SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 14, 1996
AMERICAN BANKNOTE CORPORATION
(Exact name of Registrant as specified in its charter)
DELAWARE
(State of other jurisdiction of incorporation)
1-3410 13-0460520
(Commission File Number) (IRS Employer
Identification No.)
200 Park Avenue,
New York, NY 10166-4999
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number,
including area code: (212) 557-9100
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On November 14, 1996, American Banknote Corporation (the
"Corporation") announced it had increased its ownership in its
Australia/New Zealand subsidiary to 100% by acquiring the 45%
interest it did not own from Leigh-Mardon Pty. Limited ("LM"), a
subsidiary of Amcor Limited. The acquisition of 55% of the Leigh-Mardon
Security Group, Australia's oldest and largest security
printer, from Amcor Limited, had first been announced in April 1996
and closed in June 1996. Reference is made to the Corporation's
Current Report on Form 8-K dated April 16, 1996; Current Report on
Form 8-K dated June 18, 1996; and Amendment No. 1 to Current Report
on Form 8-K/A dated August 14, 1996 for a description of the prior
transaction.
The price of the acquisition of the remaining 45% interest was A$6
million plus the settlement of certain post-closing adjustments owed
by Amcor, payable in four installments of $1.5 million on February
14, 1997, June 14, 1997, October 14, 1997 and February 14, 1998.
The Corporation's acquisition was made through an unrestricted
subsidiary of the Corporation, American Banknote Australasia
Holdings, Inc. ("ABAH"), which in June acquired a 55% interest in
ABN Australasia Ltd. (formerly American Banknote Australasia Ltd.)
("ABNA") which has secured the installment payments. In connection
with the transaction, the Shareholders and Subscription Agreement by
and between ABAH, LM and ABNA was terminated.
The Corporation's press release dated November 14, 1996 is
incorporated herein by reference.
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits:
(a) Financial Statements of Business Acquired:
Financial Statements of Business Acquired is hereby
incorporated by reference to Item 7(a) to the Current
Report on Form 8-K/A filed on August 14, 1996.
(b) Pro Forma Financial Information:
Pro Forma Financial Statements of Leigh-Mardon are not
available and cannot be provided at this time. Financial
information required pursuant of Article 11 of Regulation
S-X will be filed within 60 days after the date this
Report is filed.
(c) Exhibits:
Exhibit 1 Press release dated November 14, 1996 **
Exhibit 2 Share Sale and Exit Deed **
Exhibit 3 Share Mortgage **
** Filed electronically herewith
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Date: November 25, 1996 American Banknote Corporation
By: S/ HARVEY J. KESNER
Harvey J. Kesner
Executive Vice President
EXHIBIT 1 PRESS RELEASE DATED NOVEMBER 14, 1996
LH
AMERICAN BANKNOTE CORPORATION
200 Park Avenue
New York, NY 10166
(212) 557-9100
Contacts: Jean Marie Young
Director - Investor Relations
American Banknote Corporation
(212) 557-9100 FOR IMMEDIATE RELEASE
AMERICAN BANKNOTE ACQUIRES REMAINING SHARES
OF LEIGH-MARDON SECURITY GROUP
NEW YORK, November 14, 1996 - American Banknote Corporation
(NYSE:ABN) announced today that it increased ownership in its
Leigh-Mardon subsidiary to 100% by acquiring the balance of
equity from Amcor Limited. The price was A$6 million plus the
settlement of certain post-closing adjustments owed by Amcor.
American Banknote held certain rights to purchase this equity
under terms of the original agreement by which it acquired 55% of
Leigh-Mardon in June 1996. Simultaneously, Leigh-Mardon reduced
its A$67 million senior debt by prepaying A$1.25 million.
Morris Weissman, American Banknote's Chairman and Chief Executive
Officer, stated: "During the five months since our acquisition of
Leigh-Mardon, our confidence in its ability to add value has been
proven by its recent successes. We are pleased to have completed
the transaction on such favorable terms and believe that owning
100% of Leigh-Mardon will give us more flexibility with our
future plans for growth through joint ventures, strategic
investments, and acquisitions."
more
<PAGE> 2
Weissman added, "We are also delighted that our Brazilian
subsidiary has reached an agreement to purchase the security
print division of Companhia Melhoramentos de Sao Paulo, one of
Brazil's four largest check printers, as previously reported.
The success of our international expansion in both Latin America
and Australasia continues with these strategic moves."
Leigh-Mardon's products and services include: personalized
plastic cards, smartcards, electronic printing applications,
licenses and identity cards, electronic point of sale terminals
with specialized software, barcode labels, personal bank cheques,
and many other secure documents. The Company is the world's
first third party smartcard activator following accreditation to
initialize Visa Cash Cards.
American Banknote, through its subsidiaries in Brazil, Australia,
New Zealand and the United States, supplies anti-fraud and anti-counterfeit
security products and services associated with these
products for use worldwide including: bank cards (credit, debit,
and ATM), stored-value telephone cards, document management,
foreign currency, travelers cheques, treasury cheques, food
coupons, passports, birth certificates, driver's licenses and
gift certificates. The Company, via its Holographics subsidiary,
is the world leader in security for financial transaction cards
including those for VISA, MasterCard, Discover and Europay. For
more than 200 years, American Banknote has been adapting and
improving its technology to obstruct fraud and counterfeiting and
continues to do so in the rapidly changing field of electronic
commerce.
This release contains forward-looking statements relating to
future financial results. Actual results may differ materially
as a result of factors over which the Company has no control.
These risk factors and additional information are included in the
Company's annual report on Form 10-K and quarterly reports on
Form 10-Q on file with the Securities and Exchange Commission.
###
EXHIBIT 2 SHARE SALE AND EXIT DEED
LEIGH-MARDON PTY LIMITED
and
CONTAINERS PACKAGING (N.Z.) LIMITED
and
KIWI PACKAGING (CARTONS) LIMITED
and
LEIGH-MARDON (NZ) LIMITED
and
ABN SECURITY PTY LTD
and
ABN HOLDINGS PTY LTD
and
ABN PACIFIC PTY LTD
and
ABN NEW ZEALAND LIMITED
and
AMERICAN BANKNOTE AUSTRALASIA LIMITED
and
CONTAINERS PTY LIMITED
and
AMERICAN BANKNOTE AUSTRALASIA HOLDINGS INC
and
AMCOR INVESTMENTS PTY LIMITED
SHARE SALE AND EXIT DEED
Arthur Robinson & Hedderwicks
Melbourne
Ref WLR:PJR
Tel 9614 1011
Page ()
TABLE OF CONTENTS
1. DEFINITIONS AND INTERPRETATION 2
2. TRANSFER OF SHARES TO ABAH 4
3. PAYMENTS BY ABAH TO THE AUSTRALIAN VENDOR 4
4. WARRANTIES 5
5. RELEASES 5
6. COVENANTS NOT TO SUE 6
7. COMPLETION 7
8. CONDITIONS PRECEDENT 7
9. TERMINATION OF SHAREHOLDERS AND SUBSCRIPTION AGREEMENT 7
10. FINANCIAL INFORMATION 7
11. CONFIDENTIALITY 8
12. NOTICES 8
13. AMENDMENT 9
14. ASSIGNMENT 9
15. NO WAIVER 9
16. FURTHER ASSURANCES 9
17. NO MERGER 9
18. COSTS AND STAMP DUTY 9
19. GOVERNING LAW AND JURISDICTION 9
20. COUNTERPARTS 11
Page
SHARE SALE AND EXIT DEED
THIS DEED is made on 1996 between:
1.LEIGH-MARDON PTY LIMITED (ACN 004 432 633) incorporated in Victoria of 679
Victoria Street, Abbotsford, Victoria, Australia (the Australian Vendor);
2.CONTAINERS PACKAGING (N.Z.) LIMITED incorporated in Auckland of Nesdale
Avenue, Wiri, Auckland, New Zealand (CNZ);
3.KIWI PACKAGING (CARTONS) LIMITED incorporated in Auckland of 58 Victoria
Street, Onehunga, Auckland, New Zealand (KPCL);
4.LEIGH-MARDON (NZ) LIMITED incorporated in Wellington of 1st Floor, 175
Vivian Street, Wellington, New Zealand (LNZ);
5.ABN SECURITY PTY LTD (ACN 072 977 292) incorporated in Victoria of 1144
Nepean Highway, Highett, Victoria, Australia (the Business Purchaser);
6.ABN HOLDINGS PTY LTD (ACN 072 977 229) incorporated in Victoria of 1144
Nepean Highway, Highett, Victoria, Australia (the Fortronic Shares
Purchaser);
7.ABN PACIFIC PTY LTD (ACN 072 977 265) incorporated in Victoria of 1144
Nepean Highway, Highett, Victoria, Australia (ABP);
8.ABN NEW ZEALAND LIMITED incorporated in New Zealand c/- Chapman Sheffield
Young, AMP Centre, Grey Street, Wellington, New Zealand (the New Zealand
Purchaser);
9.AMERICAN BANKNOTE AUSTRALASIA LIMITED (ACN 072 664 692) incorporated in
Victoria of 1144 Nepean Highway, Highett, Victoria, Australia (the
Purchasers' Guarantor);
10.CONTAINERS PTY LIMITED (ACN 004 275 165) incorporated in Victoria of 679
Victoria Street, Abbotsford, Victoria, Australia (the Vendor Guarantor);
11.AMERICAN BANKNOTE AUSTRALASIA HOLDINGS INC incorporated in the United
States of America of 200 Park Avenue, 49th Floor, New York 10166, New York,
United States of America (ABAH); and
12.AMCOR INVESTMENTS PTY LIMITED (ACN 004 345 868) incorporated in Victoria of
Southgate, Tower East, 40 City Road, South Melbourne, Victoria, Australia
(Amcor).
RECITALS
A.The Australian Vendor, the Vendor Guarantor, the Business Purchaser, the
Fortronic Shares Purchaser, ABP and the Purchasers' Guarantor entered into
the Australian Sale Agreement on 10 April 1996 (the Australian Sale
Agreement).
B.CNZ, LNZ, KPCL, the New Zealand Purchaser, the Purchasers' Guarantor and the
Vendor Guarantor entered into the New Zealand Sale Agreement on 10 April 1996
(the New Zealand Sale Agreement).
C.The Australian Vendor, the Vendor Guarantor, CNZ, LNZ, KPCL, the Business
Purchaser, the Fortronic Shares Purchaser, ABP, the New Zealand Purchaser,
the Purchasers' Guarantor and the Vendor Guarantor entered into the Master
Agreement on 10 April 1996 (the Master Agreement).
