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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
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Date of Report (Date of earliest event reported): May 28, 1999
GENERAL CABLE CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 1-12983 06-1398235
- ---------------------------- ------------------------- -----------------------
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation or Identification Number)
organization)
4 Tesseneer Drive
Highland Heights, KY 41076
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(Address of principal executive offices, including zip code)
(606) 572-8000
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(Registrant's telephone number, including area code)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On May 28, 1999, General Cable Corporation (the "Company") completed
the first phase of its acquisition of the worldwide energy cable and cable
systems businesses of BICC plc and its subsidiaries with a payment to BICC plc
of 211.4 million pounds sterling ($339.3 million). Phase I included the
acquisition of substantially all of the assets of BICC Cables Corporation,
Pyrotenax USA Inc., and BICC Cables Canada Inc., the acquisition of the assets
used in the energy cable and cable systems operations in the United Kingdom of
BICC plc, BICC Cables Limited and BICC Components Limited and the acquisition of
100% of the issued and outstanding capital shares of BICC General Cable SA, BICC
Ceat Cavi Srl, BICC Cables New Zealand Limited, Trans Power Cables Pte Ltd, and
BICC Supertension Cables (1980) Limited. These entities have operations in the
United States, Canada, the United Kingdom, Spain, Italy and New Zealand. Phase
II of the transaction, which is expected to be completed in the third quarter of
1999, will include the acquisition of BICC's Middle Eastern, Asia/Pacific and
African cable businesses for aggregate cash consideration of approximately 50
million pounds sterling ($79.9 million). Both the consideration paid in Phase I
and the estimated consideration to be paid in Phase II of the acquisition are
subject to adjustment under the terms of the asset purchase agreements entered
into among the parties to this transaction.
The acquisition adds to the Company's existing products low-voltage,
medium-voltage and high-voltage power distribution and transmission cable
products, and control, signaling, electronic and data communications products
and accessories, to serve industrial, utility, OEM, military/government and
electrical and communications distributor customers worldwide. The businesses
acquired, including those to be acquired upon completion of Phase II, are
conducted in 41 manufacturing locations in 16 countries, with representation in
an additional 20 countries through regional sales offices.
Financing of the purchase price for the acquisition was provided by a
syndicate of lenders led by The Chase Manhattan Bank under the terms of a credit
agreement which provides credit facilities to the Company for borrowings of up
to $1.05 billion to use for the acquisition, refinancing of existing debt and
general corporate purposes.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
The following financial statements, pro forma financial information and
exhibits are being filed as part of this report:
(1) The financial statements required to be filed with respect to the
businesses acquired described in Item 2 above are not included in this Report on
Form 8-K. Such financial statements will be filed as an amendment to this Form
8-K as soon as practicable, but no later than August 13, 1999.
(2) The pro forma financial information required to be filed with
respect to the
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businesses acquired described in Item 2 above are not included in the Report on
Form 8-K. Such financial information will be filed as an amendment to this Form
8-K as soon as practicable, but no later than August 13, 1999.
(3) Exhibits
Number Title
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2.1 Assets Sale and Purchase Agreement, made as of April 6, 1999,
among BICC Cables Corporation, Pyrotenax USA Inc., BICC Cables
Canada Inc., BICC plc, GK Technologies, Incorporated and
General Cable Corporation, together with the Schedules to such
Agreement.
2.2 Amendment No. 1 to and Assignment of Assets Sale and Purchase
Agreement, dated as of May 27, 1999, by and among BICC Cables
Corporation, Pyrotenax USA Inc., BICC Cables Canada Inc., BICC
plc, GK Technologies, Incorporated, General Cable Corporation,
BICC General Pyrotenax Cables Ltd, BICC General Cable (USA)
LLC and BICC General Cable Company.
2.3 Sale and Purchase Agreement, made on April 6, 1999, between
BICC plc, GK Technologies, Incorporated and General Cable
Corporation, together with the Schedules to such Agreement.
2.4 Letter Agreement amending the Sale and Purchase Agreement,
dated May, 1999, among GK Technologies, Incorporated, General
Cable Corporation and BICC plc.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
General Cable Corporation
Date: June 11, 1999 By: /s/ Christopher F. Virgulak
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Name: Christopher F. Virgulak
Title: Executive Vice President,
Chief Financial Officer and
Treasurer
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EXHIBIT INDEX
Number Title
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2.1 Assets Sale and Purchase Agreement, made as of April 6, 1999,
among BICC Cables Corporation, Pyrotenax USA Inc., BICC Cables
Canada Inc., BICC plc, GK Technologies, Incorporated and
General Cable Corporation, together with the Schedules to such
Agreement.
2.2 Amendment No. 1 to and Assignment of Assets Sale and Purchase
Agreement, dated as of May 27, 1999, by and among BICC Cables
Corporation, Pyrotenax USA Inc., BICC Cables Canada Inc., BICC
plc, GK Technologies, Incorporated, General Cable Corporation,
BICC General Pyrotenax Cables Ltd, BICC General Cable (USA)
LLC and BICC General Cable Company.
2.3 Sale and Purchase Agreement, made on April 6, 1999, between
BICC plc, GK Technologies, Incorporated and General Cable
Corporation, together with the Schedules to such Agreement.
2.4 Letter Agreement amending the Sale and Purchase Agreement,
dated May, 1999, among GK Technologies, Incorporated, General
Cable Corporation and BICC plc.
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Exhibit 2.1
[EXECUTION COPY]
BICC Cables Corporation
BICC Cables Canada Inc.
Pyrotenax USA Inc.
and
GK Technologies, Incorporated
ASSETS SALE AND
PURCHASE AGREEMENT
relating to
the sale and purchase of the energy cable Operations of
BICC Cables Corporation, Pyrotenax USA Inc. and BICC Cables Canada Inc.
Dated April 6, 1999
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TABLE OF CONTENTS
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Page
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Background........................................................................................................2
1 Interpretation.............................................................................................3
1.1 Definitions...........................................................................14
1.2 Subordinate Legislation...............................................................14
1.3 [Intentionally Omitted]...............................................................14
1.4 Schedules, etc........................................................................14
1.5 Conflict..............................................................................14
1.6 Information...........................................................................14
1.7 Knowledge.............................................................................15
1.8 Accounting Standards..................................................................15
2 Agreement to Sell the Acquired Assets.....................................................................15
2.1 Sale and Purchase of Acquired Assets..................................................15
2.2 Assumption of Liabilities.............................................................15
2.3 Indemnification.......................................................................19
3 Consideration.............................................................................................28
3.1 Amount and Payment....................................................................28
3.2 Adjustments...........................................................................28
3.3 Method of Payment.....................................................................28
4 Conditions................................................................................................29
4.1 Conditions Precedent..................................................................29
4.2 Responsibility for Satisfaction.......................................................30
4.3 Termination...........................................................................31
5 Action Pending Closing....................................................................................31
5.1 Vendors' General Obligations..........................................................32
5.2 Restrictions on Vendors...............................................................32
5.3 Purchasers' General Obligations.......................................................34
6 Closing...................................................................................................34
6.1 Date and Place........................................................................34
6.2 Closing Events........................................................................34
6.3 Payment of Price......................................................................35
7 Representations and Warranties............................................................................35
7.1 Representations and Warranties from the Vendors;
Incorporation of Schedule 8.................................................35
7.2 Warranties from the Purchasers........................................................35
7.3 UPDATING TO CLOSING...................................................................35
8 [Intentionally Omitted]...................................................................................36
9 Net Asset Statement, and Adjustments to the Purchase Price................................................36
9.1 Basis of Preparation of Net Asset Statement...........................................36
9.2 Preparation of Net Asset Statement....................................................36
9.3 Net Asset Statement...................................................................40
10 Transfer Taxes............................................................................................41
11 Post-Closing Date Contract payments received by the Vendors...............................................41
12 Defective Product or Service..............................................................................41
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12.1 Responsibility Allocation ...........................................................41
12.2 Definitions...........................................................................41
12.3 Vendor receives claim.................................................................42
12.4 Purchaser receives claim..............................................................42
12.5 Vendors receive claim for post-Closing product or service.............................43
12.6 Claim made for product or service spanning Closing....................................43
12.7 Indemnities reduced by recovery from third parties....................................43
13 Third Party Consents......................................................................................44
13.1 Failure to Assign.....................................................................44
13.2 Indiana Lease.........................................................................45
14 Employees.................................................................................................47
15 Employee Benefit Arrangements.............................................................................47
16 Environmental.............................................................................................47
17 Post-Closing Obligations..................................................................................47
17.1 The Assumed Liabilities...............................................................47
17.2 Bonds and Guarantees..................................................................48
17.3 Vendors' General Obligations..........................................................48
17.4 Vendors' Continuing Obligation........................................................48
17.5 Change of Name........................................................................49
17.6 ......................................................................................50
17.7 Investment Canada Act.................................................................50
18 Guarantees ...............................................................................................51
18.1 Vendors' Guaranteed Obligations.......................................................51
18.2 Guaranty..............................................................................51
18.3 Purchaser's Guaranteed Obligations....................................................51
18.4 Guaranty..............................................................................51
19 Other Provisions..........................................................................................52
19.1 Announcements.........................................................................52
19.2 Confidential Information..............................................................52
19.3 Permitted Disclosure, etc.............................................................54
19.4 Integration...........................................................................55
19.5 Successors and Assigns; No Third-Party Beneficiaries..................................55
19.6 Amendments and Waivers................................................................56
19.7 Remedies..............................................................................56
19.8 Third Party Costs.....................................................................56
19.9 Costs to Assign Contracts.............................................................56
19.10 Interest..............................................................................57
19.11 Set-Off...............................................................................57
19.12 Long Stop Limitation of Liability.....................................................57
19.13 Exclusivity...........................................................................58
19.14 Notices...............................................................................58
19.15 Severance.............................................................................60
19.16 References to the Reporting Accountants...............................................60
19.17 General Services and Supply Agreement.................................................60
19.18 Counterparts..........................................................................60
19.19 Governing Law and Submission to Jurisdiction..........................................61
19.20 Settlement Attempt....................................................................62
19.21 Appointment of Process Agents.........................................................62
19.22 Currency..............................................................................63
19.23 Certain Restrictive Covenants.........................................................63
19.24 Reliance by Purchasers; Disclosure of Representation and Warranties...................66
19.25 Section Headings......................................................................66
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19.26 References............................................................................66
19.27 Cooperation...........................................................................66
19.28 Bulk Sales............................................................................66
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SCHEDULES
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Schedule 1 Operations
Schedule 2 [Intentionally Left Blank]
Schedule 3 Allocation of Purchase Price
Schedule 4 Certain Third Party Consents
Schedule 5 Warranties Not Updated to Closing
Schedule 6 Closing Events; US Vendors Accounting Periods; Bill of Sale;
Tax Deed of Covenant
Schedule 7 Net Asset Statement
Schedule 8 Representations and Warranties given by the Vendors under
Section 7.1
Schedule 9 Warranties from the Purchasers
Schedule 10 Transfer Taxes
Schedule 11 Employees
Schedule 12 Employee Benefit Arrangements
Schedule 13 [Intentionally Left Blank]
Schedule 14 Intentionally Left Blank
Schedule 15 Intellectual Property
Schedule 16 Environment
Schedule 17 Excluded Assets
Schedule 18 Bonds and Guarantees
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THIS AGREEMENT is made on April 6, 1999 among
(1) BICC CABLES CORPORATION
a company incorporated in Delaware, the United States
whose principal place of business is at One Crosfield Avenue,
West Nyack, NY;
(2) PYROTENAX USA INC. (together with BICC Cables Corporation, the
US VENDOR), a company incorporated in Delaware, the United
States.
(3) BICC CABLES CANADA INC. (the CANADIAN VENDOR)
a company incorporated under the federal laws of Canada whose
principal place of business is at 265 Yorkland Boulevard,
Suite 500, North York, Ontario M2J 155;
(4) BICC PLC (the VENDORS' GUARANTOR)
a company incorporated in England and Wales
whose registered office is at Devonshire House, Mayfair Place,
London W1X 5FH;
(5) GK TECHNOLOGIES, INCORPORATED (the US PURCHASER)
a company incorporated in New Jersey, the United States
whose principal place of business is at 4 Tesseneer Drive,
Highland Heights, KY 41076;
(6) GK TECHNOLOGIES, INCORPORATED (the CANADIAN PURCHASER) a
company incorporated in New Jersey, the United States
whose principal place of business is at 4 Tesseneer Drive,
Highland Heights, KY 41076; and
(7) GENERAL CABLE CORPORATION (the PURCHASERS' GUARANTOR) a
company incorporated in Delaware, the United States
whose principal place of business is at 4 Tesseneer Drive,
Highland Heights, KY 41076.
BACKGROUND
The Vendors' Guarantor engages in the energy cables business worldwide,
both directly and indirectly, through various subsidiaries and joint ventures,
including through the US Vendor and the Canadian Vendor. The Purchasers'
Guarantor and the Vendors' Guarantor intend to enter into transactions for the
sale by the Vendors' Guarantor of its worldwide energy cables business. The
parties intend that the portion of the energy cables business conducted
worldwide other than in North America be transferred to Affiliates of the
Purchasers' Guarantor under the Non-North American Agreements and that the
portion of the energy cables business conducted in North America be
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transferred to US Purchaser and Canadian Purchaser pursuant to the terms and
conditions of this Agreement.
NOW, THEREFORE, intending to be legally bound hereby, the parties
hereto agree as follows:
1 INTERPRETATION
In this Agreement, including its Schedules, the headings shall not
affect its interpretation and, unless the context otherwise requires, the
provisions in this Section 1 apply:
1.1 DEFINITIONS
ACCOUNTS RECEIVABLE means (a) any right to payment for goods sold,
leased or licensed or for services rendered, whether or not it has been earned
by performance, whether billed or unbilled, and whether or not it is evidenced
by any Contract; (b) any note receivable; or (c) any other receivable or right
to payment of any nature, in each case arising in the ordinary course of the
Operations, but excluding any Excluded Assets;
ACQUIRED ASSETS means the US Assets and the Canadian Assets;
AFFILIATE means, relative to any person, any other person which,
directly or indirectly, controls or is controlled by or under common control
with such person. For the purposes of this definition, "control" (including
correlative terms such as "controlling", "controlled by" and "under common
control with") means, relative to any person, the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such person, whether through the ownership of voting stock, by
agreement or otherwise; provided, however, that beneficial ownership of 20% or
more of the voting stock of a person shall be deemed to be control;
AGREED UPON NET ASSET VALUE has the meaning given to it in Section
9.3.3;
AGREEMENT means this Assets Sale and Purchase Agreement;
ASBESTOS LIABILITIES has the meaning given to it in Section 2.3.2(f);
ASSUMED LIABILITIES means, collectively, the US Assumed Liabilities and
the Canadian Assumed Liabilities, and ASSUMED LIABILITY means any one of such
Assumed Liabilities;
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BALANCE SHEET DATE means December 31, 1998;
BULK SALES LAWS means the Uniform Commercial Code Bulk Transfer
provisions of any Jurisdiction (or any similar Laws of any applicable
Jurisdiction) relating to bulk sales which are applicable to the sale of the
Acquired Assets hereunder;
BUSINESS DAY means a day on which banks are open for business in London
and New York City (excluding Saturdays, Sundays and public holidays);
CANADIAN ASSETS means all right, title, and interest in and to, as the
same shall exist on the Closing Date, all of the assets, business, properties
and rights of every nature, kind and description of the Canadian Vendor used in
or relating to the Canadian Business, wheresoever located and whether or not
reflected on the books and records of the Canadian Vendor, including all of its
prepayments, deposits and escrows, Accounts Receivable, Inventory, Tangible
Property, Real Property, Permits, Software, Contract Rights (other than Contract
Rights with respect to the Contracts identified on Schedule 13) Intangible
Property and goodwill, and claims, causes of action and other legal rights and
remedies related to the foregoing; provided, however, that, any term or
provision hereof to the contrary notwithstanding, the Canadian Assets shall not
include any of the Excluded Assets;
CANADIAN ASSUMED LIABILITIES has the meaning given to it in Section
2.2.4;
CANADIAN BUSINESS means the energy cables business conducted by the
Canadian Vendor which, together with the US Business, constitutes the
Operations, summary details of which are contained or referred to in Schedule 1;
CANADIAN EXCLUDED LIABILITIES has the meaning given to it in Section
2.2.6;
CASH EQUIVALENTS means "cash equivalents" as defined by the accounting
policies and principles set out in Schedule 7;
CLOSING means the closing of the sale and purchase of the Acquired
Assets and the assumption of the Assumed Liabilities pursuant to this Agreement;
CLOSING DATE means the date on which the Closing takes place;
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COLLECTIVE BARGAINING AGREEMENTS means the legally recognized
agreements, including benefit agreements, letters of understanding and
identified past practices between US Vendor or Canadian Vendor and any labor
union or organization lawfully recognized to represent the employees of any
facility;
CODE means the Internal Revenue Code of 1986, as amended, and the rules
and regulations promulgated thereunder;
COMBINED ACCOUNTS means the accounts of the US Vendor and the Canadian
Vendor relating to the Operations for the twelve-month financial period ended on
the Balance Sheet Date, extracted from the aggregated accounts of the Global
Operations for such financial period audited by Arthur Andersen, copies of which
are included in the Disclosure Letter;
CONFIDENTIAL INFORMATION has the meaning given to it in Section 19.3.3;
CONTINUING EMPLOYEES means those employees of the US Vendor or the
Canadian Vendor who will become employees of Purchaser on or after Closing;
CONTRACT RIGHT means any right, power or remedy of any nature under any
Contract, including rights to receive property or services or otherwise derive
benefits from the payment, satisfaction or performance of another person's
obligations, rights to demand that another person accept property or services or
take any other actions, and rights to pursue or exercise remedies or options;
CONTRACTS means any written or oral contract, agreement, instrument,
order, arrangement, commitment or understanding of any nature, including sales
orders, purchase orders, leases, subleases, data processing agreements,
maintenance agreements, license agreements, sublicense agreements, loan
agreements, promissory notes, instruments, security agreements, pledge
agreements, deeds, mortgages, guaranties, indemnities, warranties, employment
agreements, consulting agreements, sales representative agreements, joint
venture agreements, buy-sell agreements, options or warrants including
quotations or tenders for contracts which remain open for acceptance;
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DATA ROOM means collectively the data room containing documents
relating to the Vendors and its Affiliates at the offices of Linklaters &
Paines, 1345 Avenue of the Americas, New York, New York, at the US Vendor's
Lawyers and at Borden & Elliot, Scotia Plaza, Toronto, Ontario;
DISCLOSURE LETTER means the letter which is arranged in Sections
corresponding to the Sections of this Agreement of even date with this Agreement
from the Vendors to the Purchasers disclosing (i) information, in reasonable
detail, which constitutes exceptions to the Warranties and (ii) details of other
matters referred to in this Agreement;
DOLLAR or $ means United States dollar;
EMPLOYEE BENEFIT ARRANGEMENTS means (i) any "employee welfare benefit
plan" or "employee pension benefit plan" (as those terms are respectively
defined in sections 3(1) and 3(2) of ERISA), (ii) any pension, retirement or
supplemental pension plan or deferred compensation plan, incentive compensation
plan, savings plan, stock plan, retiree medical benefit, unemployment
compensation plan, vacation pay, severance pay, bonus or benefit arrangement,
insurance or hospitalization program or any other fringe benefit arrangements
for any current or former employee, director, consultant or agent, whether
pursuant to legislation, contract, arrangement, custom or informal
understanding, which does not constitute an employee benefit plan (as defined in
section 3(3) of ERISA), or (iii) any employment agreement;
EMPLOYEES means all persons employed by US Vendor or the Canadian
Vendor in the Operations, including, those persons on short or long-term
disability, leave of absence or legally required leave;
EMPLOYMENT LETTER means the letter from the Purchasers to the Vendors
supplied on the date hereof, as it may be updated in accordance with the terms
of Schedule 11, indicating which Employees with employment Contracts listed on
Section 1.1 of Schedule 12 of the Disclosure Letter will become Continuing
Employees (as to whom Purchasers will assume such employment Contracts) and
which Employees will not become Continuing Employees (which non-Continuing
Employees may include persons who may receive consulting agreements from the
Purchasers for a fixed period of time);
ENCUMBRANCE means any claim, charge, mortgage, easement, leasehold,
assessment, restriction, reservation, security, lien, security interest, pledge,
option, equity, power of sale,
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conditional sale, prior assignment, hypothecation or encumbrance, burden,
charge, adverse claim or third party right of any kind or nature whatsoever;
EXCLUDED ASSETS means the assets described or referred to in Schedule
17 which are excluded from the sale and purchase of the Acquired Assets set
forth in this Agreement;
EXCLUDED LIABILITIES has the meaning given to it in Section 2.2.6, and
includes all Asbestos Liabilities, Marion Liabilities and Trenton Liabilities;
GENERAL SERVICES AND SUPPLY AGREEMENT means the service and supply
agreement to be entered into with effect from or following Closing, between or
among one or more of the persons included in the Vendors' Group and one or more
persons included in the Purchasers' Group;
GLOBAL OPERATIONS means the Operations (as defined herein) and the
"Operations" (as defined in the Non-North American Sale and Purchase Agreement),
taken as a whole;
GOVERNMENTAL AUTHORITY means any international, national, federal,
state, provincial, local, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, or any court or tribunal,
in each case whether of the United States or Canada or other jurisdiction;
HOLDING COMPANY means a company which controls, whether pursuant to an
agreement with other shareholders or otherwise, a majority of the voting rights
of another company;
INCOME TAX ACT (CANADA) means the Income Tax Act (Canada), R.S.C. 1985,
c.1 (5th Supp.), as amended, and the regulations prescribed thereunder;
IMPROVEMENTS mean all buildings and all other structures, parking
areas, fixtures or other improvements on, over or under the Land;
INCLUDING means including without limitation;
INTANGIBLE PROPERTY means any name, corporate name, fictitious name,
registered or unregistered trademark, trademark application, service mark,
service mark application, trade name, brand name, product name, slogan, trade
secret, Know-how, patent, patent application, copyright,
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copyright application, design, logo, formula, invention, product right,
technology, or other intangible asset of any nature, whether in use, under
development or design, or inactive;
INVENTORY means all raw materials, supplies, work in progress,
packaging materials, finished goods, parts and any other inventory of any nature
whatsoever;
JUDGMENT means any order, writ, injunction, citation, award, decree or
other judgment of any nature of any foreign, federal, state, provincial or local
court, governmental body, administrative agency, regulatory authority or
arbitration tribunal;
JURISDICTIONS means the United States and Canada;
KNOW-HOW means confidential and proprietary industrial and commercial
information and techniques in any form (including paper, electronically stored
data, magnetic media, film and microfilm) including drawings, formula, test
results, reports, project reports and testing procedures, shop practices,
instruction and training manuals, tables of operating conditions, market
forecasts, specifications, quotations, tables, lists and particulars of
customers and suppliers, marketing methods and procedures, show-how and
advertising copy;
LAND means all that certain Real Property of the US Vendor or Canadian
Vendor (other than Excluded Assets) upon which the Improvements are located, as
more particularly described in Schedule 1 attached hereto and made a part
hereof, together with all property rights, easements, tenements, hereditaments,
rights-of-way, development rights, air rights, entitlements, unused densities,
privileges and appurtenances thereto; all leases, rents and profits derived
therefrom, all right, title and interest of the US Vendor and/or the Canadian
Vendor in and to any land lying in the bed of any street, road, highway or
avenue, open or proposed, public or private, in front of or adjoining all or any
part of the Land to the center line thereof, all right, title and interest of
the US Vendor and/or the Canadian Vendor in and to any unpaid award or payment
included in the Acquired Assets which may now or hereafter be payable in respect
of any taking, by condemnation of any portion of the Land or Improvements by any
Governmental Authority; and all right, title and interest of the US Vendor
and/or the Canadian Vendor in and to any unpaid award included in the Acquired
Assets for damage or destruction to the Land or any part thereof by reason of
any fire or other casualty, or resulting from any change of grade of any street,
road, highway or avenue adjacent to the Real Property of the US Vendor of the
Canadian Vendor; all strips and gores adjoining, and adjacent to the Land; and
all oil, gas and mineral rights;
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LAW means any provision of any foreign, federal, state, provincial or
local law, statute, ordinance, charter, constitution, treaty, code, rule,
Canadian guideline, policy or protocol, or regulation;
LEASED PROPERTY means the leased Real Property brief details of which
are set out in Schedule 1;
LIABILITIES means all liabilities, indebtedness, claims, demands,
damages, deficiencies, Judgments, actions, causes of action, duties and
obligations of every description, whether deriving from contract, common law,
statute or otherwise, whether present or future, actual or contingent,
ascertained or unascertained or disputed and whether owed or incurred severally
or jointly or as principal or surety;
LOSS OR LOSSES means all losses, Liabilities, costs (including costs of
investigation, interest costs, fines, penalties, and legal fees and costs),
charges, expenses, actions, proceedings, investigations, claims and demands;
MANAGEMENT ACCOUNTS means the unaudited management accounts relating to
the Operations for the financial period ending on February 28, 1999;
MARION LIABILITIES has the meaning given to it in Section 2.3.2(g);
MATERIAL CONTRACTS has the meaning given to it in Section 5.3.1 of
Schedule 8;
NET ASSET STATEMENT has the meaning given to it in Section 9.1;
NET ASSET VALUE means the aggregate of the value of the Acquired Assets
less the aggregate of all Assumed Liabilities as shown in the Net Asset
Statement;
NON-NORTH AMERICAN AGREEMENTS means the Non-North American Sale and
Purchase Agreement, the Non-North American Subsidiary Agreements and the
Non-North American Tax Deed of Covenant;
NON-NORTH AMERICAN SALE AND PURCHASE AGREEMENT means the Sale and
Purchase Agreement entered into on the date hereof between, among others, the
Vendors' Guarantor and the
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Purchasers' Guarantor in connection with the sale of the worldwide energy cables
operations of the Vendors' Guarantor other than the Operations;
NON-NORTH AMERICAN SUBSIDIARY AGREEMENTS means the Subsidiary
Agreements as defined in the Non-North American Sale and Purchase Agreement;
NON-NORTH AMERICAN TAX DEED OF COVENANT means Tax Deed of Covenant as
defined in the Non-North American Sale and Purchase Agreement;
OPERATIONS means, collectively, the US Business and the Canadian
Business, including without limitation, those operations briefly described on
Schedule 1 attached hereto and made a part hereof;
PAYMENT ACCOUNT DETAILS means, in relation to any payment to be made
under or pursuant to this Agreement, the name, account number, account location
and other details specified by the payee and necessary to effect payment
(whether by wire or other electronic means of transfer) to the payee;
PERMIT means any license, permit, approval, waiver, order,
authorization, consent, certificate of occupancy, order, warrant, confirmation,
permission, certificate, right or privilege of any nature, granted, issued,
approved or allowed by any Governmental Authority;
PERSON means any natural person, sole proprietorship, joint venture,
corporation, firm, association, partnership, limited liability partnership,
limited liability company, cooperative, estate, government, trust, governmental
body, administrative agency, regulatory authority or any other entity, whether
acting in an individual, fiduciary or other capacity;
(POUND) means British pounds sterling;
PURCHASE PRICE has the meaning given in Section 3.1;
PURCHASERS means the US PURCHASER and the CANADIAN PURCHASER and
PURCHASER means any of such Purchasers;
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PURCHASERS' GROUP means the Purchasers, their Subsidiaries and their
holding company, as such group may from time to time exist;
REAL PROPERTY means any real estate, Land, building, condominium, town
house, structure or other real property of any nature, all shares of stock or
other ownership interests in cooperative or condominium associations or other
forms of ownership interest through which interests in real estate may be held,
all leasehold estates with respect to any of the foregoing, and all appurtenant
and ancillary rights thereto, including easements, covenants, water rights,
sewer rights and utility rights, including, without limitation, the Improvements
and the Leased Properties, or any one or more of them;
RELEVANT PURCHASER means, when used to reflect any matter relating to
the purchase of the Canadian Assets, the Canadian Purchaser, and when used to
reflect any matter relating to the purchase of the US Assets, the US Purchaser;
RELEVANT VENDOR means, when used to reflect any matter relating to the
sale of the Canadian Assets, the Canadian Vendor, and when used to reflect any
matter relating to the sale of US Assets, the US Vendor;
REPORTING ACCOUNTANTS means Ernst & Young LLP, or another nationally
recognized firm of independent public accountants that are independent of the
Vendors' Group and the Purchasers' Group and are selected by agreement of the US
Vendor and the US Purchaser;
RESTRICTIVE COVENANTS has the meaning given in Section 19.23;
SCHEDULE 4 CONTRACTS has the meaning given to it in Section 2.3.2(e);
SENIOR EMPLOYEE means any Employee whose annual cash compensation
exceeds $90,000 or its local equivalent;
SENIOR EXECUTIVES means George N. Benjamin, III, Hans P. Berndorff,
George M. Priggins, Bill Meechan, JoAnn Prior, Don Aken, Jack Lavin and Tom
Ragion;
SOFTWARE means any computer program, operating system, applications
system, firmware or software of any nature, whether operational, under
development or inactive, including all object
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code, source code, technical manuals, user manuals and other documentation
therefor, whether in machine-readable form, programming language or any other
language or symbols, and whether stored, encoded, recorded or written on disk,
tape, film, memory device, paper or other media of any nature;
SUBSIDIARY means, relative to any person, (x) any corporation,
association or other business entity more than 50% of the outstanding shares of
voting stock of which is owned directly or indirectly by such person and (y) any
partnership in which such person is a general partner;
TANGIBLE PROPERTY means any furniture, fixtures, leasehold
improvements, vehicles, equipment (including, without limitation, office,
computer and other equipment), machinery, tools, spare parts, forms, supplies
and other tangible personal property of any nature, whether such is owned or
leased;
TAX means any federal, state, provincial, local, or foreign income,
gross receipts, license, payroll, employment, health, social services,
education, excise, severance, stamp, occupation, premium, windfall profits,
environmental (including Taxes under Code Section 59A) customs, duties, capital
stock, franchise, profits, withholding, social security (or similar),
unemployment, disability, real property, personal property, sales, use,
transfer, goods and services, registration, value added, alternative or add-on
minimum, estimated, or other tax of any kind whatsoever, including any interest,
penalty, or addition thereto, whether disputed or not;
TAX DEED OF COVENANT means the deed of covenant against liability for
Tax to be entered into by the US Vendor and the Canadian Vendor indemnifying the
US Purchaser and the Canadian Purchaser, as applicable;
TAX RETURN means any return, declaration, report, claim for refund, or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof;
TAX STATUTE OF LIMITATIONS DATE means the close of business on the 90th
day after the expiration of the applicable statue of limitations in respect of
the relevant Tax, including any extensions thereof (or if such date is not a
Business Day, the next Business Day);
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THIRD PARTY CONSENTS means all consents, permits, approvals,
authorizations or waivers required from third parties, other than Governmental
Authorities, for or necessary as a result of the conveyance, transfer,
assignment, novation or subletting of any of the Acquired Assets to any
Purchaser, including the Third Party Consents set forth on Schedule 4, and THIRD
PARTY CONSENT means any one of the Third Party Consents;
TRENTON LIABILITIES has the meaning given to it in Section 2.3.2(h).
US ASSETS means all right, title, and interest in and to, as the same
shall exist on the Closing Date, all of the assets, business, properties and
rights of every nature, kind and description of the US Vendor used in or
relating to the US Business, wheresoever located and whether or not reflected on
the books and records of the US Vendor, including without limitation, all of its
prepayments, deposits and escrows, Accounts Receivable, Inventory, Tangible
Property, Real Property, Permits, Software, Contract Rights (other than Contract
Rights with respect to the Contracts identified on Schedule 13), Intangible
Property and goodwill, and claims, causes of action and other legal rights and
remedies related to the foregoing; provided, however, that any term or provision
hereof to the contrary notwithstanding, the US Assets shall not include any of
the Excluded Assets;
US ASSUMED LIABILITIES has the meaning given to it in Section 2.2.1;
US BUSINESS means the energy cables business conducted by the US Vendor
which, together with the Canadian Business, constitutes the Operations;
US EXCLUDED LIABILITIES has the meaning given to it in Section 2.2.3;
US VENDOR'S LAWYERS means Mayer, Brown & Platt of 1675 Broadway, New
York, New York 10019;
VENDOR OWNED REAL PROPERTY means the Real Property owned by the US
Vendor or the Canadian Vendor that is used in the Operations and is not an
Excluded Asset;
VENDORS means the US Vendor and Canadian Vendor and VENDOR means any of
such Vendors;
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VENDORS' GROUP means the US Vendor, the Canadian Vendor, the Vendors'
Guarantor and each Subsidiary of the Vendors' Guarantor, as such group may from
time to time exist; provided, however, that after giving effect to the Closing,
Vendors' Group shall cease to include the Group Companies, as defined in the
Non-North American Sale and Purchase Agreement;
WARRANTIES means the representations and warranties of the Vendors
contained in this Agreement (including the Schedules hereto) and the Tax Deed of
Covenant and WARRANTY means any one of the Warranties.
1.2 SUBORDINATE LEGISLATION
Any reference to a statutory provision shall include any rules or
regulations made from time to time under that provision which are in force at
the date of this Agreement.
1.3 [INTENTIONALLY OMITTED]
1.4 SCHEDULES, ETC.
References herein to this Agreement shall include the Schedules and
Subschedules to this Agreement and references to Sections are to Sections to
this Agreement or Sections to the Schedules and/or Subschedules.
1.5 CONFLICT
The provisions of this Agreement shall control in the event of any
conflict between the provisions in this Agreement and the Non-North American
Sale and Purchase Agreement with respect to the matters set forth in this
Agreement.
1.6 INFORMATION
Any reference herein to books, records or other information means
books, records or other information in any form including paper, electronically
stored data, magnetic media, film and microfilm.
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1.7 KNOWLEDGE
Any Warranty or statement of the Vendors qualified by the expression
"to the best knowledge of" or "so far as a person is aware" or any similar
expression with respect to any Vendor shall be deemed to refer to the actual
knowledge, as of the date such Warranties are made or deemed to be made, of such
Senior Executives after having made due and careful inquiry.
1.8 ACCOUNTING STANDARDS
Unless otherwise specified, all accounting terms used herein shall be
interpreted, and all accounting determinations and computations hereunder shall
be made, in accordance with the accounting policies and principles referred to
in Section 1 of Schedule 7 (exclusive, however, of Sections 2 and 3 of such
Schedule).
2 AGREEMENT TO SELL THE ACQUIRED ASSETS
2.1 SALE AND PURCHASE OF ACQUIRED ASSETS
Subject to the terms and conditions of this Agreement and the Tax Deed
of Covenant at Closing, the US Vendor shall sell the US Assets to the US
Purchaser, and the Canadian Vendor shall sell the Canadian Assets to the
Canadian Purchaser, and the US Purchaser shall purchase the US Assets and the
Canadian Purchaser shall purchase the Canadian Assets, in each case with the
benefit of the Warranties, covenants and indemnities contained in this
Agreement, free from all Encumbrances (except as expressly provided in this
Agreement or disclosed in the Disclosure Letter).
2.2 ASSUMPTION OF LIABILITIES
2.2.1 US ASSUMED LIABILITIES
Subject to Sections 2.2.2 and 2.2.3, the US Purchaser shall
assume, duly and punctually pay, satisfy, discharge, perform or fulfill all of
the following Liabilities of the US Vendor (collectively, the US ASSUMED
LIABILITIES):
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(a) arising under the Permits and Contracts of the US
Vendor (other than the Contracts listed on Schedule 17 and the employment
Contracts for Employees named in the Employment Letter who will not be
Continuing Employees);
(b) expressly assumed by the US Purchaser or any
other Relevant Purchaser (other than the Canadian Purchaser) elsewhere under
this Agreement; or
(c) any other Liabilities of the US Vendor, but only
to the extent that they are taken into account in the calculation of, or
provided for in, the Net Asset Statement.
2.2.2 TREATMENT OF CERTAIN PRE-CLOSING US LIABILITIES
Notwithstanding anything to the contrary contained in Section
2.2.1, unless included (or provided for) in the calculation of Liabilities in
the Net Asset Statement, US Purchaser shall not assume or be deemed to have
assumed any Liability of the US Vendor described below:
(a) to perform any obligation or pay any Liability of
the US Vendor which was required to be performed or paid prior to Closing;
including, payment of any salaries, compensation (excluding unused vacation,
sick or severance pay, whether or not accrued) rents, Taxes, utility charges and
any and all fees and charges due under the Permits and Contracts transferred or
assigned to or held in trust for or held for the benefit of the US Purchaser
pursuant to this Agreement for periods prior to Closing; or
(b) for or in respect of any product manufactured
and/or sold or service performed by the US Vendor prior to Closing, except to
the extent (but only to the extent) that such Liability in respect of any
product manufactured or service performed has resulted from any US Purchaser's
breach of its obligations under Section 12 hereof.
2.2.3 US EXCLUDED LIABILITIES
Notwithstanding anything to the contrary contained herein, US
Purchaser does not assume and shall in no event be liable for any Liabilities of
the US Vendor to any person, whether fixed or inchoate, known or unknown,
liquidated or unliquidated, secured or unsecured, contingent or otherwise,
except for those Liabilities specifically assumed by US Purchaser in Section
2.2. All
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Liabilities of the US Vendor not so assumed (collectively, US EXCLUDED
LIABILITIES) shall be and remain solely US Vendor's responsibility;
2.2.4 CANADIAN ASSUMED LIABILITIES
Subject to Sections 2.2.5 and 2.2.6, the Canadian Purchaser
shall assume, duly and punctually pay, satisfy, discharge, perform or fulfill
all of the following Liabilities of the Canadian Vendor (collectively, the
CANADIAN ASSUMED LIABILITIES):
(a) arising under the Permits and Contracts of the
Canadian Vendor (other than the Contracts listed on Schedule 17 and the
employment Contracts for Employees named in the Employment Letter who will not
be Continuing Employees);
(b) expressly assumed by the Canadian Purchaser
elsewhere under this Agreement; or
(c) any other Liabilities of the Canadian Vendor, but
only to the extent that they are taken into account in the calculation of, or
provided for in, the Net Asset Statement.
2.2.5 TREATMENT OF CERTAIN PRE-CLOSING CANADIAN LIABILITIES
Notwithstanding anything to the contrary contained in Section
2.2.4, unless included (or provided for) in the calculation of Liabilities in
the Net Asset Statement, Canadian Purchaser shall not assume or be deemed to
have assumed any Liability of the Canadian Vendor described below:
(a) to perform any obligation or pay any Liability of
the Canadian Vendor which was required to be performed or paid prior to Closing;
including payment of any salaries, compensation (excluding unused vacation, sick
or severance pay, whether or not accrued) rents, Taxes, utility charges and any
and all fees and charges due under the Permits and Contracts transferred or
assigned to or held in trust for or held for the benefit of the Canadian
Purchaser pursuant to this Agreement for periods prior to Closing; or
(b) for or in respect of any product manufactured
and/or sold or service performed by the Canadian Vendor prior to Closing, except
to the extent (but only to the extent) that
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such Liability in respect of any product manufactured or service performed has
resulted from any Canadian Purchaser's breach of its obligations under Section
12 hereof.
2.2.6 CANADIAN EXCLUDED LIABILITIES
Notwithstanding anything to the contrary contained herein,
Canadian Purchaser does not assume and shall in no event be liable for any
Liabilities of the Canadian Vendor to any person, whether fixed or inchoate,
known or unknown, liquidated or unliquidated, secured or unsecured, contingent
or otherwise, except for those Liabilities specifically assumed by Canadian
Purchaser in Section 2.2. All Liabilities of the Canadian Vendor not so assumed
(collectively, CANADIAN EXCLUDED LIABILITIES and together with the US Excluded
Liabilities, EXCLUDED LIABILITIES) shall be and remain solely Canadian Vendor's
responsibility.
2.2.7 SPECIAL PROVISIONS RELATING TO CERTAIN ENVIRONMENTAL
ISSUES
Notwithstanding any term or condition set forth in Schedule 16 relating to
environmental matters:
(a) US Vendor, upon receiving a request for payment,
from time to time, from US Purchaser, shall within thirty (30) days thereafter,
reimburse Purchaser dollar for dollar up to an aggregate maximum amount of
$500,000 for Purchasers' reasonable expenses (including internal overhead costs)
for machine guarding at any of the facilities used in the Operations. US
Vendor's obligations under this clause (a) shall constitute Vendors' sole
obligation to Purchasers for machine guarding and machine guarding obligations
relating to the Operations.
(b) US Vendor, upon receiving a request for payment,
from time to time, from US Purchaser, shall within thirty (30) days thereafter,
reimburse US Purchaser dollar for dollar up to an aggregate maximum amount of
$500,000, less any amount paid by US Vendor prior to Closing, for installation
of a cooling water recirculation system and other equipment or modifications
necessary to meet wastewater discharge limits at the Malvern, Arkansas facility.
"Other equipment" for this purpose includes a dry cure byproduct filter box; a
sump evaporator and an electric byproduct precipitator. US Vendor's obligations
under this clause (b) shall constitute Vendors' sole obligation to Purchasers
for improvements necessary to meet wastewater discharge limits at the Malvern,
Arkansas facility.
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(c) US Vendor, upon receiving a request for payment,
from time to time, from US Purchaser, shall within thirty (30) days thereafter,
reimburse US Purchaser dollar for dollar up to an aggregate maximum amount of
$350,000 for installation of a wastewater recirculation system or other
wastewater system modifications necessary to meet wastewater discharge limits at
the Wilimantic, Connecticut facility. US Vendor's obligations under this clause
(c) shall constitute Vendors' sole obligation to Purchasers for improvements
necessary to meet wastewater discharge limits at the Wilimantic, Connecticut
facility.
2.3 INDEMNIFICATION
The parties hereto agree as follows:
2.3.1 Survival; Assertion of Claims, etc.
(a) All representations, warranties and covenants of
the parties to this Agreement contained in this Agreement (or the Schedules
hereto) shall survive the Closing and continue in effect for the following
periods:
(i) The covenants of each party to this
Agreement shall continue until the obligations required to be performed or
satisfied by the covenants have been performed or satisfied;
(ii) The representations and warranties of the
US Vendor and Canadian Vendor shall expire as follows: (x) with respect to the
representations and warranties relating to the environment set forth on Schedule
16, five years after the Closing Date; (y) with respect to the representation
and warranties relating to Tax matters as set forth in the Tax Deed of Covenant,
until the end of the applicable Tax Statute of Limitations Date; and (z) with
respect to all other representations and warranties, two years after the Closing
Date; and
(iii) The representations and warranties of the
Purchasers' Guarantor and the Purchaser shall expire two years after the Closing
Date.
(b) Each party to this Agreement must assert any
claim for indemnification involving a representation, warranty or covenant
against the other party before the expiration of any applicable survival period.
Any indemnity claim pursuant to this Section 2.3 shall
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(if it has not been previously satisfied, settled or withdrawn) be deemed to be
withdrawn six months after the relevant time limit set forth above unless legal
proceedings in respect of such claim (i) have been commenced and (ii) are being
pursued in good faith and with reasonable diligence. Notwithstanding any
provision to the contrary contained in this Agreement (other than the preceding
sentence), so long as such indemnity claim is asserted timely, such claim will
continue to be valid and assertable even though the survival period may
subsequently expire before such claim is resolved.
(c) All claims for indemnification pursuant to this
Agreement or the Tax Deed of Covenant shall be subject to the limitations,
notice requirements, time periods and other terms and conditions of this Section
2.3.
2.3.2 INDEMNIFICATION OF PURCHASERS' INDEMNIFIED GROUP
The US Vendor and the Canadian Vendor shall, jointly
and severally, indemnify, defend and hold harmless the US Purchaser, the
Canadian Purchaser, the Purchasers' Guarantor and their officers, directors,
Affiliates, agents and representatives (collectively, the PURCHASERS'
INDEMNIFIED GROUP) from and against any and all Losses (including for purposes
of Section 2.3.2(e) only, consequential damages) with respect to the following:
(a) any misrepresentation or breach of Warranty,
covenant or agreement of the US Vendor or the Canadian Vendor contained in this
Agreement (or the Schedules hereto);
(b) any and all of the Vendors' Excluded Liabilities
whether known or unknown on the date hereof or on the Closing Date, and whether
or not such Liabilities constitute or arise from a breach of any Warranty made
by either Vendor herein, including any such Liability which is deemed to be, or
becomes, a Liability of any member of the Purchasers' Indemnified Group by
virtue of any applicable Law and which is not otherwise assumed by the
Purchasers under this Agreement;
(c) without duplication, any Losses which any member
of the Purchasers' Indemnified Group may suffer by reason of any member of the
Purchasers' Indemnified Group taking any reasonable action to avoid, resist or
defend against any Liability arising in connection with or referred to in
Section 2.3.2(a) or Section 2.3.2(b);
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(d) subject to the provisions of the Tax Deed of
Covenant, any Liability in respect of any Tax which each Relevant Purchaser is
indemnified against pursuant to the Tax Deed of Covenant;
(e) the Purchasers' failure to (i) receive any
necessary Third Party Consent with respect to any of the Contracts listed on
Schedule 4 (the SCHEDULE 4 CONTRACTS) or (ii) otherwise provide the Purchasers
with the economic benefits of the Schedule 4 Contracts;
(f) the presence or alleged presence of or exposure
by any person to any asbestos or asbestos-containing materials in any of the
materials or products manufactured, sold, or otherwise distributed by the US
Vendor or the Canadian Vendors prior to Closing, including such goods and
materials as are in process or in inventory as of the Closing Date (any such
Losses described in this clause (f) being, collectively, the ASBESTOS
LIABILITIES);
(g) any Liability in respect of lead detected in the
fill material at the Real Property used in the Operations located at Marion,
Indiana (the MARION LIABILITIES); provided that Purchaser does not voluntarily
undertake a sampling program within the fill area in an attempt to further
characterize the nature and extent of the alleged presence of lead or any other
constituent or compound at the Marion, Indiana Real Property site, nor does
Purchaser voluntarily undertake any soil-intrusive construction activities in
said fill area; and provided further that Vendors shall not be liable as result
of the foregoing to Purchaser for any claim by Purchaser for property damage to
Purchaser's Marion, Indiana Real Property arising out of or with respect to the
presence of lead in fill material as described herein. The provisions of Section
7.4 of Schedule 16 to this Agreement shall apply to any Remedial Action (as
defined in Schedule 16) required to be performed at the Marion, Indiana Real
Property; and
(h) any Liability in respect of solvent detected in
the soil or groundwater at the Trenton, Ontario facility (the TRENTON
LIABILITIES); provided that no Vendor shall be liable as result of the foregoing
to any Purchaser for any claim for property damage to the Trenton, Ontario Real
Property arising out of or with respect to the solvent in the soil or
groundwater as described herein. The provisions of Section 7.4 of Schedule 16 to
this Agreement shall apply to any Remedial Action (as defined in Schedule 16)
required to be performed at the Trenton, Ontario Real Property.
