrantors are aware any predecessor in title to the
Company.
G.1.8 No notice or other requirement has been given by the landlord
under the Lease.
G.1.9 The Warrantors are not aware of any circumstances which would
entitle any such landlord to exercise any powers of entry or
take possession whether by means of peaceable re-entry or
proceedings or which would otherwise restrict the continued
possession and enjoyment of the Property.
G.1.10 Neither the Warrantors nor the Company has received notice of any
outstanding breach of covenant under the Lease.
G.2 FREE FROM ENCUMBRANCES
G.2.1 The Lease is free from any mortgage, debenture or charge
(whether specific or floating legal or equitable) rent-charge,
lien or other encumbrance securing the repayment of monies or
other obligation or liability whether of the Company or any
other party.
56
G.2.2 The Property is not so far as the Warrantors are aware subject
to any liability for the payment of any outgoings of a recurring
nature other than national non-domestic rates, water and
sewerage services charges, insurance premiums, rents and service
charges.
G.2.3 The Lease is not to the best of the Warrantors' knowledge and
belief subject to any covenants, restrictions, stipulations,
easements, profits a prendre, wayleaves, licences, grants,
exceptions or reservations overriding interests or other such
rights the benefit of which is vested in third parties nor any
agreement to create the same except in so far as the same are
set out in the Lease.
G.2.4 Where any such matters as are referred to in paragraphs 2.1, 2.2
and 2.3 above have been disclosed in the Disclosure Letter the
obligations and liabilities imposed and arising under them have
been fully observed and performed and all payments in respect of
them due and payable have been duly paid.
G.2.5 The Lease is not subject to any agreement or right to acquire
the same nor any option, right of pre-emption or right of first
refusal and there are no outstanding actions claims or demands
between the Company and any third party affecting or in respect
of the Lease.
G.2.6 There is no person who is in occupation or who has notified to
the Company that he claims any rights or easements of any kind
in respect of the Property adversely to the estate, interest,
right or title of the Company therein.
G.3 PRESENT USE
G.3.1 The present use of the Property is offices within the meaning of
Class B1 of the Town & Country Planning (Use Classes) Order 1987
and copies of the permissions authorising that use have been
supplied.
G.3.2 The Company has not carried out any development, alterations or
other works which would require any permission or consent under
the Planning Acts or any bye-laws or building regulations or
other relevant legislation have been carried out without all
those permissions and consents having been obtained and all
conditions attached to those permissions and consents have been
observed and performed.
G.3.3 No breach by the Company of the Planning Acts or of any relevant
bye-laws, building regulations and other legislation has been
committed by the Company so far as the Warrantors are aware in
relation to the Property.
G.4 NOTICES AND COMPULSORY ACQUISITION
57
Neither the Warrantors nor the Company has received any notice
affecting the Property from the local or other competent
authority or from any third party concerning the compulsory
acquisition of the Property or which would adversely affect the
Property.
G.5 REPAIR
The Warrantors know of no subsisting collateral warranties,
guarantees, indemnities or latent defect insurance policies the
benefit of which is vested in the Company.
G.6 SERVICES
The Property is served by drainage, water, electricity and gas services
and the passage and provision of those services has not been interrupted
since the commencement of the Lease and neither the Warrantors nor the
Company knows of any imminent or likely interruption of such passage or
provision.
G.7 FACILITIES
None of the facilities necessary for the enjoyment and current use of the
Property are enjoyed on terms entitling any person to terminate or
curtail them so far as the Warrantors are aware.
G.8 ACCESS
The means of access to or egress from the Property are set out in the
Lease.
G.9 DISPUTES
There are no disputes regarding boundaries, easements, covenants or other
matters relating to the Property or its use of which the Company is
aware.
G.10 FIXTURES & FITTINGS
All fixtures and fittings at the Property (other than landlord's fixtures
and fittings) are the absolute property of the Company free from
encumbrances.
G.11 UNREGISTERED TITLE
The Lease is properly constituted by, and can be deduced from, duly
stamped documents of title which are in the possession or under the
control of the Company or the Sellers. No event has occurred in
consequence of which registration should have been effected at HM Land
Registry.