D.ABAH, the Australian Vendor and the Purchasers' Guarantor entered into the
Shareholders and Subscription Agreement on 3 June 1996 (the Shareholders and
Subscription Agreement).
E.The Australian Vendor subscribed for 7,363,636 ordinary shares in the
Purchasers' Guarantor (the Shares) pursuant to the Shareholders and
Subscription Agreement.
F.The Australian Vendor has agreed to transfer the Shares to ABAH on the
terms of this Deed.
G.The Purchasers have made certain claims against the Vendors and the Vendor
Guarantor pursuant to the Australian Sale Agreement, the New Zealand Sale
Agreement and the Master Agreement (the Claims). The Claims are set out in a
letter dated 1 August 1996 to the Australian Vendor from Mallesons Stephen
Jaques (on behalf of the Purchasers), a copy of which is contained in
Schedule 1.
H.It is the intention of the parties that the Claims be resolved in accordance
with the terms of this Deed.
IT IS AGREED as follows.
1.DEFINITIONS AND INTERPRETATION
1.1Definitions
The following definitions apply unless the context requires otherwise.
Amcor group has the meaning given in the Management Incentive Plan Letter
Agreement.
Australian Business has the meaning given in the Master Agreement.
BABN has the meaning given in the Australian Sale Agreement.
Bank has the meaning given in the Banking Act of the Commonwealth of
Australia.
Business Day has the meaning given in the Australian Sale Agreement.
Capital Expenditure Amount has the meaning given in the Master Agreement.
Completion means the completion by the parties of the transfer of the Shares
as provided in Clause 7.
Completion Date means the date on which the conditions referred to in Clause 8
(the Conditions) are satisfied or any other date as the parties agree.
Effective Date means 1 October 1996.
Final Australian Completion Balance Sheet has the meaning given to the term
final Completion Balance Sheet in the Australian Sale Agreement.
Final New Zealand Completion Balance Sheet has the meaning given to the term
final Completion Balance Sheet in the New Zealand Sale Agreement.
Group means the Purchasers' Guarantor and all of its Subsidiaries from time to
time.
Letter Agreement means the letter agreement dated 31 May 1996 between the
Purchasers, the Vendors, the Purchasers' Guarantor and the Vendor Guarantor
in relation to various matters, including the sale of the PSS Shares.
Liabilities means debts or liabilities of any kind, including those which are
prospective or contingent and those the amount of which is not ascertained or
ascertainable.
Management Incentive Plan has the meaning given in the Management Incentive
Plan Letter Agreement.
Management Incentive Plan Letter Agreement means the Letter Agreement dated
10 April 1996 between the Purchasers, the Vendors, the Purchasers' Guarantor
and the Vendor Guarantor relating to the operation of the Amcor Group
Management Incentive Plan.
New Zealand Business has the meaning given in the Master Agreement.
Payment Date means each date upon which a payment is made by ABAH pursuant to
this Deed.
Penalty Interest Rate means the penalty interest rate fixed from time to time
pursuant to section 2 of the Penalty Interest Rates Act 1983.
PSS Shares has the meaning given in the Australian Sale Agreement.
Purchasers means the Business Purchaser, the Fortronic Shares Purchaser, ABP
and the New Zealand Purchaser.
Security Interests means an interest or power:
(a)reserved in or over any interest in any asset including, without
limitation, any retention of title; or
(b)created or otherwise arising in or over any interest in any asset under a
bill of sale, mortgage, charge, lien, pledge, trust or power, by way of
security for the payment of debt or any other monetary obligation or the
performance of any other obligation and whether existing or agreed to be
granted or created.
Senior Debt Facility Agreement has the meaning given to the term "Senior Debt
Facility" in the Subordinated Debt Facility Agreement.
Share Mortgage has the meaning given in Clause 8.
Subordinated Debt Facility Agreement means the agreement dated 3 June 1996
between the Purchasers' Guarantor, Amcor and the Purchasers.
Subsidiary has the same meaning as in the Corporations Law.
Trade Payables has the meaning given in the Australian Sale Agreement insofar
as the Australian Business is concerned and has the meaning given in the New
Zealand Sale Agreement insofar as the New Zealand Business is concerned.
Vendors means the Australian Vendor, CNZ, KPCL and LNZ.
1.2Interpretation
Headings are for convenience only and do not affect interpretation. The
following rules apply unless the context requires otherwise.
(a)The singular includes the plural and conversely.
(b)A gender includes all genders.
(c)If a word or phrase is defined, its other grammatical forms have a
corresponding meaning.
(d)A reference to a person, corporation, trust, partnership, unincorporated
body or other entity includes any of them.
(e)A reference to a Clause or a Schedule is a reference to a clause of or a
schedule to, this Deed.
(f)A reference to an agreement or document (including, without limitation, a
reference to this Deed) is to the agreement or document as amended, varied,
supplemented, novated or replaced, except to the extent prohibited by this
Deed or that other agreement or document.
(g)A reference to a party to this Deed or another agreement or document
includes the party's successors, permitted substitutes and permitted assigns
(and, where applicable, the party's legal personal representatives).
(h)A reference to legislation or to a provision of legislation includes a
modification or re-enactment of it, a legislative provision substituted for
it and a regulation or statutory instrument issued under it.
(i)A reference to conduct includes, without limitation, an omission, statement
or undertaking, whether or not in writing.
(j)A reference to an agreement includes any undertaking, deed, agreement and
legally enforceable arrangement, whether or not in writing, and a reference
to a document includes an agreement (as so defined) in writing and any
certificate, notice, instrument and document of any kind.
(k)A reference to A$ is to Australian currency.
(l)A reference to NZ$ is to New Zealand currency.
(m)A reference to a right or obligation of any two or more persons confers
that right, or imposes that obligation, as the case may be, jointly and
severally.
2. TRANSFER OF SHARES TO ABAH
2.1The parties have agreed that the Australian Vendor shall transfer the
Shares to ABAH with effect from the Effective Date in accordance with the
terms of this Deed.
2.2The Shares must be transferred to ABAH free from all Security Interests.
3.PAYMENTS BY ABAH TO THE AUSTRALIAN VENDOR
3.1ABAH shall pay the following amounts to the Australian Vendor on the
following dates:
(a)A$1,500,000 on 14 February 1997;
(b)A$1,500,000 on 14 June 1997;
(c)A$1,500,000 on 14 October 1997; and
(d)A$1,500,000 on 14 February 1998.
3.2All payments required to be made under this Deed must be made by a draft or
cheque drawn by a Bank or telegraphic transfer of funds to a Bank account
specified by the Australian Vendor. A telegraphic transfer of funds will be
deemed to occur when the Australian Vendor's Bank has confirmed that fact.
3.3If ABAH defaults in the payment of any money payable under this Deed ABAH
shall, if so demanded by the Australian Vendor, pay interest to the
Australian Vendor at the Penalty Interest Rate on the amount in default from
the time it fell due until that amount has been paid in full.
3.4The right to require payment of interest under this Clause will be without
prejudice to any other rights and remedies of the Australian Vendor.
4.WARRANTIES
4.1The Australian Vendor and the Vendor Guarantor jointly and severally
represent and warrant to ABAH that as at the Completion Date each of the
statements set out below is correct:
(a)the Australian Vendor is the legal and beneficial owner of the Shares free
from all Security Interests; and
(b)the Australian Vendor has full power and authority to transfer to ABAH good
legal and equitable title to the Shares free from all Security Interests.
4.2ABAH represents and warrants to the Australian Vendor that as at the date
of this Deed and as at each Payment Date any payment made to the Australian
Vendor pursuant to Clause 3.1 of this Deed is not and will not be derived
from assets or revenue of the Group except as permitted by law and any
applicable banking arrangements of the Group.
4.3All warranties and conditions which would otherwise be implied in this Deed
are excluded to the maximum extent permitted by law.
5.RELEASES
5.1For the purpose of this Clause and Clause 9:
(a)where a party (party one) releases another party (party two) from claims
in respect of a matter, party one will be deemed to have released and forever
discharged party two from any and all actions, claims, demands, proceedings,
accounts, interest, costs, expenses and Liabilities of whatever nature and
however arising which party one may now have or at any time hereafter might
have or, but for the execution of this Deed, might have had against party two
arising out of, in respect of, in relation to or in any way connected with
the matter;
(b)where a party (party one) waives a claim against another party (party
two) in respect of a matter, party one will be deemed to have waived its
rights against party two in respect of all actions, claims, demands,
proceedings, accounts, interest, costs, expenses and Liabilities of whatever
nature and however arising which party one may now have or at any time
hereafter might have or, but for the execution of this Deed, might have had
against party two arising out of, in respect of, in relation to or in any way
connected with that matter;
(c)a release or waiver by or in favour of a corporation, extends to its
officers, employees, servants and agents from time to time; and
(d)a release or waiver by or in favour of a person who is a director or
shareholder of a corporation which is a party to, or otherwise mentioned in
this Deed, applies to that person personally and in that person's capacity as
such director or shareholder (as the case may be).
5.2With effect from the Effective Date, each of the Purchasers and the
Purchasers' Guarantor releases each of the Vendors and the Vendor Guarantor
from each of the following claims and obligations and waives all rights it
may have in relation thereto:
(a)the obligation of the Australian Vendor (pursuant to Clause 4 of the Master
Agreement and paragraph 2(c) of the Letter Agreement) to refund $1,000,000 to
the Purchasers within 14 Business Days of 15 October 1996 as a result of the
sale of the PSS Shares to BABN;
(b)the obligation of the Amcor Group (pursuant to the Management Incentive
Plan Letter Agreement) to pay relevant management staff the proportion of the
relevant amounts payable under the Management Incentive Plan for the year
ended 30 June 1996 applicable to the period during which the management staff
were employed by the Amcor Group or, in the case of Fortronic Technology Pty
Ltd, the period during which that company was owned by the Australian Vendor;
(c)any claim they might have in relation to the calculation of the Capital
Expenditure Amount solely for the purposes of Clause 3 of the Australian Sale
Agreement and Clause 3 of the Master Agreement;
(d)any claim they might have in relation to the Final Australian Completion
Balance Sheet or the Final New Zealand Completion Balance Sheet solely for
the purpose of Clause 3 of the Master Agreement;
(e)any obligation to make any payment pursuant to Clause 3.1(a) of the Master
Agreement;
(f)any claim they might have pursuant to Clause 18(a) of the Australian Sale
Agreement or Clause 15(a) of the New Zealand Sale Agreement that the practice
of the Vendors in relation to the payment of Trade Payables breached the
obligation of the Vendors to conduct the Australian Business and the New
Zealand Business in the ordinary course; and
(g)any other claim of whatever nature made or referred to in the letter
contained in Schedule 1.