2.3.3 INDEMNIFICATION OF VENDORS' INDEMNIFIED GROUP
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The Purchaser and the Canadian Purchaser shall,
jointly and severally, indemnify, defend and hold harmless the US Vendor, the
Canadian Vendor and the Vendors' Guarantor and their officers, directors,
Affiliates, agents and representatives (the VENDORS' INDEMNIFIED GROUP) from and
against any and all Losses with respect to any of the following:
(a) any misrepresentation or breach of any
representation, warranty, covenant or agreement of the Purchasers contained in
this Agreement (or in any Schedule hereto);
(b) all Assumed Liabilities and any other Liability
to the extent such Liability arises as a result of the acts or omission of any
Purchaser and/or any other person in the course of carrying on the Operations
after Closing, including any such Liability which is or is deemed to be or
becomes a Liability of any member of the Vendors' Indemnified Group by virtue of
any applicable Law and which is not otherwise an Excluded Liability; and
(c) any Losses which any member of the Vendors'
Indemnified Group may suffer by reason of any member of the Vendors' Indemnified
Group taking any reasonable action to avoid, resist or defend against any
Liability referred to in Section 2.3.3(a) or (b).
2.3.4 Procedure
If any third party shall notify any party to this
Agreement (an INDEMNIFIED PARTY) with respect to any matter which may give rise
to a claim for indemnification against any other party (an INDEMNIFYING PARTY)
under this Section 2.3, then the Indemnified Party shall notify the Indemnifying
Party thereof promptly; provided, however, that no delay on the part of the
Indemnified Party in notifying any Indemnifying Party shall relieve the
Indemnifying Party from any liability or obligation hereunder, except to the
extent otherwise expressly provided herein or to the extent (but solely to the
extent) the Indemnifying Party thereby is damaged. In the event any Indemnifying
Party notifies the Indemnified Party within 15 days after the Indemnified Party
has given notice of the matter that the Indemnifying Party is assuming the
defense thereof, (i) the Indemnifying Party will defend the Indemnified Party
against the matter with counsel of its choice reasonably satisfactory to the
Indemnified Party, (ii) the Indemnified Party may retain separate co-counsel at
its sole cost and expense (except that the Indemnifying Party will be
responsible for the fees and expenses of the separate co-counsel to the extent
counsel to the Indemnified Party concludes reasonably that it has a conflict of
interest), (iii) the Indemnified Party will not consent to the entry of any
Judgment or enter into any settlement with respect to the matter without the
written
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consent of the Indemnifying Party (not to be withheld or delayed unreasonably),
and (iv) the Indemnifying Party will not consent to the entry of any Judgment
with respect to the matter, or enter into any settlement which does not include
a provision whereby the plaintiff or claimant in the matter releases the
Indemnified Party from all Liability with respect thereto, without the written
consent of the Indemnified Party (not to be withheld or delayed unreasonably).
If the Indemnifying Party fails to notify the Indemnified Party within 15 days
after the Indemnified Party has given notice of the matter that the Indemnifying
Party is assuming the defense thereof, the Indemnified Party may defend against
the matter in any manner it reasonably may deem appropriate.
2.3.5 LIMITATIONS ON INDEMNIFICATION
(a) No person included in the Purchasers' Indemnified
Group shall be entitled to any recovery with respect to any claim for
indemnification under this Agreement or the Tax Deed of Covenant in respect of
any such claim arising from any single circumstance or series of related
circumstances if the amount of such claim (excluding interest, costs and
expenses) does not exceed $20,000; provided that claims relating to a series of
related circumstances shall be aggregated for this purpose;
(b) No person included in the Purchasers' Indemnified
Group shall be entitled to recover with respect to any claim for indemnification
under this Agreement or the Tax Deed of Covenant until the aggregate amount of
all such claims exceeds $750,000 (the BASKET), in which event the Purchasers'
Indemnified Group shall, subject to the other provisions of this Section 2.3.5
be entitled to such indemnification for all amounts, including all amounts
forming any part of the Basket; and
(c) The aggregate amount of Liability of the Vendors'
Guarantor, US Vendor, Canadian Vendor and any other member of Vendors' Group
under this Agreement, the Tax Deed of Covenant and the Non-North American
Agreements shall not exceed (pound)160 million (the CAP), it being understood
that any Liabilities for indemnification arising under Section 2.3.2(e) of this
Agreement or Clause 11.4 of the Non-North American Sale and Purchase Agreement
shall not be applied against the Cap but shall only be applied against and shall
be limited to the Contract Cap (as defined below).
(d) Any term or provision of this Section 2.3.5 to
the contrary notwithstanding, (i) no provision of clauses (a), (b) or (c) of
this Section 2.3.5 shall apply to (x) any
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Excluded Liabilities (including Asbestos Liabilities, Marion Liabilities and
Trenton Liabilities), (y) any Liability resulting from any breach of any
Warranty set forth in Section 8.1.1, 8.4.1 or 9.9.15 of Schedule 8 or (z) any
Liability in respect of any matter described to Clause 2.3.1 or 8.10 of the Non-
North American Sale and Purchase Agreement, and (ii) the aggregate amount of
Liability of the Vendors' Guarantor, US Vendor, Canadian Vendor and any other
member of Vendors' Group under Section 2.3.2(e) of this Agreement and Clause
11.4 of the Non-North American Sale and Purchase Agreement shall not exceed
(pound)10 million (the CONTRACT CAP), it being understood that any amount of
Liability under such Section 2.3.2(e) and Clause 11.4 shall be applied against
the Contract Cap only and shall not be applied against the Cap.
2.3.6 INSURANCE PROCEEDS
Notwithstanding any contrary provision in this
Section 2.3, any recovery with respect to a claim asserted hereunder will be
reduced by the amount of any insurance proceeds actually recovered by the
claimant which directly relates to such claim. The indemnified party agrees to
diligently pursue all claims covered by any insurance policy.
2.3.7 TAXES
In calculating the Liability of the Vendors or
Vendors' Guarantor under this Section 2.3, there shall be taken into account the
amount (if any) by which any Tax for which a Relevant Purchaser would otherwise
have been accountable or liable to be assessed is actually reduced or
extinguished as a result of the matter giving rise to such Liability. The amount
of such reduction or extinguishment shall be reasonably determined (in writing
with appropriate detail) by the independent certified accounting firm or
chartered accountants which prepares or reviews the relevant Tax Returns on
behalf of the Relevant Purchaser. A copy of such determination shall be
delivered promptly to the Vendors' Guarantor upon its request.
2.3.8 CONTINGENT LIABILITIES
No person included in the Purchasers' Indemnified
Group shall be entitled to recover with respect to any claim for indemnification
under this Agreement or the Tax Deed of Covenant in respect of any Liability
which is contingent unless and until such contingent liability becomes an actual
liability and is due and payable; provided that this Section 2.3.8 shall not
operate to avoid an indemnity claim made in respect of a contingent liability
within the applicable time limits
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specified in Section 2.3.1 if such indemnity claim is asserted on a timely basis
and in accordance with Section 2.3.1 (even if such liability does not become an
actual liability until after the expiry of such period).
2.3.9 PROVISIONS IN THE ACCOUNTS
No person included in the Purchasers' Indemnified
Group shall be entitled to recover with respect to any claim for indemnification
under this Agreement or the Tax Deed of Covenant in respect of any such claim if
any allowance, provision or reserve is made for the matter giving rise to such
claim in the Net Asset Statement (regardless of whether the allowance, provision
or reserve is adequate to cover such claim).
2.3.10 OTHER LIMITATIONS
No person included in the Purchasers' Indemnified
Group shall be entitled to recover with respect to any claim for indemnification
under this Agreement or the Tax Deed of Covenant in respect of any matter, act,
omission or circumstance (or any combination thereof) (including the aggravation
of a matter or circumstance) to the extent that the same would not have occurred
but for:
(a) any change in accounting or Tax policy, basis or
practice introduced or becoming effective after the Closing Date;
(b) the effectiveness of, or any change in, any Law,
rule or regulation or, to the extent generally available, any published
administrative practice of any Governmental Authority, including any increase in
the rates of Tax or any imposition of Tax or any withdrawal of relief from Tax,
occurring after the date of this Agreement; or
(c) any act or omission of a Relevant Purchaser or
any member of the Purchasers' Group, or their respective directors, employees or
agents or successors in title, which occurs after the Closing and which is
outside the ordinary course of business.
2.3.11 NET BENEFIT
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To the extent that, as a result of any event or
circumstance giving rise to a claim for indemnification, a person included in
the Purchasers' Indemnified Group receives a corresponding savings or net
benefit resulting from such event or circumstance, the amount of such claim for
indemnification shall be reduced by the amount of such savings or benefit. In
the case of any Tax Matter, the amount of such savings or benefit shall be
reasonably determined (in writing with appropriate detail) by the independent
certified accounting firm or chartered accounting firm which prepares or reviews
the relevant Tax Returns on behalf of the Relevant Purchaser. A copy of such
determination shall be delivered promptly to the Vendors' Guarantor upon its
request.
2.3.12 MITIGATION OF LOSS
Each Purchaser hereby covenants and agrees, for
itself and each other member of the Purchaser's Indemnified Group, for the
benefit of the members of the Vendors' Group, that after a claim for indemnity
under this Agreement, the Non-North American Agreements or the Tax Deed of
Covenant has arisen or is reasonably likely to arise, it shall take all
commercially reasonable actions to mitigate the Losses of the members of the
Vendors' Group under this Section 2.3; provided that (x) all reasonable costs
and expenses (including overhead and administrative costs and expenses) of the
Purchasers or any other member of Purchasers' Indemnified Group resulting from
such actions shall be reimbursed by the Vendors and (y) no Purchaser shall be
required to take any action under this Section 2.3.12 which is outside of the
ordinary course of the Operations.
2.3.13 PRIOR RECEIPT
If any member of the Vendors' Group pays an amount in
discharge of any claim for indemnity under this Agreement or the Tax Deed of
Covenant and a member of the Purchasers' Indemnified Group subsequently recovers
(whether by payment, discount, credit, relief or otherwise) from a third party a
sum which is referable to the subject matter of such claim and which would not
otherwise have been received by such member of the Purchasers' Indemnified
Group, the Purchasers shall pay, or shall procure that the Relevant Purchaser
pays, to the US Vendor or the Canadian Vendor, as applicable, an amount equal to
the lesser of (i) the sum recovered from the third party less any reasonable
costs and expenses incurred in obtaining such recovery or (ii) the amount
previously paid by the member of the Vendors' Group to discharge such claim for
indemnity.
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2.3.14 DOUBLE CLAIMS
The members of the Purchasers' Indemnified Group
shall not be entitled to recover from any member of the Vendors' Group under
this Agreement, the Non-North American Agreements or the Tax Deed of Covenant
more than once in respect of the same damage suffered. In furtherance and not in
limitation of the foregoing, the member of the Vendors' Group shall not be
liable in respect of any breach of this Agreement if and to the extent that the
Losses are or have been included in a claim under the Tax Deed of Covenant or
the Non-North American Agreements which has been satisfied, nor shall the
members of the Vendors' Group be liable in respect of a claim under the Tax Deed
of Covenant or the Non-North American Agreements if and to the extent that the
Losses are or have been included in a claim for breach of this Agreement which
has been satisfied.
2.3.15 ENVIRONMENTAL CLAIMS
In the event of any conflict between this Agreement
and the provisions of Schedule 11, 12 or 16, the provisions of such Schedule
shall supersede and control any conflicting Sections of this Agreement.
2.3.16 CONSEQUENTIAL AND PUNITIVE DAMAGES
No member of the Purchasers' Indemnified Group shall
be entitled to indemnification pursuant to this Agreement (i) with respect to
consequential damages arising out of or in connection with this Agreement,
except no such limitation shall apply with respect to such damages arising out
of or in connection with the breach of the Restrictive Covenants or the failure
to obtain the Third Party Consents or otherwise provide the Purchasers with the
economic benefits of the Schedule 4 Contracts as set forth in Section 2.3.2(e),
or (ii) with respect to punitive damages arising out of or in connection with
this Agreement other than resulting from Vendors' fraud. In furtherance of the
foregoing, no member of the Purchasers' Indemnified Group shall institute,
directly or indirectly, and each Purchaser hereby permanently waives, on its
behalf and on behalf of all other members of Purchasers' Indemnified Group, any
right to commence any action or proceeding of any kind claiming consequential or
punitive damages; provided, however, no such limitation or waiver shall apply
to, and any member of the Purchasers' Indemnified Group shall continue to have
the right to commence an action or proceeding claiming consequential damages
with respect to the breach of the Restrictive Covenants or the failure to obtain
the Third Party
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Consents or otherwise provide the Purchasers with the economic benefits of the
Schedule 4 Contracts as set forth in Section 2.3.2 (e) or claiming punitive
damages with respect to Vendors' fraud.
3 CONSIDERATION
3.1 AMOUNT AND PAYMENT
(a) The aggregate consideration for the purchase of the
Acquired Assets and the assumption of the Assumed Liabilities pursuant to this
Agreement shall be an amount (such amount, as adjusted pursuant hereto, the
PURCHASE PRICE) which is equal to (pound)104.4 million;
(b) The Purchase Price and the Assumed Liabilities shall be
allocated as set out in Schedule 3. The consideration is exclusive of any
transfer Taxes in respect of which the provisions of Schedule 10 shall apply.
The Purchase Price shall be paid by the US Purchaser on behalf of itself and the
Canadian Purchaser to the US Vendor on behalf of itself and the Canadian Vendor,
or as otherwise agreed by the US Purchaser and the US Vendor. The determination
of the allocations of the Purchase Price and the amount of Assumed Liabilities
among the Acquired Assets as set forth on Schedule 3 shall be made in accordance
with Section 1060 of the Code and by mutual agreement of the US Vendor and the
US Purchaser with respect to the US Assets and by mutual agreement between the
Canadian Vendor and Canadian Purchaser with respect to the Canadian Assets. Each
of the US Vendor, the Canadian Vendor, the Vendors' Guarantor and the Relevant
Purchaser shall sign and submit all necessary forms to report this transaction
for Tax purposes of any Governmental Authority, in whichever combination
necessary, in accordance with Schedule 3, and shall not take a position for Tax
purposes inconsistent therewith.
3.2 ADJUSTMENTS
The Purchase Price may be reduced or increased in accordance
with the provisions of Section 9 or in accordance with any other provisions of
this Agreement stated to take effect as an adjustment to the Purchase Price. Any
adjustment to the Purchase Price shall be allocated as provided by Temp. Treas.
Reg. Sec. 1.1060-IT(f) (or any successor regulation).
3.3 METHOD OF PAYMENT
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Wherever in this Agreement provision is made for payment by
one party (the PAYER) to another (the PAYEE), such payment shall be made by wire
transfer of immediately available funds to an account designated by the payee as
specified in the Payment Account Details of the payee.
4 CONDITIONS
4.1 CONDITIONS PRECEDENT
The respective obligations of the parties to this Agreement to
consummate the transactions to be performed by them pursuant to this Agreement
are subject to the satisfaction of the following conditions:
4.1.1 the passing at a general meeting of the Vendors'
Guarantor of a resolution to approve the transactions contemplated by this
Agreement;
4.1.2 the Non-North American Sale and Purchase Agreement
becoming unconditional in accordance with its terms (other than the satisfaction
of any condition relating to this Agreement);
4.1.3 any waiting period applicable to the acquisition of the
Acquired Assets under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended (the HSR ACT) shall have terminated or expired;
4.1.4 no action, suit or proceeding shall be pending or
threatened before any Governmental Authority wherein an unfavorable Judgment,
order, decree, stipulation, injunction or charge would (i) prevent consummation
of any of the transactions contemplated by this Agreement, or (ii) cause any of
the transactions contemplated by this Agreement to be rescinded following
consummation (and no such Judgment, order, decree, stipulation, injunction or
change shall be in effect); and
4.1.5 the Non-North American Sale and Purchase Agreement shall
not have terminated pursuant to Section 4.5 as a result of a Material Adverse
Effect (as defined in such agreement).
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4.2 RESPONSIBILITY FOR SATISFACTION
4.2.1 The Vendors shall use their best efforts to ensure the
satisfaction of the condition set out in Section 4.1.1 as soon as reasonably
practicable after the date hereof subject to compliance by the directors of the
Vendors' Guarantor with their fiduciary duties.
4.2.2 The Vendors' Guarantor shall, as soon as reasonably
practicable after the date hereof, mail a circular to the shareholders of the
Vendors' Guarantor so as to inform them of this Agreement and so as to convene
the general meeting of the Vendors' Guarantor referred to in Section 4.1.1 on or
before May 15, 1999.
4.2.3 Each of the US Purchaser and US Vendor will as soon as
practicable after the date hereof make all filings which are required to be made
with any Governmental Authority under the HSR Act in connection with the
transactions contemplated by this Agreement. Notwithstanding the foregoing, with
respect to the HSR Act, neither the US Vendor nor the US Purchaser shall be
required to:
(i) divest or hold separate any assets including
assets of any Affiliate; or
(ii) agree to any limitation on their respective
freedom of action with respect to, or their ability to retain any of their (or
their Affiliate's) other assets or businesses.
4.2.4 The US Purchaser and US Vendor shall promptly inform
each other of all communications with any Governmental Authority in connection
with the condition referred to in Section 4.1.3.
4.2.5 Without limitation to the generality of the provisions
set forth in this Section 4.3, all requests and inquiries from any Governmental
Authority shall be dealt with by the US Vendor and the US Purchaser in
consultation with each other.
4.2.6 The Vendors and the Purchasers shall each use all
reasonable commercial efforts to cause the condition set forth in Section 4.1.2
to be satisfied as soon as reasonably practicable.
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4.2.7 The Vendors' Guarantor shall promptly give notice to the
US Purchaser of the satisfaction of the condition set out in Section 4.1.1, but
not later than the close of business on the day following satisfaction of such
condition.
4.2.8 The US Purchaser shall promptly give notice to the
Vendors' Guarantor of satisfaction of the condition in Section 4.1.3, but not
later than the close of business on the day following the satisfaction of each
such condition.
4.3 TERMINATION
4.3.1 The parties to this Agreement may terminate this
Agreement as follows:
(a) the parties to this Agreement may terminate this
Agreement by mutual written consent of all the parties at any time prior to the
Closing;
(b) the Purchasers may terminate this Agreement by
giving written notice to the Vendors at any time prior to the Closing if the
Closing shall not have occurred on or before July 31, 1999 by reason of the
failure of any condition precedent under Section 4.1 (unless the failure results
primarily from either Purchaser being in material breach of any warranty, or
covenant contained in this Agreement); or
(c) the Vendors may terminate this Agreement by
giving written notice to the US Purchaser at any time prior to the Closing if
the Closing shall not have occurred on or before July 31, 1999 by reason of the
failure of any condition precedent under Section 4.1 (unless the failure results
primarily from the Vendors being in material breach of any Warranty, or covenant
contained in this Agreement).
4.3.2 In the event of termination of this Agreement as
provided in Section 4.3.1, this Agreement shall forthwith become void and have
no effect, without any liability or obligation on the part of any party, other
than the provisions of Sections 19.1, 19.2 and 19.8 and except to the extent
that such termination results from the willful and material breach by a party of
any of its representations, warranties, covenants or other agreements set forth
in this Agreement.
5 ACTION PENDING CLOSING
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5.1 VENDORS' GENERAL OBLIGATIONS
Pending Closing the Vendors shall:
5.1.1 conduct the Operations as a going concern in the
ordinary course of business; and
5.1.2 subject to Section 5.3, allow the Purchasers and their
agents, upon reasonable notice and at reasonable times, reasonable access to the
Vendors' personnel, facilities and assets and to all existing books, records,
Tax Returns, work papers and other documents and information relating to the
Operations; permit and assist Purchasers and Purchasers' representatives to
contact the Vendors' customers, prospects and suppliers; and provide Purchasers
and Purchasers' representatives with such copies of the existing books, records,
Tax Returns, work papers and other documents and information relating to the
Operations and with such additional financial, operating and other data and
information regarding the Operations, as Purchasers may reasonably request;
provided that the obligations of the Vendors under this Section shall be subject
to any applicable confidentiality agreements relating to the Operations and
shall not extend to allowing access to information which is reasonably regarded
as confidential to the activities of Vendors' Group otherwise than in connection
with the Operations.
5.2 RESTRICTIONS ON VENDORS
5.2.1 Without prejudice to the generality of Section 5.1.1,
between the period from the date hereof to the Closing Date, the Vendors shall
discuss with representatives of the Purchasers (nominated in advance by the
Purchasers for such purpose and agreed to in writing by the US Vendor) in
reasonable detail those actions that are material to the Operations, and the
Vendors shall not, without the prior written consent of the Purchasers, which
consent in the case of subsection (h) will not be unreasonably withheld or
delayed :
(a) conduct the Operations in any manner except in
the ordinary course of business it being agreed and understood that all
established procedures for the approval of Contracts shall continue to be
followed; or
(b) except for liabilities incurred in the ordinary
course of business (which for purposes hereof shall include budgeted capital
expenditures within the approval limits of the
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general management of the Operations), pay or incur or agree to pay or incur any
amount, obligation or Liability relating to such Operations (absolute or
contingent) (including in respect of any purchase, lease or other acquisition of
assets) that is more than $150,000 in any specific case or $400,000 in the
aggregate; or
(c) grant any general or uniform increase in the
rates of pay or benefits to the Employees (or any class thereof) in excess of
3.5% per annum; or, except in connection with any severance or termination that
will occur prior to Closing, enter into any new severance agreement that would
be required to be disclosed pursuant to the Warranties contained herein; or
enter into any collective bargaining agreement with respect to the Operations
other than as may be required by Law or Contract; or
(d) except in the ordinary course of business, sell,
transfer, mortgage, encumber, abandon or otherwise dispose of any assets or
Liabilities relating to the Operations, except (x) for dispositions of property
not greater than $400,000 in the aggregate, (y) dispositions of Inventory
relating to the Operations in the ordinary course of business or (z) as
contemplated by this Agreement; or
(e) grant credit to any customer or distributor of
the Operations on terms substantially more favorable than the terms on which
credit has been extended to such customer or distributor in the past or change
the terms of any credit previously extended; or
(f) settle any dispute, waive any right or cancel any
debt or claim on behalf of or relating to the Operations other than in the
ordinary course of business or that involves a payment or loss of benefit to the
Operations in excess of $150,000;
(g) take any action or omit to take any action, which
action or omission will result in a breach of its Warranties and covenants
contained herein;
(h) enter into any Material Contract; provided that
this covenant shall not apply to (i) any Material Contract resulting from the
submission in the of ordinary course of business of any bid or tender on or
prior to the date hereof for the supply or manufacture of products or services
or (ii) any supply or delivery of products pursuant to a purchase order under
any supply Contract in effect on the date hereof; or
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(i) make any material changes in the terms or
conditions of employment of, or employ, or agree to employ, any Senior Employee.
5.2.2 Between the date hereof and the Closing, the Vendors
shall, in good faith, use all commercially reasonable efforts to preserve the
Operations intact, retaining the services of the current employees, salesmen,
contractors, agents and representatives of the Operations and maintaining the
good will of suppliers, customers and persons having business relations in
respect of the Operations.
5.2.3 Between the date hereof and the Closing, the Vendors
shall (i) conduct the Operations in the ordinary course in a manner consistent
with past practices, (ii) maintain all material Insurance policies, Permits and
the material Contracts which are material to the Operations in full force and
effect and (iii) comply in all material respects with all applicable Permits and
Laws.
5.3 PURCHASERS' GENERAL OBLIGATIONS
Each Purchaser hereby covenants and agrees that, prior to
Closing, only those employees, directors, agents, representatives or advisors of
Purchasers who have been identified in writing to George N. Benjamin, III, Peter
Zinkin and Hans P. Berndorff shall communicate with any employees, agents,
representatives, advisors, suppliers, customers or prospects of the Vendors
regarding the transactions contemplated by this Agreement or visit any of the
Real Properties.
6 CLOSING
6.1 DATE AND PLACE
Closing shall take place at the offices of US Vendor's Lawyers
or at such other location agreed to by the parties, on the last Business Day of
the US Vendor's accounting period (as set out in Part 2 of Schedule 6) which
occurs after each of the conditions precedent set forth in Section 4.1 is
satisfied or waived as permitted pursuant to this Agreement or at such other
place, time or date as may be agreed between the US Purchaser and the US Vendor,
provided that such later date shall be the last Business Day of an accounting
period of the US Vendor;
6.2 CLOSING EVENTS
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On Closing, the parties shall cause the events set forth in
Part 1 of Schedule 6 for which they are respectively responsible to occur.
Either party may waive the obligations of the other party as set forth in Part 1
of Schedule 6.
6.3 PAYMENT OF PRICE
At the Closing against delivery of the Acquired Assets free
and clear of all Encumbrances (except for such Encumbrances expressly permitted
in this Agreement), and assumption of the Assumed Liabilities pursuant to the
terms of this Agreement, the US Purchaser on behalf of itself and the Canadian
Purchaser shall pay the US Vendor on behalf of itself and the Canadian Vendor,
in the manner specified in Section 3.3, an amount which is equal to the amount
set forth in Section 3.1.
7 REPRESENTATIONS AND WARRANTIES
7.1 REPRESENTATIONS AND WARRANTIES FROM THE VENDORS; INCORPORATION
OF SCHEDULE 8
Knowing that the Purchasers are relying thereon, each of the Vendors,
jointly and severally, represent and warrant to the Purchasers as set forth on
Schedule 8, and, with respect to Vendors' Warranties set forth therein,
Schedules 11 and 16, subject in each case to any matter which is disclosed in
the Disclosure Letter.
7.2 WARRANTIES FROM THE PURCHASERS
Knowing that the Vendors are relying thereon, each of the
Purchasers, jointly and severally, represent and warrant to the Vendors as set
forth on Schedule 9 and, with respect to Purchasers' representations and
warranties set forth therein, Schedules 11 and 16.
7.3 UPDATING TO CLOSING
7.3.1 The Vendors further represent and warrant to the
Purchasers that:
(i) subject to matters disclosed in the Disclosure
Letter, the Warranties (other than those set out in Schedule 5) shall be true
and accurate in all respects and not misleading in any respect at Closing, in
each case as if they had been given at Closing; and
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(ii) if prior to Closing, any Vendor shall become
aware of any event or circumstance which results in or is reasonably likely to
result in any of the Warranties being unfulfilled, untrue, misleading or
incorrect in any material respect at Closing, the US Vendor shall promptly
notify the US Purchaser in writing thereof prior to Closing.
7.3.2 The Purchasers further represent and warrant to the
Vendors that if prior to the Closing, any Purchaser shall become aware of any
event or circumstance which results in or is reasonably likely to result in any
of the Warranties being untrue, misleading or incorrect in any material respect
at Closing, such Purchaser shall promptly notify the US Vendor in writing
thereof prior to Closing.
8 [INTENTIONALLY OMITTED]
9 NET ASSET STATEMENT, AND ADJUSTMENTS TO THE PURCHASE PRICE
9.1 BASIS OF PREPARATION OF NET ASSET STATEMENT
As soon as practicable and in any event not later than 40 days
following the Closing Date, the US Vendor shall prepare, or cause to be
prepared, a statement (the NET ASSET STATEMENT) of the aggregate amount of the
Acquired Assets less the aggregate amount of the Assumed Liabilities as at
Closing, determined in accordance with the principles set forth in Schedule 7.
9.2 PREPARATION OF NET ASSET STATEMENT
9.2.1 The draft Net Asset Statement shall be delivered to the
US Purchaser by the US Vendor within 60 days following the Closing Date. Prior
to such delivery, the US Vendor shall so far as is practicable consult with the
US Purchaser with a view to reducing the potential areas of disagreement
relating to such draft Net Asset Statement.
9.2.2 In order to enable the US Vendor to prepare and the US
Vendor's accountants to review the draft Net Asset Statement, the Purchasers
shall keep up-to-date and make available to the US Vendor's representatives and
to the US Vendor's accountants all books and records relating to the Operations
during normal office hours and co-operate with them with regard to the
preparation and review of the draft Net Asset Statement. The Purchasers agree,
in so far as it is reasonable to do so, to make available the services of the
Employees (at reasonable times and
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upon reasonable notice and at reasonable intervals) to assist the US Vendor in
the performance of its duties under this Agreement.
9.2.3 Unless within 60 days of delivery of the draft Net Asset
Statement pursuant to Section 9.2.1, the US Purchaser gives notice to the US
Vendor that it disagrees with the draft Net Asset Statement or any item thereof,
which notice shall state the reasons for such disagreement in reasonable detail
and specify the adjustments which in the US Purchaser's opinion should be made
to the draft Net Asset Statement in order to comply with the requirements of
this Agreement (the US PURCHASER'S DISAGREEMENT NOTICE), the draft Net Asset
Statement shall be final and binding on the parties for all purposes. If the US
Purchaser timely delivers a valid US Purchaser's Disagreement Notice within such
60-day period, the parties shall attempt in good faith to reach agreement in
respect thereof and, if they are unable to do so within 21 days of such
notification, either party may by notice to the other require that the draft Net
Asset Statement be referred to the Reporting Accountants (an APPOINTMENT
NOTICE).
9.2.4 Within 21 days of the giving of an Appointment Notice,
the US Vendor may by notice to the US Purchaser indicate that, in the light of
the fact that the US Purchaser has not accepted the draft Net Asset Statement in
its entirety, it wishes the Reporting Accountants to consider matters relating
to the Net Asset Statement in response to those specified in the US Purchaser's
Disagreement Notice, such notice stating in reasonable detail the reasons for
such additional consideration and in what respects the US Vendor believes that
the draft Net Asset Statement should be altered (the US VENDOR'S DISAGREEMENT
NOTICE).
9.2.5 The Reporting Accountants shall be engaged jointly by
the parties on the terms set out in this Section 9.2 and otherwise on such terms
as shall be agreed; provided that neither party shall unreasonably (having
regard, inter alia, to the provisions of this Section 9.2) refuse its agreement
to terms proposed by the Reporting Accountants or by the other party. If the
terms of engagement of the Reporting Accountants have not been settled within 30
days of their identity having been determined (or such longer period as the
parties may agree) then, unless one party is unreasonably refusing its agreement
to those terms, those accountants shall be deemed never to have become the
Reporting Accountants and new Reporting Accountants shall be selected in
accordance with the provisions of this Agreement.
9.2.6 Except to the extent that the parties agree otherwise,
the Reporting Accountants shall determine their own procedure except that:
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(a) apart from procedural matters and as otherwise
set out in this Agreement, the Reporting Accountants shall determine only:
(i) whether any of the arguments for an
alteration to the draft Net Asset Statement put forward in the US Purchaser's
Disagreement Notice or the US Vendor's Disagreement Notice is correct in whole
or in part; and
(ii) if so, what alterations should be made
to the draft Net Asset Statement in order to comply with the requirements of
this Agreement;
(b) the Reporting Accountants shall apply the
principles set out in Schedule 7;
(c) the Reporting Accountants shall make their
determination pursuant to Section (a) above as soon as is reasonably practicable
but in any event, unless otherwise specified, within 40 days of the referral to
them; and
(d) the procedure of the Reporting Accountants shall:
(i) provide the parties a reasonable
opportunity to make written and oral submissions to them;
(ii) require that the parties supply each
other with a copy of any written submissions at the same time as they are made
to the Reporting Accountants;
(iii) permit each party to be present while
oral submissions are being made by any other party; and
(iv) provide that the Reporting Accountants
shall not be entitled to determine the scope of their own jurisdiction.
9.2.7 The Reporting Accountants' determination pursuant to
Section 9.2.6(a) shall (i) be made in writing and delivered to the parties
promptly and (ii) unless otherwise agreed by the parties include reasons, in
reasonable detail, for each relevant determination.
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9.2.8 The determination of the Reporting Accountants of any
matter falling within their jurisdiction shall be final and binding on the
parties upon delivery thereof pursuant to Section 9.2.7, except in the event of
manifest error (when the relevant part of their determination shall be void and
the matter shall be remitted to the Reporting Accountants for correction). In
particular, without limitation, the determination of the Reporting Accountants
shall be deemed to be incorporated into the draft Net Asset Statement, which
shall then be final and binding on the parties except in the case of manifest
error as provided herein.
9.2.9 The expenses of the Reporting Accountants shall be borne
as they shall direct at the time they make any determination under Section
9.2.6(a) or, in the absence of such direction, equally between the US Purchaser,
on the one hand, and the US Vendor, on the other.
9.2.10 The parties shall co-operate with the Reporting
Accountants and comply with their reasonable requests made in connection with
the carrying out of their duties under this Agreement. In particular, without
limitation, the Purchasers shall keep up to date and, subject to reasonable
notice, make available to the Vendors' representatives, the Vendors' accountants
and the Reporting Accountants, all books and records relating to the Operations
during normal office hours during the period from the appointment of the
Reporting Accountants to the making of the relevant determination.
9.2.11 Subject to Section 9.2.12, nothing in this Section 9.2
shall entitle a party or the Reporting Accountants access to any information or
document which is protected by legal professional privilege, or which has been
prepared by the other party or its accountants or other professional advisors
with a view to assessing the merits of any claim or argument.
9.2.12 A party shall not be entitled by reason of Section
9.2.11 to refuse to supply such part or parts of documents as contain only the
facts on which the relevant claim or argument is based.
9.2.13 Each party and the Reporting Accountants shall, and
shall cause each of their respective accountants and other advisors to keep all
information and documents provided to them pursuant to this Section 9.2
confidential and shall not use the same for any purpose, except for use in
connection with the preparation of the Net Asset Statement, the proceedings of
the Reporting Accountants or another matter arising out of this Agreement or in
defending any claim or argument or alleged claim or argument relating to this
Agreement or its subject matter.
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9.3 NET ASSET STATEMENT
Once the US Vendor and the US Purchaser reach (or pursuant to
Section 9.2.3 are deemed to reach) agreement on the draft Net Asset Statement or
the draft Net Asset Statement is finally determined at any stage of the
procedures set out in this Section 9:
9.3.1 the draft Net Asset Statement as so agreed or determined
shall constitute the Net Asset Statement for the purposes of this Agreement and
shall be final and binding on the parties; and
9.3.2 the Net Asset Value shall be derived from the Net Asset
Statement.
9.3.3 NET ASSETS
The parties hereto agree as follows:
(a) if the Net Asset Value is less than (pound)138
million (the AGREED UPON NET ASSET VALUE), then the US Vendor
(on behalf of itself and the Canadian Vendor) shall pay to the
US Purchaser (on behalf of itself and the Canadian Purchaser)
an amount equal to the difference between the Agreed Upon Net
Asset Value and the Net Asset Value; or
(b) if the Net Asset Value is more than the Agreed
Upon Net Asset Value, then the US Purchaser (on behalf of
itself and the Canadian Purchaser) shall pay to the US Vendor
(on behalf of itself and the Canadian Vendor) an amount equal
to the difference between the Net Asset Value and the Agreed
Upon Net Asset Value;
such payment to be made no later than the third Business Day following agreement
or determination of the Net Asset Statement in accordance with this Section 9;
9.3.4 Where any payment is required to be made pursuant to
this Section 9.3:
(a) interest shall accrue on the relevant amount
calculated from the Closing Date in accordance with Section 19.10;
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(b) the Purchase Price shall be deemed reduced or
increased accordingly; and
(c) the allocation of the consideration in Schedule 3
shall be adjusted accordingly in such manner as the US Vendor on behalf of
itself and the Canadian Vendor and the US Purchaser on behalf of itself and the
Canadian Purchaser shall agree in accordance with Schedule 3.
10 TRANSFER TAXES
The provisions of Schedule 10 shall apply.
11 POST-CLOSING DATE CONTRACT PAYMENTS RECEIVED BY THE VENDORS
To the extent that any payment is made to the Vendors in
respect of any Contract after the Closing Date, the Vendors shall receive the
same as trustee and pay the same to the Purchasers (net of any Tax payable by
the Vendors thereon) as soon as reasonably practicable following receipt.
12 DEFECTIVE PRODUCT OR SERVICE
12.1 RESPONSIBILITY ALLOCATION
The Vendors and the Purchasers agree that any defective
product (as defined in Section 12.2 below) manufactured (as defined in Section
12.2 below) and/or sold or defective service (as defined in Section 12.2 below)
supplied prior to Closing in connection with the Operations shall be the
responsibility of the US Vendor or Canadian Vendor, as the case may be; and that
any defective product manufactured and/or sold or defective service supplied
after Closing in connection with the Operations shall be the responsibility of
the US Purchaser or Canadian Purchaser, as the case may be.
12.2 DEFINITIONS
A "defective product" or a "defective service" means a product
or service supplied or provided in connection with the Operations that does not
conform to its express or implied
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contractual requirements, whether in terms of performance, quality, time of
delivery or in any other respect. A product shall be considered as
"manufactured" when it has successfully passed through final testing at the
factory of the Operations and any reference to manufacturing or manufacture in
this Section 12 shall have such a meaning.
12.3 VENDOR RECEIVES CLAIM
(a) If, following Closing, a Vendor receives a claim from any
person in respect of a defective product manufactured and/or sold or defective
service supplied before Closing, it shall inform the Purchasers immediately and
take steps to investigate, report on, and take (in its view) appropriate and
prompt remedial action in respect of such defective product or defective
service.
(b) If the claim can be settled by a payment alone, the US
Vendor or the Canadian Vendor, as appropriate, shall be responsible for meeting
the contractual obligations of the supplier/provider of the defective product or
defective service in that respect.
(c) If the claim involves the supply of a replacement and/or
the removal, repair and reinstallation of the defective product or the
re-engineering or re-doing of work pursuant to a service supplied, the Relevant
Purchaser shall, perform the necessary work for such Vendor, at Purchaser's
fully absorbed manufacturing cost plus 5%.
(d) If the claim involves both a payment and the repair or
replacement of a product or part of a product or the re-engineering or other
re-doing of work in respect of a service, the payment shall remain the
responsibility of the Vendors, but the provisions of clause (c) above shall
apply to the repair, replacement or re-engineering.
12.4 PURCHASER RECEIVES CLAIM
If, following Closing, a claim in respect of a defective
product manufactured and sold or defective service supplied before Closing is
received by the US Purchaser or Canadian Purchaser, such Purchaser shall
promptly notify the Vendors of the claim and:
12.4.1 if, in the joint opinion of US Vendor and US Purchaser,
the claim is partly or wholly justified on contractual grounds, the US Purchaser
or the Canadian Purchaser, as appropriate, shall take all reasonable steps as
instructed by the Relevant Vendor, without prejudicing
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the legitimate interests of the Vendors, to repair, replace and make good the
defective product or defective service and/or compensate the claimant to the
extent appropriate in accordance with the terms of the relevant applicable
contract. The US Vendor and/or the Canadian Vendor shall indemnify and hold
harmless the Relevant Purchaser against all Losses which arise in connection
with the repair, replacement or making good of the defective product or
defective service, provided that if the Losses result from the repair or
replacement of a product or part of a product or the re- engineering or other
re-doing of work in respect of a service, the US Vendor's and Canadian Vendor's
obligation with respect to such indemnity shall be limited to the Relevant
Purchaser's fully absorbed manufacturing cost of such repair plus 5%; and
12.4.2 where the US Vendor and the US Purchaser are unable to
reach agreement on the extent to which the claim is justified and how it is to
be dealt with within 21 days of either party receiving notice of the claim (both
parties acting reasonably and negotiating in good faith), the Purchasers shall
be entitled to take such action with respect to the claim as they believe is
appropriate, provided, however, in dealing with the claim each Purchaser shall
use its commercially reasonable efforts to minimize the costs.
12.5 VENDORS RECEIVE CLAIM FOR POST-CLOSING PRODUCT OR SERVICE
If a claim in respect of a defective product manufactured and
sold or defective service supplied after Closing is made against a Vendor, it
shall inform the Purchasers promptly and the Purchasers shall be solely
responsible for such claim, and the Purchasers shall indemnify and hold harmless
the Vendors against all Losses which arise in connection with such claim.
12.6 CLAIM MADE FOR PRODUCT OR SERVICE SPANNING CLOSING
If a claim is made against the Vendors or Purchasers after
Closing in respect of a defective product partly manufactured or defective
service partly supplied in the period both before and after Closing, unless the
defect can be clearly established as being wholly attributable to acts or
omissions either before or after Closing (in which case either Section 12.3,
Section 12.4 or 12.5 (as the case may be) above shall apply), the costs to
satisfy the claim shall be shared equally between the Relevant Vendor and the
Relevant Purchaser.
12.7 INDEMNITIES REDUCED BY RECOVERY FROM THIRD PARTIES
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Indemnities applicable under this Section 12 shall be reduced
to the extent a Vendor or a Purchaser is able to recover any costs incurred
either from insurance or from a third party, and each of the Vendors and the
Purchasers undertake to use all commercially reasonable efforts to review the
possibility of all such recoveries and act accordingly, keeping the other fully
informed of its actions, and (in the case of legal proceedings) consulting with
the other at each stage of the proceedings.
13 THIRD PARTY CONSENTS
13.1 FAILURE TO ASSIGN
If the Vendors cannot assign to the Relevant Purchaser at
Closing any of the Contracts which are being transferred to Relevant Purchaser
pursuant to this Agreement because a required Third Party Consent has not been
obtained, then such Contracts shall not be assigned by the Vendors at Closing,
but:
13.1.1 shall be held in trust for or for the benefit of the
Relevant Purchaser from Closing until such Third Party Consent is obtained, at
which time the Relevant Vendor shall assign such Contracts to the Relevant
Purchaser. Pending such assignment the Relevant Purchaser shall perform (as
agent or sub-contractor of the Relevant Vendor) all the obligations of the
Relevant Vendor thereunder and the Relevant Vendor shall otherwise cooperate in
any reasonable arrangements proposed by the Relevant Purchaser designed to
obtain for the Relevant Purchaser the benefits of the Contract which is being
held in trust for or for the benefit of the Relevant Purchaser. If such Contract
prohibits the Relevant Purchaser from acting as an agent or sub-contractor of
the Relevant Vendor, then, if requested by the Relevant Purchaser, the Relevant
Vendor shall do (or cause to be done) all such acts as may be required for the
performance of such Contract so as to provide the Relevant Purchaser with the
benefits, subject to the burdens on the basis provided in this Agreement, of
such Contract;
13.1.2 the Relevant Vendor shall, at the request of the
Relevant Purchaser and at the cost of the US Vendor, make or assist the Relevant
Purchaser in making application for and obtaining any such Third Party Consent,
such that the Third Party Consent is effective from Closing. The Relevant
Purchaser shall supply to the Relevant Vendor such information and references
regarding the financial position of the Relevant Purchaser as may reasonably be
requested by the Relevant Vendor and shall enter into such direct covenants in
favour of any relevant third party as
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may reasonably be requested in respect of any rents, royalties, fees or other
outgoings or liabilities for which the Relevant Purchaser will subsequent to
Closing become liable. If required by any third party, the Relevant Purchaser
shall give such reasonable additional covenants requested by any third party as
a condition to receiving such Third Party Consent and shall generally use all
reasonable endeavours to secure such consent; and
13.1.3 for such time as any Contracts are being held in trust
for or for the benefit of the Relevant Purchaser, the Relevant Vendor will (so
far as it lawfully may) give all reasonable assistance to the Relevant Purchaser
to enable the Relevant Purchaser to enforce its rights under such Contracts.