58
G.12 CONTINGENT LEASEHOLD LIABILITIES
G.12.1 The Company has not been a guarantor of a tenant's covenants in any
lease.
G.12.2 The Company has not surrendered the lease of any leasehold property to
the reversioner without first investigating the reversioner's title and
without receiving from the reversioner an absolute release from the
tenant's covenants in the relevant lease and from all liability arising
under that lease.
G.12.3 Except as disclosed in the Disclosure Letter, the Company has not
assigned any leasehold property of which it was the original tenant in
respect of which it entered into a covenant with the landlord to observe
and perform the tenant's covenants under that lease without receiving a
full and effective indemnity in respect of its liability under that
lease.
G.13 STATUTORY OBLIGATIONS
G.13.1 The Company has not been notified of any requirements as to fire
precautions and means of escape in case of fire or requirements under
the Public Health Acts, the Housing Acts, the Highways Acts, the
Offices, Shops and Railway Premises Xxx 0000, the Health and Safety at
Work, etc. Xxx 0000, the Factory Acts and the London Building Acts in
respect of the Property.
G.13.2 There are not so far as the Warrantors are aware in force or required to
be in force any licences whether under the Licensing Xxx 0000 or
otherwise which apply to the Property or relate to or regulate any
activities carried on therein.
59
SCHEDULE 5
PROPERTY LICENCE
60
/s/ Xxxxxxxx Xxx Xxxxxx
-----------------------
SIGNED by Xxxxxxxx Xxx Xxxxxx )
in the presence of: )
Witness Signature:
Witness Address:
Witness Occupation:
/s/ Xxxxx XxXxxxxx
------------------
SIGNED by Xxxxx XxXxxxxx )
in the presence of: )
Witness Signature:
Witness Address:
Witness Occupation:
/s/ Xxxx Xxxxxxx
----------------------
SIGNED by Xxxx Xxxxxxx )
acting by his duly appointed )
attorney
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
61
/s/ Xxxxx Xxxxx
---------------------
SIGNED by Xxxxx Xxxxx )
acting by his duly appointed )
attorney
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
/s/ Xxxx Xxxxxxx
----------------------
SIGNED by Xxxx Xxxxxxx )
acting by his duly appointed )
attorney
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
/s/ Xxxxx Xxx Xxxxxxx
---------------------------
SIGNED by Xxxxx Xxx Xxxxxxx )
acting by her duly appointed )
attorney
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
62
/s/ Struan Xxxxxxxx
-------------------------
SIGNED by Struan Xxxxxxxx )
acting by his duly appointed )
attorney
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
/s/ Xxxxxx Xxxxxxxx
-------------------------
SIGNED by Xxxxxx Xxxxxxxx )
acting by her duly appointed )
attorney
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
/s/ Xxxx Xxxxxxx
----------------------
SIGNED by Xxxx Xxxxxxx )
acting by his duly appointed )
attorney
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
63
/s/ Xxxxx XxXxxxxx
------------------------
SIGNED by Xxxxx XxXxxxxx )
acting by her duly appointed )
attorney
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
/s/ Xxxxxxxx Xxxxxx
-------------------------
SIGNED by Xxxxxxxx Xxxxxx )
as trustee of the Xxx Xxxxxx )
Discretionary Settlement 1998
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
/s/ Xxxxxxxx Xxxxxx
--------------------------
SIGNED by Xxxxxxxx Xxxxxx )
as trustee of the Xxx Xxxxxx )
Discretionary Settlement 1998
acting by her duly appointed attorney
Xxx Xxxxxx in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
64
/s/ Xxx Xxxxxx
--------------------
SIGNED by Xxx Xxxxxx )
the duly authorised representative of )
Marquee Group (UK) Limited
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
/s/ Xxx Xxxxxx
--------------------
SIGNED by Xxx Xxxxxx )
the duly authorised representative of )
The Marquee Group Inc.
in the presence of:
Witness Signature:
Witness Address:
Witness Occupation:
65