5.3For the avoidance of doubt, each of the parties acknowledges that the
releases and waivers contained in Clause 5.2 do not operate to release or
waive:
(a)any of the warranties given by any of the parties under the Australian Sale
Agreement or the New Zealand Sale Agreement; or
(b)any of the obligations of the parties under the Australian Sale
Agreement, the New Zealand Sale Agreement or the Master Agreement (other than
the obligations released pursuant to Clause 5.2).
6.COVENANTS NOT TO SUE
As a separate and independent obligation each of the parties covenants in
favour of each of the other parties not to bring or pursue, procure that a
third party bring or pursue, provide financial support for or otherwise
support or participate in any proceeding in any court or tribunal in respect
of any matter the subject of a release, acknowledgement or waiver under
Clause 5 or Clause 9.
7.COMPLETION
7.1Completion of the transfer of the Shares will take place on the Completion
Date at the offices of the Vendors' solicitors, Arthur Robinson & Hedderwicks
of 530 Collins Street, Melbourne, Victoria or at any other place as the
Vendors and ABAH may agree.
7.2On the Completion Date:
(a)the Australian Vendor shall deliver to ABAH duly executed instruments of
transfer of the Shares in favour of ABAH together with the share certificates
relating to the Shares; and
(b)ABAH shall deliver to the Australian Vendor such instruments of transfer of
the Shares and such other documents as are required to comply with the Share
Mortgage.
8.CONDITIONS PRECEDENT
8.1Except for the provisions of this Clause and Clause 11 the provisions of
this Deed will not be binding unless:
(a)the Australian Vendor receives from ABAH in a form and substance
satisfactory to it:
(i)a duly executed counterpart of a fixed share mortgage (which is a
first ranking charge) over the Shares to secure the obligations of ABAH under
this Deed (the Share Mortgage); and
(ii)all such other documents or evidence in connection with the Share
Mortgage as the Australian Vendor may reasonably require; and
(b)the conditions set out in the escrow letter relating to this Deed are
satisfied within 14 days from the date of this Deed.
8.2The parties shall each co-operate with the other and do all things
reasonably necessary to procure that this Deed does become binding under this
Clause.
9.TERMINATION OF SHAREHOLDERS AND SUBSCRIPTION AGREEMENT
The Australian Vendor, the Purchasers' Guarantor and ABAH agree that following
Completion:
(a)the Shareholders and Subscription Agreement shall be terminated with effect
from the Effective Date; and
(b)each party shall be released from all its obligations and Liabilities
under the Shareholders and Subscription Agreement and all actions, claims or
proceedings that it may have against the other parties under or in respect of
the Shareholders and Subscription Agreement.
10.FINANCIAL INFORMATION
Until such time as the amounts referred to in Clause 3 have been paid to the
Australian Vendor, the Purchasers' Guarantor shall provide to the Australian
Vendor:
(a)as soon as practicable (and in any event not later than 30 days) after the
end of each calendar quarter, unaudited management accounts which must
include a detailed profit and loss account, balance sheet and cash-flow
statement, an analysis of sales and other revenues, a review of the budget
together with a reconciliation of results with revenue and capital budgets
for the corresponding quarter and a statement of the source and application
of funds for that quarter;
(b)as soon as practicable after the end of each of its financial years, copies
of the audited balance sheet and profit and loss account of the Group; and
(c)any other information the Australian Vendor may at any time
reasonably require as to any material matter relating to the Australian
Business, the New Zealand Business or the financial condition of the Group.
11.CONFIDENTIALITY
11.1Subject to Clause 11.2, no party shall make any disclosure in relation to
any term of this Deed.
11.2The provisions of Clause 11.1 do not apply to any disclosure:
(a)which is required by law or by the rules of any stock exchange; or
(b)to the parties to the Senior Debt Facility Agreement or the
Subordinated Debt Facility Agreement.
12.NOTICES
Any notice, demand, consent or other communication (the Notice) given or made
under this Deed:
(a)must be in writing and signed by a person duly authorised by the sender;
(b)must either be delivered to the intended recipient by prepaid post (if
posted to an address in another country, by registered airmail) or by hand or
fax to the address or fax number below or the address or fax number last
notified by the intended recipient to the sender:
(i)to the Australian Vendor, 679 Victoria Street CNZ, LNZ, KPCL and the
Abbotsford Victoria Vendor GuarantorAustralia Attention: The Company
Secretary Fax No: 61 3 9320 8392
(ii) to the Business Purchaser, 49th Floor, 200 Park Avenue
the Fortronic Shares Purchaser, New York New York, United States
ABP, the New Zealand Purchaser, of America 10166 -4999
ABAH and the Purchasers' Attention: Mr M Weismann
Guarantor Fax No: 1 212 338 0728
Copy to:49th Floor, 200 Park Avenue
New York New York, United States
of America 10166 - 4999
Attention: Mr H Kesner
Fax No. 1 212 338 0747
(c)will be taken to be duly given or made:
(i)in the case of delivery in person, when delivered;
(ii)in the case of delivery by post, two business days after the date of
posting (if posted to an address in the same country) or seven business days
after the date of posting (if posted to an address in another country);
(iii)in the case of fax, on receipt by the sender of a transmission control
report from the despatching machine showing the relevant number of pages and
the correct destination fax machine number or name of recipient and
indicating that the transmission has been made without error, but if the
result is that a Notice would be taken to be given or made on a day that is
not a business day in the place to which the Notice is sent or is later
than 4.00pm (local time) it will be taken to have been duly given or
made at the commencement of business on the next business day in that place.
13.AMENDMENT
No amendment or variation of this Deed is valid or binding on a party unless
made in writing executed by all parties.
14.ASSIGNMENT
The rights and obligations of each party under this Deed are personal. They
cannot be assigned, encumbered or otherwise dealt with and no party shall
attempt, or purport, to do so without the prior written consent of all
parties.
15.NO WAIVER
No failure to exercise nor any delay in exercising any right, power or remedy
by a party operates as a waiver. A single or partial exercise of any right,
power or remedy does not preclude any other or further exercise of that or
any other right, power or remedy. A waiver is not valid or binding on the
party granting that waiver unless made in writing.
16.FURTHER ASSURANCES
Each party agrees to do all things and execute all deeds, instruments,
transfers or other documents as may be necessary or desirable to give full
effect to the provisions of this Deed and the transactions contemplated by
it.
17.NO MERGER
The rights and obligations of the parties will not merge on the completion of
any transaction contemplated by this Deed. They will survive the execution
and delivery of any assignment or other document entered into for the purpose
of implementing a transaction.
18.COSTS AND STAMP DUTY
Each party shall bear its own costs arising out of the negotiation,
preparation and execution of this Deed. All stamp duty (including fines,
penalties and interest) that may be payable on or in connection with this
Deed and any instrument executed under this Deed shall be borne by the
Purchasers.
19.GOVERNING LAW AND JURISDICTION
19.1This Deed is governed by the laws of Victoria, Australia.
19.2With respect to any legal action or proceedings that may be brought by any
of the Vendors or the Vendor Guarantor with respect to this Deed, the Share
Mortgage or any transaction contemplated by this Deed or the Share Mortgage
(each, a Relevant Action), each of the Purchasers and the Purchasers'
Guarantor irrevocably:
(a)submits to and accepts, for itself and in respect of its assets, generally
and unconditionally the non-exclusive jurisdiction of any of the courts of or
in New York (State and Federal), Victoria, New South Wales or of the
Commonwealth of Australia selected by the Australian Vendor; and
(b)waives any objection it may have now or in the future to the venue and any
claim it may have now or in the future that the Relevant Action has been
brought in an inconvenient forum; and
(c)consents to the service of process out of any of those courts by the
mailing of copies of process by registered or certified airmail postage
prepaid to it at its address for service of notices under Clause 12 or to its
process agent at its address provided in Clause 12, in which case service
will be taken to have been effected on receipt. Nothing in this Deed affects
the right to serve process in any other manner permitted by law.
19.3With respect to any legal action or proceedings that may be brought by
ABAH or any of the Purchasers or the Purchasers' Guarantor with respect to
this Deed, or any transaction contemplated by this Deed (each, an ABAH
Relevant Action), each of the Vendors and the Vendor Guarantor irrevocably:
(a)submits to and accepts, for itself and in respect of its assets, generally
and unconditionally the non-exclusive jurisdiction of any of the courts of or
in New York (State and Federal), Victoria, New South Wales or of the
Commonwealth of Australia selected by ABAH; and
(b)waives any objection it may have now or in the future to the venue and any
claim it may have now or in the future that the ABAH Relevant Action has been
brought in an inconvenient forum; and
(c)consents to the service of process out of any of those courts by the
mailing of copies of process by registered or certified airmail postage
prepaid to it at its address for service of notices under Clause 12, in which
case service will be taken to have been effected on receipt.
Nothing in this Deed affects the right to serve process in any other manner
permitted by law.
19.4(a)ABAH irrevocably:
(i)nominates the Purchasers' Guarantor as its agent to receive service of
process or other documents in any Relevant Action or ABAH Relevant Action in
the courts referred to in Clause 19.2; and
(ii)agrees that service of any process or documents on the Purchasers'
Guarantor or any other person appointed under paragraph (b) will be
sufficient service on it.
The Purchasers' Guarantor irrevocably and unconditionally accepts that
appointment.
(b)ABAH will ensure the Purchasers' Guarantor remains authorised to accept
service on its behalf. If the Purchasers' Guarantor ceases to have an office
in Australia, ABAH will ensure that at all times there is another person in
that place acceptable to the Australian Vendor to receive process on its
behalf. It shall promptly notify the Australian Vendor of the appointment of
that other person.
20.COUNTERPARTS
This Deed may be executed in any number of counterparts. All counterparts
together will be taken to constitute one instrument.
EXECUTED
Each attorney executing this Deed states that he or she has no notice of
revocation or suspension of his or her power of attorney.