13.2 INDIANA LEASE
The Lease for the Indianapolis polymer plant (the INDIANAPOLIS
LEASE) shall not be assigned to the Purchasers at Closing, but shall
nevertheless be held in trust for the benefit of the US Purchaser and the US
Purchaser shall be entitled to all of the benefits of the Indianapolis Lease
from and after the Closing. In connection therewith, the US Purchaser shall be
permitted to occupy the facility and operate the plant which is the subject of
the Indianapolis Lease. The US Purchaser shall comply with all of the
obligations of the lessee under the Indianapolis Lease except for the rental
obligations under Section 3 thereof. The parties have agreed that the US Vendor
will pay to the Landlord all rental payments due under Section 3 of the
Indianapolis Lease through and until December 26, 2005. The US Purchaser will
pay to the US Vendor the amount of $336,700 per annum, payable in two equal
installments on each December 15 and June 15 occurring during the period from
the date hereof until December 26, 2005, and the US Purchaser shall perform all
of the other obligations of the US Vendor under the Indianapolis Lease from and
after the Closing; provided, however, that the US Vendor agrees to take such
action as may be reasonably requested by the US Purchaser on its behalf to
maintain, preserve, protect, exercise or the like, any and/or all of the
tenant's rights under the Indianapolis Lease. In the event the US Purchaser
fails to make the payment it is required to make as described above after the
expiration of 10 days after receipt of notice from US Vendor, in addition to any
other remedies which may be available under law or hereunder, the US Vendor may
elect to terminate US Purchaser's right to occupy the facility and recover
possession thereof as if this Agreement constituted a sublease of such premises
to US Purchaser. The US Purchaser shall operate and maintain the facility
pursuant to Section 8 of the
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Indianapolis Lease, shall maintain insurance pursuant to Section 10 of the
Indianapolis Lease, and shall have the right to require the US Vendor to
exercise the lessee's rights under the Indianapolis Lease, including, without
limitation, those rights specified in: Section 11 (Rights to Assign or
Sublease); Section 12 (Lease Renewal; Purchase Options); Section 13 (Notices for
Renewal and Purchase; Determination of Fair Market Value); and Section 14
(Obsolescence Termination); PROVIDED, HOWEVER, that (1) US Purchaser shall have
no right to assign its rights hereunder with respect to the Indianapolis Lease
or to sublease the premises leased thereby without the prior written consent of
US Vendor, such consent not to be unreasonably withheld, delayed or conditioned
and US Purchaser shall have no right to require that US Vendor exercise the
lessee's rights specified in Section 11 of the Indianapolis Lease UNLESS in
either instance (i) US Purchaser shall indemnify and hold US Vendor harmless
from and against any and all liability which may arise as a result of such
assignment or sublease or the exercise of such rights, as the case may be, and
(ii) the form of the indemnity agreement and the financial condition of the
indemnitor shall be reasonably satisfactory to US Vendor; (2) in connection with
any renewal or extension of the term of the Indianapolis Lease, US Vendor shall
be released by the landlord from all prospective liability and obligations
thereunder accruing from and after December 26, 2005, (3) in connection with the
exercise of any purchase option, either (a) US Vendor shall be released by the
landlord under the Indianapolis Lease from all liability and obligations in
connection with the purchase of the Real Property underlying the Indianapolis
Lease or (b) US Purchaser shall indemnify and hold US Vendor harmless from and
against any and all Liability which may arise as a result of the exercise of
such purchase option and shall assume all obligations which relate to the
purchase of such Real Property. The US Vendor agrees that it will neither amend
nor consent to any amendment to the Indianapolis Lease without the prior written
consent of the US Purchaser, which consent may be withheld in the US Purchaser's
sole and absolute discretion. The US Vendor and its Affiliates will have no
further obligation to perform under the Indianapolis Lease after December 26,
2005. The US Purchaser and the Purchasers' Guarantor hereby indemnify and hold
harmless the Vendors' Indemnified Group from and against all Losses that they
may incur under or with respect to the Indianapolis Lease from and after the
Closing Date other than the payment obligations set forth above, or any other
default by the US Vendor pursuant to the terms and provisions of this Section.
The US Vendor and the Vendors' Guarantor hereby indemnify and hold harmless the
Purchasers' Indemnified Group from and against all Losses that they may incur
under or with respect to the Indianapolis Lease from and after the Closing Date
with respect to the US Vendor's failure to perform its obligations under this
Section, or with respect to any lawsuit, action or cause of action brought by
the "Owner Trustee" under the Indianapolis Lease for a default with respect to
the payment obligations set forth above, or the performance of any obligation
required of the US Vendor thereunder.
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14 EMPLOYEES
The terms and conditions set forth in Schedules 11, 11A, 11B and 11C
are hereby incorporated into this Agreement by reference.
15 EMPLOYEE BENEFIT ARRANGEMENTS
The terms and conditions set forth in Schedule 12 are hereby
incorporated into this Agreement by reference.
16 ENVIRONMENTAL
The terms and conditions set forth in Schedule 16 are hereby
incorporated into this Agreement by reference.
17 POST-CLOSING OBLIGATIONS
17.1 THE ASSUMED LIABILITIES
17.1.1 If the Vendors become aware after Closing of any claim
which constitutes or may constitute an Assumed Liability, the Vendors shall as
soon as reasonably practicable give written notice thereof to the Purchasers and
shall not admit, compromise, settle, discharge or otherwise deal with such claim
without prior consultation with and the prior agreement of the Purchasers.
17.1.2 The Vendors shall, at the Purchasers' expense, take
such action as the Purchasers may reasonably request to avoid, dispute, resist,
appeal, compromise, defend or mitigate any claim which constitutes an Assumed
Liability, in each case subject to the Vendors being indemnified and secured to
their reasonable satisfaction by the Purchasers against all Losses which may
thereby be incurred. In connection therewith, the Vendors shall make or cause to
be made available to the Purchasers or their duly authorized agents, at the
Purchasers' cost, on reasonable notice during normal business hours, all
relevant accounting books and records, and correspondence relating to the
Operations which have been retained by the Vendor (and shall permit the
Purchasers to make copies thereof) for the purposes of enabling the Purchasers
to ascertain or extract any information relevant to the claim.
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17.2 BONDS AND GUARANTEES
17.2.1 The Purchasers shall use their best efforts with the
Vendors' assistance to cause, effective from the Closing Date, the release of
the Vendors or any person included in the Vendor Group from any bonds or
guarantees issued by banks or other financial service providers on behalf of any
of them in respect of the Operations (relating to non-completed contracts) as
shown in Schedule 18 (for the period up to and including December 31, 1998, and
after December 31, 1998 to Closing for such bonds or guarantees entered into in
the ordinary course of the Operations) or in any event as soon as practicable
after Closing.
17.2.2 After Closing but prior to such release the Purchasers
will indemnify and hold harmless the Vendors (for themselves and as trustee for
each member of the Vendors' Group) from and against any Losses arising after
Closing in respect of any such bonds or guarantees (including drawings
thereunder) to the extent resulting from actions of the Purchasers or any member
of the Purchasers' Group relating to any such bonds or guarantees referred to in
Section 17.2.1 or their respective underlying contracts or tenders.
17.2.3 After Closing if any of the bonds or guarantees
referred to in Section 17.2.1 are drawn upon, then the Vendors will indemnify
and hold harmless the Purchasers for any Losses in respect of any such bonds or
guarantees (including drawings thereunder) to the extent resulting from the
actions of any Vendor (as the case may be) before Closing as agreed to by the
Vendors and Purchasers.
17.3 VENDORS' GENERAL OBLIGATIONS
If at any time after Closing, any Vendor or any person
included in the Vendors' Group receives any monies (other than insurance
proceeds) in respect of any claim included in the Acquired Assets or in respect
of any Accounts Receivable, then the appropriate Vendor or appropriate person
included in the Vendors' Group shall pay to the Purchasers as soon as reasonably
practicable after receipt of such monies, the amount received.
17.4 VENDORS' CONTINUING OBLIGATION
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Notwithstanding Closing, the Vendors shall execute such
documents and take such actions as the Purchasers may reasonably require for the
purpose of giving to the Relevant Purchaser the full benefit of all the
provisions of this Agreement.
17.5 CHANGE OF NAME
17.5.1 The Purchasers shall, subject to Section 17.5, have the
right to continue to use the trade marks and trade names that are Excluded
Assets on a royalty free, non-exclusive basis for a period of 12 months from the
Closing Date but solely on the products on and in the manner in which they were
being used immediately before Closing; provided that commencing 30 days from
Closing the US Purchaser shall, or shall cause that the Relevant Purchaser
shall, use its reasonable efforts to make clear on all publicity material
(excluding factory signs), bank checks, letterheads and invoices that the US
Business and the Canadian Business are part of the Purchasers' Group.
17.5.2 The Purchasers shall be entitled to use and have the
right to sublicense to any member of the Purchasers' Group (but only for so long
as such person remains a subsidiary (direct or indirect) of the Purchasers'
Guarantor) the name "BICC" only in conjunction with the name "General Cable" as
the name of any corporate entity, partnership, or other vehicle which, in all
cases, is primarily involved in the manufacture, sale or distribution of energy
cables.
17.5.3 The Purchasers shall be entitled to use and have the
right to sublicense to any member of the Purchasers' Group (but only for so long
as such person remains a subsidiary (direct or indirect) of the Purchasers'
Guarantor) the name "Brand Rex" only preceded by the name "General Cable" as the
name of any corporate entity, partnership or other vehicle which, in all cases,
is solely involved in the manufacture, sale or distribution of Specialty Cables
in the US, Canada or Mexico.
17.5.4 The Purchasers shall not be entitled to register, use
or otherwise employ the name "Brand Rex" on any Data Cable product wherever
manufactured or sold. The Purchasers acknowledge that the Vendors shall be
entitled to use the name "Brand Rex" on any Data Cable product world-wide and on
any Specialty Cables (other than sales to customers located in the US, Canada or
Mexico).
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17.5.5 The Vendors shall not be entitled to register, use or
otherwise employ the name "Brand Rex" on any cable sold to specialty cable
manufacturers located in the US, Canada or Mexico.
17.5.6 For the purpose of this Section 17.5:
"Specialty Cables" means cables sold or for use in
airplanes, ships, locomotives, trucks, or other
forms of vehicular transport (or otherwise
currently manufactured in the US by the Brand Rex
division of BICC Cables Corporation) other than
Data Cables.
"Data Cables" means cables primarily intended for
the transmission of data in local or wide area
networks, examples being category 5, 6 and 7 data
cables.
17.6 The Vendor hereby grants, and shall cause each member of the
Vendor's Group to grant, to each of the Relevant Purchasers with effect from
Closing a royalty-free, irrevocable, perpetual license to use the Intangible
Property and Know-How that are Excluded Assets and that are required for the
Operations (as conducted at Closing) to be used for the purposes of the
Operations, as each of the Operations develop from time to time, with a right to
sublicense such Intangible Property and Know-How to other members of the
Purchaser's Group.
17.7 INVESTMENT CANADA ACT
17.7.1 The Canadian Purchaser shall, within thirty days after
Closing, give notification of the purchase of the Canadian Assets by the
Canadian Purchaser as required by the Investment Canada Act.
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18 GUARANTEES
18.1 VENDORS' GUARANTEED OBLIGATIONS
In consideration of the Purchasers' Guarantor entering into
the guarantee in Section 18.3, the Vendors' Guarantor hereby unconditionally and
irrevocably guarantees to each of the Purchasers the due and punctual
performance and observance by the Vendors or any of their assignees pursuant to
Section 19.5.1 or 19.5.2 of all their obligations, commitments, undertakings,
warranties and indemnities under or pursuant to this Agreement or the Tax Deed
of Covenant (the VENDORS' GUARANTEED OBLIGATIONS).
18.2 GUARANTY
If and whenever any of the Vendors defaults for any reason
whatsoever in the performance of any of the Vendors' Guaranteed Obligations, the
Vendors' Guarantor shall forthwith upon written demand served in accordance with
this Agreement unconditionally perform (or cause the performance of) and satisfy
(or cause the satisfaction of) the Vendors' Guaranteed Obligations in regard to
which such default has been made in the manner prescribed by this Agreement and
so that the same benefits shall be conferred on the US Purchaser or the Relevant
Purchaser (as the case may be) as it would have received if the Vendors'
Guaranteed Obligations had been duly performed and satisfied by the Relevant
Vendor.
18.3 PURCHASER'S GUARANTEED OBLIGATIONS
In consideration of the Vendors entering into this Agreement,
the Purchasers' Guarantor hereby unconditionally and irrevocably guarantees to
the Vendors the due and punctual performance and observance by the US Purchaser,
the Canadian Purchaser, any Relevant Purchaser or any of their assignees
pursuant to Section 19.5.1 or 19.5.2 of all their obligations, commitments,
undertakings, warranties and indemnities under or pursuant to this Agreement
(the PURCHASER'S GUARANTEED OBLIGATIONS).
18.4 GUARANTY
If and whenever any of the Relevant Purchasers defaults for
any reason whatsoever in the performance of any of the Purchaser's Guaranteed
Obligations, the Purchasers' Guarantor
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shall forthwith upon written demand served in accordance with this Agreement
unconditionally perform (or cause performance of) and satisfy (or cause the
satisfaction of) the Purchaser's Guaranteed Obligations in regard to which such
default has been made in the manner prescribed by this Agreement and so that the
same benefits shall be conferred on the Vendors as it would have received if the
Purchaser's Guaranteed Obligations had been duly performed and satisfied by the
Relevant Purchaser.
19 OTHER PROVISIONS
19.1 ANNOUNCEMENTS
19.1.1 Pending Closing, the Vendors and the Purchasers shall,
subject to the requirements of Law or any regulatory body or the rules and
regulations of any recognized stock exchange, consult together prior to issuing
any formal announcement, press release, circular, or notice to shareholders,
employees, customers, suppliers, distributors and sub-contractors and to any
recognized stock exchange or other authorities or to the media or otherwise
which either party may desire or be required to make regarding this Agreement or
any of the transactions contemplated hereby or thereby.
19.1.2 No party shall, pending Closing, make or authorize or
issue any formal announcement, circular or other communication concerning this
Agreement or any of the transactions contemplated hereby or thereby unless (a)
the other party shall have approved such disclosure or (b) such disclosure is
required by applicable Law or the rules and regulations of an applicable stock
exchange.
19.1.3 If Closing does not take place, the Purchasers shall
forthwith promptly return all accounts, records, documents and papers of or
relating to the Vendors or the Operations which shall have been made available
to them and all copies, abstracts or other records derived from such materials
and expunge any information derived from such materials or otherwise concerning
the subject matter of this Agreement from any computer, wordprocessor or other
device containing information, provided that this shall not apply to information
available from public records or information acquired by a Relevant Purchaser
otherwise than from the Vendors or their agents.
19.2 CONFIDENTIAL INFORMATION
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19.2.1 The Vendors:
(a) shall not, and shall cause all other members of
the Vendors' Group, and each of their respective directors, officers or
employees or advisors or agents or representatives not to, disclose to any
person Confidential Information; and
(b) shall use reasonable efforts to prevent the
disclosure of Confidential Information by any person other than by members of
the Purchasers' Group; and
(c) in the event either Vendor is requested or
required (by oral question or request for information or documents in any legal
proceeding, interrogatory, subpoena, civil investigative demand or similar
process) to disclose any Confidential Information, the Vendors will notify the
Purchasers promptly of the request or requirement so that the Purchasers may
seek an appropriate protective order or waive compliance with the provisions of
this Section 19.2.1(c). If, in the absence of a protective order or the receipt
of a waiver under this Section 19.2.1(c), the Vendors are, on the advice of
counsel, compelled to disclose any Confidential Information to any tribunal, the
Vendors may disclose the Confidential Information to the tribunal. However, the
Vendors shall cooperate with the Purchasers in obtaining, at the reasonable
request and expense of the Purchasers, an order or other assurance that
confidential treatment will be accorded to such portion of the Confidential
Information required to be disclosed as the Purchasers shall designate.
19.2.2 The Purchasers:
(a) shall not, and shall cause all other members of
the Purchasers' Group and each of their respective directors, officers or
employees or advisors or agents not to disclose to any person Confidential
Information; and
(b) shall use reasonable efforts to prevent the
disclosure of Confidential Information by any person other than by members of
the Vendors' Group.
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19.3 PERMITTED DISCLOSURE, ETC.
19.3.1 Section 19.2.1 does not apply to:
(a) disclosure of Confidential Information to or at
the written request of a Relevant Purchaser;
(b) disclosure of Confidential Information required
to be disclosed by Law, regulation, any revenue authority or any stock exchange;
(c) disclosure of Confidential Information to
professional advisors for the purpose of advising a Vendor; provided that such
advisors shall be made aware of the confidential nature of such information;
(d) disclosure of Confidential Information for the
purposes of defending any claim under the Warranties (including making any
claims or counterclaims against third parties pursuant to Section 8.3.2); or
(e) Confidential Information which is in the public
domain other than by the Vendors' breach of Section 19.2.1.
19.3.2 Section 19.2.2 does not apply to:
(a) disclosure of Confidential Information to or at
the written request of a Relevant Vendor;
(b) disclosure of Confidential Information required
to be disclosed by Law, regulation, any revenue authority or any stock exchange;
(c) disclosure of Confidential Information to
professional advisors for the purpose of advising a Relevant Purchaser provided
that such advisors shall be made aware of the confidential nature of such
information; or
(d) Confidential Information which is in the public
domain other than by the Purchaser's breach of Section 19.2.2.
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19.3.3 For the purpose of this Agreement, CONFIDENTIAL
INFORMATION means, (i) for the purposes of Section 19.2.1 all information
relating to the Vendors' business, including but not limited to know-how, trade
secrets, customer and supplier lists, marketing plans and strategies, designs,
pricing and cost information, drawings, technical information and other
proprietary information relating to the Operations or financial or other affairs
(including future plans and targets) of the Vendors and which is not in the
public domain; and (ii) for the purposes of Section 19.3, all information
relating to the business, financial or other affairs (including future plans and
targets) of any company in the Vendors' Group, other than in respect of the
Operations, and which is not in the public domain.
19.4 INTEGRATION
This Agreement, together with the Schedules hereto, the
Disclosure Letter, and the Tax Deed of Covenant constitute the entire agreement
among the parties relating to the subject matter of this Agreement and supercede
all prior oral and written presentations, understandings, agreements,
representations, warranties or other information by or among the parties (or any
of their respective Affiliates, directors, officers, trustees, employees,
agents, accountants, attorneys or other advisors or representatives) with
respect to the subject matter hereof, and no such prior or subsequent oral
understanding, agreement, representation or warranty shall be or be deemed to be
a part of this Agreement, the Schedules hereto, the Disclosure Letter or the Tax
Deed of Covenant except in accordance with Section 19.6.
19.5 SUCCESSORS AND ASSIGNS; NO THIRD-PARTY BENEFICIARIES
19.5.1 Any of the Vendors or Purchasers may, except as
otherwise expressly provided in this Agreement and without the consent of the
other, assign to a wholly owned Subsidiary of such party the benefit of all or
any part of any other party's obligations under this Agreement; provided,
however, that such assignment shall not be absolute but shall be expressed to
have effect only for so long as the assignee remains a wholly owned Subsidiary.
19.5.2 This Agreement is, subject to Section 19.5.1, personal
to the parties to it. Accordingly, no party may, without the prior written
consent of the Purchasers and the Vendors' Guarantor, assign either this
agreement or any of its rights, interests or obligations under this Agreement;
provided, however, the US Purchaser and Canadian Purchaser and the Purchasers'
Guarantor may assign all of their rights hereunder and delegate all of their
obligations hereunder to
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<PAGE> 59
any person to whom the US Purchaser or Canadian Purchaser sells a substantial
part of the assets of the US Business or Canadian Business and the Vendors and
the Vendors' Guarantor may assign all of their rights and delegate all of their
obligations hereunder to any person to whom the Vendors or the Vendors'
Guarantor sell a substantial part of their respective assets. This Agreement
shall bind, benefit, and be enforceable by and against each party hereto and its
successors and permitted assigns.
19.5.3 Unless specifically stated herein, this Agreement shall
not confer any rights or remedies upon any person other than the parties hereto
and their respective successors and permitted assigns.
19.6 AMENDMENTS AND WAIVERS
No amendment of any provision of this Agreement shall be valid
unless the same shall be in writing and signed by each of the parties hereto. No
waiver by any party of any default, misrepresentation, or breach of warranty or
covenant under this Agreement, whether intentional or not, shall be deemed to
extend to any prior or subsequent default, misrepresentation, or breach of
warranty or covenant under this Agreement or affect such occurrence.
19.7 REMEDIES
So far as is permitted by law and except in the case of fraud,
the parties agree and acknowledge that the only remedies available to the
Purchasers in connection with or arising out of this Agreement are set forth in
Section 2.3 of this Agreement.
19.8 THIRD PARTY COSTS
Except as set forth in Schedule 10, the Vendors shall bear all
legal, accounting and other third party costs and expenses incurred by them in
connection with this Agreement, and the Tax Deed of Covenant and the sale of the
Operations. The Purchaser shall bear all such costs and expenses incurred by it
and any other Relevant Purchaser.
19.9 COSTS TO ASSIGN CONTRACTS
The Vendors and Purchasers agree to co-operate and to use all
reasonable commercial efforts prior to and subsequent to Closing to ensure that
all Contracts included in the
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<PAGE> 60
Acquired Assets are lawfully assigned to the Purchasers with effect from the
Closing or as soon as practicable thereafter or that the Purchaser otherwise
receives the benefits of such Contracts. If there are any reasonable costs or
expenses associated with assigning or otherwise transferring such Contracts
(including any rent, royalties, costs of obtaining estoppels or other fees or
payments made or required to be made in connection with the assignment or
transfer of any such Contracts) such reasonable cost or expenses shall be paid
by the Vendors; provided that, except as provided in Section 2.3.2(e), the
Vendors shall not be responsible for any Losses resulting from the failure of
Purchaser to obtain the benefits of any Contract to be assigned or transferred.
Each Purchaser shall take all commercially reasonable actions to eliminate or
reduce any costs or expenses that may be payable by a Vendor hereunder; provided
that (x) all reasonable costs and expenses (including overhead and
administrative costs and expenses) of the Purchasers resulting from such actions
shall be reimbursed by the Vendors and (y) no Purchaser shall be required to
take any action under this Section 19.9 which is outside of the ordinary course
of the Operations.
19.10 INTEREST
If any Vendor or any Relevant Purchaser defaults in the
payment when due of any sum payable under this Agreement or the Tax Deed of
Covenant (whether determined by agreement or pursuant to an order of a court or
otherwise) their Liability shall be increased to include interest on such sum
from the date when such payment is due until the date of actual payment (as well
after as before Judgment) at a rate per annum of 2 per cent above the base rate
for US dollar loans in New York from time to time of The Hong Kong and Shanghai
Banking Corporation Limited. Such interest shall accrue from day to day.
19.11 SET-OFF
Under no circumstances shall any amounts (if any) payable by
any Relevant Purchaser to any Vendor or by any Vendor to any Relevant Purchaser
pursuant to this Agreement be set off against each other or against any amounts
otherwise owing to any such party.
19.12 LONG STOP LIMITATION OF LIABILITY
Notwithstanding any other provision in this Agreement or any
provision in the Tax Deed of Covenant, under no circumstances shall any Vendor
or any other member of the Vendors'
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<PAGE> 61
Group have any liability whatsoever pursuant to this Agreement, or the Tax Deed
of Covenant following the twentieth anniversary of the date of this Agreement.
19.13 EXCLUSIVITY
The Vendors and the Vendors' Guarantor will not (and the
Vendors will not cause or permit any of their Affiliates to) solicit, initiate
or encourage the submission of any proposal or offer from any Person relating to
any (A) liquidation, dissolution or recapitalization, (B) merger or
consolidation, (C) acquisition or purchase of a substantial portion of the
Acquired Assets, or (D) similar transaction or business combination involving
the Operations.
19.14 NOTICES
19.14.1 Any notice, consent or other communication required or
permitted to be given under this Agreement shall be in writing and shall be
sufficiently given or served if delivered or sent:
In the case of any of the Vendors and the Vendors'
Guarantor to such party care of:
BICC plc
Devonshire House
Mayfair Place
London W1X 5FH
T: 011-44-171-409-8000
F: 011-44-171-409-0070
Attention: The Company Secretary
of BICC plc.
and
BICC Cables Corporation
One Crosfield Avenue
West Nyack, New York 10994
Attention: President
T: 914-348-1400
F: 914-348-9833
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with copies to
Mayer, Brown, & Platt
1675 Broadway
New York, New York 10019
Attention: Mark S. Wojciechowski
T: 212-506-2525
F: 212-262-1910
and, in the case of any
claim relating to environmental matters,
additional copies to
DL Rothberg & Associates
230 Park Avenue
Suite 615
New York, New York 10169
Attention: Debra Rothberg
T: 212-490-2220
F: 212-490-2336
In the case of any of the Relevant Purchasers or the
Purchasers' Guarantor to such party care of:
General Cable Corporation
4 Tesseneer Drive
Highland Heights, KY 41076
Fax: 606-572-8444
Attention: Robert J. Siverd
General Counsel
with a copy to
Blank Rome Cominsky & McCauley LLP
One Logan Square
Philadelphia, PA 19103-6994
Fax: 215-569-5628
Attention: Sol Genauer
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<PAGE> 63
19.14.2 Any such notice or other communication shall be delivered
by hand or sent by fax or registered or certified mail, return receipt
requested, or overnight courier. If sent by fax such notice or communication
shall conclusively be deemed to have been given on the date transmitted if
confirmed within 24 hours thereafter by a signed original sent in one of the
other manners provided in this Section 19.14.2. If sent by registered or
certified mail, return receipt requested such notice or communication shall
conclusively be deemed to have been received three Business Days from the time
of mailing in the case of domestic mail in the United States, or five Business
Days from the time of mailing in the case of international mail. If sent by
overnight courier, such notice or communication shall conclusively be deemed to
have been received one Business Day from deposit for overnight delivery service.
Any party may change its address or fax number for notice purposes by giving
notice of the new address or fax number in accordance with this Section 19.14,
provided that any such change of address shall not be effective unless and until
received.
19.15 SEVERANCE
If any term or provision of this Agreement is held to be illegal
or unenforceable, in whole or in part, under any enactment or rule of Law, such
term or provision or part shall to that extent be deemed not to form part of
this Agreement but the enforceability of the remainder of this Agreement shall
not be affected.
19.16 REFERENCES TO THE REPORTING ACCOUNTANTS
Whenever any matter is referred under this Agreement (other than
Section 9) to the Reporting Accountants for determination, the provisions of
Section 9 which apply to the Reporting Accountants' determination of the Net
Asset Statement shall apply to their determination of any such matter.
19.17 GENERAL SERVICES AND SUPPLY AGREEMENT
The Vendors and the Purchasers hereby agree that they will use
their reasonable efforts to negotiate in good faith by Closing or as soon as
practicable thereafter the terms and conditions of any required General Services
and Supply Agreement.
19.18 COUNTERPARTS
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This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original, but all the counterparts shall together
constitute one and the same instrument.
19.19 GOVERNING LAW AND SUBMISSION TO JURISDICTION
19.19.1 This Agreement and the Tax Deed Of Covenant shall be
construed, and the rights and obligations of the parties hereunder determined,
in accordance with and governed by the internal laws of the State of New York
(as permitted by Section 5-1401 of the New York General Obligations Law (or any
similar successor provision)) without giving effect to any choice of law rule
that would cause the application of the laws of any jurisdiction other than the
internal laws of the State of New York to the rights and duties of the parties;
provided, however, that in the event a claim for an Environmental Loss is made
pursuant to Schedule 16 hereof, the substantive Environmental Laws of the
jurisdiction or jurisdictions where the Real Property in question is located, or
where the Environmental Liability has otherwise arisen, shall apply.
19.19.2 For the purposes of any suit, action or proceeding
involving this Agreement and the Tax Deed of Covenant or any other documents to
be entered into pursuant to them, each of the Vendors, the Vendors' Guarantor,
the Purchasers and the Purchasers' Guarantor hereby expressly submits to the
jurisdiction of all federal and state courts sitting in the State of New York
and agrees that any order, process, notice of motion or other application to or
by any such court or a judge thereof may be served within or without such
court's jurisdiction by registered mail or by service in hand, provided that a
reasonable time for appearance is allowed, and each party agrees that such
courts shall have exclusive jurisdiction over any such suit, action or
proceeding commenced by either or both of said parties. Each of the Vendors, the
Vendors' Guarantor, the Purchasers and the Purchasers' Guarantor hereby
irrevocably waives any objection that it may have now or hereafter to the laying
of venue of any suit, action or proceeding arising out of or relating to this
Agreement and the Tax Deed of Covenant or any other documents to be entered into
pursuant to them, brought in any federal or state court sitting in the State of
New York and hereby further irrevocably waives any claim that any such suit,
action or proceeding brought in any such court has been brought in an
inconvenient forum.
19.19.3 THE PARTIES HERETO IRREVOCABLY WAIVE THE RIGHT TO A JURY
TRIAL IN CONNECTION WITH ANY LEGAL PROCEEDING RELATING TO THIS AGREEMENT
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<PAGE> 65
AND THE TAX DEED OF COVENANT OR ANY OTHER DOCUMENTS TO BE ENTERED INTO PURSUANT
TO THEM OR THE ENFORCEMENT OF ANY PROVISIONS HEREOF OR THEREOF.
19.20 SETTLEMENT ATTEMPT
The parties agree that, except as provided in Section 19.23, any
claim or dispute between them arising out of or in connection with this
Agreement or any alleged breach of this Agreement shall be submitted promptly to
a senior executive of the US Vendor or the Vendors' Guarantor and a senior
executive of the US Purchaser who shall have authority to settle the claim, and
who shall meet in New York, New York, within 30 days of such submission to seek
in good faith an amicable settlement. In seeking an amicable settlement, the
parties may consult with a neutral third party mediator if both agree in
writing. Unless the parties agree to the contrary in writing, any advice or
decision of the mediator shall not be binding. Subject to Section 19.23, any
Claim which is not settled by the parties within sixty (60) days of notice
thereof first being given by either party to the other may be pursued by a party
in any court in accordance with Section 19.19.
19.21 APPOINTMENT OF PROCESS AGENTS
19.21.1 The Vendors' Guarantor irrevocably appoints CT Corporation
as its agent for the service of process in New York in relation to any matter
arising out of this Agreement, and the Tax Deed of Covenant service upon whom
shall be deemed completed whether or not forwarded to or received by the
Vendors' Guarantor.
19.21.2 The Vendors' Guarantor shall inform the Purchasers, in
writing, of any change in the address of its process agent within 28 days of
such change.
19.21.3 If such process agent ceases to have an address in New
York, the Vendors' Guarantor irrevocably agrees to appoint a new process agent
acceptable to the Purchasers and to deliver to the Purchasers within 14 days a
copy of a written acceptance of appointment by its new process agent.
19.21.4 Nothing contained in this Agreement shall affect the right
to serve process in any other manner permitted by law or the right to bring
proceedings in any other jurisdiction for the purposes of the enforcement or
execution of any Judgment or other settlement in any other courts.
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19.22 CURRENCY
19.22.1 With respect to any sum due hereunder, or under the Tax
Deed of Covenant or under any other document to be entered into pursuant hereto
or thereto which is denominated in a currency other than British pounds
sterling, if it is necessary to convert such sum into British pounds sterling,
the parties hereto agree, to the fullest extent that they may effectively do so,
that the rate of exchange used shall be that at which, in accordance with normal
banking procedures, the applicable party could purchase British pounds sterling,
with such sum denominated in such other currency, at the Hong Kong and Shanghai
Banking Corporation Limited in London, England, at the close of business on the
Business Day immediately preceding the day on which the conversion is to be
made, without regard to any premiums and costs of exchange payable in connection
with such purchase.
19.22.2 With respect of any sum due from any party to any other
party hereunder, or under the Tax Deed of Covenant or under any other document
to be entered into pursuant hereto or thereto which is denominated in British
pounds sterling, the obligation of the party which owes such sum shall,
notwithstanding any Judgment in a currency other than British pounds sterling,
only be discharged to the extent that on the Business Day next succeeding
receipt by such other party of any sum adjudged to be so due in such other
currency, such party may, in accordance with normal banking procedures, purchase
British pounds sterling with such other currency at the Hong Kong and Shanghai
Banking Corporation Limited in London, England or its successor. If the British
pounds sterling so purchased are less than the sum originally due to such party
in British pounds sterling, each of the parties against whom such Judgment is
rendered agrees, as a separate obligation and notwithstanding any such Judgment,
to indemnify the parties to whom such Judgment is granted against such loss.
19.22.3 If it is necessary to convert an amount (the ORIGINAL
AMOUNT) due hereunder, under the Tax Deed of Covenant or any other document to
be entered into pursuant hereto or thereto expressed in either Canadian Dollars
or U.S. Dollars (the ORIGINAL CURRENCY), the amount expressed in the other
currency shall be the sum which would be required to buy the Original Amount of
the Original Currency using the noon spot rate exchange for New York City
interbank transactions applied in converting the other currency into the
Original Currency published by The Wall Street Journal (Eastern Edition) for
such date.
19.23 CERTAIN RESTRICTIVE COVENANTS
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19.23.1 The covenants set forth in this Section 19.23 (the
RESTRICTIVE COVENANTS) are a material part of this Agreement and are an integral
part of the obligations of the Vendors hereunder, such Restrictive Covenants are
supported by good and adequate consideration, and such Restrictive Covenants are
reasonable and necessary to protect the legitimate business interests of the
Purchasers.
19.23.2 During the period beginning on the Closing Date and ending
on the third anniversary of the Closing Date, except with the Purchasers' prior
written consent, the Vendors shall not, directly or indirectly, in any capacity,
in the United States or Canada:
(a) carry on or otherwise engage or have an interest in any
capacity (whether for profit or otherwise) in, any business which competes with
any of the Operations as operated on the Closing Date anywhere in the world
where the Operations are conducted on the Closing Date;
(b) in relation to the Operations, solicit, seek to obtain or
accept orders from or otherwise do business with or solicit directly or
indirectly any other person to obtain orders from or do business with any person
or firm who or which (i) was a customer, supplier or agent of the Vendors in
relation to the Operations at any time during the two years prior to Closing, or
(ii) at the date of Closing was negotiating to do business with the Vendors in
relation to the Operations, or otherwise interfere or seek to interfere with the
supply of goods or services to or by the Operations, provided that this Section
19.23.2 shall not prohibit the Vendors from doing business with any person who
is or was a customer, supplier or agent of the Vendors prior to Closing in
relation to any business of the members of the Vendors' Group which is not being
transferred under this Agreement; or
(c) solicit, with a view to employment, directly or
indirectly, any Senior Employee who is a Continuing Employee (PROHIBITED
EMPLOYEES) (provided that nothing in this Section 19.23.2(c) shall prevent any
member of the Vendors' Group from making generalized employment searches, by
advertisement or by engaging firms to conduct searches which are not focused on
Prohibited Employees).
19.23.3 The restrictions in clause 19.23.2 shall not operate to
prohibit:
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(a) the Vendors from holding in aggregate up to 10% of the
capital stock of any person if any class of capital stock of such person is
listed on a national market quotation system or recognized stock exchange; or
(b) the Vendors from carrying on any business not sold to the
Purchasers pursuant to the terms of this Agreement, in particular the business
presently carried on under the name "BICC Brand Rex" with manufacturing
facilities outside the United States, Canada and Mexico to be renamed "Brand
Rex."
19.23.4 Each of the Vendors expressly acknowledges that it would
be extremely difficult to measure the damages that might result from any breach
of the Restrictive Covenants, and that any breach of the Restrictive Covenants
will result in irreparable injury to the Purchasers for which money damages
could not adequately compensate. If a breach of the Restrictive Covenants
occurs, then the Purchasers shall be entitled, in addition to all other rights
and remedies that they may have at law or in equity, to have an injunction
issued by a court of competent jurisdiction enjoining and restraining the
Vendors and all other persons involved therein from continuing such breach. The
existence of any claim or cause of action that either of the Vendors or any such
other person may have against any member of the Purchasers' Group shall not
constitute a defense or bar to the enforcement of any of the Restrictive
Covenants.
19.23.5 If any Restrictive Covenant, or any part thereof, or the
application thereof, is construed to be invalid, illegal or unenforceable, then
each other Restrictive Covenant, or the other portions of any such Restrictive
Covenant, or the application thereof, shall be affected thereby and shall be
enforceable without regard thereto. If any of the Restrictive Covenants is
determined to be unenforceable because of its scope, duration, geographical area
or other factor, then the court making such determination shall have the power
to reduce or limit such scope, duration, area or other factor, and such
Restrictive Covenant shall then be enforceable in its reduced or limited form.
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19.24 RELIANCE BY PURCHASERS; DISCLOSURE OF REPRESENTATION AND
WARRANTIES
Notwithstanding the right of Purchasers to investigate
the business, Acquired Assets and financial condition of the Vendors and the
Operations, and notwithstanding any knowledge obtained or obtainable by
Purchasers as a result of such investigation (including pursuant to Section
7.3.1(ii) or 7.3.2), Purchasers have the unqualified right to rely upon, and
have relied upon, each of the Warranties, and Purchasers' right to
indemnification based on the Warranties will not be affected by any
investigation conducted with respect to, or any knowledge acquired (or capable
of being acquired) whether before or after the execution and delivery of this
Agreement, with respect to the accuracy or inaccuracy of any such Warranty.
19.25 SECTION HEADINGS
Section and subsection headings in this Agreement are for
convenience of reference only, do not constitute a part of this Agreement, and
shall not affect its interpretation.
19.26 REFERENCES
All words used in this Agreement shall be construed to be of
such number and gender as the context requires or permits.
19.27 COOPERATION
The parties hereto agree to cooperate fully with each other
and to execute and deliver such further documents, certificates, agreements and
instruments and to take such other actions as may be reasonably requested to
evidence or reflect the transactions contemplated by this Agreement and to carry
out the intent and purposes of this Agreement.
19.28 BULK SALES
Purchasers hereby waive compliance by the Vendors with Bulk
Sales Laws with respect to the transactions contemplated hereby and in
connection herewith.
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IN WITNESS WHEREOF this Agreement has been duly executed as of the date
first above written.
BICC CABLES CORPORATION
By /s/ H.P. Berndorff
------------------------------
Name: H.P. Berndorff
-----------------------------
Title: Vice President
----------------------------
PYROTENAX USA INC.
By /s/ H.P. Berndorff
------------------------------
Name: H.P. Berndorff
-----------------------------
Title: Vice President
----------------------------
BICC CABLES CANADA INC.
By /s/ H.P. Berndorff
--------------------------------
Name: H.P. Berndorff
-----------------------------
Title: Secretary - Treasurer
----------------------------
BICC PLC
By /s/ Peter Zinkin
--------------------------------
Name: Peter Zinkin
-----------------------------
Title: Director
----------------------------
GK TECHNOLOGIES,
INCORPORATED, in its capacity as US
Purchaser and Canadian Purchaser
By /s/ Robert J. Siverd
--------------------------------
Name: Robert J. Siverd
-----------------------------
Title: Executive Vice President
----------------------------
GENERAL CABLE CORPORATION
By /s/ Robert J. Siverd
--------------------------------
Name: Robert J. Siverd
-----------------------------
Title: Executive Vice President
----------------------------
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SCHEDULE 1
OPERATIONS
The Operations shall include, without limitation, the
following operations:
1. VENDOR OWNED REAL PROPERTIES
----------------------------
1 MARSHALL, TX SITE
Design, manufacture and distribution of utility cables,
Technology research and development
2 MALVERN, AK SITE
Design, manufacture and distribution of utility cables
3 DUQUION, IL SITE
Design, manufacture and distribution of utility cables
4 WILLIMANTIC, CT SITE
Design, manufacture, marketing and distribution of cable and
accessories. The site also includes executive offices and
operations for the Brand-Rex product lines
5 SOUTH HADLEY, MA SITE Design and manufacture of bare cables
6 JACKSON, TN SITE
Design, manufacture, distribution and assembly of Brand-Rex cable
and accessories
7 MARION, IN SITE
Design, manufacture and distribution of Brand-Rex cables and
accessories
8 LA MALBAIE, QUEBEC SITE
Design, manufacture and distribution of utility cables and
aluminum strip
9 ST. JEROME, QUEBEC SITE
Design, manufacture and distribution of utility cables
10 MOOSE JAW, SASKATCHEWAN SITE
Design, manufacture and distribution of utility cables
11 TRENTON, ONTARIO SITE
Design, manufacture, distribution and marketing of mineral
insulated electrical cable and electronic controllers. The site is
also used for research and development, includes customer service
area, executive offices and operations management for
BICC-Pyrotenex.
2. LEASED PROPERTIES
-----------------
12 INDIANAPOLIS, IN SITE
Technology research and development center
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13 INDIANAPOLIS, IN SITE
Manufacture of Polymenic compounds for cable insulation
14 WEST NYACK, NY SITE
Headquarters for the North American Business
Headquarters for the utility cable business
15 CALGARY, ALBERTA SITE Sales offices for BICC Cables Canada Inc.
16 MONTREAL, QUEBEC SITE Sales offices for BICC Cables Canada Inc.
17 TORONTO, ONTARIO SITE
Headquarters for BICC Cables Canada Inc.
Sales offices for the certificate insurers and for BICC-Pyrotenex
18 EDMONTON, ALBERTA SITE
Light assembly of mineral insulated cable units and electronic
controllers
19 HOUSTON, TEXAS SITE
Light assembly and distribution center for mineral insulated
cables
20 SYRACUSE, NEW YORK SITE
Sales and administrative office for BICC-Pyrotenex products
manufactured in Canada and sold in the US.
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SCHEDULE 2
[INTENTIONALLY LEFT BLANK]
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SCHEDULE 3
ALLOCATION OF PURCHASE PRICE
The Purchase Price shall be allocated between the US Business and the Canadian
Business as follows:
<TABLE>
<CAPTION>
(1) (2) (3) (4)
NAME OF VENDOR JURISDICTION PARTICULARS OF ALLOCATION
CANADIAN/US BUSINESS
<S> <C> <C> <C> <C>
3.1 US Vendor US Sale of assets (pound)96 million
3.2 Canadian Vendor Canada Sale of assets (pound)8.4 million
</TABLE>
The allocation of the Purchase Price among each of the Acquired Assets
shall be agreed between the Relevant Vendor and the Relevant Purchaser by
reference to the Acquired Assets respective values, as provided in Section
3.1(b) of the Agreement.
Adjustments to the Purchase Price (pursuant to Section 9 or otherwise)
shall be allocated as determined by the US Purchaser on behalf of itself and the
Canadian Purchaser in their reasonable discretion.
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SCHEDULE 4
CERTAIN THIRD PARTY CONSENTS
- - Agreement dated September 1997 between Ace and the Canadian Vendor
concerning rights of first refusal.
- - Agreement dated February 5, 1999 with Houston Wire & Cable.
- - Nondisclosure Agreement with BrandRex and GEC (undated).
- - Product Supply Agreement with Air Products dated January , 1994 for
requirements.
- - Supply Agreement dated July 1, 1994 with Bekaert for ACSR products.
- - Agreement dated April 1, 1997 with BICC Cables for PUC products.
- - All Sumitomo confidentially and development Agreements (undated).
- - Customer Agreement between BICC Cables Corporation and IBM Corporation,
effective from January 1, 1998 to December 31, 2000
- - All agreements (including license and service agreements) relating to
software, hardware or systems which support the Operations, other than
agreements relating to software which is generally commercially
available.
- - Unless otherwise repaid or defeased by the US Vendor, consent of the
Trustee and Bondholders in connection with the $9 million Industrial
Development Revenue Bond among the Industrial Development Board of the
City of Jackson, Tennessee, BICC Cables Corporation, First America
National Bank and Chemical Securities Inc. (relating to the Lease dated
May 1, 1991) with respect to: (a) the assignment of the obligations
under the bonds to the US Purchaser, and (b) the assignment of the
obligations under the Guaranty from the Vendors' Guarantor to the
Purchasers' Guarantor, and (c) the release of the US Vendor and the
Vendors' Guarantor of any of their respective obligations thereunder.
- - Consent of General Electric Capital Corporation to assignment to US
Purchaser of Master Lease Agreement (as it may be extended or renewed)
between General Electric Capital Corporation and BICC Cables
Corporation, dated as of July 2, 1991, unless the parties otherwise
agree prior to Closing that US Vendor will purchase the equipment
subject to such Master Lease Agreement.
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SCHEDULE 5
WARRANTIES NOT UPDATED TO CLOSING
Section
- -------
4.2.2(b)
4.2.2(c)
5.3.1
5.3.2(ii)
5.3.4
6.1.1
6.1.2
6.5.4
8.4.2(b)
8.4.3
8.4.5(a)
8.4.5(b)(iii)
9.4
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SCHEDULE 6
PART 1
CLOSING EVENTS
1 On the Closing Date the Vendors shall deliver to the US Purchaser or the
Canadian Purchaser, as the case may be, the following:
1.1 DOCUMENTS OF TRANSFER. Such absolute bills of sale, assignments, special
warranty deeds, endorsements, affidavits (including, without limitation,
Internal Revenue Code Section 1445 (FIRPTA) and title affidavits), and
other instruments and documents of sale, transfer, assignment and
conveyance as Purchasers may reasonably require, in order to lawfully,
effectively and properly sell, transfer, assign, purchase and convey to
Purchasers good right, title and interest in and to all of the Acquired
Assets, as required herein, in each case substantially in the form
attached hereto on Part 3 of this Schedule or Schedule 15, as the case
may be, with respect to personal property and Intangible Property and in
such other form reasonably acceptable to the Vendors and Purchasers with
respect to all other property, dated as of the Closing Date, and duly
executed and, if necessary, acknowledged by the US Vendor or the Canadian
Vendor, as applicable;
1.2 Physical Delivery. Those Acquired Assets which are capable of transfer by
delivery;
1.3 BOOKS AND RECORDS. All books, records and other information relating to
the Operations or Continuing Employees of the Operations and all
information relating to customers, suppliers, agents and distributors;
1.4 RESOLUTIONS. Copies of the resolutions duly adopted by the Board of
Directors or shareholders of each of the Vendors, authorizing the
respective entity to enter into and perform its obligations under this
Agreement and any other agreements contemplated hereby, certified by
proper officers of the respective entity as in full force and effect on
and as of the Closing Date;
1.5 TAX DEED OF COVENANT. The Tax Deed of Covenant duly executed by the
Covenantors named therein, in substantially the form attached hereto on
Part 4 of this Schedule;
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<PAGE> 78
1.6 GOOD STANDING CERTIFICATES. Good standing certificates for US Vendor and
Canadian Vendor from their jurisdictions of incorporation and each
jurisdiction where they are required to qualify to do business as a
foreign corporation, dated no earlier than 15 days before the Closing
Date;
1.7 THIRD PARTY CONSENTS. The original signed copies of all Third Party
Consents that have been obtained prior to the Closing;
1.8 INCUMBENCY CERTIFICATES. Certificates of the Secretaries of each Vendor
as to the incumbency and signatures of their respective officers
executing this Agreement or any agreements contemplated hereby;
1.9 OTHER DOCUMENTS. All other agreements, certificates, instruments and
documents reasonably requested by the Purchasers in order to fully
consummate the transactions contemplated by this Agreement and carry out
the purposes and intent of this Agreement.