SIGNED, SEALED AND DELIVERED by
as attorney for LEIGH-MARDON PTY LIMITED
under power of attorney dated 22 February
1996 in the presence of:
Signature
Print Name
Signature
Print Name
SIGNED, SEALED AND DELIVERED by
as attorney for CONTAINERS PACKAGING
(N.Z.) LIMITED under power of attorney
dated 22 February 1996 in the presence
of:
Signature
Print Name
Signature
Print Name
SIGNED, SEALED AND DELIVERED by
as attorney for KIWI PACKAGING (CARTONS)
LIMITED under power of attorney dated 22
February 1996 in the presence of:
Signature
Print Name
Signature
Print Name
SIGNED, SEALED AND DELIVERED by
as attorney for LEIGH-MARDON (NZ) LIMITED
under power of attorney dated 22 February
1996 in the presence of:
Signature
Print Name
Signature
Print Name
SIGNED, SEALED AND DELIVERED by
Morris Weissman as attorney for ABN Morris Weissman
SECURITY PTY LTD Signature
under power of attorney dated
in the presence of:
Jeffrey Clark
Signature
Jeffrey Clark
Print Name
SIGNED, SEALED AND DELIVERED by
Morris Weissman as attorney for ABN Morris Weissman
HOLDINGS PTY LTD Signature
under power of attorney dated
in the presence of:
Jeffrey Clark
Signature
Jeffrey Clark
Print Name
SIGNED, SEALED AND DELIVERED by
Morris Weissman as attorney for ABN Morris Weissman
PACIFIC PTY LTD under Signature
power of attorney dated
in the presence of:
Jeffrey Clark
Signature
Jeffrey Clark
SIGNED, SEALED AND DELIVERED by
Morris Weissman as attorney for ABN Morris Weissman
NEW ZEALAND LIMITED Signature
under power of attorney dated
in the presence of:
Jeffrey Clark
Signature
Jeffrey Clark
Print Name
SIGNED, SEALED AND DELIVERED by
Morris Weissman as attorney for AMERICAN Morris WEissman
BANKNOTE AUSTRALASIA LIMITED Signature
under power of attorney dated
in the presence of:
Jeffrey Clark
Signature
Jeffrey Clark
Print Name
SIGNED, SEALED AND DELIVERED by
as attorney for CONTAINERS PTY LIMITED
under power of attorney dated 22 February
1996 in the presence of:
Signature
Print Name
Signature
Print Name
SIGNEDBY MORRIS WEISSMAN,
SEALED AND DELIVERED by
AMERICAN BANKNOTE AUSTRALASIA
HOLDINGS INC in the presence of: Morris Weissman
Jeffrey Clark Signature
Signature
SIGNED, SEALED AND DELIVERED by
as attorney for AMCOR INVESTMENTS PTY
LIMITED under power of attorney dated 30
May 1996 in the presence of:
Signature
Print Name
Signature
Print Name
EXHIBIT 3 SHARE MORTGAGE
LEIGH-MARDON PTY LIMITED
(Mortgagee)
and
AMERICAN BANKNOTE AUSTRALASIA HOLDINGS INC
(Mortgagor)
SHARE MORTGAGE
Arthur Robinson & Hedderwicks
Melbourne
Ref CDH/PJR:707046
Tel 9614 1011
TABLE OF CONTENTS
1. INTERPRETATION 1
1.1 Definitions 1
1.2 General 3
1.3 Determination, statement and certificate conclusive 4
1.4 Document or agreement 4
2. MORTGAGE 4
3. NATURE OF MORTGAGE 4
3.1 Priority 4
3.2 Registration of Mortgagee 5
3.3 Dealing with Mortgaged Property 5
4. REPRESENTATIONS AND WARRANTIES 5
4.1 Representations and warranties 5
4.2 Reliance on representations and warranties 7
5. COVENANTS 7
5.1 Covenant to pay 7
5.2 General covenants 7
5.3 Covenants relating to Marketable Securities 7
5.4 Dividends 9
5.5 Term of covenants 9
6. FURTHER ASSURANCES 9
7. EVENTS OF DEFAULT 9
7.1 Events of Default 9
7.2 Consequences 11
8. APPOINTMENT OF RECEIVER 11
8.1 Appointment 11
8.2 Agent of Mortgagor 12
8.3 Receiver's powers 12
8.4 Receiver appointed after commencement of Liquidation 14
8.5 Powers exercisable by the Mortgagee 14
8.6 Withdrawal 14
9. POWER OF ATTORNEY 14
10. COMPLETION OF BLANK SECURITIES 15
11. PERFORMANCE OF MORTGAGOR'S OBLIGATIONS 15
12. STATUTORY POWERS 15
12.1 Powers in augmentation 15
12.2 Notice not required 15
13. APPLICATION OF MONEY RECEIVED 15
13.1 Order 15
13.2 Money actually received 16
13.3 Amounts contingently due 16
13.4 Notice of subsequent Security Interests 16
13.5 Conversion of currencies on application 17
14. OTHER SECURITY INTERESTS OVER MORTGAGED PROPERTY 17
15. PROTECTION OF MORTGAGEE, RECEIVER AND ATTORNEY 17
16. PROTECTION OF THIRD PARTIES 17
16.1 No enquiry 17
16.2 Receipt 18
17. RELEASE UPON PAYMENT IN FULL 18
18. EXPENSES, INDEMNITY 18
18.1 Expenses 18
18.2 Indemnity 18
18.3 Amounts in foreign currency 18
19. CURRENCY INDEMNITY 19
20. STAMP DUTIES 19
21. CERTIFICATE AS TO AMOUNT OF SECURED MONEY 19
22. CONTINUING SECURITY 19
23. OTHER SECURITIES 19
24. SET-OFF 19
25. WAIVERS, REMEDIES CUMULATIVE 20
26. SEVERABILITY OF PROVISIONS 20
27. SURVIVAL OF REPRESENTATIONS AND INDEMNITIES 20
28. MORATORIUM LEGISLATION 21
29. ASSIGNMENTS 21
30. NOTICES 21
31. AUTHORISED OFFICERS 21
32. GOVERNING LAW AND JURISDICTION 22
32.1 Governing law 22
32.2 Jurisdiction 22
32.3 Process agents 22
33. COUNTERPARTS 22
34. CONSENTS AND OPINION 22
Page
SHARE MORTGAGE
THIS DEED is made on 1996 between:
1.LEIGH-MARDON PTY LIMITED ACN 004 432 633 incorporated in Victoria of 679
Victoria Street, Abbotsford, Victoria, Australia (the Mortgagee); and
2.AMERICAN BANKNOTE AUSTRALASIA HOLDINGS INC incorporated in the State of
Delaware, United States of America of 200 Park Avenue, 49th Floor, New York
10166, New York, United States of America (the Mortgagor).
RECITAL
By a deed dated on or about the date of this Deed the Mortgagee, Containers
Packaging (N.Z.) Limited, Kiwi Packaging (Cartons) Limited, Leigh-Mardon (NZ)
Limited, ABN Security Pty Ltd ACN 072 977 292, ABN Holdings Pty Ltd
ACN 072 977 229, ABN Pacific Pty Ltd ACN 072 977 265, ABN New Zealand
Limited, American Banknote Australasia Limited ACN 072 664 692 (the Company),
Containers Pty Limited, Amcor Investments Pty Limited ACN 004 345 868
and the Mortgagor (the Share Sale and Exit Deed), the Mortgagor agreed
(amongst other things) to make certain payments to the Mortgagee in
consideration for a transfer of 7,363,636 ordinary shares in the Company
(the Shares).
IT IS AGREED as follows.
1.INTERPRETATION
1.1Definitions
The following definitions apply unless the context requires otherwise.
Attorney means any attorney appointed under this Deed or any
Collateral Security.
Authorisation includes:
(a)any consent, authorisation, registration, filing, lodgement, agreement,
notarisation, certificate, permission, licence, approval, authority or
exemption from, by or with a Governmental Agency;or
(b)in relation to anything which will be fully or partly prohibited or
restricted by law if a Governmental Agency intervenes or acts in any way
within a specified period after lodgement, filing, registration or
notification, the expiry of that period without intervention or action.
Authorised Officer means:
(a)in respect of the Mortgagor, any director or person whose title includes
the word President or cognate expressions, or any person from time to time
nominated as an Authorised Officer by the Mortgagor by a notice to the
Mortgagee accompanied by certified copies of signatures of all new
persons so appointed; and
(b)in respect of the Mortgagee, any person whose title or acting title
includes the word Manager or President or cognate expressions, or any
secretary or director.
Business Day means a weekday on which banks are open in New York and Melbourne.
Collateral Security means any Security Interest, Guarantee or other document or
agreement at any time created or entered into as security for any Secured Money.
Event of Default means any of the events specified in Clause 7.
Financial Indebtedness means any indebtedness, present or future, actual or
contingent in respect of money borrowed or raised or any financial
accommodation whatever. Without limitation, it includes indebtedness under or
in respect of a negotiable or other financial instrument, Guarantee, interest,
gold or currency exchange, hedge or arrangement of any kind, redeemable share,
share the subject of a Guarantee, discounting arrangement, finance or capital
Lease, hire purchase, deferred purchase price (for more than 90 days) of an
asset or service or an obligation to deliver goods or other property or
provide services paid for in advance by a financier or in relation to any
other financing transaction.
Governmental Agency means any government or any governmental, semi-governmental
or judicial entity or authority. It also includes any self-regulatory
organisation established under statute or any stock exchange.
Guarantee means any guarantee, indemnity, letter of credit, legally binding
letter of comfort, suretyship or other assurance against loss.
Lease means any lease, charter, hire purchase or hiring arrangement of any
property or transaction having a similar effect.
Liquidation includes official management, receivership, deregistration,
compromise, arrangement, amalgamation, administration, reconstruction, winding
up, dissolution, assignment for the benefit of creditors, arrangement or
compromise with creditors, bankruptcy or death.
Marketable Security has the meaning given in the Corporations Law, but also
includes:
(a)a document referred to in the exceptions to the definition of debenture in
the Corporations Law;
(b)a unit or other interest in a trust or partnership;
(c)a negotiable instrument; and
(d)a right or an option in respect of a Marketable Security, whether issued or
unissued, including, without limitation, any of the above.
Material Adverse Effect means a material adverse effect on the ability of the
Mortgagor to perform its obligations under the Share Sale and Exit Deed or on
the financial condition of the Mortgagor.
Mortgaged Property means all the Mortgagor's right, title and interest both
present and future in, to, under or derived from the Shares.
New Rights means all assets, rights, powers and proceeds of any nature at any
time attaching to, or arising out of a holding in, any Marketable Securities
included in the Mortgaged Property, including, without limitation:
(a)all money, distributions and dividends;
(b)any Marketable Security, any right to take up Marketable Securities or any
allotment of further Marketable Securities;
(c)any certificate or other evidence of title to the Marketable Securities or
to anything specified in this definition;
(d)any proceeds of, or of the disposal of, anything specified in this
definition; and
(e)any Marketable Security resulting from the conversion, consolidation or
sub-division of a Marketable Security, and includes any certificate or other
evidence of title to a Marketable Security or to anything specified in this
definition.