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<PAGE> 79
SCHEDULE 6
PART 2
VENDOR'S ACCOUNTING PERIODS
Set out below are the dates of the last Business Day of the Vendor's relevant
accounting periods (which end on Saturdays by convention) for the first four
periods following the signing of this Agreement:
April 3, 1999
May 1, 1999
May 29, 1999
July 3, 1999
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<PAGE> 80
SCHEDULE 6
PART 3
FORM OF BILL OF SALE
BILL OF SALE
------------
REFERENCE IS MADE to that certain Assets Sale and Purchase Agreement, dated
April 6, 1999 (the PURCHASE AGREEMENT), among BICC Cables Corporation, Pyrotenax
USA Inc. (together with BICC Cables Corporation, the US VENDOR), BICC Cables
Canada Inc. (the "CANADIAN VENDOR"), BICC plc (the VENDORS' GUARANTOR), GK
Technologies, Incorporated (referred to as both the US PURCHASER and the
CANADIAN PURCHASER and General Cable Corporation (the PURCHASERS' GUARANTOR).
Unless otherwise defined, capitalized terms used herein have the meanings
provided in the Purchase Agreement.
KNOW THAT the undersigned, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, intending to be legally bound
hereby, does hereby sell, assign, transfer, bargain, convey and deliver, subject
to and in accordance with the Purchase Agreement, the [US] [Canadian] Assets,
together with the [US] [Canadian] Assumed Liabilities to the [US] [Canadian]
Purchaser, to have and hold such [US] [Canadian] Assets unto such Purchaser, its
successors and assigns, to and for its proper use and benefit from this date and
forever thereafter.
Notwithstanding the foregoing, the undersigned reserves and does not sell or
transfer to the [US] [Canadian] Purchaser any right, title or interest in or to
any of the Excluded Assets or any of the Excluded Liabilities.
Pursuant to the Purchase Agreement, the undersigned shall, at any time and from
time to time, at the reasonable written request of the [US] [Canadian]
Purchaser, execute and deliver such Purchaser all other and further instruments
as are reasonably necessary to effectuate the transfers contemplated pursuant to
the Purchase Agreement.
WITNESS the due execution and delivery of this Bill of Sale on this ___ day of
_____________________, 1999.
BICC CABLES CORPORATION
By:
--------------------------
Name:
Title:
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<PAGE> 81
SCHEDULE 6
PART 4
FORM OF TAX DEED OF COVENANT
THIS TAX DEED OF COVENANT (the DEED) is made on ___________, 1999 BETWEEN:
(1) BICC CABLES CORPORATION, a company incorporated in Delaware, the United
States, whose principal place of business is at One Crosfield Avenue,
West Nyack, NY;
(1a) PYROTENAX USA INC. (together with BICC Cables Corporation, the
US VENDOR), a company incorporated in Delaware, the United
States;
(2) BICC CABLES CANADA INC. (the CANADIAN VENDOR), a company incorporated
under the laws of Canada, whose principal place of business is at 265
Yorkland Blvd., Suite 500, North York, Ontario M2J 155;
(3) BICC PLC (the VENDORS' GUARANTOR:), a company incorporated in England and
Wales, whose registered office is at Devonshire House, Mayfair Place,
London W18 5FA;
(4) GK TECHNOLOGIES, INCORPORATED (the US PURCHASER), a company incorporated
in New Jersey, the United States, whose principal place of business is at
4 Tesseneer Drive, Highland Heights, KY 41076;
(5) GK TECHNOLOGIES, INCORPORATED (the CANADIAN PURCHASER), a company
incorporated in New Jersey, the United States, whose principal place of
business is at 4 Tesseneer Drive, Highland Heights, KY 41076; and
(6) GENERAL CABLE CORPORATION (the PURCHASERS' GUARANTOR), a company
incorporated in Delaware, the United States, whose principal place of
business is at 4 Tesseneer Drive, Highland Heights, KY 41076.
WHEREAS this Deed is entered into pursuant to the provisions of an
Agreement dated _______________, 1999 and made by and between the parties set
forth above (the AGREEMENT).
IT IS AGREED as follows:
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<PAGE> 82
1. INTERPRETATION
In this Deed , including Exhibit A attached hereto, the headings shall
not affect its interpretation and:
1.1 words and expressions defined in the Agreement shall have the same
meaning wherever used in this Deed and the provisions of Sections 1.2 and
1.5 of the Agreement shall be deemed to be incorporated in this Deed;
1.2 the following expressions bear the following meanings namely:
"CLAIM" includes any liability to make a payment of Taxes and any notice,
demand, assessment, letter or other document issued by or for any Governmental
Authority indicating that any Purchaser is or may be placed or sought to be
placed under a liability to make a payment of Taxes;
"LIEN" means any mortgage, lien, charge, restriction, pledge, security
interest, option, easement, encroachment or encumbrance;
"TRANSACTION" includes any transaction, circumstance, act or event of
whatever nature;
1.3 references to "PROFITS" include income, profits or gains (including capital
gains) and references to profits earned, accrued or received include
profits deemed to have been or treated as earned, accrued or received for
Tax purposes.
2. REPRESENTATIONS OF US VENDOR
2.1 Subject as hereinafter provided or disclosed on Exhibit A attached hereto,
the US Vendor hereby represents to the US Purchaser that:
(a) There are no Tax Liens (other than Liens for current Taxes not
yet due and payable) upon the Acquired Assets. All Taxes which
US Vendor is required by Law to withhold or collect, including
sales and use Taxes, and amounts required to be withheld for
Taxes of employees and other withholding Taxes, have been duly
withheld or collected and, to the extent required, have been
paid over to the proper Governmental Authorities or are held in
separate bank accounts for such purpose.
(b) The US Vendor is not a "foreign person" as defined in Section
1445(f)(3) of the Code.
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<PAGE> 83
(c) The US Vendor has filed all material Tax Returns that it was
required to file. All such Tax Returns were correct and complete
in all material respects. All material Taxes currently owed by
the US Vendor (whether or not shown on any Tax Return have been
paid or provision for which has been made. The US Vendor has
never received notice by a Taxing authority in a jurisdiction
for which no material Tax Return has been filed that it is or
may be subject to Tax by or in that jurisdiction.
(d) There is no material dispute or claim concerning any Tax
liability of the US Vendor either (A) claimed or raised by any
Governmental Authority in writing or (B) as to which the US
Vendor has knowledge.
(e) The US Vendor has not waived any statute of limitations in
respect of Taxes nor agreed to any extension of time with
respect to a Tax liability or deficiency.
(f) The US Vendor has not made and is not obligated to make any
payment that will not be deductible under Section 280G of the
Code.
3. REPRESENTATIONS OF THE CANADIAN VENDOR
3.1 Subject as hereinafter provided or disclosed on Exhibit A attached hereto,
the Canadian Vendor represents to the Canadian Purchaser:
(a) The Canadian Vendor has duly and timely filed with the
appropriate Governmental Authority all Tax Returns required to
be filed by it and has duly completed and correctly reported all
income required to be reported thereon in all material respects;
(b) The Canadian Vendor has duly and timely paid all Taxes,
including all installments on account of Taxes for the current
year, that are due and payable by it.
(c) The Canadian Federal and provincial income and capital Tax
liabilities of the Canadian Vendor have been assessed by the
relevant Governmental Authority and notices of assessment or
notifications that no Tax is payable have been issued to it by
the relevant Governmental Authorities prior to 1997.
(d) There are no actions, suits, proceedings, investigations, audits
or claims now pending or, to the knowledge of the Canadian
Vendor or the Vendors' Guarantor, threatened
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<PAGE> 84
against the Canadian Vendor in respect of any Taxes and there
are no matters under discussion, audit or appeal with any
Governmental Authority relating to Taxes.
(e) The Canadian Vendor has duly and timely withheld from any
amounts paid or credited by it to or for the account or benefit
of any Person, including, without limitation, any of its
employees, officers and directors and any non-resident Person,
the amount of all Taxes and other deductions required by
applicable Law to be withheld from any such amount, and has duly
and timely remitted the same to the appropriate Governmental
Authority.
(f) The Canadian Vendor is duly registered under subdivision (d) of
Division V of Part IX of the Excise Tax Act (Canada) with
respect to the goods and services Tax and harmonized sales Tax
and under Division I of Chapter VIII of Title I of the Quebec
Sales Tax Act with respect to the Quebec sales Tax, and its
registration numbers are 87399 2842RT and 10188220737,
respectively.
(g) The Canadian Vendor has not filed any elections, designations or
similar filings for purposes of the Income Tax Act (Canada) or
any relevant provincial Tax statute that would affect any of the
Canadian Assets.
(h) The Canadian Vendor is not a non-resident of Canada for purposes
of the Income Tax Act (Canada).
4. COOPERATION.
4.1 Each of the Vendors shall make available to the Relevant Purchaser, such
records as such Relevant Purchaser may reasonably require for the
preparation of any Tax Returns or other similar reports or forms required
to be filed by such Relevant Purchaser and such records as the Relevant
Purchaser may require for the defense of any audit, examination,
administrative appeal or litigation of any such Tax Return or any other
report or form.
4.2 Each of the Relevant Purchasers shall make available to the Vendors, such
records as such Vendor may reasonably require for the preparation of any
Tax Returns or other similar reports or forms required to be filed by such
Vendor and such records as the Vendor may require for the defense of any
audit, examination, administrative appeal or litigation of any such Tax
Return or any other report or form.
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<PAGE> 85
5. BULK SALES. The Relevant Vendor shall use reasonable commercial efforts to
comply with the Laws of any jurisdiction relating to the bulk sale or
transfer of assets for Tax purposes that may be applicable to the transfer
of the U.S. Assets or the Canadian Assets, as the case may be, as soon as
practicable after the date hereof, and the Relevant Vendor shall indemnify
the Relevant Purchaser from any Losses to such Relevant Purchaser resulting
from any noncompliance in accordance with Section 7 of this Deed.
6. CANADIAN ELECTIONS.
6.1 GST ELECTION. The Canadian Vendor and the Relevant Purchaser shall jointly
elect under subsection 167(l) of Part IX of the Excise Tax Act (Canada) and
any provincial legislation imposing a similar value added or multi-staged
Tax, that no Tax be payable with respect to the sale and purchase of the
Canadian Assets pursuant to this Agreement. The Canadian Vendor and the
Canadian Purchaser shall make such election in the prescribed form
containing prescribed information pursuant such Laws and the Canadian
Purchaser shall file the joint election in compliance with the requirements
of the Excise Tax Act (Canada) and any provincial legislation imposing a
similar value added or multi-staged Tax.
6.2 ELECTION. The Canadian Vendor and the Canadian Purchaser shall jointly
elect in prescribed form to have section 22 of the Income Tax Act (Canada)
apply to the sale of the Accounts Receivable by the Canadian Vendor to the
Canadian Purchaser.
7. INDEMNIFICATION.
7.1 BREACHES OF REPRESENTATIONS AND COVENANTS. Subject to the provisions set
forth in Section 9, the US Vendor and the Canadian Vendor (as is applicable
"COVENANTOR") agree to indemnify the US Purchaser and the Canadian
Purchaser, respectively, against, and agree to hold harmless from, any and
all Losses incurred or suffered by them arising out of or in connection
with any of the following:
(a) any breach of or any inaccuracy in any representation or warranty made
by the relevant Covenantor in this Tax Deed of Covenant set forth in
Sections 2, 3, 4 and 5; or
(b) any breach of or failure by the relevant Covenantor to perform any of
its covenants or obligations set forth in this Tax Deed of Covenant.
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<PAGE> 86
7.2 EXCLUSIONS FROM INDEMNIFICATION. For the avoidance of doubt, this Section 7
shall not cover any Tax liability by reference to any profits earned,
accrued or received after Closing or in respect of or arising from any
Transaction effected or deemed to have been effected after Closing (except
to the extent that such item is properly accounted for in Tax periods
ending on or prior to Closing).
8. PRORATION OF REAL ESTATE TAXES. All real estate, personal property and ad
valorem Taxes relating to the US Assets and the Canadian Assets which shall
have accrued and become payable prior to Closing shall be paid by the US
Vendor and the Canadian Vendor, respectively. All such Taxes which shall be
accrued but unpaid shall be prorated to Closing; provided, however, that
the parties hereby agree to promptly make appropriate payments which are
required to adjust the prorations to reflect the actual amount of such
Taxes payable when such amount is determined by the appropriate
Governmental Authority. In connection with the proration of Taxes, in the
event that actual Tax figures are not available at Closing, proration of
Taxes shall be based upon 105% of the actual Taxes for the preceding year
for which actual Tax figures are available. The amount due one party as the
result of such proration shall be paid to the other party at Closing.
9. EXCLUSIONS
9.1 Neither the US Vendor nor the Canadian Vendor shall be liable under Section
7 above, respectively:
(a) in respect of any Tax liability to the extent that adequate
provision or reserve for such Tax liability was made in the Net
Asset Statement or to the extent that such Tax liability was
discharged prior to Closing; or
(b) to the extent that such Tax liability arises or is increased as
a consequence of any change in the accounting policy or practice
adopted by the Relevant Purchaser after Closing (except with
respect to any change made to correct any erroneous or improper
historic Tax accounting policies or practices, if any, of the
Relevant Vendor); or
(c) to the extent that the liability would not have arisen but for
or is increased by a Transaction effected by the Covenantor
prior to Closing at the request or with the approval of the
Relevant Purchaser; or
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<PAGE> 87
(d) to the extent that recovery has been made in respect of the same
subject matter under the Agreement and any payment made by (or
procured by) the Covenantor under this Deed shall reduce by that
amount any claim in respect of the same subject matter by the
Relevant Purchaser under the Agreement.
9.2 The provisions of Section 2.3 of the Agreement shall have effect as if
expressly incorporated in this Deed and in the case of conflict between
the provisions of the Agreement and this Deed, this Deed shall prevail.
10. CLAIMS
10.1 If the Relevant Purchaser becomes aware after Closing of any Claim which
could give rise to a liability of a Covenantor under this Deed, the
Relevant Purchaser shall procure that notice thereof is given as soon as
reasonably practicable to the Covenantor in the manner hereinafter
provided. As regards any such Claim, the Covenantor shall be entitled at
its own expense in its absolute discretion to take such action as it
shall deem necessary to avoid, dispute, deny, defend, resist, appeal,
compromise or contest such Claim and any adjudication in respect thereof
in the name of and on behalf of the Relevant Purchaser concerned, or to
require the Relevant Purchaser concerned to take any such action.
Notwithstanding the foregoing, however, the Covenantor shall allow the
Relevant Purchaser reasonable opportunity to participate in any such
proceedings, negotiations or appeal. The Covenantor shall also have the
right at its own expense in its absolute discretion to conduct or direct
the conduct of any related proceedings, negotiations or appeals.
10.2 The Relevant Purchaser will not, without the written consent of the
Covenantor, compromise or settle any Claim or agree any matter which may
affect the outcome of any dispute or negotiation with any Tax authority
in relation to a Claim which may result in a liability under this Deed.
10.3 The Relevant Purchaser will give all such information and assistance as
the Covenantor or its professional advisers reasonably request, including
access to premises and personnel, and the right to examine and copy any
accounts, documents and records, for the purpose of Section 10.1 above,
limited in scope to the subject matter of the Claim. The Covenantor
agrees to keep all such information confidential and only to use it for
such purpose.
11. DUE DATE FOR PAYMENT
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<PAGE> 88
11.1 The due date for payment under this Section 11 shall be as follows:
(a) where a liability of the Covenantor under Section 7 arises from
a liability of a Relevant Purchaser to make a payment of Taxes
which has not at the date of the notice under Section 10.1 been
made, no later than the date which falls ten (10) days prior to
the latest date on which such Tax liability becomes payable to
the relevant Governmental Authority in order to avoid a
liability to interest or penalties accruing (and if such date
falls on a Saturday or Sunday, the next Business Day).
(b) in any other case, ten (10) days after service by the Relevant
Purchaser of a notice containing a written demand in respect of
the matter for which the Covenantor is liable.
11.2 The provisions of Section 19.10 of the Agreement are expressly
incorporated herein by reference.
12. RELEVANT PURCHASER'S INDEMNITY
12.1 The Relevant Purchaser hereby covenants with the Covenantor to pay to the
Covenantor an amount equal to any Tax liability for which the Covenantor
becomes liable in consequence of the failure by the Relevant Purchaser to
discharge any Tax liability within a specified period or otherwise where
such Tax liability arises in circumstances such that the Relevant
Purchaser would not have been entitled to make a claim against the
Covenantor under Section 7 of this Deed in respect of any Tax liability
which has been the subject of a Claim by the Relevant Purchaser under
this Deed which has been satisfied.
12.2 Any amount paid by the Relevant Purchaser to the Covenantor pursuant to
this Section 12 shall be paid by way of adjustment to the Purchase Price
under the terms of the Agreement.
13. RECOVERY FROM THIRD PARTIES
If the Covenantor has paid an amount in respect of any Tax liability under
Section 11 hereof and the Relevant Purchaser is entitled at the due date
for the making of that payment to recover from some other person any sum in
respect of the Tax liability which has resulted in that payment becoming
due from the Covenantor, or at some subsequent date becomes entitled to
make such a recovery, then the Relevant Purchaser shall as soon as
reasonably practicable notify the Covenantor of such entitlement and shall,
if so requested by the Covenantor and
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<PAGE> 89
subject to the Relevant Purchaser being indemnified to its reasonable
satisfaction by the Covenantor against all losses (including additional Tax
liabilities), costs, damages and expenses which may thereby be incurred,
take all reasonable steps to enforce that recovery (keeping the Covenantor
informed of the progress of any action taken) and shall account to the
Covenantor for the whole of any unrestricted sum so recovered (including
any interest or repayment supplement paid to the Relevant Purchaser on or
in respect thereof) less any costs and expenses of recovery up to an amount
not exceeding the amount of any such payment previously made by the
Covenantor in respect of the Tax liability which resulted in payment by the
Covenantor pursuant to Section 10.
14. SAVINGS AND OVER-PROVISIONS. The provisions of Section 2.3.7 of the
Agreement are expressly incorporated herein by reference.
15. WITHHOLDINGS AND DEDUCTIONS
15.1 All sums payable by the Covenantor to the Relevant Purchaser under this
Deed shall be paid free and clear of all deductions, withholdings,
set-offs or counterclaims whatsoever except as may be required by law.
15.2 If any deduction or withholding is made from any payment as contemplated
in Section 15.1, the Covenantor shall supply to the Relevant Purchaser
such official receipt, if any, or other evidence of payment to the
relevant authority of the amount deducted or withheld and shall give all
reasonable assistance to enable the Relevant Purchaser to receive a
credit or refund or similar benefit by reason of the deduction or
withholding as promptly as possible.
16. MISCELLANEOUS
The provisions of Section 19 (Other Provisions) of the Agreement shall
apply mutatis mutandis to this Deed, replacing references to the Vendor by
references to the Covenantor and references to the Agreement by references
to this Deed and making any other necessary modifications.
17. ILLEGALITY
If at any time any provision hereof is or becomes illegal, invalid or
unenforceable in any respect under the law of any jurisdiction, neither the
legality, validity or enforceability of such provision under the law of any
other jurisdiction shall in any way be affected or impaired thereby.
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<PAGE> 90
IN WITNESS WHEREOF this document has been duly executed as of the day and
year first above written.
BICC CABLES
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
BICC CABLES CANADA INC.
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
PYROTENAX USA INC.
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
GK TECHNOLOGIES, INCORPORATED,
IN ITS CAPACITY AS US PURCHASER AND
CANADIAN PURCHASER
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
GENERAL CABLE CORPORATION
By:
--------------------------------
Name:
-------------------------------
Title:
------------------------------
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<PAGE> 91
EXHIBIT A TO BICC /
GENERAL CABLE TAX
DEED OF COVENANT
PART 1: REPRESENTATIONS OF US VENDOR.
-------------------------------------
DISCLOSURES FOR BICC CABLES CORPORATION
EXTENSIONS
- ----------
<TABLE>
<CAPTION>
TAX YEAR TYPE EXTENDED DATE
- -------- ---- -------------
<S> <C> <C>
12/31/94 Federal Income Tax 12/31/99
12/31/93 Federal Income Tax 12/31/99
12/31/94 Federal Employment Tax 12/31/99
12/31/95 Federal Employment Tax 12/31/99
To be provided Illinois Sales and Use Tax To be provided
1993-95 New York State Income Tax 1/31/00
</TABLE>
<TABLE>
<CAPTION>
AUDITS
<S> <C> <C>
Federal IRS Income Tax Completed through 12/31/95
Federal Employment Tax Years 1994-1997 Open
Connecticut Sales and Use Tax through 7/97 Protest filed 1/99
Illinois Sales and Use Tax in Process Open
New York State Income Tax - Start date 4/6/99 Open (Years 1993-95)
</TABLE>
TAX LIENS
- ---------
New York State Employment Tax Lien removed
<TABLE>
<CAPTION>
STATES WITH INVENTORY AND PLANTS
- --------------------------------
<S> <C>
Connecticut Plant and Inventory
NYS Headquarters - inventory (Pyro US)
Massachusetts Plant and Inventory
Tennessee Plant and Inventory
Texas Plant and Inventory
Illinois Plant and Inventory
Indiana Plant and Inventory
Arkansas Plant and Inventory
</TABLE>
TAX SHARING AGREEMENT WITH OTHER BICC, PLC COMPANIES IN US.
BICC CABLES CORPORATION FILES A CONSOLIDATED RETURN WITH OTHER
BICC, PLC COMPANIES IN THE US.
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<PAGE> 92
PROPERTY TAX
- ------------
Only issue is for Texas plant for consigned inventory of Reynolds metals. Taxing
authority will allow rendition to include Reynolds consigned inventory. Claim in
process for 1998 filing.
NON-FILING
- ----------
BICC Cables Corporation has registered in Michigan. We do not believe we have
nexus in the state and therefore, have not filed returns. The state has not
contacted us with regard to filing.
IRS AUDIT ISSUES
There are no carryover issues that will effect the assets purchased. Transfer
pricing between the US - Canada and the US - UK was reviewed with no adjustments
proposed.
Employment Tax issues relate to employee loans which will be resolved with the
sale of the business.
PART 2: REPRESENTATIONS OF CANADIAN VENDOR.
-------------------------------------------
Appeal of British Columbia Social Service Tax Assessment dated September 10,
1998. The assessed amount of Tax has been paid.
Notice of Assessment from the Commencement of Quebec dated May 8, 1998 for 1996
payroll Taxes which is under discussion. The assessed amount of Tax has been
paid.
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<PAGE> 93
SCHEDULE 7
NET ASSET STATEMENT
1. The Net Asset Statement shall be prepared in accordance with UK GAAP
prevalent as of December 31, 1998, excluding the impact of FRS 11 and on a basis
consistent with the Combined Accounts and shall be drawn up in accordance with
the provisions of Sections 2 and 3 below and, to the extent not inconsistent
therewith:
1.1 the accounting policies for the Operations as attached to the
Combined Accounts and included in the Disclosure Letter; and to the extent not
inconsistent therewith;
1.2 the accounting policies and principles applied in the preparation
of the audited accounts relating to the BICC Group for the period ended December
31, 1998, excluding the impact of FRS 11, and otherwise;
1.3 in accordance with the accounting policies and principles generally
accepted in the United Kingdom, excluding the impact of FRS 11 as in effect on
December 31, 1998.
2. No account shall be taken of events taking place after Closing and regard
shall only be had to information available to the parties to this Agreement at
Closing.
3. The Net Asset Statement shall be expressed in pounds sterling. Amounts in
other currencies shall be translated into sterling at the exchange rates
specified in the Exchange Cross Rates Table published in the Financial Times,
London Edition, on the Closing Date.
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SCHEDULE 8
REPRESENTATIONS AND WARRANTIES GIVEN BY THE VENDORS UNDER SECTION 7.1
Knowing that Purchasers rely thereon, the Vendors jointly and severally
represent and warrant to the Purchasers as follows:
1. AUTHORITY AND CAPACITY
1.1 Each Vendor and the Vendors' Guarantor is a company duly
incorporated and validly existing under the laws of its jurisdiction of
incorporation. Each Vendor is duly qualified and registered to do business in
each jurisdiction where such qualification or registration is required by
applicable law except where the failure to be so qualified would not have a
material adverse effect on the Operations or the financial condition or results
of operations thereof. Except as set forth on the Disclosure Letter, neither
Vendor has any Subsidiaries nor owns any securities of any corporation or any
other interest in any person. Neither Vendor has agreed or is obligated to make,
or is bound by any Contract under which it may become obligated to make, any
future equity or similar investment in or capital contribution to any other
person.
1.2 Subject to receipt of approval by Vendors' Guarantor's
shareholders, each Vendor and the Vendors' Guarantor has the legal right and
full power and authority to enter into and perform its obligations under this
Agreement and the Tax Deed of Covenant and any other documents to be executed by
such Vendor and the Vendors' Guarantor pursuant to or in connection with this
Agreement.
1.3 This Agreement and the Tax Deed of Covenant, and any other
agreements executed or to be executed in connection herewith or therewith, will
when duly executed, constitute legally valid and binding obligations of each of
the Vendors and the Vendors' Guarantor which are party thereto, enforceable
against each of the Vendors and the Vendors' Guarantor in accordance with their
respective terms, subject as to enforcement of remedies to applicable
bankruptcy, insolvency, reorganization and similar laws affecting generally the
enforcement of rights of contracting parties and to a court's discretionary
authority with respect to the granting of a decree ordering specific performance
or other equitable remedies.
1.4 The execution and delivery of, and the performance by the Vendors
of their obligations under, this Agreement and the Tax Deed of Covenant and any
other documents to be executed by the Vendors pursuant to or in connection with
this Agreement, and the execution and delivery of, and the performance by the
Vendors' Guarantor of its obligations under this Agreement and any other
documents to be executed by the Vendors' Guarantor, will not:
1.4.1 result in a violation of or default under of any
provision of the articles of incorporation, bylaws and/or other charter
documents of any Vendor or Vendors' Guarantor; or
1.4.2 result in a breach of any Judgment to which any Vendor
is a party or by which any Vendor is bound; or
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1.4.3 constitute a violation of any Law that is applicable to
either Vendor or their respective businesses or assets except where the
violation would not have a material adverse effect on the Operations or on the
financial condition or results of operations thereof or on the ability of the
parties to consummate the transactions contemplated by this Agreement; or
1.4.4 Subject to the need to obtain any Third Party Consent,
conflict with, result in a breach of, constitute a default under, result in the
acceleration of, create in any party the right to accelerate, terminate, modify,
or cancel, or require any notice under, any Contract or result in the imposition
of any Encumbrance upon any of the Acquired Assets, except where the violation,
conflict, breach, default, acceleration, termination, modification,
cancellation, failure to give notice, or Encumbrance would not have a material
adverse effect on the Operations or on the financial condition or results of
operations thereof, or on the ability of the parties to consummate the
transactions contemplated by this Agreement. Except in regards to the HSR Act or
as disclosed in the Disclosure Letter, the Vendors do not need to give any
notice to, make any filing with, or obtain any authorization, consent, or
approval of any Governmental Authority in order for the parties hereto to
consummate the transactions contemplated by this Agreement, except where such
authorization, consent or approval would not have a material adverse effect on
the Operations or on the financial condition or results of operations thereof or
on the ability of the parties hereto to consummate the transactions contemplated
by this Agreement.
1.5 Subject to receipt of approval by the shareholders of Vendors's
Guarantor all corporate action required to be taken by the Vendors and Vendors'
Guarantor validly and duly to authorize the execution and delivery of, and to
exercise their rights and perform their obligations under, this Agreement, the
Tax Deed of Covenant and any other documents to be executed by the Vendors or
Vendors' Guarantor at the Closing pursuant to or in connection with this
Agreement, have been duly taken or will have been duly taken before Closing.
2. DISCLOSURE LETTER AND DATA ROOM; FULL DISCLOSURE
2.1 To the knowledge of the Vendors, no representation or warranty made
by the Vendors in this Agreement or pursuant hereto (a) contains any untrue
statement of material fact; or (b) omits to state any material fact that is
necessary to make the statements made, in light of the circumstances under which
they are made, not false or misleading in any respect.
2.2 The Data Room has been collated by the Vendors in good faith.
3. ACCOUNTS AND RECORDS
3.1 COMBINED ACCOUNTS
The Combined Accounts:
(a) have been prepared on a basis consistent with the
accounting policies and principles set out in Section 1 (including Subsections
1.1, 1.2 and 1.3, but excluding Sections 2 and 3) of Schedule 7;
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(b) fairly present in all material respects the state
of affairs of the Operations as at the Balance Sheet Date for the financial year
ended on that date.
3.2 MANAGEMENT ACCOUNTS
The Management Accounts have been properly prepared in
accordance with the principles set out in Section 1 (including Subsections 1.1,
1.2 and 1.3, but excluding Sections 2 and 3) of Schedule 7.
3.3 ACCOUNTING AND OTHER RECORDS
The statutory books and books of account and other records of
whatsoever kind relating to the Operations are up-to-date and maintained in
accordance with all applicable legal requirements on a proper and consistent
basis and contain complete and accurate records of all matters required to be
dealt with in such books. All such books and records and all other documents
(including documents of title and copies of all subsisting agreements to which
either Vendor is a party) are in the possession (or under the control) of the
Canadian Vendor or the US Vendor, as applicable, and no notice or allegation
that any is incorrect or should be rectified has been received.
3.4 CHANGES SINCE BALANCE SHEET DATE
3.4.1 Since the Balance Sheet Date, the Operations have been
carried on in the ordinary course, without any interruption or alteration in
their nature, scope or manner and so as to maintain the same as a going concern.
3.4.2 Since the Balance Sheet Date, there has been no material
adverse change in the Operations or on the financial condition or results of
operations thereof.
3.4.3 Since the Balance Sheet Date, except in the ordinary
course of business, neither Vendor has created or assumed any Encumbrance upon
any of the Acquired Assets.
3.4.4 Except as set forth on the Disclosure Letter, since the
Balance Sheet Date and prior to the date of this Agreement, neither Vendor has
taken any action that would have required the consent of the Purchasers pursuant
to Section 5.2.1(b), (c), (d), (e) or (f) of the Agreement.
4. LEGAL MATTERS
No reference to any law or Licence (howsoever expressed) in Section 4.1
or 4.2 below shall be deemed to include a reference (directly or indirectly) to
any Environmental Laws (as defined in Schedule 16), and it is expressly
acknowledged that no representation or warranty is given by or on behalf of the
Vendors in this Agreement or otherwise in respect of any Environmental Laws
except as provided in Schedule 16.
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4.1 COMPLIANCE WITH LAWS
The Operations and the ownership, possession and use of the
assets of each Vendor currently comply with all applicable Laws except where
such non-compliance would not have a material adverse effect on the Operations
or on the financial condition or the results of operations thereof. Neither
Vendor is in violation of their respective articles of incorporation, by-laws or
other charter documents. Except as described in the Disclosure Letter, there is
no investigation or inquiry by any Governmental Authority, or Judgment
outstanding or to the knowledge of the Vendors, threatened against either
Vendor, or any person for whose acts or defaults they may be vicariously liable
which would have a material adverse effect upon the Operations or on the
financial condition or the result of operations thereof, nor has any notice or
other communication (official or otherwise) from any Governmental Authority been
issued with respect to an alleged actual or potential violation and/or failure
to comply with any such applicable Law, or requiring it/them to take or omit any
action which would have a material adverse effect on the Operations or on the
financial condition or the results of operations thereof and neither Vendor is
aware of any circumstances which are likely to give rise to any such
investigation or inquiry.
4.2 PERMITS AND CONSENTS
Nothing in this Section 4.2 applies to Permits of Intangible
Property rights (including Software) or environmental Licenses.
4.2.1 All material Third Party Consents which are necessary
for the transfer to a Relevant Purchaser of the Operations or any part thereof
or the entry into or completion of this Agreement are listed in the Disclosure
Letter and have been obtained (other than those still required, details of which
are set out in the Disclosure Letter).
4.2.2(a) All material Permits necessary for carrying on the
Operations as and where now carried on have been obtained, are in full force and
effect and have been and are being complied with in all material respects;
(b) neither Vendor is aware of any reason why any of
such Permits should be suspended, threatened or revoked;
(c) all such Permits which are material to the
Operations are listed on the Disclosure Letter, and true and correct copies of
all such material Permits have been made available to the Purchasers.
4.3 LITIGATION
4.3.1 Except as described in the Disclosure Letter, no breach
of contract, breach of warranty, tort, negligence, infringement, product
liability, discrimination, wrongful discharge or other claim of any nature has
been asserted or, to the knowledge of either Vendor, threatened by or against
either Vendor at any time since January 1, 1997 which if determined adversely to
the
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Vendors would have a material adverse effect on the Operations or the financial
condition or results of operations thereof.
4.3.2 Except as described in the Disclosure Letter, as at the
date hereof, neither Vendor (or any person for whose acts or defaults either
Vendor may be vicariously liable) is involved whether as plaintiff or defendant
or other party in any claim, legal action, proceeding, suit, litigation,
prosecution, investigation, inquiry or arbitration (other than as plaintiff in
the collection of debts arising in the ordinary course of business) which is
material to the Operations or the financial condition or results of operations
thereof and, so far as either Vendor is aware, no such claim, legal action,
proceeding, suit, litigation, prosecution, investigation, inquiry or arbitration
is pending or threatened by or against either Vendor (or any person for whose
acts or defaults either Vendor may be vicariously liable).
4.3.3 As at the date hereof, so far as the Vendors are aware,
there are no investigations, disciplinary proceedings or other circumstances
likely to lead to any such material claim or legal action, proceeding, suit,
litigation, prosecution, investigation, inquiry or arbitration described in
Section 4.3.2.
4.4 ENVIRONMENTAL LIABILITY
The only environmental Warranties relating to the Operations
are contained in Section 2 of Schedule 16.
4.5 INSOLVENCY
4.5.1 No order has been made, petition presented, resolution
passed or meeting convened for the winding up (or other process whereby the
business is terminated and the assets of the company concerned are distributed
amongst the creditors and/or shareholders or other contributories) of either
Vendor, and there are no cases or proceedings under any applicable insolvency,
reorganization or similar laws in any jurisdiction concerning either Vendor,
and, so far as the Vendors are aware, no events have occurred which, under
applicable laws, would justify any such cases or proceedings.
4.5.2 No petition has been presented or other proceedings have
been commenced by or against (i.e., voluntarily or involuntarily) either Vendor
for an administration order to be made (or any other order to be made by which,
during the period it is in force, the affairs, business and assets of the
company concerned, are managed by a person appointed for the purpose by a court
or other Governmental Authority) in relation to either Vendor in relation to the
Operations, nor has any such order been made.
4.5.3 No receiver (including an administrative receiver),
liquidator, trustee, administrator, custodian or similar official has been
appointed in any jurisdiction in respect of the whole or any part of the
business or assets of either Vendor or in respect of any of the Acquired Assets
and, so far as either Vendor is aware, no step has been taken for or with a view
to the appointment of such a person.
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4.5.4 Neither Vendor is insolvent or unable to pay its debts
as they become due.
5. TRADING AND CONTRACTUAL ARRANGEMENTS
5.1 CAPITAL COMMITMENTS
Except as set forth in the Disclosure Letter, there are no
material capital commitments entered into or proposed by or on behalf of the US
Vendor or the Canadian Vendor other than as set forth in the capital budgets.
For these purposes, a material commitment is one involving capital expenditure
of over $400,000.
5.2 ARRANGEMENTS WITH RELATED PERSONS ETC.
5.2.1 Except as described in the Disclosure Letter, there is
no indebtedness (actual or contingent) nor any indemnity, guarantee or security
arrangement between or among either Vendor, any member of the Vendors' Group,
any officer, Senior Employees or director of either Vendor or any husband or
wife of such persons.
5.2.2 Except as described in the Disclosure Letter, or for
Contracts, arrangements or understandings related to compensation or employment,
neither Vendor nor any member of the Vendors' Group is party to any Contract,
arrangement or understanding with any officer, Senior Employee or director of
either Vendor or any husband or wife of such persons, or in which any such
person as aforesaid is interested (whether directly or indirectly), other than
on normal commercial terms in the ordinary course of business.
5.2.3 There are no existing Contracts or arrangements with a
value in excess of $500,000, per annum between or involving either Vendor and
any member of the Vendors' Group other than in the ordinary course of business.
5.3 CONTRACTS
5.3.1 Section 5.3.1 of the Disclosure Letter lists the
following types of Contracts to which either Vendor is a party and which relate
to the Operations (MATERIAL CONTRACTS):
(a) any agreement (or group of related agreements) for the lease
of personal property to or from any person providing for lease
payments in excess of $1,000,000 (one million dollars), per
annum;
(b) any agreement (or group of related agreements) for the
purchase or sale of raw materials, commodities, supplies,
products, or other personal property, or for the furnishing or
receipt of services, the performance of which will extend over
a period of more than one year, or involve consideration in
excess of $2,500,000 (two million five hundred thousand
dollars;
(c) any agreement concerning a partnership or joint venture;
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(d) any agreement (or group of related agreements) under which it
has created, incurred, assumed, or guaranteed any indebtedness
for borrowed money in excess of $1,000,000 (one million
dollars), including any capitalized lease obligation under
which it has imposed a security interest on the Acquired
Assets; and
(e) any other agreement (or group of related agreements) the
performance of which involves consideration in excess of
$2,500,000 (two million five hundred thousand dollars) other
than customer contracts or distribution agreements, the
performance of which involves consideration in excess of
$7,500,000 (seven million five hundred thousand dollars).
The Vendors have delivered to the Purchaser a correct and
complete copy of each written agreement listed in Section 5.3.1 of the
Disclosure Letter (as amended to date) and a written summary setting forth the
terms and conditions of each oral agreement referred to in Section 5.3.1 of the
Disclosure Letter.
5.3.2 With respect to each Material Contract (i) neither
Vendor is in material breach or default, and to the knowledge of the Vendors, no
other party is in breach or default and (ii) no event has occurred which with
notice or lapse of time would constitute a material breach or default, or permit
termination, modification, or acceleration, under the agreement.
5.3.3 Except as set forth on the Disclosure Letter, neither
Vendor is party to any unusual, long-term or onerous commitments, contracts or
arrangements and any such not wholly on an arm's length basis in the ordinary
course of business. For the purposes of this representation and warranty, a
long-term commitment, contract or arrangement is one which is incapable of
termination without cause by either Vendor on 180 days' notice or less.
5.3.4 Except as set forth in the Disclosure Letter, neither
Vendor is party to any agency, distributorship, marketing, purchasing,
manufacturing or licensing agreement or arrangement or any agreement or
arrangement which restricts its freedom to carry on its business as currently
carried on in any part of the world in such manner as it thinks fit so as to
have a material adverse effect on the relevant Operations.
6. EMPLOYEES
6.1 GENERAL
6.1.1 There are no persons employed by the US Vendor or by the
Canadian Vendor as of the date hereof other than the Employees identified in the
Disclosure Letter.
6.1.2 The Disclosure Letter contains and sets forth a complete
list of the following items as of the date of this Agreement:
(a) The details, numbers and categories of Employees
at each facility.
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(b) A list of all persons working at each facility
who are independent contractors, leased employees, consultants or who otherwise
perform work at any facility.
(c) A list and summary, including status, of all
pending grievances brought or filed by individual Employees or a labor union or
organization.
(d) A list and summary, including status, of all
outstanding demands for arbitration brought or filed by individual Employees or
a labor union or organization.
(e) A list of all outstanding workers' compensation
claims and their anticipated valuation and/or reserve amounts.
(f) A list of all outstanding hearing loss claims and
their anticipated valuation and/or reserve amounts.
(g) A list and summary, including status, of all
pending investigations or on-going audits by any local, state/province or
federal/national agencies of any facility, including, without limitations,
claims related to safety, employment discrimination, unfair labor practices,
affirmative action, compensation, benefits or EEO-1 compliance.
(h) A list of all Collective Bargaining Agreements
between US Vendor and Canadian Vendor and the labor unions or organizations that
represent Employees.
(i) A list of all written agreements between US
Vendor or Canadian Vendor and any of their respective labor/labour unions which
might interpret or change the plain language of any Collective Bargaining
Agreement.
(j) A list of all known current organizing efforts by
any labor organization or union of the Employees of any of US Vendor's and
Canadian Vendor's facilities, including inter-union jurisdictional disputes.
(k) A list of all employees, by facility, who have
been laid-off or separated from employment due to economic conditions during the
six (6) months prior to the date of this Agreement.
6.1.3 Except as disclosed in the Disclosure Letter, the
Vendor's facilities have been and are being operated in compliance with all Laws
relating to Employees, including, without limitation, employment standards,
occupational health and safety, pay equity and human rights, document and record
retention, except where the failure to be in compliance would not have a
material adverse effect on the Operations or the financial condition or results
of operations thereof.
6.1.4 There are no employment Contracts relating to Continuing
Employees except those which have been reduced to writing and provided to
Purchaser on or before the date hereof (or described in the Disclosure Letter).
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6.1.5 All written individual Contracts of employment have been
disclosed to the Purchaser in the Disclosure Letter.
6.1.6 Neither the US Vendor nor the Canadian Vendor is party
to any contractual arrangement to make material changes to remuneration or other
benefits or other terms of employment or to establish any new bonus arrangements
for the Employees, except as stated in the Collective Bargaining Agreements
identified in the Disclosure Letter or in the employment Contracts listed in
Schedule 12 Section 1.1, of the Disclosure Letter.
6.1.7 All current assessments under the Workplace, Safety and
Insurance Act (Ontario), the Workers' Health and Safety Commission (CSST)
(Quebec) and the Saskatchewan Workers' Compensation Act in relation to the
Canadian Vendor have been paid or accrued and the Canadian Vendor has not been
subject to any special or penalty assessment under such legislation which has
not been paid.
6.1.8 There are no claims or complaints, except those set
forth in the Disclosure Letter, nor, to the knowledge of the Vendors, are there
any threatened claims or complaints, against the Vendors, before any employment
standards branch, pay equity, human or civil rights tribunal in the United
States or Canada. To the knowledge of the Vendors nothing has occurred which
might lead to a complaint against the Vendors, under any human rights
legislation or employment standards legislation. There are no outstanding
decisions or settlements or pending settlements which place any obligation upon
the Vendors to deal or refrain from doing any act, except as set forth in the
Disclosure Letter.
6.2 TERMINATION OF EMPLOYMENT
6.2.1 There are no claims outstanding on the date of this
Agreement related to breach of contract of service, termination or severance
obligations (either statutory or at common law), compensation for dismissal
(either wrongful or constructive), equal pay, sex, race, disability or other
discrimination with respect to any of the individuals identified on Schedule 11
of this Agreement or the Employment Letter.
6.2.2 As of the date of this Agreement, and except as stated
in Schedule 11 and the Employment Letter, no Senior Employee has given to a
Vendor or received from a Vendor notice terminating his employment or
engagement.
6.2.3 No Liability which remains undischarged as of the date
of this Agreement has been incurred by the US Vendor or the Canadian Vendor for
breach of any contract of service or for termination or separation payments or
for compensation for dismissal (wrongful or constructive), equal pay, sex, race,
disability or other discrimination or failure to comply with any order for the
reinstatement or re-engagement of any of the Continuing Employees.
6.3 DISCLOSURES OF EMPLOYMENT TAXES, EMPLOYEE LOANS AND
COMPENSATION
6.3.1 The Vendors have paid to the appropriate authorities all
Taxes, statutorily required payroll withholdings, and other contributions and
charges due and payable in respect of the
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Employees in respect of their employment by the US Vendor and the Canadian
Vendor up to Closing or such amounts have been or will be accrued for in the Net
Asset Statement.
6.3.2 Particulars of all loans made by the Vendors to
Continuing Employees which are in excess of $15,000 and which shall remain
outstanding at Closing, together with sums owed by the Vendors to any Employee
(other than remuneration and other contractual or customary benefits) which are
in excess of $15,000 are disclosed in the Disclosure Letter.
6.3.3 There are no accrued wages, overtime, bonuses, accrued
vacation or sales commissions owed to any Continuing Employee, other than those
which may be owing for the pay or payment period immediately preceding the
Closing; such payments to be made by Vendors, except as provided in Schedule 12
of the Agreement.
6.4 PAYMENTS ON TERMINATION
6.4.1 All outstanding separation agreements, termination
agreements or settlement agreements, any obligations therein, or obligations to
pay termination or severance pay pursuant to any such agreements or statute,
common law or otherwise, which arises with respect to services provided prior to
Closing (other than those identified on Schedules 11 or 12 or in the Employment
Letter) are Excluded Liabilities.
6.4.2 Without limiting Paragraph 6.4.1, Vendors shall also be
responsible for any and all payments arising out of the special performance
letters dated August 20, 1998, and August 24, 1998, concerning Anthony Cutri,
Joseph DeBolt, William Fike, Linda Ermelin, Robert Jamieson.
6.4.3 There are no breaches and/or terminations of any
contracts with leased or contingent employees, independent contractors,
consultants or persons who provide labor, but who are the employees of any third
party entity, who perform work at any facility, other than those listed in the
Disclosure Letter.
6.4.4 Within the period of one year preceding the date hereof
neither Vendor in relation to the Operations has been obliged by statute to give
notice of terminations to a relevant authority or started consultations with any
Employee representative body relating to any such termination.
6.5 COLLECTIVE BARGAINING RELATIONSHIPS
6.5.1 Vendors have fully complied with all of their
obligations to bargain with the appropriate unions over the effects of the
transactions contemplated by this Agreement.
6.5.2 There are no outstanding labour tribunal, Saskatchewan
Labour Relations Board, Quebec Labour Court and/or Quebec Labour Commissioner,
Ontario Labour Relations Board proceedings or United States National Labor
Relations Board proceedings or proceedings before the labor relations board of
any state within the United States of any kind, including, without limitations,
any unfair labor practice, enforcement or compliance proceedings or proceedings
which could result in certification of a trade union as bargaining agent or
collective bargaining representative for any
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Employees or dependant contractors of the Vendors not already covered by the
Collective Bargaining Agreements identified in the Disclosure Letter.
6.5.3 There are no strikes or lockouts, as these terms are
defined under both United States labor law and Canadian labour law. Neither
Vendor has any unresolved grievances or pending arbitration matters, other than
those listed on the Disclosure Letter.
6.5.4 To the knowledge of the Vendors there are no
labor/labour problems that might materially affect the value of the facilities
or the Purchaser's ability to operate any facility after the Closing.
6.6 PENSIONS AND OTHER EMPLOYEE BENEFITS
6.6.1 Employee Benefit Arrangements
All of the Employee Benefit Arrangements in which the US
Vendor and/or the Canadian Vendor have entered into, participate, or have
liability for, are listed in Disclosure Letter and are expressly identified
therein as between the US Vendor and the Canadian Vendor, as applicable.
6.6.2 Disclosure
With respect to Employee Benefit Arrangement assumed by
Purchasers, current and complete copies of all written Employee Benefit
Arrangements or, where oral, written summaries of the material terms thereof,
have been provided or made available to the Purchasers together with current and
complete copies of all documents relating to the Employee Benefit Arrangements,
including, without limitation, as applicable, (i) all documents establishing,
creating or amending any Employee Benefit Arrangement; (ii) all trust
agreements, insurance contracts and investment management agreements; (iii) all
Form 5500 financial statements and accounting statements and reports, and
investment reports for each of the last three (3) years and the three (3) most
recent actuarial reports, if applicable (iv) all reports, returns, filings and
material correspondence with any Government Authority in the last three (3)
years; and (v) all booklets, summaries or manuals prepared for or circulated to,
and written communications of a general nature to Employees concerning any
Employee Benefit Arrangements.
6.6.3 Regulation
All of the Vendors' Employee Benefit Arrangements to be
assumed by US Purchaser are, and have been, operated in material compliance with
their provisions and with all applicable laws including, without limitation,
ERISA and the Code and the regulations and rulings thereunder. To the US
Vendor's knowledge all fiduciaries of such Employee Benefit Arrangements have
materially complied with the provisions of such Employee Benefit Arrangements to
be assumed by the US Purchaser and with all applicable laws including ERISA and
the Code and the regulations and rulings thereunder. All of the Canadian
Vendor's Employee Benefit Arrangements are, and have been established,
registered, qualified, administered and operated in material compliance with all
applicable Canadian Laws.
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6.6.4 Claims
With respect to Employee Benefit Arrangements assumed by
Purchasers, except as described in the Disclosure Letter, there are no pending
actions, claims or lawsuits which have been asserted or instituted against any
of the Employee Benefit Arrangements, the assets of any of the trusts under such
Employee Benefits Arrangements, the sponsor, the administrator or against any
fiduciary of any of the Employee Benefits Arrangement (other than routine
benefit claims) nor does US Vendor and/or Canadian Vendor have knowledge of
facts which could form the basis for any such action, claim or lawsuit. Except
as described in the Disclosure Letter, there are no investigations or audits by
any Government Authority of any of Employee Benefit Arrangements to be assumed
by Purchasers, any trusts under such Arrangement, the sponsor, the administrator
or any fiduciary of any of Employee Benefit Arrangements which have been
threatened or instituted nor do US Vendor and/or Canadian Vendor have knowledge
of facts which could form the basis for any such investigation or audit. No
event has occurred respecting any Employee Benefit Plan of the Canadian Vendor
which would entitle any person without the consent of the Canadian Vendor to
wind-up or terminate, in whole or in part any such Employee Benefit Arrangement
or which could reasonably be expected to adversely affect the Tax status
thereof.
6.6.5 Contributions/Benefit Obligations
All material obligations under the Employee Benefit
Arrangements to be assumed by Purchasers (whether pursuant to the terms thereof
or applicable law) have been satisfied, and there are no outstanding defaults or
violations thereunder by the US Vendor or Canadian Vendor nor does either have
any knowledge of any default or violation by any other party to any Employee
Benefit Arrangements.
All contributions or premiums required to be paid to or in
respect of each Employee Benefit Arrangement to be assumed by Purchasers have
been paid in a timely fashion in accordance with the terms thereof and all
applicable law, and no Taxes, penalties or fees are owing or eligible under any
Employee Benefit Arrangements.
Except as noted in the Disclosure Letter, neither the
execution and delivery of this Agreement nor the consummation of the
transactions contemplated hereby will (i) result in any payment (including,
without limitation, severance, unemployment compensation, golden parachute or
otherwise) becoming due under any Employee Benefit Arrangement, (ii) increase
any benefits otherwise payable under any Employee Benefit Arrangement, or (iii)
result in the acceleration of the time of payment or vesting of any such
benefits to any extent. Except as disclosed in the Disclosure Letter, no
amendments to any Employee Benefit Arrangement of the Canadian Vendor has been
made, nor have any improvements thereto been promised.
6.6.6 Funding
Except as noted in the Disclosure Letter, all Employee Benefit
Arrangements to be assumed by Purchasers are fully funded on an ongoing basis
and on a termination basis with respect to any benefit obligation accrued as of
the date of this Agreement. US Vendor maintains a reserve
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adequate to satisfy timely claims made with respect to the Employee Benefit
Arrangements that the US Purchaser is assuming, including, but not limited to,
claims made under any Employee Benefit Arrangement which provides health and
medical benefits for Employees and retired Employees.
6.6.7 Rights to Excess Assets/Reserves
US Vendor has an unqualified right with respect to any assets
under any Employee Benefit Arrangement assumed by the US Purchaser which exceed
accrued benefit obligations under such Employee Benefit Arrangement. US Vendor
shall have an unqualified right with respect to any unused reserves held with
respect to any Employee Benefit Arrangement assumed by the US Purchaser. Neither
US Vendor nor Canadian Vendor has pledged or otherwise encumbered any excess
assets or reserves except to the extent specifically permitted in the documents
governing the appropriate Employee Benefit Arrangement. The Canadian Vendor has
not received, nor applied for, any payment of surplus out of any Canadian
Employee Benefit Arrangement except in accordance with applicable law nor have
there been any improper transfers of assets from any Canadian Employee Benefit
Arrangement to any other Canadian Employee Benefit Arrangement or otherwise, and
the Canadian Vendor is entitled under the terms thereof and under applicable law
and regulatory policy to fund employer contribution obligations out of the
assets of any Canadian Employee Benefit Arrangement.
7. INTENTIONALLY OMITTED
8. ASSETS AND LIABILITIES
8.1 TITLE
8.1.1 The US Vendor has good title to all of the US Assets and
the Canadian Vendor has good title to all of the Canadian Assets, in each case
other than Intangible Property and Real Property, free and clear of any
Encumbrance, except for Encumbrances listed in Section 8.1.1 of the Disclosure
Letter. The Acquired Assets constitute all of the assets that are necessary to
conduct the Operations in substantially the same manner as such Operations are
conducted as of the date hereof.
8.1.2 All Tangible Property of the Vendors is located at the
offices or facilities of the Vendors, or the Vendors each have the full and
unqualified right to require the return of any of its respective Tangible
Property which is not located at its offices or facilities as soon as practical.
The Acquired Assets other than Tangible Property are, where capable of
possession, in the possession of or under the control of either Vendor, or
either Vendor is entitled to take such possession or control as soon as
practical.
8.2 INSURANCE
The Disclosure Letter sets forth summary details of the
insurances of the Vendors material to the Operations as on the date of this
Agreement.
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8.3 TANGIBLE PROPERTY
All Tangible Property of the Vendors material to the
Operations as currently conducted, wherever located, is in satisfactory working
order, ordinary wear and tear excepted and having regard to the age of such
Tangible Property, and have been properly maintained.
8.4 INTANGIBLE PROPERTY
8.4.1 The US Vendor or the Canadian Vendor owns or has the
right to use pursuant to license, sublicense, agreement, or permission all
Intangible Property which is necessary for the Operations as conducted. Subject
to obtaining any Third Party Consents, each such item of Intangible Property
(other than Software) owned or used by the US Vendor and Canadian Vendor
immediately prior to Closing hereunder will be owned or available for use by the
Purchasers on materially the same terms and conditions immediately subsequent to
Closing hereunder, other than to the extent that the failure to own or use such
Intellectual Property would not have a material adverse effect on the Operations
or the financial condition or results of operations thereof. All fees regarding
such Intangible Property due on or before Closing have been paid in full or are
fully reserved on the Net Asset Statement.
8.4.2 (a) To the knowledge of the US Vendor and the Canadian
Vendor, neither the US Vendor, the Canadian Vendor nor the Operations have
interfered with, infringed upon or misappropriated any Intangible Property
rights of third parties in any material respect.
(b) Neither the US Vendor, nor the Canadian Vendor
has knowledge of any facts or circumstances or has received any complaint,
claim, demand, or notice alleging any such interference, infringement,
misappropriation, or violation (including any claim that the US Vendor or the
Canadian Vendor must license or refrain from using any Intangible Property that
is included on the Acquired Assets rights of any third party). To the knowledge
of the US Vendor and the Canadian Vendor, no third party has interfered with,
infringed upon, misappropriated, or otherwise come into conflict with any
Intangible Property rights that are included in the Acquired Assets of the US
Vendor or the Canadian Vendor in any material respect.
8.4.3 Schedule 15 of this agreement identifies:
(a) each patent (including issuing country, number, current
assignee of record, title and issue date), each trademark and service mark
registration (including issuing country, number, description of mark, current
owner of record, classes of goods or services, and issue date), each
unregistered trademark and service mark that is material to the Operations for
which no application for registration is pending (including a description of the
mark and the goods or services with which it is used) and each copyright
registration (including issuing country, number, title or description of work,
current owner of record and issue date) currently in effect, owned by the US
Vendor or the Canadian Vendor and included in the Acquired Assets.
(b) each pending patent application (including country of
filing, serial number, pending patent application (including country of filing,
serial number, current owner of record, title and filing date), application for
registration of a trademark or service mark (including country of filing,
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serial number, description of mark, current owner of record, classes of goods or
services, and filing date), which the US Vendor or Canadian Vendor has made with
respect to any of their Intangible Property which is included in the Acquired
Assets; and
(c) identifies each material license, agreement, or other
permission which the US Vendor or the Canadian Vendor has granted to any third
party with respect to any of the owned Intangible Property that is included in
the Acquired Assets (together with any exceptions). The US Vendor and the
Canadian Vendor have made available to Purchaser correct and complete copies of
all such patents, registrations, applications, permits, agreements and
permissions (as amended to date).
8.4.4 With respect to each item of Intangible Property that
the US Vendor or the Canadian Vendor owns and which is included in the Acquired
Assets, except as otherwise set forth in Schedule 15:
(a) the US Vendor or the Canadian Vendor possesses
all right, title, and interest in and to the item, free and clear of any
Encumbrance, license, or other restriction;
(b) the item is not subject to any outstanding
injunction, Judgment, order, decree, or ruling;
(c) no action, suit, proceeding, hearing,
investigation, charge, complaint, claim, or demand is pending or, to the
knowledge of the US Vendor or the Canadian Vendor, is threatened which
challenges the legality, validity, enforceability, use, or ownership of the
item; and
(d) the US Vendor and the Canadian Vendor have not
agreed to indemnify any person for or against any interference infringement,
misappropriation, or other conflict with respect to the item.
8.4.5(a) Schedule 15 identifies each item of Intangible
Property that is included in the Acquired Assets and that is material to the
Operations that any third party owns and that the US Vendor or the Canadian
Vendor uses in the Operations pursuant to license, sublicense, agreement, or
permission. The US Vendor and the Canadian Vendor have made available to the
Purchaser correct and complete copies of all such licenses, sublicenses,
agreements, and permissions (as amended to date).
(b) With respect to each item of Intangible Property
required to be identified in Schedule 15:
(i) the Vendors are not in material breach or
default under any such license, sublicense or agreement;
(ii) to the knowledge of the US Vendor and the
Canadian Vendor, no party to the license, sublicense, agreement, or permission
is in material breach or default,
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(iii) to the knowledge of the Vendors, no event
has occurred which with notice or lapse of time would constitute a material
breach or default or permit termination, modification, or acceleration
thereunder; and
(iv) the US Vendor and the Canadian Vendor have
not granted any sublicense or similar right with respect to the license,
sublicense, agreement, or permission.
8.4.6 The US Vendor and the Canadian Vendor shall execute
Assignments of their respectively-owned Intangible Property in the form set
forth in Exhibit A to Schedule 15.
8.5 INFORMATION TECHNOLOGY
Details of procedures for Year 2000 compliance of the
Information Technology are disclosed on the Disclosure Letter and such
procedures disclose the actual status of the Vendors' efforts with respect to
addressing any Year 2000 issue, including identifying any Information Technology
that is Year 2000 capable. For the purposes of this Section 8.5.1, INFORMATION
TECHNOLOGY means all computer systems, communications systems, software,
computer hardware and other similar information technology used in connection
with or required to carry on the business of either Vendor (as they relate to
the Operations).
9. REAL PROPERTY
In no event shall the Vendors or the Vendors' Guarantor be
liable for a breach of a Warranty contained in this Section 9 in the event that
it is shown that the factual circumstances or matters which (a) give rise to the
claim for a breach of a Warranty would be shown in a commitment to issue title
insurance prepared by a nationally recognized title insurance company or on an
accurate survey of the property in question and (b) shall not materially
adversely interfere with the use of the Real Property in question as it is
currently used.
9.1 REAL PROPERTY
The Real Property included in this transaction is set out in
Schedule 1 and the particulars contained or referred to therein are true and
correct.
9.2 TITLE
The US Vendor or the Canadian Vendor, as the case may be, is
the legal and beneficial owner or lessee, as the case may be, of the Real
Property included in the Acquired Assets.
9.3 RIGHTS AND EASEMENTS
All of the Vendor Owned Real Property has the benefit of such
rights and easements which are necessary for the existing use of such Real
Property. There are no easements which encroach upon any of the Improvements
constructed or located on any of the Vendor Owned Real Property which materially
adversely interfere with the Operations use of such Real Property.
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The US Vendor and Canadian Vendor have such rights of entry and exit to and from
the Real Property included in the Acquired Assets as are reasonably necessary to
conduct their business upon such Real Property.
9.4 PERFORMANCE OF OBLIGATIONS AFFECTING THE REAL PROPERTY
The US Vendor or the Canadian Vendor, as the case may be, has
not received written notice of any material breach of any obligation, condition,
restriction, agreement or statutory requirement affecting the Real Property
included in the Acquired Assets, its occupation of such Real Property or the
existing use thereof, and has no knowledge of any material breach of any
obligation, condition, restriction, agreement or statutory requirement affecting
such Real Property, its occupation of such Real Property or the existing use
thereof.
9.5 DISPUTES AND NOTICES
So far as the US Vendor or the Canadian Vendor, as the case
may be, is aware, there are no outstanding disputes or notices, and neither
Vendor has received written notices, of any outstanding disputes or notices
affecting the Real Property included in the Acquired Assets which has or is
reasonably likely to have a material adverse effect on the Operations conducted
at such Real Property.
9.6 USE
Neither the US Vendor nor the Canadian Vendor, as the case may
be, has received written notice of, and the Vendors have no knowledge of any
outstanding dispute as to the use of the Real Property included in the Acquired
Assets or any current contravention of the relevant Laws (including, zoning,
land use and planning Laws) or any alleged breach of applicable Laws which has
or is reasonably likely to have a material adverse effect on the Operations
carried out at such Real Property.
9.7 LEASES
So far as either Vendor is aware:
9.7.1 there is no material breach of lease terms which are
likely to adversely affect the business carried out at the Real Property
included in the Acquired Assets; and
9.7.2 any principal rent payable in respect of the Real
Property included in the Acquired Assets is not in the course of being reviewed
other than on rent review terms provided in the relevant Lease and neither
Vendor has received any written notice to the contrary.
9.8 PROPERTY SUBJECT TO OCCUPATIONAL INTERESTS
There is no Vendor Owned Real Property which is subject to any
lease or licence in favor of a third party.
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9.9 REAL PROPERTY
9.9.1 None of the Vendor Owned Real Property, nor the
ownership, possession, occupancy, maintenance or use thereof, is in violation
of, or breach or default under, any Contract or Law, and no notice, work order,
directive, or threat from any lessor, Governmental Authority or other Person has
been received by the US Vendor or the Canadian Vendor, as the case may be, or
served upon any such Real Property claiming any violation of, or breach, default
or liability under, any Contract or Law, or requiring or calling attention to
the need for any work, repairs, construction, alteration, installations or
environmental remediation.
9.9.2 No casualty has occurred with respect to any of the Real
Property included in the Acquired Assets within the last six (6) months which
has had a material adverse effect on the use or operation of such Real Property.
9.9.3 To the knowledge of either Vendor, no proceedings are
pending or threatened which would affect the zoning or use any of the Real
Property included in the Acquired Assets.
9.9.4 All utilities, including water, gas, telephone,
electricity, sanitary and storm sewers, are currently available to all of the
Vendor Owned Real Property at normal and customary rates, and are adequate to
serve such Real Property for each of the current operations and current use
thereof by the US Vendor or the Canadian Company, as the case may be.
9.9.5 No person, firm, corporation or other entity, other than
the US Vendor or the Canadian Vendor, as the case may be (or any Affiliate or
Subsidiary thereof) has any right or option to acquire the Vendor Owned Real
Property or any portion thereof which is owned by the US Vendor or the Canadian
Vendor, as the case may be, or lease or occupy any portion thereof.
9.9.6 Neither Vendor has received written notice of any
material breach of the applicable Vendor's obligations under any easements,
covenants, reservations, restrictions or right-of-way agreements which affect
the Vendor Owned Real Property.
9.9.7 Neither the US Vendor nor the Canadian Vendor, as the
case may be, has received written notice from any Governmental Authority, any
insurer, or any other party (i) that either the Real Property included in the
Acquired Assets or the use or operation thereof is currently in violation of any
Law and to the knowledge of the US Vendor or the Canadian Vendor, as the case
may be, no such notice has been issued; (ii) that the US Vendor or the Canadian
Vendor, as the case may be, is currently in violation or with the passage of
time will be in violation of any Laws or the recommendations of any insurance
carrier or board of fire underwriters affecting the Real Property included in
the Acquired Assets or that any investigation has commenced or is contemplated
regarding any such possible violation, or (iii) asserting that the US Vendor or
the Canadian Vendor, as the case may be, is required to perform work at the Real
Property included in the Acquired Assets and to our knowledge of the US Vendor
or the Canadian Vendor, as the case may be, no such notices have been issued.
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9.9.8 There are no persons other than the US Vendor or the
Canadian Vendor, as the case may be, in possession of any portion of the Real
Property included in the Acquired Assets or Improvements as lessees, tenants at
sufferance or trespassers.
9.9.9 The leases described on Schedule 1 comprise all of the
real property leases presently existing and each is in full force and effect as
of date hereof in which the US Vendor or the Canadian Vendor, as the case may
be, is a landlord or a tenant. None of the leases has been modified, altered, or
amended in any respect, and neither the US Vendor nor the Canadian Vendor, as
the case may be, has the right to cancel or terminate any lease, except as set
forth in the Disclosure Letter. Neither the US Vendor nor the Canadian Vendor,
as the case may be, has received any written notice that it is in default under
any lease. Except as specified on Schedule 1, the US Vendor or the Canadian
Vendor, as the case may be, is in possession of its respective premises. The US
Vendor or the Canadian Vendor, as the case may be, does not have any offsets,
defenses, claims or causes of actions against landlord arising out of matters
occurring prior to Closing.
Within ten (10) business days from the date of this
Agreement, the US Vendor or the Canadian Vendor, as the case may be, shall
request an estoppel certificate from the landlord thereof confirming, among
other things that: (a) a true and correct copy of the lease is attached and that
the Lease is in full force and effect, and has not been modified or amended in
any respect whatsoever, except as specifically set forth; (b) the tenant is not
in default under the lease; (c) the tenant has not prepaid any rent for a period
of more than thirty (30) days from the date hereof; and (d) upon Closing,
Landlord will and does hereby agree to recognize Purchaser as its tenant as
successor to the tenant, said consent to be effective and self operative without
the execution of any further instruments upon Purchaser's succeeding to the
interest of tenant under the lease. The US Vendor or the Canadian Vendor, as the
case may be, agrees: (x) to use commercially reasonable efforts to pursue,
obtain and deliver such estoppel certificates to Purchaser on or prior to
Closing and (y) to cooperate with Purchaser to permit Purchaser to participate
in obtaining such certificates.
9.9.10 Neither the US Vendor nor the Canadian Vendor, as the
case may be, shall take any action prior to Closing which would affect the
current zoning classification of any of the Real Property included in the
Acquired Assets.
9.9.11 Neither the air rights over the Vendor Owned Real
Property nor any other "development rights" with respect to such Real Property
have been assigned, transferred, leased or encumbered.
9.9.12 There are no property interests, buildings, structures,
or other improvements that are owned or held by the US Vendor or the Canadian
Vendor, as the case may be, and which are necessary or currently used for the
Operations that are not being conveyed pursuant to the Agreement (e.g., adjacent
parcels for parking, expansion, development and the like).
9.9.13 All accounts for work and services performed or
materials placed or furnished upon or in respect of the construction and
completion of any of the buildings,
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improvements or other structures constructed on the Vendor Owned Real Property
have been fully paid and no one is entitled to claim an Encumbrance under the
Construction Lien Act (Ontario) or other similar legislation for such work
performed by or on behalf of the Canadian Vendor, and neither Vendor has
received any notification of and neither has knowledge of, any outstanding or
incomplete work orders in respect of any of the buildings, improvements or other
structures constructed on the Real Property included in the Acquired Assets.
9.9.14 Neither Vendor has any knowledge of any expropriation
or condemnation or similar proceeding pending or threatened against the Real
Property included in the Acquired Assets or any part of such Real Property.
9.9.15 Each of the US Vendor and the Canadian Vendor, as the
case may be, has good, marketable and insurable legal title in fee simple
absolute to all of the Vendor Owned Real Property, free and clear of any
Encumbrance except current property taxes accrued but not yet due and payable,
subject to such other exceptions as do not materially and adversely affect the
operations conducted at such Real Property.
10. QUESTIONABLE PAYMENTS
No current or former director, executive, officer, representative,
agent or employee of either Vendor (when acting in such capacity or otherwise on
behalf of either Vendor or any of their predecessors), has violated or is
violating any provision of the Foreign Corrupt Practices Act of 1977.
11. COMPETITION ACT (CANADA)
The Canadian Vendor, together with its affiliates, have assets in
Canada that are less than $90 Million (Canadian) in aggregate value, determined
as of such time and in such manner as is prescribed under the Competition Act
(Canada) and its regulations and have gross revenues from sales in, from or into
Canada, determined for such annual period and in such manner as is prescribed
under such Act and its regulations, that are less than $155 Million (Canadian)
in aggregate value.
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SCHEDULE 9
WARRANTIES FROM THE PURCHASERS
Knowing that the Vendors rely thereon the Purchasers jointly and
severally represent and warrant to the Vendors as follows:
1. AUTHORITY AND CAPACITY
1.1 Each Purchaser and the Purchaser's Guarantor is a corporation duly
incorporated and validly existing under its respective laws of incorporation.
1.2 Each Purchaser has the legal right and full power and authority to
enter into and perform its obligations under this Agreement and any other
agreement entered into pursuant to this Agreement and each such agreement when
executed will constitute valid and binding obligations on the Purchaser, and/or
each Relevant Purchaser (as the case may be) in accordance with their respective
terms, subject to enforcement of remedies to applicable bankruptcy, insolvency,
reorganization and similar laws generally affecting the enforcement of rights of
contracting parties and to a court's discretionary authority with respect to the
granting of a decree ordering specific performance or other equitable remedies.
1.3 The execution and delivery of, and the performance by each
Purchaser of its respective obligations under, this Agreement and any other
agreement entered into pursuant to this Agreement will not:
(a) result in a violation of or default under any
provision of the articles of incorporation and bylaws of either Purchaser; or
(b) result in a breach of any Judgment to which
either Purchaser is a party or by which either Purchaser is bound.
1.4 All corporate action required to be taken by each Purchaser validly
and duly to authorize the execution and delivery of, and to exercise its rights
and perform its obligations under, this Agreement and any other agreement
entered into pursuant to this Agreement has been duly taken or will have been
duly taken before Closing.
1.5 There are no proposals to terminate the employment of any
Continuing Employees after the Closing, except those individuals identified in
Schedule 11, 11A, 11B or 11C, or to materially vary or amend terms and
conditions of employment of any Continuing Employee (whether to their detriment
or benefit), except as may be required by law or as contemplated by this
Agreement. This provision, however, is not and shall not be construed as a
guarantee that Purchaser will not make changes to personnel subsequent to the
Closing.
1.6 As at the date of this Agreement, no Senior Employee has given to
Purchasers or has received from Purchasers a notice terminating his employment.
2. FINANCING
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The Purchasers' Guarantor has entered into a definitive commitment
letter and term sheet with The Chase Manhattan Bank and Chase Securities Inc.
(collectively, CHASE), dated April 6, 1999, which, among other things, commits
Chase to provide up to approximately $1,100,000,000 of senior secured financing
(such commitment letter and term sheet, being the COMMITMENT). The Commitment
has not been modified or amended in any respect (except as approved in writing
by the Vendors' Guarantor) and is in full force and effect as of the date hereof
and as of the Closing Date. Together with proceeds to be made available under
the Commitment, the Purchasers' Guarantor has available, and will make available
to each Purchaser and Relevant Purchaser (as defined in both the Agreement and
the Non-North American Sale and Purchase Agreement), sufficient funds to pay the
Purchase Price (as defined in both the Agreement and the Non-North American Sale
and Purchase Agreement) and consummate the transactions contemplated pursuant to
each such agreement in accordance with the terms and conditions thereof.
Purchasers' Guarantor is not aware of any fact or circumstance which would
prevent the financing described in the Commitment from being provided to the
Purchaser.
3. COMPETITION ACT (CANADA)
The Canadian Purchaser, together with its affiliates, have assets in
Canada that are less than $150 million (Canadian) in aggregate value, determined
as of such time and in such manner as prescribed under the Competition Act
(Canada) and its regulations and have gross revenues from sales in, from or into
Canada, determined for such annual period and in such manner as is prescribed
under such Act and its regulations, that are less than $100 million (Canadian)
in aggregate value.
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SCHEDULE 10
PART 1
TRANSFER TAXES
The Vendors shall pay, or procure payment of, all stamp and other
transfer and registration Taxes and duties payable in respect of the sale and
purchase of the Operations other than the costs of recording of the deeds and
the related transfer taxes with respect to Real Property which shall be shared
equally by the Vendors on the one hand and the Purchasers on the other hand.
At the Closing, the Relevant Purchaser (to the extent that it is the
appropriate party to execute such materials) shall execute and deliver to the
Relevant Vendor exemption certificates as are reasonable and available at such
time with respect to the Acquired Assets in a form that meets the legal
requirements of any Governmental Authority in which such assets are located.
The Vendors and Purchasers agree that prior to Closing they will in
good faith attempt to reach an agreement regarding the value to be attributed to
each parcel of Real Property which will be transferred under the Agreement. They
further agree that in the event they are unable to reach such agreement with
respect to any such parcel of Real Property, each such parcel as to which no
agreement is reached will be deemed to have the value set forth below:
Valuation of Real Property for Transfer Tax Purposes
----------------------------------------------------
<TABLE>
<CAPTION>
UNITED STATES
- -------------
<S> <C>
Malvern, AR (pound)2,767,741
Willimantic, CT (pound)4,500,000
DuQuion, IL (pound)1,553,981
Indianapolis, IN (pound) 262,500
Marion, IN (pound) 763,791
S. Hadley, MA (pound)1,367,513
Jackson, TN (pound)3,380,625
Scottsville, TX (pound)8,422,616
CANADA
- ------
La Malbaie, QU (pound) 731,250
St. Jerome, QU (pound)1,300,000
Trenton, ON (pound) 406,250
</TABLE>
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<TABLE>
<S> <C>
Moose Jaw, SAS (pound) 527,313
</TABLE>
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SCHEDULE 11
EMPLOYEES
1. EMPLOYEES COVERED BY COLLECTIVE BARGAINING AGREEMENTS
1.1 Effective at the Closing, the Purchasers shall (A) assume
the obligations of the Vendors to the Employees who are represented by a labor
union or organization and who are working under the terms of an applicable
Collective Bargaining Agreement (UNION EMPLOYEES) and/or (B) accept the
obligation to recognize and to bargain in good faith with the applicable labor
unions or organizations to the extent required by law and (C) to make all Union
Employees Continuing Employees.
1.2 Nothing in this Agreement provides any additional rights
to the Union Employees, other than what already exists in their Collective
Bargaining Agreements.
1.3 Vendors shall, prior to Closing, provide notice to all
Union Employees of the transaction contemplated by this Agreement. Vendors will
cooperate with Purchasers, including reasonable efforts prior to the Closing, to
assist in the transition of labor relations, including, without limitation,
meeting with Purchasers designated representatives to review applicable past
practices and outstanding labor issues which may not appear in the applicable
Collective Bargaining Agreements.
1.4 Vendors will fully comply with and comply to any and all
obligations they have to bargaining with the labor union or organization which
represents the Union Employees.
1.5 Nothing contained in this Agreement shall be interpreted
as or explained to the Union Employees as a guarantee by Purchasers that after
the Closing it will not affect the number of Union Employees at any facility or
in the aggregate, or that Purchasers will not make changes to terms and
conditions of employment, consistent with prevailing law.
1.6 Vendors shall discharge or provide on the Net Asset
Statement all of their obligations to their former Union Employees, which were
accrued prior to the Closing, regardless of whether they become Employees of
Purchasers, including the payment of wages, salary, tax withholdings, bonuses,
commissions, vacation or holiday pay or workers compensation or any other
compensation except as provided in Schedule 12 of the Agreement. Payments
relating to all Employment Benefit Arrangements shall be determined as stated in
Schedule 12.
1.7 As soon as practicable after Closing, Vendors shall
deliver to the Purchasers either originals or copies (if originals no longer
exist or are not under the US Vendor's custody or control) of all records in
relation to Taxes arising out of the employment relationship and of any other
documents or records (including, but not limited to, personnel records and
files) which are relevant to the Continuing Employees.
2. EMPLOYEES NOT COVERED BY A COLLECTIVE BARGAINING AGREEMENT
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2.1 As of the Closing, Purchaser agrees to make all Employees
of the US Vendor at Closing, except those who are specifically designated in the
Employment Letter as Employees who will not be offered a position of employment
with Purchaser, Continuing Employees.
2.2 Purchasers expressly reserve the right to make changes in
personnel subsequent to the Closing, so long as these decisions are consistent
with any pre-existing Employment Agreements between Vendors and their former
Employees, which Purchaser has agreed to assume, and applicable law.
2.3 Nothing contained in this Agreement shall be interpreted
as a guarantee by Purchasers that after the Closing they will not affect the
number of Employees at any facility or in the aggregate, or that Purchasers will
not make changes to terms and conditions of employment, consistent with
prevailing law.
2.4 Vendors shall discharge all of their obligations to their
former Employees, which were accrued prior to Closing, regardless of whether
they become Continuing Employees, including the payment of wages, salary, tax
withholdings, bonuses, commissions, vacation or holiday pay or any workers
compensation or any other compensation except as provided in Schedule 12 of the
Agreement. Payments relating to all Employment Benefit Arrangements shall be
determined as stated in Schedule 12.
3. SPECIAL CONDITIONS FOR IDENTIFIED EMPLOYEES
3.1 Purchasers shall have no obligation to any Employee who is
specifically identified in the Employment Letter as not receiving a position of
employment with Purchasers and such Employees shall not become a Continuing
Employees and Purchasers shall have no obligation to compensate or make any
payment to such Employee arising from his employment with Vendors or any
termination arising therefrom, except as provided in Schedule 12 of the
Agreement.
3.2 Notwithstanding Paragraph 3.1 of Schedule 11, Purchasers
may provide the Employees identified in the Employment Letter with positions
with Purchasers as consultants for a period not to exceed three (3) months. The
time period for performing consulting services may be extended, in the sole
discretion of Purchasers, but such extensions must be in writing. Such Employees
shall not become Continuing Employees and Purchasers shall have no obligation to
compensate or make any payment to the Employees, other than for services
provided during the three (3) month contract period or longer period if
extended.
3.3 Subject to compliance with Section 5.3. of the Agreement,
Purchasers shall have the right, at any time subsequent to signing this
Agreement and prior to Closing, to meet with any Employee of US Vendor for the
purpose of discussing possible terms and conditions of employment between any
particular Employee and Purchasers. Such discussions shall not affect the terms
of any existing contract or cause or impose or result in any liability on
Purchasers, or on Vendors.
3.4 Subsequent to Closing modifications to any existing
employment agreement between a Continuing Employee and Vendors may only be
executed by a duly authorized representative of Purchasers, and may not impose
any additional obligation or liability on Vendors
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(including without limitation) under the individual employment contract or this
Agreement. Purchaser fully reserves the right to make personnel decisions
respecting these Continuing Employees. Such discussions shall not affect the
terms of any existing contract or cause or impose any liability on Purchaser, or
on Vendors. Vendors shall, upon reasonable notice from Purchasers, cooperate to
facilitate these discussions.
4 ASSUMED LIABILITIES
4.1 Vendors shall calculate, as soon as practical following
signing, the amount of legal entitlement and/or remuneration under the relevant
individually negotiated employment contracts, side letters, and amendments, to
those Employees listed in the Employment Letter who are specifically designated
as receiving positions of employment (excluding any offered consulting
positions) with Purchasers after Closing. Vendors will take due notice of
Purchasers' reasonable representations with regard to the above-referenced
calculations. Vendors will make available a pool of money to Purchasers in an
amount equal to one-half of this amount to be used exclusively for the purpose
of assisting Purchasers in convincing these designated Employees to accept
employment with Purchasers. Vendors will pay Purchasers pursuant to this
Paragraph 4.1 within five (5) days of receipt of evidence acceptable to Vendors
that Purchasers have made a proper payment in accordance with the foregoing to
the designated Employee.
4.2 Vendors shall also calculate, as soon as practical
following signing, the amount of legal entitlements under all negotiated
employment contracts, side letters, and amendments thereto potentially payable
to those Employees listed in the Employment Letter as not receiving positions
with the Purchasers.
4.3 Purchasers shall have the right to switch people between
the lists in the Employment Letter but Vendors' total aggregate liability to
Purchasers under Paragraph 4.1 of Schedule 11, and to the Employees who are not
receiving positions with the Purchaser under their Employment Contracts under
Paragraph 4.2 of Schedule 11 shall not increase as a result of such changes.
4.4 Any liability arising under the Workers Adjustment and
Retraining Notification Act ("WARN") or any similar state, local or provincial
law or regulation for events which arise on or after the Closing or resulting
from the consummation of the transactions contemplated hereby shall be an
Assumed Liability.
4.5 Purchaser shall assume the individual employment contracts
of those Employees who are listed in the Employment Letter as receiving a
position of employment with Purchaser. These individual employment contracts
shall become Assumed Liabilities.
4.6 All workers' compensation claims and related expenses
(including medical, legal and investigative) and hearing loss claims and related
expenses (including medical, legal and investigative) arising prior to Closing
are Excluded Liabilities.
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SCHEDULE 12
EMPLOYEE BENEFIT ARRANGEMENTS
1. US EMPLOYEES
1.1 ASSUMPTION OF EMPLOYEE BENEFIT ARRANGEMENTS Except for the Employee
Benefit Arrangements listed at Section 1.1.7 below, as of the Closing
Date the US Purchaser hereby assumes sponsorship of all Employee
Benefit Arrangements of the US Vendor listed in Schedule 12 of the
Disclosure Letter, and all responsibilities, obligations and
liabilities with respect to, or arising under, such Employee Benefit
Arrangements, including liabilities in connection with those
arrangements relating to current and former Employees of the US Vendor
whether arising before or after the Closing Date, shall be Assumed
Liabilities of the Purchaser.
1.1.1 With respect to the BICC Cables Corporation 401(k)
Savings Plan (the 401(K) PLAN), prior to the
assumption of the 401(k) Plan by the US Purchaser
pursuant to Section 1.1, the US Vendor shall transfer
the assets and liabilities of the 401(k) Plan
attributable to the accrued benefits of those
Employees who will remain employed at the corporate
headquarters of the US Vendor (listed in the
Disclosure Letter), in accordance with Sections
411(d)(6) and 414(l) of the Code, to a plan sponsored
within the controlled group of the US Vendor prior to
the Closing Date or as soon as practicable
thereafter;
1.1.2 In connection with the US Purchaser's assumption of
the BICC Relocation Loan Program, the US Purchaser
agrees to accept transfer of all mortgages with
respect to loans of all Continuing Employees of which
the US Vendor is the mortgagee. In the event that a
Continuing Employee with respect to whom a mortgage
was transferred by the US Vendor to the US Purchaser
is voluntarily or involuntarily terminated by the US
Purchaser within 90 days of the Closing Date, the US
Vendor agrees to purchase from the US Purchaser the
mortgage held with respect to such Continuing
Employee for an amount equal to the face amount of
the outstanding principal and accrued interest under
the mortgage.
1.1.3 In connection with the US Purchaser's assumption
pursuant to Section 1.1 of the Medical Benefit
Programs, including without limitation vision and
dental (other than excluded arrangements at Section
1.1.7), collectively referred to herein as the
"Medical Benefits Plan," the US Vendor shall cause
the reserves for any claims for medical expenses
incurred prior to the Closing Date to equal, as of
the Closing Date, 29% of the total amount of medical
expenses reimbursed pursuant to the Medical Benefits
Plan with respect to the 1998 calendar year (the
Reserve), against which US Purchaser shall on and
after the Closing Date reimburse under the Medical
Benefits Plan claims of individuals who were active
or former Employees
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of the US Vendor prior to Closing (excluding those
described at Section 1.1.7) for medical expenses
incurred prior to the Closing Date. The US Purchaser
shall continue to maintain or shall secure policies
comparable to, all stop loss policies currently in
place with respect to all active and former Employees
of the US Vendor. Only claims for reimbursement for
medical services actually provided on a date prior to
the Closing Date will be treated as "claims for
medical expenses incurred prior to the Closing Date."
The US Purchaser shall provide the US Vendor monthly
with a report of all reimbursements for medical
expenses incurred prior to the Closing Date by
individuals who were active or former Employees of
the US Vendor prior to the Closing Date with
sufficient information to verify the date on which
services were provided and the amount and the
appropriateness of the reimbursement; the US
Purchaser shall ensure that the US Vendor has at all
times the right to audit the relevant third party
administrator with respect to all such
reimbursements. On the first anniversary of the
Closing Date, the US Purchaser shall cause to be
prepared and delivered to the US Vendor a
reconciliation of the amount of the Reserve and all
reimbursements for claims for medical expenses
incurred prior to the Closing Date. In the event that
the amount of the Reserve exceeds the total amount of
all reimbursements for medical expenses incurred
prior to the Closing Date by individuals who were
active or former Employees of the US Vender prior to
the Closing Date, the excess will be returned to the
US Vendor. In the event that the Reserve (together
with any reimbursements from relevant stop loss
policies) is not sufficient to cover claims of
individuals who were active or former Employees of
the US Vendor prior to Closing Date for medical
expenses incurred prior to the Closing Date, the US
Vendor agrees to reimburse the US Purchaser for the
shortfall. Notwithstanding the foregoing, the US
Purchaser shall not pay, and the US Vendor shall in
no event reimburse the US Purchaser for, any claims
relating to the liabilities described at Section
1.1.7 for which the US Vendor remains responsible.
1.1.4 With respect to each Employee of the US Vendor whose
employment with the US Vendor terminates on or prior
to the Closing Date, and all of their relevant
dependents (collectively the COBRA QUALIFIED
BENEFICIARIES) the US Vendor shall provide any COBRA
notice and election forms relating to continuation
health care coverage provided under Part 6 of Title I
of ERISA and Section 4980E of the Code, and further
shall transmit to the US Purchaser any elections
filed with the US Vendor (along with any related
information) by any such person. In connection with
the US Purchaser's assumption pursuant to this
Section 1.1 of the Medical Benefit Plan, the US
Purchaser shall assume (without limitation)
responsibility for providing, to current and former
Employees of the US Vendor, continuation healthcare
coverage and the performance of all responsibilities
in connection therewith including without limitation
the payment of medical benefits. As of the date that
is 18 months after the date of Closing, a
reconciliation of all premiums
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paid, stop loss payments and reimbursements of the
COBRA Qualified Beneficiaries shall be performed. To
the extent that, as of the date that is 18 months
from the Closing Date, the total amount of (i)
premiums paid to the US Purchaser after the Closing
Date by COBRA Qualified Beneficiaries, plus (ii)
reimbursements from all applicable stop loss
policies, is less than (A) the total reimbursements
paid by the US Purchaser for claims for medical
services incurred after the Closing Date by COBRA
Qualified Beneficiaries, plus (B) the per capita per
month third party administrator fees and stop loss
premiums attributable to COBRA Qualified
Beneficiaries, an amount equal to the shortfall shall
be transferred by the US Vendor to the US Purchaser.
1.1.5 The US Purchaser shall reimburse claims pursuant to
paragraph 1.1.3 in accordance with the terms of the
US Vendor's Medical Plan as in effect immediately
prior to the Closing Date. (The US Purchaser reserves
the right to amend US Vendor's medical plan
prospectively, but such amendment shall in no event
apply to claims incurred pre-closing). The US
Purchaser shall reimburse claims pursuant to
paragraph 1.1.4 strictly in accordance with the terms
of the medical plans of the US Purchaser as in effect
at the time the relevant claims are incurred and as
applicable to all similarly situated employees.
Although the US Purchaser (and its relevant agents)
shall with respect to the medical plan and all
participants thereunder have fiduciary responsibility
for the grant or denial of all claims for benefits
that are filed after the Closing Date, as between the
US Vendor and the US Purchaser, at the time of
reconciliation of all claims (described in paragraphs
1.1.3 and 1.1.4)) the US Vendor shall have the right
to challenge the reconciliation, on any relevant
basis, including without limitation, the amount or
appropriateness of any claim granted.
1.1.6 The US Purchaser shall make payment (at the normal
time in the normal manner) of any bonus or pro rata
portion thereof, if any, to be treated as accrued by
a Continuing Employee in the discretion of the US
Vendor under (i) the BICC North American Management
Incentive Compensation Plan; (ii) the Special
Performance Award for Sales Group; (iii) the BICC
Cables Corporation Marshall Texas Gain Share Plan;
(iv) the Foreman's Incentive Bonus Plan; and (v) the
BICC Cables Corporation Discretionary Bonus Plan
attributable to the period ending on the Closing
Date; provided, however, that the US Purchaser's
total obligation under this Section 1.1.6 shall not
exceed the dollar amount of reserves booked by US
Vendor with respect to such programs including, to
the extent applicable, related payroll taxes. US
Vendor shall be responsible (as of the normal
determination date under the foregoing arrangements)
for determining the portion of such reserves if any,
to be treated as accrued for a Continuing Employee
for the period up to the Closing Date. US Purchaser
shall make payment in strict accordance with
the determination by US Vendor and shall not be
responsible for confirming the veracity of such
determination. In no event
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shall the total amounts payable by US Purchaser to
Continuing Employees under this paragraph 1.1.6
exceed the reserves booked with respect to such
obligations.
1.1.7 The US Purchaser will not assume responsibility,
obligations or liabilities relating to the following
Employee Benefit Arrangements:
(i) the BICC Cables Corporation Deferred
Compensation Plan;
(ii) the BICC Cables Corporation
Supplemental Executive Retirement
Plan;
(iii) the BICC Phantom Stock Plan;
(iv) the frozen Brintec Hourly Pension
Plan;
(v) the Brintec Supplemental Retirement
Plan; and
(vi) Miscellaneous one-on-one
arrangements for post- termination
or post-retirement medical benefits
and post- termination or
post-retirement life insurance
benefits listed in the attached
chart;
(vii) Post-Retirement Life Insurance for
Salaried Employees listed in
attached chart;
(viii) Medical Benefits and Life Insurance
for Employees who became disabled
prior to the Closing Date;
(ix) Employment Agreements for Employees
specifically designated in the
Employment Letter, in final form as
of the Closing Date, as not
receiving positions with the
Purchaser.
1.2 GENERAL CABLE SEVERANCE PLAN With respect to all Continuing Employees,
the US Purchaser agrees to enroll such employees in the General Cable
Severance Plan, and give credit for their service with the US Vendor
and any member of its controlled group for purposes of calculating
their benefits under the General Cable Severance Plan. The US Purchaser
also agrees to maintain the General Cables Severance Plan with respect
to Continuing Employees for a period of at least one year immediately
following the Closing Date.
1.3 PLANS OF US PURCHASER The US Purchaser hereby agrees that each
Continuing Employee as of the Closing Date shall be immediately
eligible to participate in the US Purchaser's
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Employee Benefit Arrangements on the same terms and conditions as
similarly situated employees of the US Purchaser.
1.4 PAST SERVICE CREDIT To the extent applicable with respect to Employee
Benefit Arrangements, maintained by the US Purchaser, Continuing
Employees (and their eligible dependents) shall be given credit for
their service with the US Vendor and any member of its controlled group
(i) for purposes of eligibility to participate and vesting (but not
benefit accrual except as described in Section 1.2); and (ii) for
purposes of satisfying any waiting periods, evidence of insurability
requirement, or the application of any pre-existing condition
limitation.
1.5 INDEMNIFICATION The US Vendor shall indemnify the US Purchaser against
all Losses incurred by the US Purchaser relating to or arising from (i)
any action or inaction by the US Vendor prior to the Closing Date in
breach of the law with respect to any Employee Benefit Arrangements
assumed by the US Purchaser; or (ii) breach of any post-closing
obligations of US Vendor under this Schedule 12. The US Purchaser shall
indemnify the US Vendor against all Losses arising on or after the
Closing Date relating to or arising from (i) any action or inaction in
breach of the law of the US Purchaser in connection with those Employee
Benefit Arrangements assumed by the US Purchaser pursuant to this
Schedule 12 and (ii) breach of any post-closing obligations of the
Purchaser under this Schedule 12.