Power means a power, right, authority, discretion or remedy which is conferred
on the Mortgagee or a Receiver or Attorney:
(a)by this Deed or any Collateral Security; or
(b)by law in relation to this Deed or any Collateral Security.
Receiver means a receiver or receiver and manager appointed under this Deed
or any Collateral Security.
Secured Money means all money which the Mortgagor is or at any time may become
actually or contingently liable to pay to or for the account of the Mortgagee
for any reason whatever under or in connection with Clause 3 of the Share Sale
and Exit Deed. Where the Mortgagor would have been liable but for its
Liquidation, it will be taken still to be liable.
Security Interest includes any mortgage, pledge, lien or charge or any
security or preferential interest or arrangement of any kind or any other right
of, or arrangement with, any creditor to have its claims satisfied in priority
to other creditors with, or from the proceeds of, any asset.
Without limitation it includes retention of title other than in the ordinary
course of day-to-day trading and a deposit of money by way of security but it
excludes a charge or lien arising in favour of a Governmental Agency by
operation of statute unless there is default in payment of
money secured by that charge or lien.
Share includes, without limitation, any New Rights in respect of the Shares.
Tax includes any tax, levy, impost, deduction, charge, rate, duty, compulsory
loan or withholding which is levied or imposed by a Governmental Agency and any
related interest, penalty, charge, fee or other amount.
1.2General
Headings are for convenience only and do not affect interpretation. The
following rules apply unless the context requires otherwise.
(a)The singular includes the plural and conversely.
(b)A gender includes all genders.
(c)Where a word or phrase is defined, its other grammatical forms have a
corresponding meaning.
(d)A reference to a person, corporation, trust, partnership, unincorporated
body or other entity includes any of the foregoing.
(e)A reference to a Clause is a reference to a clause of this Deed.
(f)A reference to a party to this Deed or another agreement or document
includes the party's successors and permitted substitutes or assigns (and,
where applicable, the party's legal personal representatives).
(g)A reference to an agreement or document is to the agreement or document as
amended, novated, supplemented or replaced from time to time.
(h)A reference to legislation or to a provision of legislation includes a
modification or re-enactment of it, a legislative provision substituted for it
and a regulation or statutory instrument issued under it.
(i)A reference to writing includes a facsimile transmission and any means of
reproducing words in a tangible and permanently visible form.
(j)A reference to conduct includes, without limitation, an omission, statement
or undertaking, whether or not in writing.
(k)A reference to an asset includes any real or personal, present or future,
tangible or intangible property or asset and any right, interest, revenue or
benefit in, under or derived from the property or asset.
(l)A limited partnership will be regarded as a corporation.
(m)A reference to an amount for which a person is contingently liable includes,
without limitation, an amount which that person may become actually or
contingently liable to pay if a contingency occurs, whether or not that
liability will actually arise.
1.3Determination, statement and certificate conclusive
Except where otherwise provided in this Deed any determination, statement or
certificate by the Mortgagee or an Authorised Officer of the Mortgagee provided
for in this Deed is conclusive and binds the parties in the absence of manifest
error.
1.4Document or agreement
A reference to an agreement includes a Security Interest, Guarantee,
undertaking, deed, agreement or legally enforceable arrangement whether or not
in writing. A reference to a document includes an agreement (as so defined) in
writing or a certificate, notice, instrument or document.
2.MORTGAGE
(a)The Mortgagor mortgages to the Mortgagee the Mortgaged Property.
(b)The mortgage secures the due and punctual payment of the Secured Money.
(c)The mortgage is given in consideration of the Mortgagee entering the Share
Sale and Exit Deed, and for other valuable consideration received.
3.NATURE OF MORTGAGE
3.1Priority
The mortgage is a first mortgage and takes priority over all other Security
Interests.
3.2Registration of Mortgagee
The Mortgagee may at any time after the date of this Deed procure the
registration of itself as the registered holder of all or any of the
Mortgaged Property. If requested by the Mortgagee, the Mortgagor shall
procure such registration promptly.
3.3Dealing with Mortgaged Property
(a)Except with the prior consent of the Mortgagee or as expressly permitted in
this Deed or the Share Sale and Exit Deed, the Mortgagor shall not:
(i)create or allow to exist any Security Interest over any Mortgaged Property;
or (ii)in any other way: (A)dispose of; (B)create or allow any interest in;
or (C)part with possession of, any Mortgaged Property.
(b)Where by law the Mortgagee may not restrict the creation of any Security
Interest over an asset ranking after the mortgage created by this Deed,
paragraph (a) will not restrict that creation, but the Mortgagor shall ensure
that before that Security Interest is created the holder of that Security
Interest enters into a deed of priority in form and substance specified by the
Mortgagee.
4.REPRESENTATIONS AND WARRANTIES
4.1Representations and warranties
The Mortgagor makes the following representations and warranties.
(a)(Status) It is a corporation validly existing under the laws of the place
of its incorporation specified in this Deed.
(b)(Power) It has the power to enter into and perform its obligations under
this Deed, to carry out the transactions contemplated by those documents and
to carry on its business as now conducted or contemplated.
(c)(Corporate authorisations) It has taken all necessary corporate action to
authorise the entry into and performance of this Deed, and to carry out the
transactions contemplated by this Deed.
(d)(Documents binding) This Deed is its valid and binding obligation
enforceable in accordance with its terms, subject to any necessary stamping
and registration. Each of this Deed and any Collateral Security is effective
security over the Mortgaged Property with the priority stated subject to
general principles of equity and laws affecting creditors' rights generally.
(e)(Transactions permitted) The execution and performance by it of this Deed
and each transaction contemplated under this Deed did not and will not violate
in any respect a provision of:
(i)a law or treaty or a judgment, ruling, order or decree of a Governmental
Agency binding on it;
(ii)its constituent documents; or
(iii)any other document or agreement which is binding on it or its assets,
and, except as provided by this Deed, did not and will not:
(iv)create or impose a Security Interest on any of its assets; or
(v)allow a person to accelerate or cancel an obligation with respect to its
Financial Indebtedness, or constitute an event of default, cancellation event,
prepayment event or similar event (whatever called) under an agreement
relating to Financial Indebtedness, whether immediately or after notice or
lapse of time or both.
(f)(No litigation) No litigation, arbitration, Tax claim, dispute or
administrative or other proceeding is current or pending or, to its knowledge,
threatened, which may have a Material Adverse Effect other than the matters
described in schedule 1 of the Share Sale and Exit Deed.
(g)(No default)
(i)It is not in default under a document or agreement (including, without
limitation, an Authorisation) binding on it or its assets which relates to
Financial Indebtedness or is material.
(ii)Nothing has occurred which constitutes an event of default, cancellation
event, prepayment event or similar event (whatever called) under those
documents or agreements, whether immediately or after notice or lapse of
time or both.
(h)(Authorisations) Each Authorisation which is required in relation to:
(i)the execution, delivery and performance by it of this Deed and the
transactions contemplated by this Deed;
(ii)the validity and enforceability of those documents and the effectiveness
or priority of this Deed or any Collateral Security; and
(iii)its business as now conducted or contemplated and which is material,
has been obtained or effected. Each is in full force and effect. It has
complied with each of them. It has paid all applicable fees for each of
them.
(i)(Title) It is the sole beneficial owner of the Mortgaged Property
purported to be charged or mortgaged by it free of any other third party right
or interest whatever other than as permitted by Clause 3.3.
(j)(Trust) It does not hold any assets as the trustee of any trust.
(k)(No further issues) It has disclosed to the Mortgagee the share capital in
the Company. No document, agreement, arrangement or understanding exists
under which further Marketable Securities in the Company may be issued to a
person or under which a person is entitled to call for the issue of
Marketable Securities.
(l)(Transfer valid) The transfer from it to the Mortgagee of the Marketable
Securities included in the Mortgaged Property:
(i)is legal, valid and binding on it;
(ii)is duly executed by it; and
(iii)upon registration will transfer title to the Marketable Securities
to which the transfer refers to the Mortgagee.
4.2Reliance on representations and warranties
The Mortgagor acknowledges that the Mortgagee has entered this Deed and the
Share Sale and Exit Deed in reliance on the representations and warranties
in this Clause.
5.COVENANTS
5.1Covenant to pay
The Mortgagor shall duly and punctually pay the Secured Money.
5.2General covenants
The Mortgagor covenants with the Mortgagee as follows, except to the extent
that the Mortgagee consents.
(a)(Disposal of assets) Without limiting Clause 3.3, it will not sell or
otherwise dispose of, part with possession of, or create an interest in, any
of the Mortgaged Property or agree or attempt to do so (whether in one or more
related or unrelated transactions) except (subject to this Deed and any
Collateral Security) as permitted by Clause 3.3(b) or unless the proceeds of
the sale or disposal are to be applied in fully repaying the Secured Money;
(b)(Corporate existence) It will do everything necessary to maintain its
corporate existence in good standing. It will not transfer its jurisdiction
of incorporation or enter any merger or consolidation.
(c)(Compliance with law) It will comply fully with all laws binding on it
where non-compliance is likely to have a Material Adverse Effect.
(d)(Pay Taxes) It will pay all Taxes payable by it when due, but:
(i)it need not pay Taxes for which it has set aside sufficient reserves and
which are being contested in good faith, except where failure to pay
those Taxes may have a Material Adverse Effect; and
(ii)it will pay contested Taxes which it is liable to pay on the final
determination or settlement of the contest.
5.3Covenants relating to Marketable Securities
The Mortgagor covenants to maintain and protect all Marketable Securities
included in the Mortgaged Property. Without limitation, it undertakes
as follows:
(a)(Notify rights offered or accruing) It will:
(i)notify the Mortgagee immediately if it becomes entitled to, or is offered,
New Rights (other than any dividends); and (ii)ensure that all documents
relating to New Rights (other than any dividends) or arising out of
their subscription, taking up or exercise are delivered to the Mortgagee.
(b)(Bonus issues) The Mortgagor will procure that the Company makes no bonus
issues other than on a pro rata basis to all holders of shares in the relevant
class. For the purposes of clarification only, the parties acknowledge that
nothing in this Deed affects the Company's power to make or offer rights
issues or otherwise make private placements of its shares to any other
person.
(c)(Remedy defects) It will remedy each defect in its, or the Mortgagee's,
holding of those Marketable Securities.
(d)(Take proceedings) It will take or defend all legal proceedings which the
Mortgagee reasonably requires to protect or recover those Marketable
Securities.
(e)(Execute documents) It will execute each document to which it is expressed
to be a party in relation to any thing required under this Clause including,
without limitation, a transfer of a Marketable Security to perfect its legal
mortgage to the Mortgagee or any document appointing it proxy to vote those
Marketable Securities.