2. CANADIAN EMPLOYEES
2.1 SALARIED PLAN
(a) The Canadian Purchaser shall adopt or amend, effective as of
the Closing, a pension plan and related fund (the CANADIAN
PURCHASER'S PENSION PLAN) which shall cover all the
Transferred Salaried Employees. The Canadian Purchaser's
Pension Plan as adopted and the benefits provided thereunder
shall be substantially the same in the aggregate as the
Salaried Plan. The Canadian Purchaser shall provide a
registered pension plan for the Transferred Salaried Employees
for a period of not less than 2 years after the Closing.
(b) The Canadian Purchaser's Pension Plan shall provide for (i)
accrued benefits, based on pensionable earnings and service as
of the Closing, for each Transferred Salaried Employee's
defined benefits under the Salaried Plan, and (ii) accrued
benefits, based on each Transferred Salaried Employee's
defined contribution account balance as of the Closing, for
such Transferred Salaried Employee's defined contribution
benefits under the Salaried Plan (such defined benefit accrued
benefits and defined contribution accrued benefits shall be
referred to herein as the DB BENEFITS and the DC BENEFITS,
respectively). Subject to applicable law, the DB Benefits and
DC Benefits shall be determined in accordance with the
provisions of the Salaried Plan.
(c)(i) The Canadian Vendor shall cause the transfer to the pension
fund for the Canadian Purchaser's Pension Plan of a pro rata
portion of assets (the DB TRANSFERRED
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AMOUNT) from the Salaried Plan funding media (the SALARIED
TRUST), such that the DB Transferred Amount bears the same
ratio to the total assets of the Salaried Plan as the going
concern actuarial liabilities of the Salaried Plan relating to
the DB Benefits as of the Closing, determined in accordance
with the summary of actuarial methods and assumptions annexed
hereto as Appendix 2.1(c)(i), applied in accordance with
generally accepted Canadian actuarial principles and all
applicable laws, as certified by William M. Mercer Limited
(CSA), actuaries for the Salaried Plan bears to the total
defined benefit going concern actuarial liabilities of the
Salaried Plan, determined on the same basis. The Canadian
Vendor shall make the details of these calculations and their
results, including individual results by plan member,
available to the Canadian Purchaser and its actuary (the CPA)
within 45 days after Closing for their review and
confirmation, and shall furnish to them such other information
and data, as may reasonably be required or requested to permit
a review, recalculation and confirmation of the DB Transferred
Amount, by the Canadian Purchaser and the CPA. The Canadian
Purchaser shall notify the Canadian Vendor within thirty (30)
days of receiving such information and data as to its
agreement or disagreement with the Canadian Vendor's
calculation of the DB Transferred Amount. Any dispute with
respect to such amount or payment shall be resolved pursuant
to Section 2.3 of this Schedule 12.
(ii) On Closing, the Canadian Vendor shall pay to the Canadian
Purchaser an amount equal to the difference between the DB
Transferred Amount (as estimated by CSA on the basis set forth
in Section 2.1(c)(i) above) and the amount necessary to ensure
that as of the Closing Date, all of the DB Liabilities are
fully funded on a going concern basis (as estimated by CSA on
the basis set forth in Section 2.1(c)(i) above). As soon as
practicable, but in any event within thirty (30) days after
final agreement is reached between the Canadian Vendor and the
Canadian Purchaser with respect to the amount of the DB
Transferred Amount, the amount of the payment pursuant to this
Section shall be adjusted based on a full actuarial valuation
of the Salaried Plan and the actual status of the Salaried
Plan as of Closing, in the manner set forth in Section
2.1(c)(i) above.
(iii) If the Superintendent of Financial Services of Ontario (the
SUPERINTENDENT ) requires an amount other than the DB
Transferred Amount to be transferred (the DB REGULATORY AMOUNT
), the parties agree that the DB Regulatory Amount shall be
the DB TRANSFERRED AMOUNT hereunder, subject to any rights of
appeal. In addition to the adjustments contemplated by Section
2.1(c)(ii) above, if the DB Transferred Amount (before
adjustment pursuant to the preceding sentence) is greater than
the DB Regulatory Amount, the Canadian Vendor shall pay the
amount of such difference to the Canadian Purchaser; if the DB
Transferred Amount (before adjustment pursuant to the
preceding sentence) is less than the DB Regulatory Amount, the
Canadian Purchaser shall pay the amount of such difference to
the Canadian Vendor, such payment to be made in either case on
the date specified in Section 2.1(f) of this Schedule 12.
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(iv) Subject to all applicable regulatory approvals, the Canadian
Vendor shall cause the transfer to the funding agent for the
Canadian Purchaser's Pension Plan (the CANADIAN PURCHASER'S
TRUST) from the Salaried Trust of each Transferred Salaried
Employee's DC Benefit account balance (the DC TRANSFERRED
AMOUNT) as at the date such transfer is completed in
accordance with the terms of the Salaried Plan. Such transfer
shall be made at the time set forth in Section 2.1(f) of this
Schedule 12.
(d) The Canadian Purchaser shall file an application for
registration of the Canadian Purchaser's Pension Plan or
amendment thereof, and the Canadian Vendor shall file
applications for approval of the transfer of funds from the
Salaried Trust into the Canadian Purchaser's Trust
contemplated hereunder, in each case with the Superintendent,
any other applicable pension regulatory authority and Revenue
Canada. The Canadian Purchaser and Canadian Vendor shall
diligently pursue their respective applications. The Canadian
Vendor shall diligently cooperate with the Canadian Purchaser
by amending the Salaried Plan and filing or otherwise
providing to the Canadian Purchaser any information required
with respect thereto and otherwise cooperate with the Canadian
Purchaser to the extent necessary to allow the Canadian
Purchaser to effect the registration of the Canadian
Purchaser's Pension Plan or amendment thereof.
(e) The Canadian Vendor shall, on behalf of the Canadian
Purchaser's Pension Plan and the Canadian Purchaser's Trust
but out of the Salaried Plan and the Salaried Trust, pay or
cause to be paid all benefits accrued to the Closing and
payable under the Canadian Purchaser's Pension Plan and
Canadian Purchaser's Trust with respect to the Transferred
Salaried Employees until the completion of the transfer of
funds to the Canadian Purchaser's Pension Plan and Canadian
Purchaser's Trust as contemplated herein.
(f) On the last day on which banks in Toronto are open for regular
banking business of the month in which the approval for the
transfer of assets contemplated in Section 2.1(d) of this
Schedule 12 is received or so soon thereafter as is
practicable (the TRANSFER DATE), the Canadian Vendor shall
cause to be transferred from the Salaried Trust to the
Canadian Purchaser's Trust, cash or assets with a value equal
to the DB Transferred Amount and the DC Transferred Amount. An
amount equal to the pro rata share attributed by the Canadian
Vendor, acting reasonably, to the DB Transferred Amount of
investment gains or losses shall be added to or deducted (as
applicable) from the DB Transferred Amount from the amount to
be transferred from the Salaried Trust to the Canadian
Purchaser's Trust hereunder, and there shall be deducted from
the DB Transferred Amount (i) the amount of any expenses
payable and not otherwise paid by the Canadian Purchaser in
accordance with Section 2.1(g) of this Schedule 12, and (ii)
the amount of any DB Benefits paid to Transferred Salaried
Employees out of the Salaried Plan and Salaried Trust during
such period in accordance with Section 2.1(e) of this Schedule
12. There shall be deducted from the DC Transferred Amount (i)
the amount of any expenses paid in accordance with Section
2.1(g) of this Schedule 12, and (ii) the amount of any DC
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Benefits paid to Transferred Salaried Employees out of the
Salaried Plan and Salaried Trust during such period in
accordance with Section 2.1(e) of this Schedule 12.
(g) The Canadian Vendor shall provide the Canadian Purchaser such
information and reports as Canadian Purchaser may reasonably
require in order to administer the Canadian Purchaser's
Pension Plan in respect of the Transferred Salaried Employees.
Canadian Purchaser shall pay the reasonable costs and expenses
necessary to provide such information and reports, by
deducting these amounts from the DB Transferred Amount and the
DC Transferred Amount or otherwise paying such amounts to the
Canadian Vendor.
2.2 HOURLY PENSION PLANS WITH RESPECT TO TRENTON, ST-JEROME AND LA MALBAIE
LOCATIONS
(a) Effective on Closing, the Canadian Vendor shall assign to the
Canadian Purchaser, and the Canadian Purchaser shall assume,
the sponsorship and administration of, and all rights and
obligations of the Canadian Vendor under, the Hourly Pension
Plans and the Hourly Trust Agreements, with the effect that
following the Closing, the Canadian Purchaser will be the
administrator and sponsor of the Hourly Pension Plans and
related pension funds in place of the Canadian Vendor, and the
Canadian Vendor shall be relieved of all further obligations
in respect of the Hourly Pension Plans and the Hourly Trust
Agreements. The Canadian Vendor and the Canadian Purchaser
shall cooperate in making such amendments to the Hourly
Pension Plans and making such filings with Revenue Canada and
the pension benefits regulatory authorities applicable to the
Hourly Pension Plans are entering into such arrangements with
the trustees of the Hourly Pension Plans, in each case as may
be necessary or desirable to effect the assignment and
assumption contemplated by this Section 2.2 of this Schedule
12. The Canadian Purchaser shall become the administrator of
the Hourly Pension Plans only upon the assignment to the
Canadian Purchaser by the Canadian Vendor of the rights and
obligations of the Canadian Vendor under the Hourly Trust
Agreements, including, without limitation, all of the Canadian
Vendor's rights in respect of the assets held in each of the
Hourly Trust Agreements, except that, with effect from the
Closing Date, the Canadian Purchaser shall administer each of
the Hourly Plans as agent for the Canadian Vendor.
(b) On Closing, the Canadian Vendor shall pay to the Canadian
Purchaser an amount equal to the difference between the value
of assets in the Hourly Plans as of the Closing Date (as
estimated by CSA) and the amount necessary to ensure that, as
of the Closing Date, all of the liabilities of the Hourly
Plans are fully funded on a going concern basis (as estimated
by CSA on the basis set forth below). As soon as practicable,
and in any event within thirty (30) days after the Closing
Date, the Canadian Vendor shall update the pension records of
all of the members of the Hourly Pension Plans up to the
Closing Date, and shall determine, within forty-five (45) days
after the Closing Date, the estimated going concern
liabilities for each of the LaMalbaie Plan (the LAMALBAIE PLAN
LIABILITIES), the St. Jerome Plan (the ST.
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JEROME PLAN LIABILITIES) and the Pyrotenax Plan (the PYROTENAX
PLAN LIABILITIES, all calculated in accordance with the
actuarial methods and assumptions set out in Appendix
2.1(c)(i) applied in accordance with generally accepted
Canadian actuarial principles and all Applicable Laws and
shall determine the estimated value of the assets of each of
the La Malbaie Plan (the LA MALBAIE PLAN ASSETS), the St.
Jerome Plan (the ST. JEROME PLAN ASSETS) and the Pyrotenax
Plan (the PYROTENAX PLAN ASSETS). The Canadian Vendor shall
make the details of these calculations and their results,
including individual results by plan member, available to the
Canadian Purchaser and the CPA for their review and
confirmation, and shall furnish to them such other information
and data, as may reasonably be required or requested to permit
a review, recalculation and confirmation of the LaMalbaie Plan
Liabilities, the St. Jerome Plan Liabilities and the Pyrotenax
Plan Liabilities, as well as the LaMalbaie Plan Assets, the
St. Jerome Plan Assets and the Pyrotenax Assets. The Canadian
Purchaser shall notify the Canadian Vendor within thirty (30)
days of receiving such information and data as to its
agreement or disagreement with the Canadian Vendor's
calculation of the LaMalbaie Plan Liabilities, the St. Jerome
Plan Liabilities and the Pyrotenax Plan Liabilities, as well
as the LaMalbaie Plan Assets, the St. Jerome Plan Assets and
the Pyrotenax Assets. Any dispute shall be resolved pursuant
to Section 2.3 of this Schedule 12.
(c) As soon as practicable, but in any event within thirty (30)
days after final agreement is reached between the Canadian
Vendor and the Canadian Purchaser with respect to the amount
of the LaMalbaie Plan Liabilities, the St. Jerome Plan
Liabilities and the Pyrotenax Plan Liabilities, as well as the
LaMalbaie Plan Assets, the St. Jerome Plan Assets and the
Pyrotenax Assets, the Canadian Vendor shall pay to the
Canadian Purchaser an amount equal to the amount necessary to
ensure that, as at the Closing Date, all of the Hourly Pension
Plans are fully funded on an ongoing basis, on the basis set
forth in Appendix 2.1(c)(i).
(d) The Canadian Purchaser (as agent for the Canadian Vendor)
agrees to administer the Hourly Pension Plans until the date
on which the rights and obligations of the Canadian Vendor
under each of the Hourly Pension Plans and associated trust
agreements, including all of the Canadian Vendor's rights in
respect of the assets held in the trust funds, are assigned to
the Canadian Purchaser (the HOURLY PENSION PLAN ASSIGNMENT
DATE) in the same manner as it is being administered at the
Closing Date but for the account of, and at the expense of,
either the trust fund for the applicable Hourly Plan (subject
to any Applicable Law) or, where such charge to the trust fund
is not permitted by Applicable Law, the Canadian Purchaser.
Until the Hourly Pension Plans Assignment Date and subject to
any other agreements between the Canadian Vendor and the
Canadian Purchaser, the Canadian Purchaser (as agent of the
Canadian Vendor) shall receive and deposit contributions, if
any, by the Canadian Purchaser and the participants in the
Hourly Plans to the trust funds therefor. Until the Hourly
Pension Plans Assignment Date, the assets held in the trust
funds for the Hourly Plans shall be invested under the
supervision of the Canadian Purchaser (as agent of the
Canadian Vendor), by the
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trustee of the trust fund for each of the Hourly Plans, who
will act with reasonable diligence and prudence and in good
faith in so doing.
(e) As soon as practicable after the Closing Date, the Canadian
Vendor shall provide to the Canadian Purchaser such
information and records, and access to such personnel, as may
reasonably be required to administer the Hourly Plans, to the
extent that such information and records are not then in the
possession of the Canadian Purchaser or any of its authorized
representatives.
(f) All statutory and regulatory administration reporting, filing
and disclosure requirements applicable to the Hourly Pension
Plans in respect of the plan years ending prior to the Closing
Date shall remain the responsibility of the Canadian Vendor,
and all such requirements applicable in respect of plan years
ending on or after the Closing Date shall be the
responsibility of the Canadian Purchaser.
2.3 DISPUTE RESOLUTION
If CSA and CPA are unable to agree on the DB Transferred Amount, or the
Canadian Purchaser and the Canadian Vendor are unable to agree on any
amount or calculation pursuant to Sections 2.1 or 2.2 of this Schedule
12, their differences shall be resolved by a third independent actuary
selected by CSA and CPA, and the expense of such independent actuary
shall be paid one half by the Canadian Vendor and one half by the
Canadian Purchaser. In certifying , verifying or reviewing the DB
Transferred Amount or the amounts payable pursuant to Sections
2.1(c)(ii) and 2.2(c) of this Schedule 12, the actuaries referred to
herein shall have no responsibility, obligation or right to change the
methods, assumptions or any other term or condition of the summary of
actuarial methods and assumptions annexed hereto as Appendix 2.1(c)(i),
it being understood and agreed that the duties requested of such
actuaries shall be solely to calculate and otherwise determine such
amounts in a manner consistent with Appendix 2.1(c)(i), this Schedule
12, generally accepted Canadian actuarial principles and all applicable
law.
2.4 BENEFIT PLANS FOR TRANSFERRED EMPLOYEES
With effect from the Closing Date, the Canadian Purchaser shall
establish or otherwise provide benefit plans for the Transferred
Employees consisting of life insurance, medical, dental, accident,
disability and other benefits that are substantially similar, in the
aggregate, to those offered as of the Closing by the Canadian Vendor to
the Transferred Employees and all eligible persons claiming through
them. The Canadian Vendor shall remain liable for all obligations for
claims in respect of which the event giving rise to the claim occurred
prior to the Closing Date.
2.5 GROUP RRSP - TRANSFERRED EMPLOYEES
With effect from the Closing Date, the Canadian Purchaser shall
establish or otherwise provide a group registered retirement savings
plan upon substantially similar terms, in the aggregate, to the BICC
Group RRSP.
127
<PAGE> 131
2.6 COMPLIANCE WITH COLLECTIVE AGREEMENTS
The Canadian Purchaser shall ensure that all pension and benefits
arrangements established or maintained by it comply with the terms of
each applicable collective agreement affecting the Transferred
Employees and the Former Employees - Continuing Operations.
2.7 CONTINUOUS SERVICE
For the purposes of the Canadian Purchaser's Plans, service of a
Transferred Employee with the Canadian Vendor and membership in any of
the Canadian Vendor's Plans shall be deemed to be service with the
Canadian Purchaser and membership in the corresponding Canadian
Purchaser's Plan and as if the Canadian Purchaser's Plans were
continuations of the Canadian Vendor's Plans.
2.8 NO ASSUMPTION OF LIABILITIES
The Canadian Vendor and the Canadian Purchaser agree and confirm that
the Canadian Purchaser is not assuming nor will it have any liability
for; any Employee Benefit Arrangement of the Canadian Vendor unless
expressly set forth in this Schedule 12.
2.9 TRANSFERRED EMPLOYEES PERFORMING SERVICES FOR THE CANADIAN VENDOR
The Canadian Purchaser shall make available to the Canadian Vendor the
services of the Transferred Employees named in Appendix 2.9. The
Canadian Vendor and the Canadian Purchaser will enter into a services
contract relating to such employees pursuant to which the Canadian
Vendor will agree to reimburse the Canadian Purchaser for the salary
and all pension and non-pension benefits paid and any other reasonable
expenses incurred by the Canadian Purchaser with respect to such
employees on similar terms to those currently applicable to such
persons, together with applicable taxes.
2.10 RELATED DEFINITIONS
For the purpose of this Section 2 of this Schedule 12, the terms set
forth below shall have the meanings specified below.
<TABLE>
<S> <C>
Canadian Purchaser's Plans: the pension and benefit plans and arrangements required to be
established or maintained by the Canadian Purchaser pursuant to
Section 2 of this Schedule 12.
Canadian Vendor's Plans: the Employee Benefit Arrangements in which the Canadian Vendor
has entered into, participate, or has liability for.
Former Employee: each person who (a) at any time prior to the Closing Date was an
employee of the Canadian Vendor, and (b) remains entitled as of the
</TABLE>
128
<PAGE> 132
<TABLE>
<S> <C>
Closing Date to any benefits under the Canadian Vendor's Plans in
respect of his or her employment with the Canadian Vendor.
Hourly Pension Plans: The Pension Plan for Hourly Paid Employees of BICC Cables Canada
Inc. at its St. Jerome Factory (Quebec Registration No. 25587),
Pension Plan for Hourly Employees of Pyrotenax of Canada Limited,
a Division of BICC Cables Canada Inc. (FSCO Registration No.
05211406) and Pension Plan for Unionized Employees of BICC
Cables Canada Inc. located at LaMalbaie Quebec (Quebec
Registration No. 31236).
Hourly Trust Agreements: the trust agreements relating to the pension funds for the Hourly
Pension Plans.
Salaried Plan: The Employees' Pension Plan of BICC Cables Canada Inc. (FSCO
Registration No. 0293761).
Transferred Employee: those employees of the Canadian Vendor who will continue as
employees of the Canadian Purchaser after Closing but, for greater
certainty, does not include any Former Employee.
Transferred Salaried
Employee: each Transferred Employee who as of the Closing Date is a member
of or is satisfying the criteria for membership of the Salaried Plan, and
each Former Employee or Employee who is not a Transferred
Employee but who as of the Closing Date is a member or former
member of or is satisfying the criteria for membership of the defined
contribution portion of the Salaried Plan.
</TABLE>
129
<PAGE> 133
Appendix 2.9
to Schedule 12
Mary Freeman
Deborah Wisteand
Stephanie De Lauretis
Mike Taylor
Danuta Dworaczek
130
<PAGE> 134
APPENDIX 2.1(c)(i)
------------------
TO SCHEDULE 12
BICC CABLES CANADA INC.
SUMMARY OF ACTUARIAL ASSUMPTIONS
FOR FUNDING PURPOSES
AS AT APRIL 6, 1999
<TABLE>
<CAPTION>
ACTUARIAL PLAN
ASSUMPTIONS --------------------------------------------------------------------------------------
(PROVINCIAL EMPLOYEES ST. JEROME PYROTENAX LA MALBAIE
REGISTRATION) (ONTARIO) HOURLY HOURLY (QUEBEC)
(QUEBEC) (ONTARIO)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
GOING CONCERN BASIS
- --------------------------------------------------------------------------------------------------------------------------
ECONOMIC ASSUMPTIONS:
- --------------------------------------------------------------------------------------------------------------------------
- - Investment Return 7.5% 7.5% 7.5% 7.5%
- - Increase in 7.0% None None None
Earnings
- - Increase in YMPE 6.5% None None None
- - Expenses None None None None
- - Increase in None None None None
Revenue Canada
Maximum
- - Indexing None None None None
- --------------------------------------------------------------------------------------------------------------------------
DEMOGRAPHIC ASSUMPTIONS:
- --------------------------------------------------------------------------------------------------------------------------
- - Retirement Age - 50% retire at 25% at min. age 25% at min. Age 63
age 63 and of entitlement to age of
50% retire at an unreduced entitlement to
age 64 pension and an unreduced
75% at age 65 pension and
- Executives 75% at age 65
retire at age 62
- - Termination Ontario Light Ontario Light Ontario Light Ontario Light
truncated at truncated at truncated at truncated at
age 55 age 56 age 55 age 55
- - Morality GAM83 GAM83 GAM83 GAM83
</TABLE>
131
<PAGE> 135
<TABLE>
<CAPTION>
ACTUARIAL PLAN
ASSUMPTIONS --------------------------------------------------------------------------------------
(PROVINCIAL EMPLOYEES ST. JEROME PYROTENAX LA MALBAIE
REGISTRATION) (ONTARIO) HOURLY HOURLY (QUEBEC)
(QUEBEC) (ONTARIO)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- - Disability None except that None None None
current disabled
members
assumed not to
return to actives
- - Family 100% of plan None None None
Composition members are
married and male
partner is 3 years
older than female
- --------------------------------------------------------------------------------------------------------------------------
SOLVENCY BASIS
- --------------------------------------------------------------------------------------------------------------------------
- - Investment Return 5.75% for 15 years, 6% thereafter for March 99 valuation
- - Increases in
Earnings None
- --------------------------------------------------------------------------------------------------------------------------
Otherwise as above except as required by specified provincial pension legislation.
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
132
<PAGE> 136
SCHEDULE 13
[INTENTIONALLY LEFT BLANK]
133
<PAGE> 137
SCHEDULE 14
[INTENTIONALLY LEFT BLANK]
134
<PAGE> 138
SCHEDULE 15
INTELLECTUAL PROPERTY
135
<PAGE> 139
The Vendors' Intellectual Property is being sold, transferred and assigned
pursuant to the Assets Sale and Purchase Agreement, dated April 6, 1999, and
such sale, transfer and assignment is subject to the provisions of the license
agreements to which the Vendors or either of them is a party.
List of patents, registered designs and registered trade marks and applications
therefor
<TABLE>
<CAPTION>
Status
(Reg/ Application
Title Country Pending) Number Title Holder of Record
- ---------------------------- ---------------------- --------------------------- ------------------- ------------------------
<S> <C> <C> <C> <C>
Low-ash Blacks CA Pending BICC Cables Corporation
US Pending 08/217116 BICC Cables Corporation
Metallic constant watt BR Granted 8700141 Pyrotenax of Canada Ltd.
CA Granted 527383 Pyrotenax of Canada Ltd.
FR Granted 8700406 Pyrotenax of Canada Ltd.
GB Granted 8700888 Pyrotenax of Canada Ltd.
US Granted 06/946761 Pyrotenax of Canada Ltd.
ARMORKOTE US Registered 74/099682 BICC Cables Corporation
CABLEC US Registered 73/524225 BICC Cables Corporation
CDC US Registered 72/164557 BICC Cables Corporation
CONOPTICS US Registered 71/299827 BICC Cables Corporation
DURALOX US Registered 72/021357 BICC Cables Corporation
DURASHEATH US Registered 71/612941 BICC Cables Corporation
FLAME-GUARD US Registered 73/026995 BICC Cables Corporation
HOT SPOT US Registered 74/142400 BICC Cables Corporation
Cablec Continental Cables
INTEGRAFLAME US Registered 73/794406 Corporation
LOOSE PACK US Registered 74/299830 BICC Cables Corporation
ACID FLAMECHECK &
design US Registered 73/579401 Phillips Cables Ltd.
PLENUM FLEX 90 US Registered 74/276207 BICC Cables Corporation
ARCTIC-FLEX US Registered 74/664828 BICC Cables Corporation
POLYRAD US Registered 73/066819 BICC Cables Corporation
PPP US Registered 73/564594 BICC Cables Corporation
PRECON US Registered 72/352665 BICC Cables Corporation
STRANDFILL US Registered 73/547526 BICC Cables Corporation
T-2 US Registered 73/268684 BICC Cables Corporation
THRMOLENE US Registered 72/164556 BICC Cables Corporation
UNI BLEND US Registered 72/150841 BICC Cables Corporation
UNICON US Registered 70/218170 BICC Cables Corporation
UNISHIELD US Registered 72/333516 BICC Cables Corporation
ACID-FLAME-CHECK CA Registered 546613 BICC Phillips Inc.
CARQUAD CA Registered 351153 BICC Phillips Inc.
CELSEAL CA Registered 357092 BICC Phillips Inc.
DEVILEAD CA Registered 585076 BICC Phillips Inc.
DEVILEAD US Registered 73/697713 Philips Cables Ltd.
DEVILENE US Registered 73/697712 Philips Cables Ltd.
DEVILENE CA Registered 585075 BICC Phillips Inc.
DEVILENE US Registered 73/716226 Philips Cables Ltd.
DEVILENE FR Registered 929456 Philips Cables Ltd.
DEVILENE CA Registered 397207 BICC Phillips Inc.
EPD CA Registered 679929 BICC Phillips Inc.
</TABLE>
136
<PAGE> 140
<TABLE>
<CAPTION>
- -------------------------- ---------------------- ------------------- --------------------- ---------------------------------
Status
(Reg/ Application
Title Country Pending) Number Title Holder of Record
- -------------------------- ---------------------- ------------------- --------------------- ---------------------------------
<S> <C> <C> <C> <C>
EPN CA Registered 679933 BICC Phillips Inc.
FLAMBICC CA Registered TMA602049 BICC Cables Corporation
FLEXFORM CA Registered 358936 BICC Phillips Inc.
NORAL-AC CA Registered 143839 BICC Phillips Inc.
NORFLAME CA Registered 394208 BICC Phillips Inc.
PHILLIPS ACID
FLAMECHECK US Registered 73/633111 Philips Cables Ltd.
PHILLIPS CABLES US Registered 74/996026 Philips Cables Ltd.
PHILPLEX CA Registered 253944 BICC Phillips Inc.
PHILSHEATH US Registered 73/1572491 Philips Cables Ltd.
PHILSYM CA Registered 351151 BICC Phillips Inc.
PORTAFLEX CA Registered 511037 BICC Phillips Inc.
REELFREE and design CA Registered 504934 BICC Phillips Inc.
STALCELL CA Registered 351152 BICC Phillips Inc.
STANDFILL CA Pending 775735 BICC Cables Corporation
THERMALENE CA Registered 329871 BICC Phillips Inc.
VERTITECK US Registered 73/622383 Phillips Cables Limited
VERTITECK CA Registered 560038 BICC Phillips Inc.
PORTAFLEX PLUS CA Registered 725957 BICC Phillips Inc.
PY-TRACE CA Registered 532311 BICC Cables Canada Inc.
PYROPAK CA Registered 242249 Pyrotenax of Canada Ltd.
PYROTRACE CA Registered 468279 BICC Cables Canada Inc.
SLOT-LOK CA Registered 350461 Pyrotenax of Canada Ltd.
PYROTRACE US Registered 73/342608 Pyrotenax USA Ltd.
</TABLE>
Licenses of Vendors' Intangible Intellectual Property and Vendors' Know-How
<TABLE>
<CAPTION>
Other Party Subject Agreement Type
- ----------- ------- --------------
<S> <C> <C>
BP Chemicals Ltd. Dual Layer Strippable Screens Licence Agreement
General Electric Company Insulated Power and Control Technology and Patent Licence
Cables Agreements
Essex Group Inc. Transmission, Distribution and Licence Agreement
Control Cables
BP Performance Polymers, Inc. Water Tree Retardant XPLE Sublicence Agreement
Compound
Dow Chemical Company Medium Voltage Cable Collaboration Agreement
Insulation
BICC Plc/Cablec Corporation Joint Research Technical Collaboration
Agreement
</TABLE>
137
<PAGE> 141
Material computer software license agreements (excluding shrink-wrap licenses)
Vendors
- -------
Axiox
Candle (03611)
Omegamon/CICS
Omegamon/MVS
Client Soft
Pilot
Comet/CICS (Techologic)
Computer Associates (01236)
Corporate Tie
CJB's group
Compu Ware (03277)
XPEDITRER/CICS
File Aid
Corporate Software & Tech.
Decision One Corp.
Design Consultants, Inc.
Geac Computer Systems
AMAPS
A/P
A/R
O/P
IBM (52422)
Information Access
Computer Select Library
Innovation
FDR/ABR/COMPAKTOR
Intel
Levi, Ray, Shoup, Inc. (03744)
VTAM Printer
VMCF/VTAM
Mac Kinney Systems (04112)
Microsoft Select/Office 97
Monarch Bay Software, Inc.
Professional Network Services
Scheduling (00157)
OPT Software Maintenance
Sterling
DYI/280
Support Magic
Syncsort, Inc. (00525)
Syncsort MVS
Sysdata (00630)
Mufmon
Taxware International (00166)
Technologic Software
Vanguard
138
<PAGE> 142
<TABLE>
<CAPTION>
Other Material Intellectual Property Agreements
Other Party Title Type Unit
- ----------- ----- ---- ----
<S> <C> <C> <C>
Cabot Corporation Carbon Blacks Collaboration BICC Cables
Agreement Corporation
BP Performance Sheathing Materials Secrecy Agreement BICC Cables
Polymers Inc. Corporation
Polytechnic University Halogen Free Low Fire Sponsored BICC Cables
of Brooklyn Hazard Cable Development Work Corporation,
Agreement Indianapolis Technical
Center
Sheffield University Bonding of Different Sponsored BICC Cables
Flexible Polyer Development Work Corporation,
Compositions Agreement Indianapolis Technical
Center
University of Montreal Modelling of Two Layer Sponsored BICC Cables
Die Flow Development Work Corporation,
Agreement Indianapolis Technical
Center
Cornell University Nanocomposite Draft Sponsored BICC Cables
Structures in Polyolefin Development Work Corporation,
Insulations Agreement Indianapolis Technical
Center
</TABLE>
1. Sublicense Agreement between Dow Chemical Corporation and Dow Chemical
Canada, Inc. ("Dow" or "Licensor") and BICC Cables Corporation
("Licensee") effective June 12, 1996 as amended.
2. Water Tree Retardant XLPE Compound License Agreement between Sumitomo
Electric Industries, Ltd. ("Licensor") and Cablec Corporation ("Licensee")
dated July 15, 1986.
3. Compound Licence Agreement between Sumitomo Electric Industries, Ltd.
("Licensor") and Cablec Corporation ("Licensee") dated July 15, 1986.
4. Moisture Barrier Technology License Agreement between Sumitomo Electric
Industries, Ltd. ("Licensor") and Cablec Corporation ("Licensee") dated
July 15, 1986.
5. Welded Sheath License Agreement between Sumitomo Electric Industries, Ltd.
("Licensor") and Cablec Corporation ("Licensee") dated July 15, 1986.
139
<PAGE> 143
Schedule 15A
Exhibit A to Schedule 15
Form of Assignment
COPYRIGHT ASSIGNMENT
THIS COPYRIGHT ASSIGNMENT is made this ____ day of _______, 19__ by
_________________________, a ________ corporation ("Assignor").
WHEREAS, Assignor has entered into an Assets Sale and Purchase
Agreement, dated April 6, 1999 (the "Agreement") among Assignor,
_____________________ ("Assignee"), a ________ corporation, and certain other
parties pursuant to which Assignor has agreed to sell and Assignee has agreed to
purchase certain Proprietary Rights (as defined in Section ____ of the
Agreement); and
WHEREAS, Assignor is willing in connection with certain transactions
being consummated on the date hereof to assign to Assignee all of Assignor's
right, title and interest in and to those certain copyrights, U.S. and foreign
copyright registrations, and applications for registration listed on Schedule A
attached hereto (collectively, "Copyrights"); and
WHEREAS, Assignee desires to acquire all of Assignor's right, title and
interest in, to and under said Copyrights.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Assignor has sold, assigned,
transferred and set over, and does hereby grant and exclusively assign to
Assignee its successors, legal representatives and assigns, all of Assignor's
right, title and interest in and to the Copyrights, including rights to apply
for copyright or other protection, to existing copyrights, to renewals and
extensions, all rights to print, to publish, to reproduce, to prepare derivative
works, to distribute copies of the Copyrights by sale, rental, lease, lending or
other transfer of ownership, to publicly perform and to publicly display the
Copyrights in all countries of the world, including the United States of
America, and all of its territories and any rights and causes of action for
copyright infringement, royalties and proceeds heretofore accrued.
All rights in the Copyrights and all derivative works granted to an
author under the copyright laws of the United States, foreign countries, and
international copyright conventions and the right to grant these rights or any
part of them to third parties are hereby assigned by Assignor to Assignee.
140
<PAGE> 144
Assignor hereby requests the Commissioner of Copyrights to record
Assignee, as assignee of the U.S. copyright registrations and applications for
registration listed on Schedule A, for the sole use and enjoyment of Assignee,
its successors, legal representatives and assigns.
_____________________________
By:_______________________________
[Name]___________, Title
STATE OF __________ )
) SS.
COUNTY OF ________ )
The foregoing assignment was acknowledged before me on this ___ day of
_______, 19__, by ________________ of _____________________, a ________
Corporation, on behalf of the corporation.
____________________________________
NOTARY PUBLIC
My Commission Expires:_____________
141
<PAGE> 145
PATENT ASSIGNMENT
THIS PATENT ASSIGNMENT is made this ____ day of _______, 19__ by
_________________________, a ________ corporation ("Assignor").
WHEREAS, Assignor has entered into an Assets Sale and Purchase
Agreement, dated April 6, 1999 (the "Agreement") among Assignor,
_____________________ ("Assignee"), a_________ corporation and certain other
parties, pursuant to which Assignor has agreed to sell and Assignee has agreed
to purchase certain Proprietary Rights (as defined in Section ____ of the
Agreement); and
WHEREAS, Assignor is willing in connection with certain transactions
being consummated on the date hereof to assign to Assignee all of Assignor's
right, title and interest in and to: (1) all U.S. patents and patent
applications listed on Schedule attached hereto; and (2) all foreign patents and
patent applications listed on Schedule attached hereto (collectively,
"Patents"); and
WHEREAS, Assignee desires to acquire all of Assignor's right, title and
interest in, to and under said Patents.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Assignor has sold, assigned,
transferred and set over, and does hereby sell, assign, transfer and set over,
unto the said Assignee, its successors, legal representatives and assigns, all
of Assignor's right, title and interest in, to and under the Patents and all
divisions, renewals and continuations thereof, and all Letters Patent of the
United States which may be granted thereon and all reissues and extensions
thereof (including, without limitation, all proceeds thereof and the rights to
sue for past, present and future infringements), and all applications for
Letters Patent which may hereafter be filed for said Patents in any country or
countries foreign to the United States, and all Letters Patent which may be
granted for said Patents in any country or countries foreign to the United
States hereby authorized, and requests the Commissioner of Patents of the United
States, and any Official of any country or countries foreign to the United
States, whose duty it is to issue patents on applications as aforesaid, to
record Assignee as the owner of all such Patents and issue all Letter Patent for
said Patents to the said Assignee, as assignee of the patent applications listed
on Schedule and Schedule hereto, for the sole use of Assignee, its successors,
legal representatives and assigns, in accordance with the terms of this
instrument.
Assignor hereby requests the Commissioner of Patents and Trademarks to
record Assignee, as assignee of the U.S. Patents and Patent Applications listed
on Schedule for the sole use and engagement of the Assignee, its successors,
legal representatives and assigns.
_____________________________
By:_______________________________
[Name]__________, Title
STATE OF __________ )
) SS.
COUNTY OF ________ )
The foregoing assignment was acknowledged before me on this ___ day of
_______, ____, by ___________________________________, a ________ Corporation,
on behalf of the corporation.
142
<PAGE> 146
___________________________________
NOTARY PUBLIC
My Commission Expires:_____________
143
<PAGE> 147
TRADEMARK AND TRADE NAME ASSIGNMENT
THIS TRADEMARK AND TRADE NAME ASSIGNMENT (the "Assignment") is made as
of this ___ day of _________, ____, by and between _______________, a ________
corporation ("_________"), with its principal office at ___________________,
___________, ________, and ______________________________, a ________
corporation ("__________") and a wholly-owned subsidiary of
_________________________, with its principal office at ______________, ______,
__________.
WHEREAS, _________________ and __________________ are parties to that
certain Asset Purchase Agreement, dated as of ___________, pursuant to which
_________ has agreed to sell and ________________________ has agreed to purchase
certain Assets (as defined in the Asset Purchase Agreement) including, without
limitation, the United States and foreign trademark registrations identified and
set forth on Schedule A attached hereto and incorporated herewith (collectively,
the "Marks"), the unregistered trademarks and the trade names identified and set
forth on Schedule B, attached hereto and incorporated herewith (collectively,
the "Trade Names"), and the goodwill of the business associated therewith; and
WHEREAS, ______________________ wishes to acquire _______________'s
entire right, title and interest in and to the Marks, title and interest in and
to the Marks and the Trade Names, together with the goodwill of the business in
connection with which the Marks and the Trade Names are used;
NOW THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged, _______ does hereby sell and assign to ________
all the right, title and interest ______________ has or may have in the Marks
and Trade Names and in any and all other marks or names owned or used by
__________ or in which ____________ otherwise has any ownership interest and
which include the listed terms of said Marks and/or Trade Names alone or in
combination with other words, figures, designs or indicia, including any rights,
title and interest as service marks, trademarks, tradenames and all common law
rights connected therewith, together with the goodwill of the business with
respect to which the Marks and Trade Names or any such other marks or names have
been used and/or registered and all claims and causes of action relating to
infringement of said Marks and Trade Names or said other marks or name.
___________ will assist in obtaining or providing any further documents
which may be required to confirm chain or title thereto.
Signed at __________________ this ______ day of ___________________,
19___.
_______________________________________
By:___________________________________
Title:____________________________
______________________________________
By: __________________________________
Title: __________________________
144
<PAGE> 148
Schedule 16
Environment
1 Definitions
For the purpose of the Agreement and this Schedule and the following
terms shall have the following meanings:
Agreed Proportion means that proportion of any Environmental Loss which
the parties have agreed that the Vendors shall bear in Section 5.1 of
this Schedule 16.
Agreed Remedial Action Plan means the initial program of work set out
in Exhibit 16A to this Schedule 16 agreed between the Vendors and the
Purchasers and as amended at Closing.
Environmental Condition means any contamination or any condition
existing prior to the Closing Date with respect to surface soil,
subsurface soil, ambient air, surface waters, groundwaters, leachate,
run- on or run-off, stream or other sediments, on, in, under, above or
off the Vendor-Owned Real Properties or Leased Properties, which
conditions cause or consist of a violation of and/or liability under
applicable Environmental Laws or Environmental Permits and require
investigation and/or remedial or corrective action on or off any
Vendor-Owned Real Properties or Leased Properties by Vendors or other
owner of the Vendor-Owned Real Properties or Leased Properties under
applicable Environmental Laws or Environmental Permits and/or results
in claims, demands, orders, directives, judgments or liabilities
against Purchasers by third persons, including Environmental
Governmental Authorities.
Environmental Laws means any applicable law, by-law, regulation, code,
ordinance, license, permit, order, judgment, decree or injunction
promulgated by any Environmental Governmental Authority (A) for the
protection of health, safety, including worker health and safety or the
environment, (including air, water, soil, and natural resources) or (B)
regulating Hazardous Substances, in each case as presently in effect
and presently enforced in the relevant jurisdiction as of and including
at Closing.
Environmental Liability means any and all Liabilities arising under
Environmental Laws in connection with or relating to (i) the operation
of any of the Operations or any part thereof before Closing, (ii) the
occupation of the Vendor-Owned Real Properties or Leased Properties or
any part thereof by the Vendors or any other persons or entities before
Closing (including liability under Environmental Law to undertake
Remedial Action), (iii) the breach of any Environmental Warranty, or
(iv) any Environmental Condition.
Environmental Permit means any licenses, certificates, permits,
directives, requirements, registrations, government approvals,
agreements, authorizations, exemptions and consents which are required
under or are issued pursuant to an Environmental Law or are otherwise
required by Environmental Governmental Authorities for the operation of
any of the Operations, the Vendor-Owned Real Properties or the Leased
Properties on or before Closing.
Environmental Proceedings means:
(a) any civil, criminal, administrative or regulatory suit or
proceeding;
(b) any arbitration or dispute resolution procedure;
(c) any investigation undertaken by or on behalf of an
Environmental Governmental Authority under Environmental Law
pursuant to which the Environmental Governmental Authority may
order enforcement action or undertake or compel Remedial
Action; and
145
<PAGE> 149
(d) any court order, or any statutory or legislative notice or
written notification issued by a Environmental Governmental
Authority which determines or relates to liability under or a
violation of any Environmental Law, assesses any civil,
regulatory or criminal penalty, prohibits or imposes
restrictions upon the Operations, the Vendor-Owned Real
Properties or the Leased Properties or which requires action
to be taken, Operations to be modified or Remedial Action to
be undertaken, relating to, concerning or affecting any
Environmental Liability.
Environmental Warranties means the Warranties at Section 2 of this
Schedule 16.
Environmental Governmental Authority shall mean any US or Canadian
agency, commission, department or body of any municipal, township,
county, local, state, provincial or Federal governmental or
quasi-governmental regulatory unit, entity or authority having
jurisdiction or authority over any matter arising under Environmental
Laws.
Hazardous Substances means any pollutant, contaminant, waste, chemical,
material or substance listed, defined, designated, classified or
regulated as dangerous, special, hazardous, toxic or radioactive and
any similar terms, under any applicable Environmental Law including
petroleum and any derivative or by-product thereof.
Operational Expenditure means in respect of any of the Operations any
expenditure to the extent that after Closing it is incurred or is
properly incurrable in the ordinary course of business of any of the
Operations, as part of routine maintenance and upkeep of any works,
plant, equipment and/or buildings and/or their services or to overcome
fair wear and tear of such works, plant, equipment and/or buildings
and/or their services or to ensure that such works, plant, equipment
and/or buildings and/or their services remain in compliance with
Environmental Laws after Closing but shall exclude any future
expenditure arising or incurred by the Purchasers after Closing with
respect to any works required to bring any plant, facility, building,
property, equipment, or services into compliance with or satisfy the
requirements of Environmental Laws which were non-compliant on the
Closing Date.
Qualified Consulting Firm shall mean a nationally or regionally
recognized environmental engineering and/or consulting firm. By way of
example, the parties hereby specifically recognize Cody Ehlers Group,
ERM-Northeast, Pilko & Associates, Roux Associates, Inc., Dames & Moore
and Philip Services and QST as such firms.
Remedial Action means any works necessary to investigate, assess,
monitor, remove, abate, close, mitigate, treat, remediate, ameliorate
and/or contain any matter in accordance with Environmental Laws and
includes any period of post-closure or remediation monitoring and any
operation and maintenance relating to such remedial activities.
2 Environmental Warranties
Except as disclosed in the Disclosure Letter:
2.1 The Operations and the Vendor-Owned Real Properties are in
compliance in all material respects with all applicable
Environmental Laws and Environmental Permits and, so far as
the Vendors are aware, have been since January 1, 1998.
2.2 The Vendors have not received any written notice from any
Environmental Governmental Authority or other third party
alleging the violation of or liability under any applicable
Environmental Laws other than for matters that have been fully
and finally resolved prior to the Closing Date.
146
<PAGE> 150
2.3 There are no suits, actions, proceedings, Environmental
Proceedings, demands, notices or other claims, either pending
or to the Vendors' knowledge threatened, against the Canadian
Business or the US Business regarding any actual, potential or
alleged liability or obligation under or violation of any
applicable Environmental Laws with respect to the Operations,
the Vendor-Owned Real Properties or the Leased Properties.
2.4 So far as the Vendors are aware, the Canadian Business and US
Business (i) have all Environmental Permits necessary for the
conduct of the Operations, the Vendor-Owned Real Properties
and the Leased Properties; and (ii) all such Environmental
Permits are in force.
2.5 So far as the Vendors are aware, the Canadian Business and US
Business have not disposed of any Hazardous Substance on the
Vendor-Owned Real Properties or Leased Properties in
circumstances which are likely to give rise to material
liability under Environmental Laws.
2.6 So far as the Vendors are aware, the Canadian Business and US
Business have not had any emissions or discharges of any
Hazardous Substances in circumstances which are likely to give
rise to material liability under Environmental Laws.
2.7 Vendors have not caused any Environmental Condition and to
Vendors' knowledge there exists no Environmental Condition.
2.8 So far as Vendors are aware no lien or superlien has been
imposed on any of the Vendor-Owned Real Properties or Leased
Properties in connection with any Environmental Liability.
2.9 So far as Vendors are aware there are no underground storage
tanks, whether or not currently in use, at the Vendor-Owned
Real Properties or Leased Properties and no underground
storage tanks have previously been removed therefrom, and any
existing underground storage tank disclosed in the Disclosure
Letter, together with the piping appurtenant thereto, is free
of leaks and is otherwise in compliance with applicable
Environmental Laws.