(f)(Pay calls) It will duly pay all calls in respect of those Marketable
Securities. On demand it will indemnify the Mortgagee for the amount of
any call which the Mortgagee has paid in respect of those Marketable
Securities.
(g)(Deliver documents) Immediately on receipt by it or for its account, it
will deliver to the Mortgagee each certificate, acceptance, contract note
or transfer for those Marketable Securities.
(h)(Return of documents) If the Mortgagee makes available a document relating
to those Marketable Securities or New Rights for registration, stamping,
exercise, acceptance or another purpose:
(i)it will ensure that the document or each resulting or replacement document
(as the case may be) is delivered directly to the Mortgagee when available or
returned; and (ii)to the extent required by the Mortgagee, it will ensure
that all persons dealing with it have notice of this Deed. (The Mortgagee
will make available any document which it holds on reasonable request by
the Mortgagor for the purpose of recording, perfecting or preserving the
title of the Mortgagor to Marketable Securities, or exercising rights
attaching to Marketable Securities in a manner consistent with the Mortgagee's
security, if arrangements satisfactory to the Mortgagee are in place to
protect the Mortgagee's security.)
(i)(Nothing prejudicial) It will not do or omit to do anything which might
render those Marketable Securities liable to forfeiture, cancellation,
avoidance or loss or might otherwise prejudicially affect the Mortgagee's
interest in them or their value.
(j)(Meetings of shareholders) It will immediately provide to the Mortgagee
certified copies of all reports and other documents received by it relating
in any way to those Marketable Securities including, without limitation,
any report or notice of any meeting.
(k)(Vote)
(i)If the Marketable Securities are not registered in the name of the Mortgagee,
it will vote those Marketable Securities in a prudent manner except that while
an Event of Default subsists or after this Deed has been enforced: (A)it will
not vote those Marketable Securities except with the consent of the Mortgagee;
and (B)it will comply with any directions given by the Mortgagee as to the
way in which those Marketable Securities are to be voted.
(ii)If the Marketable Securities are registered in the name of the Mortgagee,
it will: (A)not assert or claim any right to vote, or to direct the Mortgagee
in relation to the voting of, those Marketable Securities, except that if no
Event of Default is subsisting and if this Deed has not been enforced the
Mortgagee will comply with any lawful directions given to it by the Mortgagor
for voting the Marketable Securities; and (B)act as proxy with respect to
any of those Marketable Securities if the Mortgagee requires.
5.4 Dividends Unless an Event of Default has occurred, the Mortgagee will
promptly account to the Mortgagor for any dividend it receives in respect of
the Mortgaged Property.
5.5Term of covenants
Each covenant in this Clause continues from the date of this Deed until the
Secured Money is fully and finally repaid.
6.FURTHER ASSURANCES
Whenever the Mortgagee requests the Mortgagor to do anything:
(a)for more satisfactorily mortgaging, assuring or securing the Mortgaged
Property to the Mortgagee in a manner not inconsistent with this Deed or
any Collateral Security; or
(b)for aiding in the execution or exercise of any Power, the Mortgagor shall
do it immediately at its own cost. It may include (without limitation)
registering this Deed, the execution or registering of any other document or
agreement, the delivery of documents or evidence of title to any Shares and the
execution and delivery of blank transfers.
7.EVENTS OF DEFAULT
7.1Events of Default
Each of the following is an Event of Default (whether or not it is in the
control of the Mortgagor).
(a)(Obligations under the Share Sale and Exit Deed) The Mortgagor fails to
pay an amount payable by it under the Share Sale and Exit Deed when due.
(b)(Cross default) Financial Indebtedness of the Mortgagor aggregating to at
least USD5,000,000 or its equivalent:
(i)is not paid when due (or within an applicable grace period); or
(ii)becomes due and payable before its stated maturity or expiry;
For the purpose of this paragraph, if a person is required to provide cash
cover for Financial Indebtedness as a result of an actual, likely or
threatened default or an event of default or termination, cancellation,
special prepayment or similar event, whatever called, that Financial
Indebtedness will be taken to be due and payable.
(c)(Winding up, arrangements, insolvency etc.)
(i)Except for the purposes of a solvent reconstruction or amalgamation
previously approved by the Mortgagee, the Mortgagor ceases, suspends or
threatens to cease or suspend the conduct of all or a major part of its
business or disposes of or threatens to dispose of all or a major part of
its assets; (ii)the Mortgagor stops or suspends or threatens to stop or
suspend payment of all or a class of its debts; (iii)the Mortgagor is
insolvent within the meaning of section 95A of the Corporations Law;
(iv)a court presumes that the Mortgagor is insolvent under section 459C(2)
of the Corporations Law; (v)the Mortgagor fails to comply with a statutory
demand (within the meaning of section 459F(1) of the Corporations Law);
(vi)an administrator is appointed over all or any of the assets of the
Mortgagor or any step preliminary to the appointment of an administrator is
taken; or (vii)except for the purposes of a solvent reconstruction or
amalgamation previously approved by the Mortgagee, an application or an
order is made, proceedings are commenced, a resolution is passed or proposed
in a notice of meeting or an application to a court or other steps (other than
frivolous or vexatious applications, proceedings, notices and steps) are taken
for: (A)the winding up or dissolution of the Mortgagor; or (B)the Mortgagor
entering into any arrangement, compromise or composition with or assignment
for the benefit of its creditors or any class of them or any of them.
(d)(Enforcement against assets) (i)A controller (within the meaning of
section 9 of the Corporations Law) or similar officer is appointed to;
(ii)a Security Interest is enforced over; or (iii)a distress, attachment or
other execution is levied or enforced or applied for over, all or a
substantial portion of the assets and undertaking of the Mortgagor.
(e)(Reduction of capital) Without the prior consent of the Mortgagee, the
Mortgagor:
(i)reduces its capital (including, without limitation, a purchase of its
shares but excluding a redemption of redeemable shares);
(ii)passes a resolution to reduce its capital or to authorise it to purchase
its shares or a resolution under section 188(2) or 205(10) of the Corporations
Law or an equivalent provision, or calls a meeting to consider such a
resolution; or (iii)applies to a court to call any such meeting or to sanction
any such resolution or reduction.
(f)(Analogous process) Anything analogous to anything referred to in
paragraphs (c) to (e) inclusive, or having substantially similar effect,
occurs with respect to the Mortgagor under any overseas law or any law
which commences or is amended after the date of this Deed.
(g)(Revocation of Authorisation) An Authorisation which is material to the
performance by the Mortgagor of the Share Sale and Exit Deed, or to the
validity and enforceability of the Share Sale and Exit Deed or this Deed or
to the security of the Mortgagee, is repealed, revoked or terminated or
expires, or is modified or amended or conditions are attached to it in a
manner unacceptable to the Mortgagee, and is not replaced by another
Authorisation acceptable to the Mortgagee.
(h)(Compulsory acquisition)
(i)All or any part of the Mortgaged Property of the Mortgagor is
compulsorily acquired by or by order of a Governmental Agency or under law;
(ii)a Governmental Agency orders the sale, vesting or divesting of all or
any part of the Mortgaged Property of the Mortgagor; or
(iii)a Governmental Agency takes a step for the purpose of any of the
foregoing.
(i)(Governmental interference) A law or anything done by a Governmental
Agency wholly or partially to a material extent renders illegal, prevents
or restricts the performance or effectiveness of the Share Sale and Exit
Deed or this Deed.
7.2Consequences
In addition to any other rights provided by law or this Deed, at any time
after an Event of Default (whether or not it is continuing) the Mortgagee may
to the extent permitted by law, without notice, exercise Powers which are
exercisable after an Event of Default.
8.APPOINTMENT OF RECEIVER
8.1Appointment
To the extent permitted by law, at any time after an Event of Default (whether
or not it is continuing) the Mortgagee or any Authorised Officer of the
Mortgagee may:
(a)appoint any person or any two or more persons jointly and/or severally to
be a receiver or receiver and manager of all or any of the Mortgaged Property;
(b)remove any Receiver;
(c)appoint another Receiver in addition to or in place of any Receiver; and
(d)fix or vary the remuneration of any Receiver.
Such appointment may be made on such terms as the Mortgagee thinks fit, and
whether or not the Mortgagee at any time has taken, or entered into, possession
of any of the Mortgaged Property. Without limiting any other method of
appointment permitted by law, such appointment may be made by an instrument
signed by an Authorised Officer of the Mortgagee or by, or on behalf of, the
Mortgagee.
8.2Agent of Mortgagor
Subject to Clause 8.4, every Receiver is the agent of the Mortgagor. The
Mortgagor alone is responsible for a Receiver's acts and defaults.
8.3Receiver's powers
In addition to any powers granted by law, and except to the extent specifically
excluded by the terms of a Receiver's appointment, every Receiver has power to
do anything in respect of the Mortgaged Property that the Mortgagor could do.
The Receiver's powers include the following (without limitation), in each
case on such terms as the Receiver thinks fit.
(a)(Take possession and manage) The Receiver may take possession of, get in
and manage the Mortgaged Property.
(b)(Acquire any asset) The Receiver may acquire in any manner any asset
(including, without limitation, to take it on Lease). After that acquisition
it will be included in the Mortgaged Property.
(c)(Raise money) The Receiver may:
(i)borrow or raise any money from the Mortgagee or any other person approved
by the Mortgagee;
(ii)give Guarantees; and
(iii)grant any Security Interest over any of the Mortgaged Property to
secure that money or Guarantee. That Security Interest may rank in priority
to or equally with or after, the security created by this Deed. It may be
given in the name of the Mortgagor or otherwise.
(d)(Sell)
(i)The Receiver may sell any of the Mortgaged Property (whether or not the
Receiver has taken possession).
(ii)Without limitation any sale may be made: (A)by public auction, private
treaty or tender; (B)for cash or on credit; (C)in one lot or in parcels;
(D)either with or without special conditions or stipulations as to title
or time or mode of payment of purchase money or otherwise; (E)with power to
allow the whole or any part of the purchase money to be deferred (whether
with or without any security); and (F)whether or not in conjunction with
the sale of any property by any person.
(e)(Options) The Receiver may grant or take put or call options.
(f)(Employ) The Receiver may employ or discharge any person as employee,
contractor, agent, professional adviser, consultant or auctioneer for any
purpose and at such remuneration and on such other terms as the Receiver
thinks fit.
(g)(Compromise) The Receiver may make or accept any arrangement or compromise.
(h)(Give receipts) The Receiver may give receipts for money and other assets.
(i)(Perform and enforce agreements) The Receiver may:
(i)perform or enforce; (ii)exercise or refrain from exercising the Mortgagor's
rights and powers under; or (iii)obtain the benefit in other ways of, any
documents or agreements or rights which form part of the Mortgaged Property
and any documents or agreements entered into in exercise of any Power.
(j)(Take proceedings) The Receiver may commence, defend, conduct, settle,
discontinue or compromise proceedings in the name of the Mortgagor or
otherwise.
(k)(Execute documents) The Receiver may enter into and execute documents or
agreements on behalf of the Receiver or the Mortgagor in connection with
the Mortgaged Property. This includes, without limitation, signing,
accepting and endorsing cheques, promissory notes and bills of exchange.
(l)(Surrender Mortgaged Property) The Receiver may surrender, release or
transfer any of the Mortgaged Property.
(m)(Exchange Mortgaged Property) The Receiver may exchange with any person
any of the Mortgaged Property for other property.
(n)(Delegate) The Receiver may delegate to any person approved by the
Mortgagee any of the powers conferred upon the Receiver (including
delegation).
(o)(Vote) The Receiver may exercise any voting or other rights or powers in
respect of any of the Mortgaged Property and to do anything in relation to
Marketable Securities.
(p)(Incidental power) The Receiver may do anything incidental to the exercise
of any other Power.
All of the above paragraphs are to be construed independently. None limits the
generality of any other.
8.4Receiver appointed after commencement of Liquidation The power to appoint a
Receiver may be exercised notwithstanding that:
(a)an order may have been made or a resolution may have been passed for the
Liquidation of the Mortgagor; and (b)a receiver appointed in those
circumstances may not, or may not in some respects specified by
the Receiver, act as the agent of the Mortgagor.
8.5Powers exercisable by the Mortgagee
Whether or not a Receiver has been appointed, to the extent permitted by law the
Mortgagee may exercise any Power of a Receiver at any time after an Event of
Default (whether or not it is continuing) in addition to any Power of the
Mortgagee and without giving notice. It may exercise those Powers and its
Powers without taking possession or being liable as mortgagee in possession.
8.6Withdrawal
The Mortgagee may at any time give up possession of the Mortgaged Property and
may at any time withdraw any receivership.
9.POWER OF ATTORNEY
(a)For valuable consideration and by way of security the Mortgagor irrevocably
appoints the Mortgagee and each Authorised Officer of the Mortgagee severally
its attorney to do anything which:
(i)the Mortgagor is obliged to do under or in relation to this Deed; or
(ii)the Mortgagee or any Receiver is authorised or empowered to do under this
Deed or any law, but only at the times that the Mortgagee or a Receiver (if a
Receiver had been appointed) would have been able to do it, after an Event
of Default has occurred.
(b) Without limitation, the Attorney may at any time:
(i)do anything necessary or considered expedient by the Mortgagee or
the Attorney to secure, preserve or perfect the security contained in this
Deed (including, without limitation, anything under Clauses 10 or 11) and
for this purpose, without limitation, the Attorney may execute any legal
mortgage, transfer, assignment and other assurance in favour of the Mortgagee
of any of the Mortgaged Property; and (ii)delegate the Attorney's powers
(including delegation).
(c)No Attorney appointed under this Deed may act inconsistently with this Deed.
10.COMPLETION OF BLANK SECURITIES
The Mortgagee, any Authorised Officer of the Mortgagee, any Receiver or any
Attorney may complete any document which at any time is executed by or on
behalf of the Mortgagor and deposited with the Mortgagee. It may complete
it in favour of the Mortgagee, any appointee of the Mortgagee or any
purchaser.
11.PERFORMANCE OF MORTGAGOR'S OBLIGATIONS
If at any time the Mortgagor fails duly to perform any obligation in this Deed
the Mortgagee or any person it authorises may do anything which in its opinion
is necessary or expedient to make good or to attempt to make good that failure
to its satisfaction.
12.STATUTORY POWERS
12.1Powers in augmentation
The powers conferred on a mortgagee by law:
(a)are in addition to the Powers conferred by this Deed or any Collateral
Security;
(b)(to the extent permitted by law) may be exercised by the Mortgagee
immediately an Event of Default occurs and at any time subsequently; and
(c)are excluded or varied only so far as they are inconsistent with the
express terms of this Deed or any Collateral Security.
12.2Notice not required
To the extent permitted by law:
(a)the Mortgagor dispenses with any notice or lapse of time required by law
before enforcing this Deed or any Collateral Security or exercising any
Power;
(b)the Mortgagee is not required to give notice to any person before
enforcement or exercise; and
(c)any law requiring the giving of notice or the compliance with a procedure or
the lapse of time before enforcement or exercise is excluded.
13.APPLICATION OF MONEY RECEIVED
13.1Order
Subject to any law which applies notwithstanding an agreement to the contrary,
all money received by a Receiver, an Attorney or the Mortgagee under or by
virtue of this Deed shall be applied in the manner and order determined by
the Mortgagee or, if the Mortgagee does not make a determination, in the
following order.
(a)First: all costs, charges and expenses of the Mortgagee or a Receiver or
Attorney which are incurred in or are incidental to the exercise or
performance or attempted exercise or performance of a Power or otherwise in
relation to this Deed or any Collateral Security.
(b)Second: any other outgoings which the Receiver, Attorney or the Mortgagee
thinks fit to pay.
(c)Third: the Receiver's remuneration.
(d)Fourth: to each holder of a Security Interest of which the Mortgagee is
aware and which has priority over this Deed in relation to the relevant
Mortgaged Property, to the extent, and in order, of priority.
(e)Fifth: to the Mortgagee towards satisfaction of the Secured Money.
(f)Sixth: to each holder of a Security Interest of which the Mortgagee is
aware and which ranks after this Deed in relation to the relevant Mortgaged
Property, to the extent, and in order, of priority.
(g)Seventh: the surplus (if any) belongs to the Mortgagor.
The surplus will not carry interest. If it pays the surplus to the credit of
an account in the name of the Mortgagor with any bank carrying on business in
Australia, the Receiver, Mortgagee or Attorney (as the case may be) will be
under no further liability in respect of it.
13.2Money actually received
(a)In applying any money towards satisfaction of the Secured Money the
Mortgagor will be credited only with the money available for that purpose
which is actually received by the Mortgagee. The credit will date from the
time of receipt.
(b)That money shall be appropriated as between principal, interest and other
amounts as the Mortgagee determines. Any such appropriation by the Mortgagee
shall override any appropriation made by the Mortgagor.
13.3Amounts contingently due
If any of the Secured Money is contingently owing to the Mortgagee at the time
of a distribution of an amount under Clause 13.1, the Mortgagee may retain any
of that amount. If it does, it shall place the amount retained on short term
interest bearing deposit until the relevant Secured Money becomes actually
due or cease to be contingently owing, and the Mortgagee shall then:
(a)pay to itself the amount which becomes actually due to it; and
(b)apply the balance of the amount retained (together with interest earned
on the deposit) in accordance with Clause 13.1.
13.4Notice of subsequent Security Interests
(a)If the Mortgagee receives actual or constructive notice of a subsequent
Security Interest affecting any of the Mortgaged Property it may open a
separate account in the name of the Mortgagor in the books of the Mortgagee.
(b)If the Mortgagee does not open a new account it will be treated as if it
had done so at the time it received actual or constructive notice of the
Security Interest.
(c)From the time the new account is opened or is taken to be opened:
(i)all payments made by the Mortgagor to the Mortgagee; and
(ii)money to be applied towards the Secured Money under Clause 13.1(e),
will be or will be taken to be debited or credited, as appropriate, to the
new account. Payments, repayments and other money will only be applied in
reduction of other Secured Money to the extent that there is no debit
balance in that account.
13.5Conversion of currencies on application
For the purpose of making an application under Clause 13.1 the Mortgagee, any
Receiver or Attorney may purchase one currency with another, whether or not
through an intermediate currency, whether spot or forward, in the manner and
at the time it thinks fit.
14.OTHER SECURITY INTERESTS OVER MORTGAGED PROPERTY
(a)The Mortgagee and any Receiver or Attorney may rely on the certificate of a
holder of another Security Interest affecting or purporting to affect the
Mortgaged Property as to the amount and property secured by the Security
Interest.
(b)The Mortgagee or any Receiver may at any time pay or agree to pay the amount
certified by the holder of a Security Interest or purported Security Interest
to be necessary to discharge it or some of the indebtedness secured by it or
to acquire it. From the date of payment that amount will be part of the
Secured Money and the Mortgagor will indemnify the Mortgagee and the
Receiver on demand against that amount. This applies whether or
not that Security Interest or purported Security Interest was valid or prior,
equal or subsequent ranking or the property or money stated in the
certificate was secured by it.
15.PROTECTION OF MORTGAGEE, RECEIVER AND ATTORNEY
Subject to any law which applies notwithstanding an agreement to the contrary,
neither the Mortgagee nor any Receiver or Attorney will be liable in respect
of:
(a)any conduct, delay, negligence or breach of duty in the exercise or non-
exercise of a Power; nor
(b)for any loss (including consequential loss) which results, except where it
arises from fraud or gross negligence on the part of the Mortgagee, any
Receiver or any Attorney.
16.PROTECTION OF THIRD PARTIES
16.1No enquiry
No party to any Dealing (as defined below) and no person asked to register
a Dealing:
(a)is bound to enquire:
(i)whether an Event of Default has occurred or whether this Deed has become
enforceable; (ii)whether a person who is, or, purports or is purported to be,
a Receiver or Attorney is duly appointed; (iii)the amount of Secured Money
and whether Secured Money is due and payable; or (iv)in any other way as to
the propriety or regularity of the Dealing; or (b)is affected by express
notice that the Dealing is unnecessary or improper. For the protection of
any party to a Dealing or a person registering a Dealing, the Dealing will
be taken to be authorised by this Deed and will be valid accordingly, even
if there is any irregularity or impropriety in the Dealing. In this Clause
a Dealing is: (a)any payment, or any delivery or handing over of an asset,
to; or (b)any acquisition, incurring of Financial Indebtedness, receipt,
sale, disposal or other dealing, by, the Mortgagee or any Receiver or
Attorney, or any person who purports or is purported to be a Receiver
or Attorney.
16.2Receipt
The receipt of any Authorised Officer of the Mortgagee or any Receiver or
Attorney (or person who purports, or is purported, to be a Receiver or
Attorney) for any money or assets payable to or receivable or received by
it exonerates the person paying those money or handing over that
asset from being concerned as to their application, or from being liable
or accountable for their loss or misapplication.