3 Environmental Indemnity
Subject to remaining provisions of this Schedule 16 together with
Sections 2.3 to the extent not in conflict with the provision of this
Schedule 16 of the Agreement, the Vendors agree to indemnify, defend
and hold the Purchasers' Group harmless from and against any and all
Liabilities and Losses including claims for personal injury and
property damage arising out of or in connection with any Environmental
Liability (collectively, "Environmental Loss" or "Environmental
Losses") in an amount equal to the Agreed Proportion of any
Environmental Loss suffered or incurred by the Purchasers' Group after
Closing to the extent that it arises out of:
3.1 any breach of Environmental Warranties made by the Vendors
contained in this Agreement;
3.2 any Environmental Liability arising out of or relating to any
Environmental Condition, act or omission, in each case that
existed with respect to the Operations on or prior to the
Closing Date;
3.3 the violation of any then-applicable Environmental Law by the
Canadian Business or the US Business on or prior to the
Closing Date or which is continuing after the Closing Date for
a period of four (4) months;
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3.4 any Environmental Liability arising out of any failure by
Vendors to prepare and timely file Notices as provided by
Section 4 of this Schedule 16 or otherwise comply with the
provisions of the transfer acts listed on Exhibit 16C;
3.5 any Environmental Liability arising out of the recycling or
disposal of Hazardous Substances or the disposal of any other
waste materials at any off-site location on or prior to the
Closing Date;
3.6 any Environmental Liability arising out of any Excluded
Assets, any Excluded Liabilities or any properties owned,
occupied, operated, controlled or leased by the Vendors where
such ownership, occupation, operation, control or lease ceased
prior to Closing.
4 Change of Ownership Notification
Vendors agree to prepare and timely file, at Vendors' sole expense, and
in Vendors' names, all environmental forms, reports, notices,
statements and questionnaires, however defined, required to be
submitted to any Environmental Governmental Authority or to Purchasers
in connection with the Agreement ("Notices"), as set forth on Exhibit
16C. Vendors further agree that all such filings shall be as complete
and accurate as possible and that where such filings require the name
of the person or entity who will be responsible for and undertake any
Remedial Action which may be required, the Vendors shall identify the
Vendors as the party responsible.
5 Limitations on liability
5.1 Apportionment of Environmental Losses
(a) Vendors will bear 100% of the Environmental Losses
which relate to:
(i) the matters and projects identified on
Exhibit 16A; and
(ii) Sections 3.4, 3.5 and 3.6.
(b) Vendors and Purchasers will bear Environmental Losses
which relate to Sections 3.1, 3.2 and 3.3 in the
following ratios [Vendors:Purchasers]:
(i) 95:5 where written notice of a claim is
given by the Purchasers to the Vendors prior
to the third anniversary of the Closing
Date;
(ii) 70:30 where written notice of a claim is
given by the Purchasers to the Vendors
following the third anniversary of the
Closing Date but prior to the fifth
anniversary of the Closing date.
(c) Notwithstanding anything in this Agreement to the
contrary, and in addition to Vendors' obligations
under Exhibit 16A, Vendors and Purchasers will bear
Environmental Losses which relate to the matters and
projects identified on Exhibit 16B in the following
ratios:
(i) Remedial Action required as a result of
changes in applicable Environmental Law
which occur prior to the first anniversary
of the Closing Date will be shared 50:50;
(ii) Remedial Action required as a result of
changes to applicable Environmental Laws
which occur after the first anniversary but
prior to the second anniversary of the
Closing Date will be shared 33 1/3 : 66 2/3;
and
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(iii) Remedial Action required as a result of
changes to applicable Environmental Laws
which occur after the second but prior to
the third anniversary of the Closing Date
will be shared 25:75.
(d) Each written notice of claim under this Section 5.1
shall be given in accordance with the requirements of
Section 19.14 of the Agreement and shall include
reasonable details regarding the matter in respect of
which the claim is being made (including an estimate
of the amount of such claim if practicable).
5.2 Limits on Liability
The Vendors shall not be liable in relation to any claim
under Section 3 of this Schedule 16 of the Agreement:
5.2.1 in respect of any Operational Expenditure; and
5.2.2 in respect of any claim unless written notice of such
claim is given by the Purchasers to the Vendors by
the relevant anniversary date in accordance with
Section 5.1 of this Schedule 16.
5.3 Change of Use / Exacerbation
The Vendors shall not be liable in relation to any claim under
Section 3 to the extent that the Environmental Loss which is
the subject of the claim arises by virtue of the closure,
redevelopment or proposed redevelopment of any Real Property
after Closing or is made worse by the act or omission of the
Purchasers (or any member of the Purchasers' Group) or because
of any change in use of any Real Property.
5.4 Exclusive Remedy
The rights and remedies of Purchasers and the Purchasers'
Group under this Schedule 16 shall be the exclusive remedy for
Environmental Losses and Purchasers shall have no other
rights, and shall expressly release and waive any and all such
other rights, against Vendors based on Environmental Laws with
respect to matters covered by this Schedule 16.
6 Conduct of Claims
The provisions of this Section 6 of this Schedule 16 shall apply to any
matter which may give rise to or arises by virtue of a claim under
Section 3 of this Schedule 16.
6.1 Where the Vendors or any member of the Vendors' Group has or
may have a claim against a third party in relation to a matter
which has given or may give rise to a claim under Section 3 of
this Schedule 16, upon written request by Vendors to
Purchasers, the Purchasers shall afford the Vendors all such
assistance as may be reasonable in relation to its conduct of
such claim (subject to any duties of confidentiality owed to
third parties and to any right to maintain legal privilege),
including access to and copies of any reports, correspondence,
documents or other information in the possession of the
Purchasers or any member of the Purchasers' Group.
6.2 Without prejudice to the validity of any claim or alleged
claim made by the Purchasers under Section 3 of this Schedule
16, the Purchasers shall promptly appear and give testimony
and shall provide such reports, documents, correspondence,
information, assistance (including access to employees, agents
or contractors of the Purchasers' Group) and facilities as are
potentially relevant to any such claim and are in its
possession (or in the possession of the Purchasers' Group) as
the Vendors may reasonably request (subject to compliance with
any
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<PAGE> 153
duties of confidentiality owed to third parties and to the
right to maintain legal privilege) including reasonable access
to any relevant part of any Real Property or so far as
reasonably practicable to any adjacent or affected property.
The Vendors receiving such information etc. shall keep all
such information confidential except for disclosure in
defending or prosecuting any Environmental Proceedings or any
claim or alleged claim or argument under Section 3 of this
Schedule 16 or as otherwise required by law. Vendors shall use
reasonable efforts not to impose an undue burden on
Purchasers.
6.3 If a claim under Section 3 of this Schedule 16 arises or may
arise as a result of or in connection with any Environmental
Proceedings to which the Purchasers or any member of the
Purchasers' Group is or is likely to become a party or where
the Purchasers or a member of the Purchasers' Group is the
subject of such Environmental Proceedings, the Purchasers
shall notify the Vendors within fifteen (15) Business Days, in
writing, of such claim or potential claim and the actual or
anticipated Environmental Proceedings as soon as it becomes
aware of such claim or Proceedings, setting forth in
reasonable detail the nature thereof and the basis upon which
indemnification is sought, and the following provisions shall
apply:
(i) the Vendors shall have the right at any time to
assume primary responsibility for and control over
the conduct of all or any part of such Environmental
Proceedings. Unless and until the Vendor assumes
conduct by notice in writing to the Purchasers, the
Purchasers shall have responsibility for the conduct
of any such Environmental Proceedings;
(ii) while the Purchasers have responsibility for the
conduct of any such Environmental Proceedings, it
shall be entitled to avoid, dispute, deny, defend,
resist, appeal or contest such Environmental
Proceedings (including, without limitation, making
counterclaims or other claims against third parties
in its own name) and to have responsibility for the
conduct of such Environmental Proceedings, and any
related Remedial Action, negotiations or appeals;
provided, however, that no admission of liability
shall be made by or on behalf of the Purchasers (or
any member of the Purchasers' Group), and the claim
shall not be compromised, disposed of or otherwise
settled without the prior written consent of the
Vendors (such consent not to be unreasonably withheld
or delayed);
(iii) Purchasers recognize Vendors' right to control the
conduct of those Environmental Proceedings over which
Vendors assume control. If the Vendors assume conduct
of the Environmental Proceedings, they shall be
entitled to take any action to avoid, dispute, deny,
defend, resist, appeal, compromise or contest such
Environmental Proceedings in the name of the
Purchasers or any member of the Purchasers' Group.
Vendors shall, however, consult as much as is
reasonably practicable with and pay reasonable regard
to the views of the Purchasers (or the relevant
member of the Purchasers' Group) in respect thereof
and shall not take such action in its name as may
materially adversely affect the value of any Real
Property or the goodwill or good name of the
Purchasers (or the relevant member of the Purchasers'
Group) and the Vendors shall consult as much as is
reasonably practicable with and pay reasonable regard
to the views of the Purchasers (or the relevant
member of the Purchasers' Group) as regards any
negotiations and/or appeals arising out of such
Environmental Proceedings. Vendor shall make no
admission of liability and the claim shall not be
compromised, disposed of or otherwise settled without
the prior written consent of Purchasers (such consent
not to be unreasonably withheld or delayed);
(iv) except as otherwise provided herein, after Vendors'
assumption of the defense of the Environmental
Proceeding the Vendors shall not be liable to the
Purchasers for
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<PAGE> 154
any legal or other expenses subsequently incurred by
the Purchasers in connection with the defense
thereof;
6.4 The party having responsibility for the conduct of any
Environmental Proceedings (the "Conduct Party") shall also
ensure that:
(i) the other party shall be informed promptly of any
information, and shall be provided with copies of any
correspondence or documents held by the Conduct Party
which is material to the Environmental Proceedings
(except to the extent this would reasonably be
expected to waive privilege in respect thereof);
(ii) the other party shall be provided with advance notice
of any proposal by the Conduct Party (or any member
of its group of companies) or any third party to
undertake Remedial Action provided that this
obligation shall not apply in case of emergency, that
is where there is an imminent and substantial risk of
serious harm to human health or to the environment;
6.5 If any amount is recovered in relation to any Environmental
Loss or claim under the Environmental Warranties pursuant to
Sections 7.1 and/or 7.3 of this Schedule 16, after first
deducting any costs and expenses incurred in relation to such
recovery, the balance shall be divided between the Vendors and
the Purchasers in accordance with the Agreed Proportion in
which the Environmental Loss arising in relation to the breach
of Environmental Warranties was borne by them.
7 Remedial Action
With respect to any Environmental Proceedings that involve Remedial
Action, and with respect to the Agreed Remedial Action Plan, the
Vendors shall be the Conduct Party and the following shall apply:
7.1 Scope of Work
(i) AGREED REMEDIAL ACTION PLAN: Within ninety (90)
calendar days after Closing, Vendors shall retain a
Qualified Consulting Firm to prepare a work plan
(Scope of Work) setting forth (in reasonable detail)
the Remedial Action to be performed with respect to
the conditions set forth on the Agreed Remedial
Action Plan (the Remedial Work) for the approval of
Purchasers, which approval shall not be unreasonably
withheld. With respect to other Remedial Action under
this Schedule 16, Vendors shall retain such
consultant within 90 days of written notice by
Purchasers to Vendors of the need to initiate
Remedial Action.
(ii) ENVIRONMENTAL PROCEEDINGS: where Remedial Action is
required as a result of any Environmental Proceedings
pursuant to Section 6.3 of this Schedule 16, the time
within which Vendors shall retain a Qualified
Consulting Firm to prepare a Scope of Work for the
approval of Purchasers, which approval shall not be
unreasonably withheld, shall be within Vendors'
discretion.
(iii) Within twenty-one (21) Business Days after receipt
from Vendors of the Scope of Work, Purchasers shall
advise Vendors in writing of its approval thereof or
objections thereto. If Purchasers fails to respond,
in writing, within such twenty-one (21) Business Day
period, then Purchasers shall automatically be deemed
to have approved the Scope of Work. If Purchasers
object to the Scope of Work, and the parties are
unable to resolve such objections either Vendors or
Purchasers shall have the unilateral right, but not
the obligation, to provide written notice to, and/or
consult with (Notify), the applicable Government
Authority regarding the
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<PAGE> 155
appropriate Scope of Work for the conditions for
which Purchasers and Vendors fail to agree upon a
Scope of Work; provided, however, that the party that
desires to Notify such Environmental Governmental
Authority shall first give the other party five (5)
Business Days' prior written notice thereof (the
Scope of Work Notice) in accordance with the
following procedure:
(a) within five (5) calendar days after Purchasers or Vendors (as
the case may be) receive the Scope of Work Notice, Vendors
shall Notify the applicable Environmental Governmental
Authority, in writing, regarding the appropriate Scope of Work
as to which Purchasers and Vendors disagree upon a Scope of
Work;
(b) in the event that Vendors fail to Notify the Environmental
Governmental Authority within such five (5) calendar day
period, Purchasers shall have the right, but not the
obligation, to Notify the Environmental Governmental
Authority, in writing, in order to determine the appropriate
Scope of Work; and
(c) if neither party notifies the Environmental Governmental
Authority or if no definitive answer is received from the
Environmental Governmental Authority within 60 calendar days
of the Notice, the Vendors and Purchasers shall jointly agree
upon, retain and share equally the cost of a Qualified
Consulting Firm (Third Party Consultant) to provide an opinion
concerning the appropriate scope for the items as to which the
parties disagree. Within ten Business Days of the retention,
Vendors shall provide the Scope of Work to the Third Party
Consultant and Purchasers shall provide to the Third Party
Consultant a writing setting forth in detail the items as to
which they disagree and the reasons therefor. As soon
thereafter as reasonably possible, Vendors and Purchasers and
their environmental consultants shall jointly communicate
and/or meet with the Third Party Consultant. Within seven days
of the joint communication and/or meeting with the Third Party
Consultant, the Third Party Consultant shall advise of its
opinion regarding the appropriate scope of work for the items
as to which the parties disagree, and the Scope of Work shall
be revised to reflect the determination of the Third Party
Consultant.
7.2 Notice to Environmental Governmental Authorities
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<PAGE> 156
After the Scope of Work is determined pursuant to Section
7.1(ii) of this Schedule 16, then, prior to undertaking the
Remedial Work, Vendors shall, at any time, consult with
Purchasers regarding whether any notice to, or consultation
with, any Environmental Governmental Authority is required
under applicable Environmental Laws. If either Vendors or
Purchasers reasonably determine that any such notice or
consultation is required under applicable Environmental Laws,
Vendors, after giving Purchasers reasonable advance notice
thereof shall undertake such notice or consultation and, if
required by the Environmental Governmental Authority with
jurisdiction over the Remedial Work or if desired by
Purchasers, shall seek approval of the Remedial Work from that
Environmental Governmental Authority. Vendors agree that, from
time to time, the Scope of Work for the Remedial Work may be
revised and shall be deemed to include any and all Remedial
Action required by such Environmental Governmental Authority;
provided, however, that Vendors shall have the right to
conduct negotiations with, and undertake appeals to, such
Environmental Governmental Authority. Purchasers shall be kept
reasonably informed of such negotiations and appeals, receive
copies of proposed submissions and reports for review and
comment and afforded an opportunity to participate in all
meetings and conferences with any Environmental Governmental
Authority. Vendor shall pay reasonable regard to any comments
submitted by Purchasers. Nothing contained herein shall be
deemed to prevent Vendors or Purchasers from complying with
applicable reporting requirements under Environmental Laws.
Vendors shall have the right to delay commencement or
continuation of Remedial Work as long as Vendors properly
obtain any necessary stays pending appeals from the
Environmental Governmental Authority, if needed, provided that
such delay shall not unreasonably interfere with Purchasers'
use of or operations at the affected Real Property.
7.3 Performance of Work
(i) Promptly following approval of the Scope of
Work by Purchasers and any Environmental
Governmental Authorities consulted or
notified, Vendors shall diligently cause and
continue to cause the Remedial Work to be
diligently performed by their Qualified
Consulting Firm until such work is completed
(as that term is defined under Section 7.5
of this Schedule 16). From and after
Purchasers' approval of any Scope of Work,
Vendors may not materially modify, amend,
restrict, expand, alter or eliminate any
provision or component of the Scope of Work
without Purchasers' prior consent, which
consent shall not be unreasonably withheld
or delayed.
(ii) Notwithstanding the provisions of Section
7.3(i) of this Schedule 16, Vendors may,
without prior consultation with Purchasers
if such prior consultation is not possible,
amend the Scope of Work to take such action
but only as is reasonably necessary in case
of an emergency or to comply with a lawfully
issued emergency demand or order of the
relevant Government Authority, provided,
however, that Vendor shall notify Purchasers
of any such amendment as soon thereafter as
is possible.
7.4 Institutional Controls
In the event that the Environmental Governmental Authority
with jurisdiction over the Remedial Work agrees that the level
of remediation required at a Real Property at which Remedial
Work is being performed may be reduced by the imposition of
restrictions limiting the use and occupancy of the Real
Property to non-residential uses, Purchasers shall not
unreasonably withhold its consent to the imposition of such
use restrictions and shall not seek any compensation therefor
from Vendors. Vendors shall not propose to any Environmental
Governmental Authority or agree to the imposition of any other
institutional controls without Purchasers' written consent
which consent Purchasers may withhold if Purchasers, in their
reasonable discretion, determine that such controls will
substantially reduce the value of the Real Property or
unreasonably interfere with its current use of the Real
Property.
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<PAGE> 157
7.5 Completion of Remedial Work
Upon the completion of the Remedial Work at any Real Property in
accordance with the approved Scope of Work and as necessary to satisfy
the requirements of applicable Environmental Laws or Environmental
Permits, Vendors shall so advise Purchasers and shall provide such
documentation as Purchasers may reasonably require to satisfy
Purchasers that the Remedial Work has been completed. For the purposes
of this Section, "completed" or "completion" shall mean: (i) in the
event that Vendors or Purchasers have provided notice to or consulted
with a Environmental Governmental Authority with respect to the
Remedial Work, Vendors shall have: (x) obtained a written statement by
the Environmental Governmental Authority with jurisdiction over the
Remedial Work in question that no further action is required with
respect to such Real Property, and (y) if applicable, formally
requested and obtained, in writing, the closure, de-listing and/or
removal of the relevant Real Property from any list maintained by such
Environmental Governmental Authority, or (ii) in the event that a
Environmental Governmental Authority has not been consulted or has been
consulted and has not responded within six (6) months, completion shall
be evidenced by a written certification to Purchasers from Vendors'
Qualified Consulting Firm, in a form reasonably acceptable to
Purchasers, stating that all such work has been completed in accordance
with the approved Scope of Work and the requirements of applicable
Environmental Laws and Environmental Permits satisfied.
7.6 Access for Performance of Remedial Work
Prior to the performance of the Remedial Work by Vendors, Vendors and
Purchasers shall execute an Access Agreement in each case in which
Remedial Work is to be performed by Vendors, and substantially in the
form and substance of Exhibit 16D, Model Access Agreement.
7.6.1 Prior to, and throughout the performance of the
Remedial Work by Vendors, Vendors shall cause their
Qualified Consulting Firm and all other contractors
to maintain workers' compensation insurance, as
required by law, professional errors and omissions
liability insurance, where appropriate, of not less
than $3,000,000, contractor's pollution liability
insurance with coverage of not less than $1,000,000
per occurrence, general liability insurance with
coverage of not less than $1,000,000 per occurrence
and umbrella liability insurance with coverage of not
less than $10,000,000. Purchasers shall be named as
an additional insured with respect to the general
liability policy. Vendors shall, promptly upon
Purchasers' request, provide Purchasers with
Certificates of Insurance.
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Schedule 17
Excluded Assets
1.1 The benefit of any Claim made by the Vendors in respect of
insurance arising or accruing in consequence of anything done or omitted to be
done prior or subsequent to Closing relating to an Excluded Liability or
Excluded Asset;
1.2 All right, title and interest in the trade marks and trade
names "BICC" and "Brand Rex" other than pursuant to Section 17.5 of the
Agreement;
1.3 Debts owing by any employee who is not a Continuing
Employee;
1.4 Debts due from any relevant Tax authority in respect of any
Tax arising on or before Closing except to the extent reflected in the Net
Asset Statement including any bond or other security issued by any Tax
authority or other Governmental Authority representing any such debts;
1.5 Cash and Cash Equivalents credited to any account of either
Vendor, wherever held;
1.6 Debts due not included in the Net Asset Statement that are
not part of the Operations;
1.7 All prepayments, deposits and escrows that do not relate to
the Operations;
1.8 All Claims, causes of actions and other legal rights and
remedies that do not relate to Assumed Liabilities.
1.9 The former manufacturing site in York, PA;
1.10 The former manufacturing site in Yorkers, New York;
1.11 The following former sales offices:
a) Schaumberg, IL
b) Norcross, GA
c) Huntington Beach, CA
d) Houston, TX;
1.12 All shares of capital stock and any other interest of the US
Vendor in Brintec Canada Ltd., General Precision Parts, Inc.
and BBR Holding Ltd.
1.13 All assets relating to Employee Benefit Arrangements that
are not being assumed by the Purchasers.
1.14 Books, records and files, including minute books and other
corporate record books and all Tax records and files
relating to the Vendors or the Excluded Assets or Excluded
Liabilities.
1.15 Personal computers, office desks and office chairs of
Employees that are not Continuing Employees.
1.16 Asset Purchase Agreement dated as of February 19, 1996
between BICC Philips Inc. and Essex international, Inc.
1.17 The following Hardware & Furniture used at the West Nyack
Facility
- 3 Compaq Deskpro 2000 Computers including
Optiquest monitors and cables
- HP LaserJet 4000N printer
- HP LaserJet III
- HP LaserJet 6L (S. Brecher)
- Any and all furniture located within the Tax Dept.
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<PAGE> 159
1.18 The following Software used at the West Nyack Facility
- Fast Tax for 1997 &1998
- AACTS for 1994, 1995 & 1996
- Microsoft Office 95 which includes Microsoft Word
word-processing and Microsoft Excel spreadsheet
- Lotus 1-2-3 spreadsheet
- FAS Encore Tax Depreciation Software
- Org Plus for Windows 3.1
- CCH Omni Tax Tax Research software
- CCH Perform Plus for Windows
- CCH Win Tax Rate Locator
- Federal Tax Products - 1998 U.S. Federal Tax
Products CD-ROM
- New York State Personal and Corporate Tax Forms
for 1998 CD-ROM
- WinZip
- CompuServe (Internet access)
- Kubra Doc 2.1 (Internal software to print
invoices)
1.19 The following items in the West Nyack Tax Library
- CCH, BNA, RIA, Panel Publishing & etc. Tax
Research Books and Forms in the Tax Dept. Library
in West Nyack
- Tax subscriptions by CCH, BNA, RIA, Panel
Publishing & other publishers
1.20 The following items in the West Nyack Tax Files
- All files located in the Tax Department in West
Nyack
- All BICC Cables and Pyrotenax Usa, Inc. files in
archives (entire contents in off- site storage)
- Any and all BICC Cables and Pyrotenax USA, Inc.
corporate files through the date of Closing
1.21 Federal & State Tax Estimates or Receivables Re: BICC Cables
Corp. and Pyrotenax USA, Inc., including IRS refund of about
$900K Re: IRS audit - Brintec Corporation & subs
1.22 Accounting Software & Files - Access to the Accounting
Software for all years through the date of Closing - Access
to Accounting Dept. files through the date of Closing
1.23 The individual employment Contract of each Employee set
forth in the Employment Letter who is not a Continuing
Employee.
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<PAGE> 160
Schedule 18
Bonds and Guarantees
BICC USA GROUP
OUTSTANDING LETTERS OF CREDIT
April-99
<TABLE>
<CAPTION>
ORIGINAL
AP $ ISSUING BANK ISSUE EXPIRY
No. PL OBLIGO BENEFICIARY AMOUNT BANK REF DATE DATE COMMENTS
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
31 BC BCC Atlantic Mutual W.C. 675,000 CHASE P-398331 10/15/97 1-Nov-98 WC Prems/BCC Evergree
C BICC 30 days
- -----------------------------------------------------------------------------------------------------------------------------------
33 BC BCC STATE BANK OF 9,090 CHASE P-357205 3-MAR-98 23-Mar-00 For Guar to Kudremukh
C INDIA Iron Ore Co.
- -----------------------------------------------------------------------------------------------------------------------------------
38 BC BCC ABB Sadelmi S.P.A. 144,489 CHASE P-374754 11-Aug-98 30-Oct-01 Bid
C
- -----------------------------------------------------------------------------------------------------------------------------------
41 BC BCC Travelers W.C. BICC 1,900,000 CHASE P-396747 8-MAR-99 15-Mar-00 WC Prems - Evergreen
C 90 days
- -----------------------------------------------------------------------------------------------------------------------------------
N/A BC BCC ABB Sadelin S.P.A 46,448 CHASE Pending Pending 30-Mar-02 Bid
C
- -----------------------------------------------------------------------------------------------------------------------------------
Total 8,577,303
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
166
<PAGE> 161
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SURETY REPORT
M-DAY M-DAY Bond
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Bond No. Surety Principal Obligee/in State of Bond Effective Expire Amount
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
183946 Nat. Union Utility CA, City of Roseville Labor & 08/14/98 12/31/99 459,745.00
- ------------------------------------------------------------------------------------------------------------------------------------
Material
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
016720 Nat. Union Polymers IN, Marion Environmental Fin Guar. 11/21/98 11/21/99 400,000.00
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
141451 Nat. Union Utility NE, Omaha Pub. Power Perf. 06/13/96 06/05/99 2,900,000.00
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
183948 Nat. Union Utility NE, Omaha Publ Power Perf. 11/08/98 04/30/99 265,000.00
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
*183949 Nat. Union Utility NE, Omaha Pub. Power Perf. & Pay. 11/17/98 12/30/99 385,836.00
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
172097 Nat. Union Brand-Rex TX, Graybar Electric Contract 04/10/97 04/30/99 16,249.00
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Dated: 4/05/99 SURETY REPORT 1/27/98 Pg. 2 of 2
- ------------------------------------------------------------------------------------------------------------------------------------
M-DAY M-DAY Bond
Bond No. Surety Principal Obligee/in State of Bond Effective Expire Amount
- ------------------------------------------------------------------------------------------------------------------------------------
183941 Nat. Union Utility WA, Snohomish, Co, PUD Perf. 05/01/98 04/30/99 243,285.00
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
* Nat. Union Utility WA, Orcas Power & Light Bid Bond 04/03/98 04/30/99 75,000.00
- ------------------------------------------------------------------------------------------------------------------------------------
CUSTOMS BONDS
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
06-1093542 C.A. Shea DQ Utility DuQuoin, IL Customs 04/22/98 04/22/99 100,000.00
- ------------------------------------------------------------------------------------------------------------------------------------
UT Utility West Nyack, NY Customs 04/22/98 04/22/99
- ------------------------------------------------------------------------------------------------------------------------------------
JM Utility Malvern, AR Customs 04/22/98 04/22/99
- ------------------------------------------------------------------------------------------------------------------------------------
SV Utility Marshall, TX Customs 04/22/98 04/22/99
- ------------------------------------------------------------------------------------------------------------------------------------
PS BPC Indianapolis, IN Customs 04/22/98 04/22/99
- ------------------------------------------------------------------------------------------------------------------------------------
MN BBR Marion, IN Customs 04/22/98 04/22/99
- ------------------------------------------------------------------------------------------------------------------------------------
SH BBR South Hadley, MA Customs 04/22/98 04/22/99
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</TABLE>
167
<PAGE> 162
<TABLE>
<S> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
CT BBR Willmantic, CT Customs 04/22/98 04/22/99
- ------------------------------------------------------------------------------------------------------------------------------------
JK BBR Jackson, TN Customs 04/22/98 04/22/99
- ------------------------------------------------------------------------------------------------------------------------------------
970201- BICC-CAN Canada St. Jerome Customs 04/22/98 04/22/99
00835
- ------------------------------------------------------------------------------------------------------------------------------------
970201- BICC-CAN Canada Moose Jaw Customs 04/22/98 04/22/99
01727
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
OTHERS
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
ANNUALS
- ------------------------------------------------------------------------------------------------------------------------------------
61-02461 Nat. Union Utility Puerto Rico Electric Power Bid Bond renewed yrly. $ 850,000.00
- ------------------------------------------------------------------------------------------------------------------------------------
11-98-01 Nat. Union Utility Omaha Public Power Bid Bond open
- ------------------------------------------------------------------------------------------------------------------------------------
11-98-02 Nat. Union Utility Lincoln Electric System Bid Bond open
- ------------------------------------------------------------------------------------------------------------------------------------
11-98-03 Nat. Union Utility Nebraska Publish Power District Bid Bond open
- ------------------------------------------------------------------------------------------------------------------------------------
11-98-04 Nat. Union Utility Public Utility #1 Snohomish City Bid Bond $35,000.00
- ------------------------------------------------------------------------------------------------------------------------------------
11-98-09 Nat. Union Utility Sacramento (SMUD) Continuous
- ------------------------------------------------------------------------------------------------------------------------------------
* = New bonds included in this quarter. * = bonds added and removed during this quarter
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
168
<PAGE> 1
Exhibit 2.2
AMENDMENT NO. 1 TO AND ASSIGNMENT OF ASSETS PURCHASE AGREEMENT
--------------------------------------------------------------
AMENDMENT NO. 1 TO ASSETS PURCHASE AGREEMENT (the "AMENDMENT"),
dated as of May 27, 1999, by and among BICC CABLES CORPORATION, a company
incorporated in Delaware, the United States, whose principal place of business
is at One Crosfield Avenue, West Nyack, NY; PYROTENAX USA INC. (together with
BICC Cables Corporation, the "US VENDOR"), a company incorporated in Delaware,
the United States; BICC CABLES CANADA INC. (the "CANADIAN VENDOR"), a company
incorporated under the federal laws of Canada, whose principal place of business
is at 265 Yorkland Boulevard, Suite 500, North York, Ontario M2J 155; BICC PLC
(the "VENDORS' GUARANTOR"), a company incorporated in England and Wales, whose
registered office is at Devonshire House, Mayfair Place, London W1X 5FH; GK
TECHNOLOGIES, INCORPORATED (the "US PURCHASER"), a company incorporated in New
Jersey, the United States, whose principal place of business is at 4 Tesseneer
Drive, Highland Heights, KY 41076; GK TECHNOLOGIES, INCORPORATED (the "CANADIAN
PURCHASER" and together with the US Purchaser, the "PURCHASER"), a company
incorporated in New Jersey, the United States, whose principal place of business
is at 4 Tesseneer Drive, Highland Heights, KY 41076; GENERAL CABLE CORPORATION
(the "PURCHASERS' GUARANTOR"), a company incorporated in Delaware, the United
States whose principal place of business is at 4 Tesseneer Drive, Highland
Heights, KY 41076; BICC GENERAL PYROTENAX CABLES LTD. ("PYROTENAX ASSIGNEE"), a
company incorporated in Ontario, Canada; BICC GENERAL CABLE (USA) LLC ("US
ASSIGNEE"), a limited liability company organized under the laws of the state of
Delaware, the United States; and BICC GENERAL CABLE COMPANY ("CANADIAN
ASSIGNEE"), an unlimited liability company incorporated in Nova Scotia, Canada.
W I T N E S E T H:
------------------
WHEREAS, the US Vendor, the Canadian Vendor, the Vendors'
Guarantor, the US Purchaser, the Canadian Purchaser and the Purchasers'
Guarantor are parties to an Assets Sale and Purchase Agreement, dated as of
April 6, 1999 (the "ASSET PURCHASE AGREEMENT");
WHEREAS, the parties to the Asset Purchase Agreement desire to
consent to make certain amendments to the Asset Purchase Agreement, as set forth
below and to set forth other agreements among the parties;
WHEREAS, the US Purchaser and Canadian Purchaser desire to assign
all of their rights and delegate all of their obligations arising under the
Asset Purchase Agreement to the US Assignee, the Canadian Assignee and the
Pyrotenax Assignee; and
WHEREAS, the US Vendor, Canadian Vendor and Vendor's Guarantor
desire to consent to such assignment and delegation.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
A G R E E M E N T:
------------------
I. DEFINED TERMS. Except as otherwise expressly provided herein,
capitalized terms used herein that are defined in the Asset Purchase Agreement,
as amended hereby, shall have the same meaning as specified in the Asset
Purchase Agreement, as so amended.
II. AMENDMENTS: the Asset Purchase Agreement is hereby amended as
set forth below.
<PAGE> 2
(a) A new Section 3.4 is added to the Asset
Purchase Agreement to read in its entirety as follows:
"3.4 ADJUSTMENT WITH RESPECT TO JACKSON, TENNESSEE PROPERTY.
Notwithstanding anything to the contrary contained herein and in
connection with the assignment at Closing to the US Purchaser of that
certain lease dated May 1, 1991 (the "Lease") between the US Vendor and
The Industrial Development Board of the City of Jackson, a Tennessee
public non-profit Corporation, at the Closing the Purchase Price shall
be reduced by $9 million, the amount of the aggregate Liability to be
assumed by the US Purchaser with respect to the Lease. The adjustment
set forth in this Section shall take effect as an adjustment to the
Purchase Price. No adjustment to the Purchase Price shall be made in
accordance with the provisions of Section 9 of the Agreement for the
Liability for which the Purchase Price is adjusted pursuant to this
Section."
(b) Section 6.4.2 of Schedule 8 shall be deleted in
its entirety and replaced with the following:
"Without limiting Section 6.4.1, Vendors shall
also be responsible for one-half of the special award
payments payable pursuant to the special performance
letters dated August 20, 1998, and August 24, 1998, (as in
effect immediately prior to the Closing Date) concerning
Anthony Cutri, Joseph DeBolt, William Fike, Linda Ermelin,
Robert Jamieson (collectively, the "SPECIAL PERFORMANCE
LETTERS"). The US Purchaser shall be responsible for the
other half of the special award payments pursuant to the
Special Performance Letters."
(c) A new Section 17.5.7 is added as follows:
"17.5.7. The parties have agreed that without
prejudice to the rights conferred on the US
Purchaser under and notwithstanding Section
17.5.3 the US Purchaser shall be entitled to
use and have the right to sublicense to any
wholly owned subsidiary of the Purchaser's
Guarantor (but only for so long as such remain
a wholly owned subsidiary of the Purchaser's
Guarantor) the name "BICC General Brand Rex
Cables "as the name of any corporate entity,
partnership or other vehicle which, in all
cases, is solely involved in the manufacture,
sale or distribution of Specialty Cables in the
United States of America, Canada or Mexico."
(d) A new section 17.8 is added as follows:
"17.8 RECORDS RETENTION AND ACCESS
17.8.1 (a) The Purchaser shall keep and preserve in an
organized and retrievable manner all books, records and other
information in any form including paper, electronically stored data,
magnetic media, film and microfilm included in the Acquired Assets
(the "PURCHASER BOOKS AND RECORDS") for three (3) years from the
Closing Date or longer if the statute of limitations for income tax
purposes has not expired for any income or franchise tax return for
any taxable period prior to or including the Closing Date. The
Purchaser shall neither dispose of nor destroy such Books and Records
at any time without first offering to turn over possession thereof to
the US Vendor and the Canadian Vendor by written notice to each at
least fifteen (15) days prior to the proposed date of such
disposition.
(b) Each of the US Vendor and the Canadian Vendor shall
keep and preserve in an organized and retrievable manner all books,
records and other information in any form including paper,
electronically stored data, magnetic media, film and microfilm
included in the Excluded Assets (the "VENDOR BOOKS AND
-2-
<PAGE> 3
RECORDS") for three (3) years from the Closing Date or longer if the
statute of limitations for income tax purposes has not expired for
any income or franchise tax return for any taxable period prior to or
including the Closing Date. Neither the US Vendor nor the Canadian
Vendor shall dispose of or destroy such Books and Records at any time
without first offering to turn over possession thereof to the
Purchaser by written notice to the US Purchaser at least fifteen (15)
days prior to the proposed date of such disposition.
17.8.2 (a) Purchaser shall allow the Canadian Vendor and
the US Vendor, their representatives, attorneys and accountants, at
the respective Vendors' expense, access to the employees of the
Purchaser and to the Purchaser Books and Records upon reasonable
request and during normal business hours for the purpose of
interviewing, examining and copying to the extent reasonably
necessary or advisable in connection with any litigation or
proceeding, the preparation of any required tax returns or in
connection with any tax procedure, any obligation or duty hereunder,
compliance with any legal duty or obligation, or otherwise.
(b) Each of the US Vendor and the Canadian Vendor shall
allow the Purchaser, its representatives, attorneys and accountants,
at the Purchaser's expense, access to the employees of the Vendors to
the Vendor Books and Records upon reasonable request and during
normal business hours for the purpose of interviewing, examining and
copying to the extent reasonably necessary or advisable in connection
with any litigation or proceeding, the preparation of any required
tax returns or in connection with any tax procedure, any obligation
or duty hereunder, compliance with any legal duty, or obligation or
otherwise.
17.8.3 (a) The Purchaser shall allow Internal Revenue
Service or Revenue Canada examining agents or state or provincial
income or franchise or sales tax examining agents, if accompanied by
the Canadian or US Vendor's tax representatives, accountants or
attorneys, access to the Purchaser Books and Records during normal
business hours for the purpose of conducting an income or franchise
tax audit of the Operations for any tax period prior to or including
the Closing Date; which access shall be limited in scope to the
Purchaser Books and Records which are relevant to the subject matter
of the audit.
(b) Each of the US Vendor and the Canadian Vendor shall
allow Internal Revenue Service or Revenue Canada examining agents or
state or provincial income or franchise or sales tax examining
agents, if accompanied by the Purchaser's tax representatives,
accountants or attorneys, access to the Vendor Books and Records
during normal business hours for the purpose of conducting an income
or franchise tax audit of the Operations."
(c) Section 19.5.2 of the Asset Purchase Agreement is
deleted in its entirety and replaced with the following:
"19.5.2 This Agreement is personal to the parties to it.
Accordingly, except as otherwise set forth in Section 19.5.1 no party
may, without the prior written consent of the Purchasers and the
Vendors' Guarantor, assign either this agreement or any of its
rights, interests or obligations under this Agreement; provided,
however, (i) the US Purchaser and the Purchasers' Guarantor may
assign all of their rights and interest hereunder relating to the US
Business and delegate all of their obligations hereunder relating to
the US Business to any person to whom the US Purchaser sells a
substantial part of the assets of the US Business or to any person
that is the successor to all or substantially all of the US Business;
(ii) the Canadian Purchaser and the Purchasers' Guarantor may assign
all of their rights and interests hereunder relating to the Canadian
Business and delegate all of their obligations hereunder relating to
the Canadian Business to any person to whom the Canadian Purchaser
sells a substantial part of the assets of the Canadian Business or to
any person that is the successor to all or substantially all of the
Canadian Business; and (iii) and the Vendors and the Vendors'
Guarantor may assign all of their rights and delegate all of their
obligations hereunder to any person to whom the Vendors or the
Vendors' Guarantor sell a substantial part of their respective
assets. This Agreement shall bind, benefit, and be enforceable by and
against each party hereto and its successors and permitted assigns."
-3-
<PAGE> 4
(d) Schedule 1 of the Asset Purchase Agreement is amended
to reflect that the Jackson, TN site is a Leased Property and not a
Vendor Owned Real Property.
(e) Schedule 10, Part I, Transfer Taxes is deleted in its
entirety and replaced with Exhibit B hereto.
(f) Schedule 15 of the Asset Purchase Agreement is deleted
in its entirety and replaced with Exhibit A hereto.
III. ADDITIONAL AGREEMENTS REGARDING EMPLOYMENT MATTERS. In addition
to the foregoing amendments to the Asset Purchase Agreement, the parties agree
as follows:
(a) SECTION 401(K) PLAN. US Vendor and US Purchaser agree
that notwithstanding the provisions of Section 1.1.1 of Schedule 12
of the Asset Purchase Agreement, the assets and liabilities of the
BICC Cables Corporation 401(k) Savings Plan (the "PLAN") attributable
to the accrued benefits of those employees of the US Vendor who
remain employed at the corporate headquarters of the US Vendor
post-Closing shall not be transferred to another plan maintained by
the US Vendor or one of its affiliates, but instead shall be included
in the Plan as assumed by US Purchaser at Closing. The parties
further agree that the participation in the Plan by those employees
who remain employed at the corporate headquarters of the US Vendor
post-Closing shall be frozen, and that amendments to the Plan
necessary to implement the foregoing shall be adopted prior to
Closing, and that all loans outstanding to such employees shall be
repaid prior to Closing.
(b) SEVERANCE PLAN. Notwithstanding the provisions of
Section 1.2 of the Asset Purchase Agreement, US Purchaser hereby
agrees to pay severance benefits (including Salary as defined under,
and all Benefits specified in Attachment A to, the BICC Cables
Corporation Severance Plan) for the period specified in, and in
accordance with the terms of the BICC Cables Corporation Severance
Plan, as in effect on the date of the Asset Purchase Agreement (April
6, 1999), to all Continuing Employees whose employment with the US
Purchaser is terminated within 90 days after the Closing Date, as if
the employee were terminated from BICC. Such payments shall be in
lieu of any other severance benefits to which the individual might be
entitled under the General Cable Severance Plan. US Vendor shall
reimburse US Purchaser each month, within 5 business days of receipt
of an invoice for such month after the last day of such month, for an
amount equal to the sum of (i) one-half of the difference between (A)
the actual monthly salary continuation payment, if any, made during
such month by US Purchaser to any Continuing Employee whose
employment was terminated within 90 days after the Closing Date; and
(B) the monthly salary continuation payment to which such Continuing
Employees would otherwise be entitled under the General Cable
Severance Plan in the absence of this paragraph (b) and (ii) one-half
of the employer matching contribution made by General Cable to the
Section 401(k) Plan with respect to any salary deferrals made during
such month by any Continuing Employees whose employment was
terminated within 90 days after the Closing Date, provided that the
total amount payable by US Vendor pursuant to this paragraph (b)
shall not exceed $275,000.
(c) Cooperative Efforts. US Purchaser has agreed that upon
the Closing Date it will cause all of the employees of the US Vendor
(other than those employees with employment contracts who are not
listed in the Employment Letter as continuing employees) to become
Continuing Employees of US Purchaser. The parties recognize, however,
that for purposes of effecting a smooth transition of the sale of US
Vendor's operations each side may wish to draw on the expertise of
employees of the other. To this end, the parties agree that, for 60
days from the Closing without charge, US Vendor shall be permitted
reasonable access to the employees of US Purchaser after Closing for
purposes of obtaining such information as necessary to implement the
wind-up of US Vendor's operations in the United States and US
Purchaser shall be permitted reasonable access to the remaining
employees of US Vendor after Closing for purposes of assisting in the
integration of the business. Any services provided to US Vendor by an
employee of US Purchaser pursuant to this Section III shall be
performed in his capacity as an employee of US Purchaser, under the
exclusive direction and control of US Purchaser, and he shall in no
event on account of such
-4-
<PAGE> 5
services become an employee of US Vendor or entitled to any benefit
plans maintained by US Vendor, and any services provided to US
Purchaser by an employee of US Vendor shall be performed in his
capacity as an employee of US Vendor, under the exclusive direction
and control of US Vendor, and he shall in no event become an employee
of US Purchaser on account of such services or entitled to any
benefit plans maintained by US Purchaser. After 60 days from the
Closing US Purchaser and US Vendor shall review these arrangements to
determine whether it is appropriate for such access to be on a cost
reimbursable basis going forward or otherwise.
(d) LEASEBACK. US Vendor hereby reserves the right to
require that up to four individuals, to be named by US Vendor, who
become Continuing Employees of US Purchaser, be leased back to US
Vendor, for such period as required by US Vendor, on a full time
basis. US Purchaser shall continue to employ such individuals for the
period that they are leased back to US Vendor and shall provide them
with salary and benefits commensurate with that provided to other
Continuing Employees who perform services for US Purchaser similar to
those provided by the leased individuals to the US Vendor. US Vendor
shall reimburse US Purchaser for 100% of the cost of the salary and
other benefits (other than severance benefits) actually provided by
the US Purchaser to such individuals during the time that they are
leased to US Vendor. With respect to severance benefits, upon the
termination of employment with US Purchaser of any individual subject
to this paragraph (d), US Purchaser shall pay severance benefits to
such individuals, in accordance with the provisions of the General
Cables Severance Plan subject to the requirements of subsection
III(b) above. Notwithstanding any other severance obligation, the US
Vendor shall reimburse US Purchaser for any additional severance
benefits earned by the individual under such plan on account of his
employment with the US Purchaser, from the date as of which his
employment would have been terminated by the US Purchaser in the
absence of this paragraph (d) until the date of his actual
termination of employment by the US Purchaser
(e) LEASEBACK. US Purchaser hereby reserves the right to
require that up to four individuals, to be named by US Purchaser, who
are employees of US Vendor after the Closing Date, be leased back to
US Purchaser, for such period as required by US Purchaser, on a full
time basis. US Vendor shall continue to employ such individuals for
the period that they are leased back to US Purchaser and shall
provide them with their existing salary and benefits. US Purchaser
shall reimburse US Vendor for 100% of the cost of the salary and
other benefits (other than severance benefits) actually provided by
the US Vendor to such individuals during the time that they are
leased to US Purchaser. With respect to severance benefits, upon the
termination of employment with US Vendor of any individual subject to
this paragraph (e), US Vendor shall pay severance benefits to such
individuals, in accordance with the employee contracts, if any, into
which they have entered with US Vendor.
IV. ASSIGNMENT.
(a) Pursuant to Section 19.5 of Asset Purchase
Agreement:
(i) Except with respect to the assets as to which the
assignment set forth in Section (iii) below relates, the
US Purchaser hereby assigns to BICC General Cable (USA),
LLC, a Delaware limited liability company, all of its
rights and delegates all of its obligations arising under
the Asset Purchase Agreement, as amended by this
Amendment, relating to the US Assets, and BICC General
Cable (USA), LLC hereby accepts such assignment and shall
assume and perform such obligations.