17. RELEASE UPON PAYMENT IN FULL
Promptly at the request of the Mortgagor, and if the Secured Moneys have been
fully and finally repaid, the Mortgagee shall at the cost of the Mortgagor
release and discharge the whole of the Mortgaged Property from the security
constituted by this Deed.
18.EXPENSES, INDEMNITY
18.1Expenses
On demand the Mortgagor shall reimburse the Mortgagee, each Receiver and each
Attorney for its reasonable expenses in relation to any actual enforcement of
this Deed or the Share Sale and Exit Deed or the actual exercise, preservation
or consideration of any Powers or in relation to the Mortgaged Property and
including in each case legal costs and expenses (including in-house
lawyers charged at their usual rates) on a full indemnity basis.
18.2Indemnity
On demand the Mortgagor shall indemnify the Mortgagee and each Receiver and
Attorney against any loss, cost, charge, liability or expense the Mortgagee
or any Receiver or Attorney (or any officer or employee of any of them) may
sustain or incur as a direct or indirect consequence of:
(a)the occurrence of any Event of Default; or
(b)any exercise of any Power, except in the case of fraud or gross
negligence on the part of the Mortgagee, the Receiver or the Attorney (as
the case may be).
18.3Amounts in foreign currency
Where an amount to be reimbursed or indemnified against is denominated in
another currency, if the person to be indemnified so requests, the Mortgagor
shall reimburse or indemnify it against the amount of Australian dollars
which the person certifies that it used to buy the relevant amount of the
other currency in accordance with its normal procedures. If the person does
not so request, the Mortgagor shall reimburse or indemnify it in the
relevant currency.
19.CURRENCY INDEMNITY
On demand the Mortgagor shall indemnify the Mortgagee against any deficiency
which arises whenever for any reason (including, without limitation, as a
result of a judgment or order or Liquidation):
(a)the Mortgagee receives or recovers an amount in one currency (the Payment
Currency) in respect of an amount denominated under this Deed or the Share
Sale and Exit Deed in another currency (the Due Currency); and
(b)the amount actually received or recovered by the Mortgagee in accordance
with its normal practice when it converts the Payment Currency into the Due
Currency is less than the relevant amount of the Due Currency.
20.STAMP DUTIES
(a)The Mortgagor shall pay all stamp, transaction, registration and similar
Taxes (including fines and penalties) which may be payable or determined to
be payable in relation to the execution, delivery, performance or enforcement
of this Deed or the Share Sale and Exit Deed or any payment or receipt or any
other transaction contemplated by this Deed or the Share Sale and Exit Deed.
(b)Those Taxes include financial institutions duty, debits tax or other Taxes
payable by return and Taxes passed on to the Mortgagee by a bank or financial
institution.
(c)On demand the Mortgagor shall indemnify the Mortgagee against any liability
resulting from delay or omission to pay those Taxes except to the extent that
the liability results from failure by the Mortgagee to pay any Tax after
having been put in funds to do so by the Mortgagor.
21.CERTIFICATE AS TO AMOUNT OF SECURED MONEY
A certificate signed by an Authorised Officer of the Mortgagee will be
conclusive evidence against the Mortgagor, in the absence of manifest error
as to the amount of Secured Money stated in that certificate.
22.CONTINUING SECURITY
Each of this Deed and each Collateral Security is a continuing security despite
any settlement of account, intervening payment or anything else until a final
discharge of this Deed and each Collateral Security has been given to the
Mortgagor.
23.OTHER SECURITIES
No Power and nothing in this Deed or any Collateral Security merges in, or in
any other way prejudicially affects or is prejudicially affected by:
(a)any other Security Interest; or
(b)any judgment, right or remedy against any person, which the Mortgagee or
any person claiming through the Mortgagee may have at any time.
24.SET-OFF
(a)The Mortgagor irrevocably authorises the Mortgagee if an Event of Default
is subsisting to apply any credit balance in any currency (whether or not
matured) in any of its accounts with the Mortgagee towards satisfaction of
any sum at any time due and payable by it to the Mortgagee under or in
relation to the Share Sale and Exit Deed or this Deed. The Mortgagee is
not obliged to make the application.
(b)The Mortgagee may effect currency exchanges appropriate to implement that
application.
25.WAIVERS, REMEDIES CUMULATIVE
(a)No failure to exercise or delay in exercising any right, power or remedy
under this Deed operates as a waiver. A single or partial exercise of any
right, power or remedy does not preclude any other or further exercise of
that or any other right, power or remedy. A waiver is not valid or binding
on the party granting that waiver unless made in writing. (b)The Powers in
this Deed are in addition to, and do not exclude or limit, any right, power or
remedy provided by law.
26.SEVERABILITY OF PROVISIONS
(a)Any provision of this Deed or any Collateral Security which is prohibited
or unenforceable in any jurisdiction is ineffective as to that jurisdiction
to the extent of the prohibition or unenforceability. That does not
invalidate the remaining provisions of this Deed or any Collateral Security
nor affect the validity or enforceability of that provision in any other
jurisdiction.
(b)Without limiting the generality of paragraph (a):
(i)the definition of Secured Money does not include any obligation so long as
and to the extent that the inclusion of that obligation would avoid,
invalidate or render ineffective Clause 2 or 3 or the security constituted
by this Deed; and
(ii)the definition of the Mortgaged Property does not include any property so
long as and to the extent that the inclusion of that property would invalidate,
avoid or render ineffective Clause 2 or 3 or the security constituted by this
Deed.
The Mortgagor shall use its best endeavours to satisfy any condition or obtain
any consent which may be necessary to include that obligation or property
validly under this Deed.
27.SURVIVAL OF REPRESENTATIONS AND INDEMNITIES
(a)All representations and warranties in this Deed survive the execution and
delivery of this Deed and the provision of advances and accommodation.
(b)Each indemnity in this Deed:
(i)is a continuing obligation;
(ii)is a separate and independent obligation; and
(iii)survives termination or discharge of this Deed.
28.MORATORIUM LEGISLATION
To the full extent permitted by law all legislation which at any time directly
or indirectly:
(a)lessens, varies or affects in favour of the Mortgagor any obligation under
this Deed or any Collateral Security; or
(b)delays, prevents or prejudicially affects the exercise by the Mortgagee,
any Receiver or Attorney of any Power, is excluded from this Deed and any
Collateral Security.
29.ASSIGNMENTS
Neither party may assign or transfer any of its rights or obligations under this
Deed or any Collateral Security without the prior written consent of the other
party (not to be unreasonably withheld).
30.NOTICES
Any notice, demand, consent or other communication (a Notice) given under this
Deed:
(a)must be in writing and signed by an Authorised Officer of the sender;
(b)must either be delivered to the intended recipient by prepaid post (where
posted to an address in another country, by registered airmail) or by hand
or fax to the address or fax number set out in this Deed or the address or
fax number last notified by the intended recipient to the sender;
(c)will be taken to be duly given or made:
(i)in the case of delivery in person, when delivered;
(ii)in the case of delivery by post, four Business Days after the date of
posting (where posted to an address in the same country) or ten Business Days
after the date of posting (where posted to an address in another country);
(iii)in the case of fax, on receipt by the sender of a transmission control
report from the despatching machine showing the relevant number of pages, the
correct destination fax machine number and the result of the transmission as
"OK", but if the result of the foregoing is that a Notice would be taken to be
given or made on a day which is not a business day in the place to which the
Notice is sent or is later than 4.00pm (local time) it will be taken to have
been duly given or made at the commencement of business on the next business
day in that place.
31.AUTHORISED OFFICERS
The Mortgagor irrevocably authorises the Mortgagee to rely on a certificate by
a person purporting to be its director or secretary as to the identity and
signatures of its Authorised Officers. The Mortgagor warrants that those
persons have been authorised to give notices and communications under or in
connection with this Deed.
32.GOVERNING LAW AND JURISDICTION
32.1 Governing law
This Deed is governed by the laws of Victoria, Australia.
32.2Jurisdiction
With respect to any legal action or proceedings that may be brought with respect
to this Deed or any transaction contemplated by this Deed (each, a Relevant
Action), the Mortgagor irrevocably:
(a)submits to and accepts, for itself and in respect of its assets, generally
and unconditionally the non-exclusive jurisdiction of any of the courts of or
in New York (State and Federal), or of the States of Victoria or New South
Wales, Australia or of the Commonwealth of Australia selected by the
Mortgagee; and
(b)waives any objection it may have now or in the future to the venue and any
claim it may have now or in the future that the Relevant Action has been
brought in an inconvenient forum; and
(c)consents to the service of process out of any of those courts by the mailing
of copies of process by registered or certified airmail postage prepaid to it
at its address for service of notices under Clause 30 or to its process agent
at its address provided in Clause 32.3, in which case service will be taken to
have been effected on receipt.
Nothing in this Deed affects the right to serve process in any other manner
permitted by law.
32.3Process agents
(a)The Mortgagor irrevocably:
(i)nominates as its agent to receive service of process or other documents in
any Relevant Action in the Courts of the States of Victoria or New South Wales,
Australia or of the Commonwealth of Australia : The Company at 1144 Nepean
Highway, Highett, Victoria, Australia; and
(ii)agrees that service of any process or documents on the agent or any other
person appointed under paragraph (b) will be sufficient service on it.
(b)The Mortgagor will ensure the Company remains authorised to accept service on
its behalf. If the Company ceases to have an office in the place specified,
the Mortgagor will ensure that at all times there is another person in that
place acceptable to the Mortgagee to receive process on its behalf. It shall
promptly notify the Mortgagee of the appointment of that other person.
33.COUNTERPARTS
This Deed may be executed in any number of counterparts. All counterparts
together will be taken to constitute one instrument.
34.CONSENTS AND OPINION
Except where expressly stated the Mortgagee may give or withhold, or give
conditionally, approvals and consents, may be satisfied or unsatisfied, and
may form opinions, at its absolute discretion.
EXECUTED as a Deed in .
Each attorney executing this Deed states that he or she has no notice of
revocation or suspension of his or her power of attorney.
THE MORTGAGEE
SIGNED SEALED AND DELIVERED for and on behalf of LEIGH-MARDON PTY
LIMITED by its
attorney in the presence of:
Signature
Print Name
Signature
Print Name
THE MORTGAGOR
SIGNED by MORRIS WEISSMAN of, SEALED AND Morris Weissman
DELIVERED by AMERICAN BANKNOTE Signature
AUSTRALASIA HOLDINGS INC in the presence
of: Morris Weissman
Jeffrey Clark Print Name
Signature
Jeffrey Clark
Print Name