(ii) Except with respect to the assets as to which the
assignment forth in Section (iii) below relates, the
Canadian Purchaser hereby assigns to BICC General Cable
Company, a Nova Scotia unlimited liability company, all of
its rights, and delegates all of its obligations arising
under the Asset Purchase Agreement, as amended by this
Amendment, relating to the Canadian Assets, and BICC
General Cable Company hereby accepts such assignment and
shall assume and perform such obligations.
-5-
<PAGE> 6
(iii) GK Technologies, Incorporated, as US Purchaser and
Canadian Purchaser, hereby assigns to BICC General
Pyrotenax Cables Ltd., an Ontario Corporation, all of its
rights and delegates all of its obligations under the
Asset Purchase Agreement, as amended by this Amendment,
relating to the US Assets and Canadian Assets that are
assets used in the Pyrotenax business conducted by the
Vendors (the "Pyrotenax Assets"), and BICC General
Pyrotenax Cables Ltd. hereby accepts such assignment and
shall assume and perform such obligations.
(b) Each of Vendors' Guarantor, US Vendor and Canadian
Vendor hereby consent to the assignment set forth in this Section.
(c) From and after the date hereof, BICC General Cable
(USA), LLC and BICC General Pyrotenax Cables Ltd. as assignee with
respect to that portion of the Pyrotenax Assets that are US Assets
shall be collectively the "US Purchaser" under the Asset Purchase
Agreement and BICC General Cable Company and BICC General Pyrotenax
Cables Ltd. as assignee with respect to that portion of the Pyrotenax
Assets that are Canadian Assets shall collectively be the "Canadian
Purchaser" under the Asset Purchase Agreement.
V. INDEMNITY PAYMENT.
(a) Pursuant to Section 7.3.1(ii) of the Asset Purchase
Agreement, the US Vendor hereby gives notice that, at Closing, a
breach of the Warranty set forth in Section 3.4.2 of Schedule 8 of
the Asset Purchase Agreement has occurred (such Warranty being the
"SECTION 3.4.2 WARRANTY"; the Section 3.4.2 Warranty, together with
any other representation or warranty contained in the Asset Purchase
Agreement or the Non-North American Sale and Purchase Agreement
(together with the Asset Purchase Agreement the "PURCHASE
AGREEMENTS") or any Schedule to either Purchase Agreement which
relates to material adverse changes in all or any portion of the
Global Operations or the financial condition or results of operation
thereof, being herein collectively referred to as "MAC WARRANTIES").
(b) In acknowledgment of the breach of the Section 3.4.2
Warranty and the desire of the parties to consummate the transactions
contemplated by the Purchase Agreements, the parties hereto
acknowledge and agree as follows:
(i) At the Closing, US Purchaser shall be deemed to have
made, and US Vendor shall be deemed to have accepted,
without dispute, a claim for indemnification, pursuant to
Section 2.3 of the Asset Purchase Agreement, in the amount
of (pound) 13.6 million for Losses resulting from the
breach of the Section 3.4.2 Warranty (the "SECTION 3.4.2
INDEMNITY CLAIM").
(ii) Upon receipt by the US Purchaser of a payment in
respect of the Section 3.4.2 Indemnity Claim in the amount
of (pound) 13.6 million (the "MAC INDEMNITY PAYMENT"), the
Purchaser and the Purchaser's Guarantor, together with the
Purchaser and each Relevant Purchaser (each as defined in
the Non-North American Sale Purchase Agreement), shall
have waived (i) all further claims any of them may have
pursuant to either Purchase Agreement in respect of any
Losses resulting from any breach of any MAC Warranty and
(ii) any right any of them may have to terminate the
Non-North American Sale and Purchase Agreement pursuant to
Section 4.5 thereof as a result of any breach of any MAC
Warranty.
(iii) Any term or provision hereof to the contrary
notwithstanding, (i) for purposes of Section 2.3.5(b) of
the Asset Purchase Agreement, the Section 3.4.2 Indemnity
Claim shall be deemed never to have been made, and (ii)
for purposes of Section 2.3.5(c) of the Asset Purchase
Agreement, such Section 3.4.2 Indemnity Claim shall be
deemed to have been made and, upon receipt of the MAC
Indemnity Payment, satisfied in full.
-6-
<PAGE> 7
(iv) The MAC Indemnity Payment will be made through
offset against the Purchase Price payable at Closing
pursuant to Section 3.1(a) of the Asset Purchase
Agreement.
VI. INDUSTRIAL REVENUE BOND.
(a) JACKSON, TENNESSEE FACILITY. US Vendor entered into a
certain lease dated as of May 1, 1991 (the "Lease"), with The
Industrial Development Board of the City of Jackson, a Tennessee
public nonprofit corporation (the "IDB") to finance the construction
of, inter alia, a certain manufacturing facility and all
improvements thereon and property therein, having an address of 19
Bobrick Drive, Jackson, Tennessee (the "Property"). Vendors'
Guarantor guaranteed the obligations of US Vendor under the Lease
pursuant to the terms of that certain Guaranty Agreement dated as of
May 1, 1991, from Vendors' Guarantor to First American National
Bank, Nashville, Tennessee, a national banking association, as
trustee (the "Guaranty"). It is anticipated that as of the Closing
Date, all or any consents necessary to release US Vendor and the
Vendors' Guarantor from their respective obligations under the
Guaranty will not have been obtained. As a result, the parties
hereto have agreed as follows: (a) at Closing, US Vendor and US
Purchaser will enter into a certain assignment and assumption of
lease in the form attached hereto as Exhibit C pursuant to which,
among other things, US Vendor will assign the Lease to US Purchaser
who will perform the obligations of the tenant thereunder from and
after the Closing Date, (b) at Closing, Purchaser's Guarantor will
execute a certain guaranty indemnity agreement in the form attached
hereto as Exhibit D pursuant to which Purchaser's Guarantor shall
agree to indemnify the Vendors' Guarantor from any liability arising
from performance by Vendor's Guarantor under the Guaranty as a
result of acts occurring after Closing, (c) US Vendor will execute
that certain certificate attached hereto as Exhibit E and (d) on or
before May 31, 2000, US Purchaser shall, at its sole cost and
expense, cause US Vendor and the Vendors' Guarantor and their
affiliates to be released in full from their respective obligations
under the Lease and the Guaranty by either: (i) obtaining the
consent of the bondholders to release the US Vendor, the Vendors'
Guarantor and their affiliates, if any, from their obligations under
the Guaranty or (ii) defeasing the bonds. In the event that the US
Vendor and the Vendors' Guarantor are not released from all
obligations and Liability under the Lease and the Guaranty on or
before May 31, 2000 the US Purchaser will pay to the US Vendor, or
its assignee, an amount equal to all Liability then due under the
Lease and the US Vendor will defease the bonds.
VII. Section 1.1.6 of Schedule 12 of the Asset Purchase Agreement
is hereby deleted in its entirety and replaced with the following:
(a) On the Closing Balance Sheet US Vendor shall
(i) establish a reserve for the total bonuses payable under the
BICC Cables Corporation Management Incentive Plan and the BICC
Cables Corporation Discretionary Bonus Plan to Continuing
Employees ("total bonus accrual"); and (ii) supply US Purchaser
with a schedule of individuals who are Continuing Employees and
for whom bonuses have been accrued under the Management Incentive
Plan and Discretionary Bonus Plan for the period January 1, 1999
through the Closing Date ("pre-closing period"), which schedule
shall specify the name of each individual and the specific dollar
amount of the total bonus accrual assigned to that individual
("individual's pre-closing accrued bonus"). (Individuals
described in this paragraph (a) are referred to as "scheduled
individuals").
Thereafter, at such time as US Purchaser pays
bonuses to its employees for 1999 under its bonus and/or
incentive programs, US Purchaser will supply US Vendor with a
report that indicates (i) the portion of each scheduled
individual's 1999 bonus and incentive payments from US Purchaser
that are attributable to the pre-closing period (actual
pre-closing bonus) and (ii) the portion attributable to the
period from May 29, 1999 until December 31, 1999 (post-closing
bonus). With respect to the pre-closing period, US Purchaser
shall have the discretion to determine whether a scheduled
individual's actual pre-closing bonus shall be less than or equal
to the individual's pre-closing accrued bonus. In no event may
the amount designated by the US Purchaser as the scheduled
individual's actual pre-closing bonus exceed the individual's
pre-closing accrued bonus. In the event that the actual
pre-closing bonus of a scheduled individual (including a
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<PAGE> 8
scheduled individual who receives no bonus for 1999 or for the
pre-closing period) is less than his pre-closing accrued bonus,
US Purchaser shall pay the difference to US Vendor.
(b) MARSHALL, TEXAS GAIN SHARE PLAN. Pursuant to US
Purchaser's assumption of the Marshall, Texas Gain Share Plan, US
Vendor shall not pay out at Closing any amounts accrued under
that Plan for the December 1, 1998 through November 30, 1999 Gain
Share Period. US Purchaser shall be responsible for payment of
all bonuses under that Plan for the December 1, 1998 to November
30, 1999, Gain Share Period at the normal time and in the normal
manner.
VIII. The US Vendor will use its reasonable efforts to close out
all inventory hedges relating to copper and aluminum. For the avoidance of
doubt, there is no obligation to close out any hedges relating to open purchase
orders.
IX. EFFECT OF AMENDMENT NO. 1. Except as expressly amended and
modified herein, all other terms of the Asset Purchase Agreement shall remain
in full force and effect as originally made and entered into by the parties
thereto.
X. GOVERNING LAW. This Amendment shall be governed by and
construed and enforced in accordance with the laws of the State of New York
applicable to agreements made and to be performed wholly within such
jurisdiction.
XI. NECESSARY DOCUMENTS. The parties hereto agree to execute or
cause to be executed at any time, any and all other documents or instruments
necessary to carry out the terms of this Amendment.
XII. COUNTERPARTS. This Amendment No. 1 may be executed in any
number of counterparts, each of which shall be deemed to be an original and all
of which together shall be deemed to be one and the same instrument, and all
signatures need not appear on any one counterpart.
-8-
<PAGE> 9
IN WITNESS WHEREOF, the undersigned have caused this Amendment to
be executed as of the date first written above.
BICC CABLES CORPORATION
By: /s/ Hans P. Berndorff
----------------------------------
Name: Hans P. Berndorff
----------------------------------
Title: Vice President
----------------------------------
BICC CABLES CANADA INC.
By: /s/ Hans P. Berndorff
----------------------------------
Name: Hans P. Berndorff
----------------------------------
Title: Vice President
----------------------------------
PYROTENAX USA INC.
By: /s/ Hans P. Berndorff
----------------------------------
Name: Hans P. Berndorff
----------------------------------
Title: Vice President
----------------------------------
BICC PLC
By: /s/ Peter Zinkin
----------------------------------
Name: Peter Zinkin
----------------------------------
Title: Director
----------------------------------
GK TECHNOLOGIES,
INCORPORATED, in its capacity
as US Purchaser and Canadian Purchaser
By: /s/ Chris Virgulak
----------------------------------
Name: Chris Virgulak
----------------------------------
Title: Executive Vice President
----------------------------------
-9-
<PAGE> 10
GENERAL CABLE CORPORATION
By: /s/ Robert Siverd
----------------------------------
Name: Robert Siverd
----------------------------------
Title: Executive Vice President
----------------------------------
BICC GENERAL PYROTENAX
CABLES, LTD.
By: /s/ Robert Siverd
----------------------------------
Name: Robert Siverd
----------------------------------
Title: Executive Vice President
----------------------------------
BICC GENERAL CABLE (USA),
LLC
By: /s/ Robert Siverd
----------------------------------
Name: Robert Siverd
----------------------------------
Title: Executive Vice President
----------------------------------
BICC GENERAL CABLE
COMPANY
By: /s/ Robert Siverd
----------------------------------
Name: Robert Siverd
----------------------------------
Title: Executive Vice President
----------------------------------
-10-
<PAGE> 1
Exhibit 2.3
CONFORMED COPY
Dated 6 April 1999
BICC PLC
and
GK TECHNOLOGIES, INCORPORATED
and
GENERAL CABLE CORPORATION
SALE AND PURCHASE AGREEMENT
relating to
the Energy Cables Operations of
BICC plc
Linklaters & Paines
One Silk Street
London EC2Y 8HQ
tel:(+44)171 456 2000
<PAGE> 2
AGREEMENT FOR THE SALE AND PURCHASE OF THE ENERGY CABLES OPERATIONS OF BICC PLC
THIS AGREEMENT is made on 6 April 1999
BETWEEN:
(1) BICC PLC a company incorporated in England and Wales, whose registered
office is at Devonshire House, Mayfair Place, London WIX 5FH (the
VENDOR); and
(2) GK TECHNOLOGIES, INCORPORATED a company incorporated in New Jersey, the
United States, whose principal place of business is at 4 Tesseneer
Drive, Highland Heights, Kentucky, 41076 (the PURCHASER); and
(3) GENERAL CABLE CORPORATION a company incorporated in Delaware, the
United States, whose principal place of business is at 4 Tesseneer
Drive, Highland Heights, Kentucky, 41076 (the PURCHASER'S GUARANTOR).
IT IS AGREED as follows:
1. INTERPRETATION
In this Agreement, including its Schedules, the headings shall not
affect its interpretation and, unless the context otherwise requires,
the provisions in this Clause 1 apply:
1.1 DEFINITIONS
ACTUAL INDEBTEDNESS STATEMENTS means the Intra-Group Indebtedness
Statement, the Third Party Indebtedness Statement and the Cash
Statement;
AGREED TERMS means in relation to any document such document in the
terms agreed between the parties and signed by or on behalf of the
Purchaser's Lawyers and the Vendor's Lawyers or the Vendor's Property
Lawyers for the purposes of identification as that document may be
amended by agreement in writing between the Purchaser and the Vendor
from time to time;
ASSETS means the Business Sellers' Assets and all the property, rights
and assets owned and used by any of the Group Companies exclusively or
primarily in
<PAGE> 3
connection with the Operations to be sold pursuant to this Agreement or
any Subsidiary Agreement;
ASSOCIATED COMPANY means a company which is a subsidiary of the party
concerned or which is a holding company of such party or a subsidiary
of such holding company;
ASSUMED LIABILITIES means the Liabilities of any of the Business
Sellers to be assumed by a Relevant Purchaser under Clause 2.2 and
Assumed Liability means any one of them;
BALANCE SHEET DATE means 31 December 1998;
BUSINESSES means those businesses carried on by the Business Sellers
and comprised in the Operations (including the Assumed Liabilities),
brief details of which are contained or referred to in Part 2 of
Schedule 2 and BUSINESS means any one of them;
BUSINESS DAY means a day on which banks are open for business in London
and New York City (excluding Saturdays, Sundays and public holidays);
BUSINESS SELLERS has the meaning given to it in the definition of
Relevant Seller;
BUSINESS SELLERS' ASSETS means all the property, rights and assets
forming part of the Businesses to be sold under this Agreement or any
Subsidiary Agreement;
BUSINESS SELLERS' CASH BALANCES means cash in hand, or credited to any
account with a bank, and securities of any description held by or on
behalf of any of the Business Sellers as at close of business on the
Completion Date;
BUSINESS SELLERS' INTELLECTUAL PROPERTY means all rights and interests
owned by any of the Business Sellers in Intellectual Property (details
of which are set out in Parts A, B and C of Schedule 15) and all other
Intellectual Property which at or before Completion is owned by a
member of the Vendor's Group and used exclusively or primarily in
connection with the Operations;
<PAGE> 4
BUSINESS SELLERS' KNOW-HOW means all rights and interests owned by any
member of the Vendor's Group in Know-how which at or before Completion
is used exclusively or primarily in connection with the Operations;
BUSINESS SELLERS' LEASED PROPERTIES means the Leased Properties owned
by any Business Sellers and BUSINESS SELLER'S LEASED PROPERTY means any
of them;
BUSINESS SELLERS' MOTOR VEHICLES means all the motor vehicles owned by
any of the Business Sellers and used exclusively or primarily in
connection with the Operations at Completion;
BUSINESS SELLERS' MOVEABLE ASSETS means the Business Sellers' Plant and
Machinery, the Business Sellers' Office Equipment and the Business
Sellers' Motor Vehicles;
BUSINESS SELLERS' OFFICE EQUIPMENT means the Office Equipment owned by
any of the Business Sellers and used exclusively or primarily in
connection with the Operations at Completion but excluding Office
Equipment forming part of any of the Properties;
BUSINESS SELLERS' PLANT AND MACHINERY means the Plant and Machinery
owned by any of the Business Sellers and used exclusively or primarily
in connection with the Operations at Completion but excluding Plant and
Machinery forming part of any of the Properties;
BUSINESS SELLERS' PROPERTIES means the Properties owned or leased by
any Business Sellers;
CASH DETERMINATION DATE means the date on which the process described
in Part 2 of Schedule 7 for the preparation of the Cash Statement is
complete;
CASH STATEMENT means the statement of the Relevant Group Companies'
Cash Balances to be prepared pursuant to Clause 9.5 in accordance with
the provisions of Part 2 of Schedule 7;
CLAIMS means all rights and claims of any of the Business Sellers
arising at any time (whether before or after Completion) out of or in
connection with the Operations
<PAGE> 5
(whether arising under any warranties, conditions, guarantees,
indemnities, insurance policies, contracts, agreements (in each case
whether express or implied) or otherwise howsoever) in so far as they
relate exclusively (or primarily) to any of the Business Sellers'
Assets or any Assumed Liability;
COMBINED ACCOUNTS means the aggregated accounts relating to the
Operations extracted from those audited by Arthur Andersen relating to
the Global Operations for the twelve-month financial period ended on
the Balance Sheet Date in the agreed terms;
COMPANIES means the companies or partnership interests listed in column
(2) of Part 1, paragraph 1 of Schedule 2, and Company means any one of
them;
COMPANIES EMPLOYEES means the persons employed by any of the Group
Companies at Completion and, where applicable, at any Subsequent
Completion;
COMPLETION means completion of the sale and purchase of the Shares,
Businesses and Assets in the Jurisdictions specified in Part A of Part
1 of Schedule 6 and of any other Shares the sale and purchase of which
is completed on the same date pursuant to Clause 6.1 and Schedule 6;
COMPLETION DATE means the date on which Completion takes place;
CONTRACTS means (i) the Customer Contracts, the Supplier Contracts and
the Licence Agreements; (ii) all other contracts, undertakings,
arrangements and agreements entered into prior to Completion by or on
behalf of any of the Business Sellers exclusively or primarily in
connection with the Operations in each case to the extent that at
Completion the same remain to be completed or performed or remain in
force but excluding this Agreement, the Subsidiary Agreements and
employment and other agreements with Employees;
CUSTOMER CONTRACTS means all contracts and agreements entered into
prior to Completion by or on behalf of any of the Business Sellers with
customers for the manufacture and/or sale, letting on hire, rental of
goods or other supply or the provision of services by any of the
Business Sellers exclusively or primarily in
<PAGE> 6
connection with the Operations in each case to the extent that at
Completion there are any obligations relating thereto (other than
obligations as to the warranting or guaranteeing of goods or services
supplied or provided prior to the date hereof) which remain to be
completed or performed by the relevant Business Seller;
DATA ROOM means the data room at the offices of the Vendor's Lawyers;
DISCLOSURE LETTER means the letter of even date with this Agreement in
agreed terms from the Vendor to the Purchaser disclosing (i)
information constituting exceptions to the Warranties and (ii) details
of other matters referred to in this Agreement;
EMPLOYEE BENEFIT ARRANGEMENTS means the schemes or arrangements
operated by the Business Sellers or Group Companies or in which any
Business Seller or Group Company participates in respect of any
Employee or any past employee of a Group Company or persons dependent
on any such Employee or past employee providing for benefits payable on
retirement, death, disability or voluntary withdrawal from, or
involuntary termination of, employment (other than State or statutory
or other mandatory agreements (the STATE SCHEMES) providing social
security, unemployment insurance, workers' compensation and other
benefits payable on retirement, death, disability or voluntary
withdrawal from, or involuntary termination of, employment);
EMPLOYEES means the Companies Employees and all the persons employed by
any of the Business Sellers wholly in connection with the Businesses as
at Completion and, where applicable, at any Subsequent Completion;
EMPLOYMENT COSTS means a sum equivalent to the aggregate of (i) the
amount payable or paid in respect of the employment of an Employee
(including, but not limited to, salary, wages, tax and social security
contributions, employer's pension contributions, bonus, insurance
premium, payments or allowances or any other consideration for
employment) and (ii) the cost of providing any non-cash benefits, which
the employer is required to provide, by law or contract in connection
with such employment (including, but not limited to, other employee
benefit provisions);
EMPLOYMENT LIABILITIES means in relation to any Employee, any and all
Losses arising out of or connected with his or her employment or the
employment
<PAGE> 7
relationship, or termination of his or her employment, or of the
employment relationship (including, but not limited to, all Losses in
connection with any claim for redundancy pay, or damages or
compensation for unfair or wrongful dismissal or breach of contract);
ENCUMBRANCE means any claim, charge, mortgage, security, lien, option,
equity, power of sale, hypothecation or other third party rights;
EQUITY SHARE CAPITAL means, in relation to a company, its issued share
capital excluding any part of that capital which, neither as respects
dividends nor as respects capital, carries any right to participate
beyond a specified amount in a distribution;
ESTIMATED CASH means the estimate of the aggregate of the Relevant
Group Companies' Cash Balances set out in the Estimated Cash Statement;
ESTIMATED CASH STATEMENT means the statement of Estimated Cash to be
prepared pursuant to Clause 5.5 in accordance with the provisions of
Part 2 of Schedule 7;
ESTIMATED INDEBTEDNESS STATEMENTS means the Expected Intra-Group
Indebtedness Statement, the Estimated Third Party Indebtedness
Statement and the Estimated Cash Statement;
ESTIMATED THIRD PARTY INDEBTEDNESS means the estimate of Third Party
Indebtedness set out in the Estimated Third Party Indebtedness
Statement;
ESTIMATED THIRD PARTY INDEBTEDNESS STATEMENT means the statement of
Estimated Third Party Indebtedness to be prepared pursuant to Clause
5.5 in accordance with the provisions of Part 2 of Schedule 7;
EUROPEAN COUNTRY means any member state of the European Union at the
date of this Agreement;
EUROPEAN EMPLOYEE means any Employee ordinarily working in any European
Country including any such employee who is temporarily seconded on an
ex-patriate basis to any of the Group Companies (not being a Companies
Employee) and whose name is on the list in the agreed terms, which list
shall be updated to Completion to
<PAGE> 8
reflect changes in the ordinary course of business between the date of
this Agreement and the Completion Date;
EXCLUDED ASSETS means the assets excluded from the sale and purchase
pursuant to this Agreement and the Subsidiary Agreements and described
or referred to in Schedule 17;
EXCLUDED LIABILITIES means all Liabilities of any Business Seller
except for any Assumed Liabilities;
EXPECTED INTRA-GROUP INDEBTEDNESS means the expected Intra-Group
Indebtedness set out in the Expected Intra-Group Indebtedness
Statement;
EXPECTED INTRA-GROUP INDEBTEDNESS STATEMENT means the statement of
Expected Intra-Group Indebtedness to be prepared pursuant to Clause 5.5
in accordance with the provisions of Part 2 of Schedule 7;
GENERAL SERVICES AND SUPPLY AGREEMENTS means the various service and
supply agreements to be entered into between the members of the
Vendor's Group, the Relevant Business Sellers and certain other parties
(as the case may be) covering such matters and in such terms as the
Purchaser may reasonably consider appropriate having regard to the
terms of such agreements which may have been previously negotiated with
third parties;
GLOBAL OPERATIONS means the Operations together with the "Operations"
(as such term is defined in the North American Sale and Purchase
Agreement) taken as a whole;
GOODWILL means the goodwill of each of the Business Sellers in
connection with the Operations or part thereof together with the
exclusive right (so far as the relevant Business Seller can grant the
same) for the Relevant Purchaser to represent itself as carrying on the
Operations or relevant part thereof in succession to the relevant
Business Seller;
<PAGE> 9
GROUP OR GROUP COMPANIES means each of the Companies and the
Subsidiaries and GROUP COMPANY means any one of them but shall exclude
any Company or Subsidiary in respect of which Subsequent Completion
does not take place;
INTELLECTUAL PROPERTY means trade marks, service marks, trade names,
logos, get-up, patents, inventions, registered and unregistered design
rights, copyrights, semi-conductor topography rights, rights of
extraction relating to databases and all other similar proprietary
rights which may subsist in any part of the world (but excluding
Know-how) including, where such rights are obtained or enhanced by
registration, any registration of such rights and applications and
rights to apply for such registrations;
INTERNAL REORGANISATIONS means the pre-Completion internal fiscal and
operational reorganisations of the Vendor's Group involving the Group
Companies and the Businesses referred to in Schedule 4;
INTRA-GROUP INDEBTEDNESS means the aggregate net amount of all
outstanding loans of the Relevant Group Companies from or to any member
of the Vendor's Group (save that in the case of Majority Owned Group
Companies only the Proportionate Share of such outstanding loans shall
be included), as at the close of business on the Completion Date and
prepared pursuant to Clause 9.5 and Part 2 of Schedule 7 but excluding
any Relevant Group Companies' Cash Balances, Third Party Indebtedness
and trading debt or liabilities arising in the ordinary course;
INTRA-GROUP INDEBTEDNESS DETERMINATION DATE means the date on which the
process described in Part 2 of Schedule 7 for the preparation of the
Intra-Group Indebtedness Statement is complete;
INTRA-GROUP INDEBTEDNESS STATEMENT means the statement of Intra-Group
Indebtedness to be prepared pursuant to Clause 9.5 in accordance with
the provisions of Part 2 of Schedule 7;
JURISDICTIONS means the United Kingdom, Italy, Spain, Portugal,
Germany, Norway, Brazil, Dubai, Zimbabwe, Egypt, Angola, Mozambique,
India, New Zealand, Malaysia, Singapore, Fiji, Indonesia, China, Saudi
Arabia, Argentina, Bahrain, Taiwan, Thailand, Hong Kong and Jersey;
<PAGE> 10
KNOW-HOW means confidential industrial, financial and commercial
information and techniques in any form (including paper, electronically
stored data, magnetic media, film and microfilm) and information and
techniques not reduced to a tangible form including (without limiting
the foregoing) drawings, formulae, test results, reports, project
reports and testing procedures, shop practices, instruction and
training manuals, tables of operating conditions, market forecasts,
specifications, quotations, tables, lists and particulars of customers
and suppliers, marketing methods and procedures and advertising copy;
LEASE means the lease of the relevant Business Seller's Leased
Property;
LEASED PROPERTIES means the leased properties brief details of which
are set out in Part 2 of Schedule 13 and Leased Property means any one
of them;
LIABILITIES means all liabilities, duties and obligations of every
description, whether deriving from contract, common law, statute or
otherwise, whether present or future, actual or contingent, ascertained
or unascertained or disputed and whether owed or incurred severally or
jointly or as principal or surety;
LICENCE AGREEMENTS means the licence agreements relating to
Intellectual Property and Know-how brief details of which are set out
in Schedule 15 and other licences entered into prior to Completion by
or on behalf of any of the Business Sellers exclusively or primarily in
connection with the Operations in each case which remain in force at
Completion or have outstanding rights and obligations;
LOSSES means all losses, Liabilities, costs (including without
limitation legal costs), charges, expenses, actions, proceedings,
claims and demands;
MAJORITY OWNED GROUP COMPANIES means any Group Company (other than the
Wholly Owned Group Companies) in which the Vendor, directly or
indirectly, owns more than 50 per cent. of the Equity Share Capital and
MAJORITY OWNED GROUP COMPANY means any one of them;
<PAGE> 11
MANAGEMENT ACCOUNTS means the unaudited management accounts relating to
each of the Businesses and each of the Group Companies for the
financial period ending on 28 February 1999;
MATERIAL ADVERSE EFFECT means (i) any adverse change or effect to the
business, properties, assets, condition (financial or otherwise) or
results (whether current or future) of the Global Operations occurring
after the date hereof which, individually or in the aggregate, has
resulted in or is reasonably likely to result in a reduction in the
fair market value of the Global Operations of (pound)50,000,000 or more
PROVIDED THAT the financial implications of any failure to win a
contract or tender by any Business Seller or Group Company shall not be
taken into account in determining whether the fair market value of the
Global Operations has been reduced; or (ii) any fire, flood, explosion
or other similar calamity occurring after the date hereof in
consequence of which substantially all of the manufacturing operations
at the Erith site (details of which are set out in paragraph 1 Part 2
of Schedule 14) are suspended, such suspension to be for a period
likely to be greater than three months;
MATERIAL CONTRACT shall have the meaning set out in paragraph 5.3.2 of
Schedule 8;
MINORITY GROUP COMPANIES means Group Companies other than Relevant
Group Companies;
MOVEABLE ASSETS means the Business Sellers' Moveable Assets and all
motor vehicles, Office Equipment and Plant and Machinery owned and used
by any of the Group Companies;
NET ASSET STATEMENT has the meaning given to it in Clause 9.1;
NET ASSET VALUE means the aggregate of the amounts of the Assets less
the aggregate of the amounts of the Liabilities of the Operations as
shown in the Net Asset Statement;
NON-LEASED PROPERTIES means the properties, brief details of which are
set out in Part 1 of Schedule 13 and NON-LEASED PROPERTY means any one
of them;
<PAGE> 12
NORTH AMERICAN SALE AND PURCHASE AGREEMENT means the Sale and Purchase
Agreement entered into on the date hereof between the Vendor and the
Purchaser in connection with the sale of the Vendor's energy cables
operations in the United States and Canada;
OFFICE EQUIPMENT means loose or severable items of office equipment,
furniture and furnishings;
OPERATIONS means the businesses carried on in the Jurisdictions by the
Business Sellers and the Group Companies as described in Schedule 1;
OTHER EMPLOYEES means the Employees (not being Companies Employees or
European Employees), if any;
OVERSEAS PROPERTIES means any of the Properties brief details of which
are set out in Part 3 of Schedule 13 and OVERSEAS PROPERTY means any
one of them;
PAYMENT ACCOUNT DETAILS means, in relation to any payment to be made
under or pursuant to this Agreement or any Subsidiary Agreement, the
name, account number, sort code, account location and other details
specified by the payee and necessary to effect payment (whether by
telegraphic or other electronic means of transfer) to the payee;
PLANT AND MACHINERY means loose or severable plant and machinery,
tools, moulds, dyes and other equipment (excluding Office Equipment);
PROPERTIES means the Non-Leased Properties, the Leased Properties and
the Overseas Properties and PROPERTY means any one of them;
PROPORTIONATE SHARE means the proportion which the Equity Share Capital
of the relevant corporate entity held by the relevant member of the
Vendor's Group bears to the entire Equity Share Capital of the relevant
corporate entity;
PURCHASE PRICE has the meaning given in Clause 3.1;
PURCHASER'S GROUP means the Purchaser and any of its subsidiaries or
holding company from time to time (including, with effect from
Completion or any Subsequent
<PAGE> 13
Completion, as the case may be, the Group Companies which have been
acquired by the Purchaser with effect from such completion);
PURCHASER'S LAWYERS means Norton Rose of Kempson House, PO Box 570,
Camomile Street, London EC3A 7AN;
RECEIVABLES means the book and other debts receivable by or owing to
any of the Business Sellers to the extent that they arise exclusively
or primarily in the course of the Operations (and whether or not yet
due or payable) at Completion and interest thereon but excluding:
(i) debts owing by any employee who is not an Employee;
(ii) debts due from any relevant Taxation authority in respect
of Taxation including, for the avoidance of doubt, any
bond or other security issued by any Taxation authority or
other governmental agency representing any such debts;
cash and cash equivalents credited to any account of any Business
Seller, wherever held; and
(iii) debts not included in the Net Asset Statement;
RELEVANT GROUP COMPANY means any Wholly Owned Group Company or Majority
Owned Group Company;
RELEVANT GROUP COMPANIES' CASH BALANCES means cash in hand held by, or
credited to any account or on deposit with a bank on behalf of any
Relevant Group Company as at the close of business on the Completion
Date (save that in the case of Majority Owned Group Companies, only the
Proportionate Share of such cash shall be included in such balances);
RELEVANT PURCHASER means the Purchaser and in relation to (i) each of
the Companies referred to in column (2) of Part 1, paragraph 1 of
Schedule 2 and (ii) each of the Businesses referred to in column (2) of
Part 2 of Schedule 2, any member of the Purchaser's Group nominated
prior to Completion by the Purchaser as the purchaser of the Shares in
such Companies or of such Businesses, such nomination
<PAGE> 14
being with the Vendor's consent (such consent not to be unreasonably
withheld) and so that each such purchaser shall be referred to herein
as a SHARE PURCHASER or BUSINESS PURCHASER as the context requires;
RELEVANT SELLER means in relation to (i) the Shares in each of the
Companies referred to in column (2) of Part 1, paragraph 1 of Schedule
2, the relevant seller whose name is set out or referred to opposite
that Company in column (1) of that Schedule (each a SHARE SELLER) and
(ii) each of the Businesses or Assets referred to in column (2) of Part
2 of Schedule 2, the relevant seller whose name is set out opposite
that Business or Asset in column (1) of that Schedule (each a BUSINESS
SELLER);
REPORTING ACCOUNTANTS means a firm of Chartered Accountants independent
of the Vendor and the Purchaser to be agreed by the Vendor and the
Purchaser within seven days of a notice by one to the other requiring
such agreement or failing such agreement to be nominated on the
application of either of them by or on behalf of the President for the
time being of the Institute of Chartered Accountants in England and
Wales;
RETAINED INTELLECTUAL PROPERTY means any Intellectual Property (other
than Business Sellers Intellectual Property) owned by any member of the
Vendor's Group which is necessary for the carrying on of the
Operations;
RETAINED KNOW-HOW means any Know-how (other than Business Sellers
Know-how) owned by any member of the Vendor's Group which is necessary
for the carrying on of the Operations;
SENIOR EMPLOYEE means any Employee employed in relation to the
Operations on an annual cash salary or fee (on the basis of full-time
employment) in excess of (pound)60,000 or local equivalent;
SHARES means the shares, quotas or other securities in the capital of
each of the Companies or partnership interests being sold by the
relevant Share Sellers as set out in column (2) of Part 1, paragraph 1
of Schedule 2;
SHARE SELLERS has the meaning given to it in the definition of Relevant
Seller;
<PAGE> 15
SPECIAL CONDITIONS OF SALE means the special conditions set out at Part
3 of Schedule 14 relating to the Business Sellers' Properties in
England and Wales;
STOCK means the stock-in-trade and work-in-progress owned by any of the
Business Sellers exclusively or primarily in connection with the
Operations at the Completion Date wherever held;
SUBSEQUENT COMPLETION means, in relation to those Shares in the
Jurisdictions specified in Part B of Part 1 of Schedule 6 the sale and
purchase of which is not completed on or with effect from the
Completion Date, the completion of the sale and purchase of such Shares
pursuant to Clause 6.1 and Schedule 6 (to the extent applicable);
SUBSEQUENT COMPLETION DATE means the date on which any Subsequent
Completion takes place;
SUBSIDIARY AGREEMENTS means the agreements (if any) substantially in
the agreed terms required in order to effect the sale and purchase of
Shares and/or Businesses outside the United Kingdom in the
Jurisdictions referred to therein, and, to the extent required (or as
agreed by the parties), of any Business Sellers' Assets in the United
Kingdom, to be entered into between the Relevant Sellers and the
Relevant Purchasers on Completion or any Subsequent Completion and
SUBSIDIARY AGREEMENT means any one of them;
SUBSIDIARIES means the subsidiaries, subsidiary undertakings and
associated undertakings of the Companies, details of which are
contained in Part 1, paragraph 2 of Schedule 2;
SUBSTANTIAL CONTRACTS means those contracts listed in Schedule 19;
SUPPLIER CONTRACTS means all contracts and agreements entered into
prior to Completion by or on behalf of any of the Business Sellers with
suppliers exclusively or primarily in connection with the Operations
(i) for the sale of goods or the provision of services to the extent
that at Completion the same remain to be completed or performed or (ii)
for the letting on hire or rental or other supply of the Business
Sellers'
<PAGE> 16
Motor Vehicles, the Business Sellers' Office Equipment or the Business
Sellers' Plant and Machinery which remain in force at Completion;
TAXATION OR TAX means all forms of taxation whether direct or indirect
and whether levied by reference to income, profits, gains, net wealth,
asset values, turnover, added value or other reference and statutory,
governmental, state, provincial, local governmental or municipal
impositions, duties, contributions, rates and levies (including without
limitation social security contributions and any other payroll taxes),
whenever and wherever imposed (whether imposed by way of a withholding
or deduction for or on account of tax or otherwise) and in respect of
any person and all penalties, charges, costs and interest relating
thereto;
TAX DEED OF COVENANT means the deed of covenant against Liability to
Taxation in the agreed terms to be entered into by the Vendor on behalf
of itself and the other Relevant Sellers indemnifying the Purchaser on
behalf of itself and the other Relevant Purchasers in respect of the
Group Companies;
THIRD PARTY CONSENTS means any consents, licences, approvals, permits,
authorisations or waivers required from third parties (including but
not limited to any governmental, administrative, judicial, or
regulatory authority or organisation) and THIRD PARTY CONSENT means any
one of them;
THIRD PARTY INDEBTEDNESS means the aggregate amount of all outstanding
loans owing by any Relevant Group Company (save that in the case of
Majority Owned Group Companies only the Proportionate Share of such
outstanding loans shall be included) to any third party (other than a
member of the Vendor's Group or the Group) as at the close of business
on the Completion Date but excluding any Relevant Group Companies' Cash
Balances, Intra-Group Indebtedness and trading debt or liabilities
arising in the ordinary course;
THIRD PARTY INDEBTEDNESS DETERMINATION DATE means the date on which the
process described in Part 2 of Schedule 7 for the preparation of the
Third Party Indebtedness Statement is complete;
<PAGE> 17
THIRD PARTY INDEBTEDNESS STATEMENT means the statement of Third Party
Indebtedness to be prepared pursuant to Clause 9.5 in accordance with
the provisions of Part 2 of Schedule 7;
TRANSFER PROVISIONS means in relation to a European Employee, the
legislation implementing the provisions of EEC Directive No.77/187
dated 14.2.1977 applicable to such European Employees' terms and
conditions of employment;
UK BUSINESS means the Business carried on by the Vendor and its
Subsidiaries in the United Kingdom as described in paragraph 1 of
Schedule 1;
VAT means Value Added Tax and elsewhere within the European Community
such Tax as may be levied in accordance with (but subject to
derogations from) the Directive 77/338/EC and outside the European
Community any Taxation levied by reference to added value or sales;
VENDOR'S GROUP means the Vendor and any subsidiary undertaking of the
Vendor from time to time (other than the Group Companies except, on or
after Completion or any Subsequent Completion, those Group Companies
which are not acquired by the Purchaser at or with effect from such
completion);
VENDOR'S LAWYERS means Linklaters & Paines of One Silk Street, London
EC2Y 8HQ;
VENDOR'S PROPERTY LAWYERS means Beachcroft Stanleys of 100 Fetter Lane,
London EC1A 1BN;
WARRANTIES means the warranties contained or referred to in Schedule 8
and WARRANTY means any one of them;
WHOLLY OWNED GROUP COMPANIES means the Group Companies which are wholly
owned directly or indirectly by the Vendor and WHOLLY OWNED GROUP
COMPANY means any one of them.
<PAGE> 18
1.2 SUBORDINATE LEGISLATION
Any reference to a statutory provision shall include any subordinate
legislation made from time to time under that provision which is in
force at the date of this Agreement.
1.3 MODIFICATION ETC. OF STATUTES
Any reference to a statutory provision shall include such provision as
from time to time modified or re-enacted or consolidated whether before
or after the date of this Agreement so far as such modification,
re-enactment or consolidation applies or is capable of applying to any
transactions entered into under this Agreement prior to Completion and
(so far as Liability thereunder may exist or can arise) shall include
also any past statutory provision (as from time to time modified,
re-enacted or consolidated) which such provision has directly or
indirectly replaced, except in any case to the extent that any
statutory provision made or enacted after the date of this Agreement
would create or increase a Liability of the Relevant Sellers under this
Agreement, any Subsidiary Agreement or the Tax Deed of Covenant.
1.4 HOLDING COMPANIES ETC.
1.4.1 A HOLDING COMPANY means a company which holds or controls,
whether alone or pursuant to an agreement with other
shareholders, a majority of the voting rights in another
company, its subsidiary, or, being a member of that other
company, has the right to appoint or remove a majority of its
board of directors;
1.4.2 A PARENT UNDERTAKING means an undertaking which holds or
controls, whether alone or pursuant to an agreement with other
shareholders, a majority of the voting rights in another
company, ITS SUBSIDIARY UNDERTAKING, or, being a member of that
other undertaking, has the right to appoint or remove a
majority of its board of directors or has the right to exercise
a dominant influence over the undertaking pursuant to the
undertaking's constitutional documents or pursuant to a control
contract.
<PAGE> 19
1.5 INTERPRETATION ACT 1978
The Interpretation Act 1978 shall apply to this Agreement in the same
way as it applies to an enactment.
1.6 SCHEDULES ETC.
References to this Agreement shall include any Schedules to it and
references to Clauses and Schedules are to Clauses of and Schedules to
this Agreement.
1.7 ENGLISH LEGAL TERMS
References to any English legal term or concept (including, without
limitation, those for any action, remedy, method of judicial
proceeding, document, statute, court official, governmental authority
or agency) shall in respect of any Jurisdiction other than England be
construed as references to the term or concept which most nearly
corresponds to it in that Jurisdiction.
1.8 INFORMATION
Any reference to books, records or other information means books,
records or other information in any form including paper,
electronically stored data, magnetic media, film and microfilm.
1.9 VENDOR'S KNOWLEDGE
Any statement qualified by the expression TO THE BEST KNOWLEDGE OF THE
VENDOR or SO FAR AS THE VENDOR IS AWARE or any similar expression
shall, insofar as such statement is referable to any particular
Jurisdiction, be deemed to refer to the knowledge of the Vendor having
made due and careful enquiry of those persons set out in column (2)
Schedule 21 in relation to those Warranties set out in column (1).
1.10 CURRENCY CONVERSION
Any amount to be converted from one currency into a second currency for
the purposes of this Agreement (other than for the purposes of the Net
Asset Statement) shall be converted into an equivalent amount at the
Relevant Date of such second
<PAGE> 20
currency as calculated by reference to the Exchange Cross Rate Table as
published in the Financial Times, London Edition, prevailing at the
Relevant Date. The RELEVANT DATE for the purposes of the definition of
SENIOR EMPLOYEE shall be 31 December 1998, for the purposes of the
definition of MATERIAL ADVERSE EFFECT shall be the date on which the
Purchaser serves its Termination Notice pursuant to Clause 4.5 and for
the purposes of Clause 8.2 shall be the date on which the relevant
claim was made (or, in any case, if such Exchange Cross Rate Table is
not published on any such date, the next following date on which such
table is published).
2 AGREEMENT TO SELL THE OPERATIONS
2.1 SALE AND PURCHASE OF OPERATIONS
2.1.1 Subject to Clause 4, on Completion, the Vendor shall sell, or
procure to be sold by each Relevant Seller in each case
pursuant to the relevant Subsidiary Agreement or (in the case
of any Asset which is not the subject of a Subsidiary
Agreement) this Agreement, and the Purchaser shall purchase, or
procure that there are purchased by each Relevant Purchaser,
with the benefit of the warranties and undertakings contained
in this Agreement free from all Encumbrances (except as
expressly provided in this Agreement or specifically disclosed
in the Disclosure Letter) and together with all rights and
advantages attaching thereto as at Completion (or, as the case
may be, any Subsequent Completion), the whole of the
Operations, comprising the Shares and the Businesses as a going
concern, except as otherwise expressly provided in Clause
2.1.3.
2.1.2 Without prejudice to the generality of Clause 2.1.1 and subject
to Clause 2.1.3, there shall be included in the sale under this
Agreement (or, where relevant, under the Subsidiary Agreements)
the following:
(i) the Shares;
(ii) the Stock;
<PAGE> 21
(iii) the benefit of the Contracts (subject, save as provided
in this Agreement, to the burden of the same);
(iv) the Business Sellers' Properties (on the terms set out
in Part 1 of Schedule 14);
(v) the Goodwill;
(vi) the Business Sellers' Intellectual Property and the
Business Sellers' Know-how (each subject to Clause
18.5);
(vii) the Business Sellers' Moveable Assets;
(viii) the benefit (so far as the same can lawfully be
assigned or transferred to or held in trust for the
Relevant Purchaser) of the Claims;
(ix) the Receivables; and
(x) all books of account and records and other property,
rights and assets owned and used exclusively or
primarily in connection with the Operations at
Completion (other than any property, rights or assets
owned by any Group Company).
2.1.3 The Excluded Assets shall be excluded from the sale and
purchase pursuant to this Agreement or, where relevant, the
Subsidiary Agreements.
2.2 ASSUMPTION OF LIABILITIES
2.2.1 Subject to Clauses 2.2.2 and 2.2.3, the Purchaser shall, or
shall procure that the other Relevant Purchasers shall, assume,
duly and punctually pay, satisfy, discharge, perform or fulfil
all Liabilities of the Business Sellers:
(i) arising under the Contracts;
(ii) expressly assumed by the Relevant Purchasers under this
Agreement; and
(iii) any other Liabilities of the Business Sellers, but only
to the extent that they are taken into account in the
calculation of, or provided for in, the Net Asset
Statement.
<PAGE> 22
2.2.2 Nothing in this Clause 2 shall (unless the relevant Liability
has been taken into account in the calculation of, or provided
for in, the Net Asset Statement):
(i) require the Purchaser or any Relevant Purchaser to perform
any obligation or honour any Liability of any Business
Seller falling due for performance, or which should have
been performed, prior to Completion; or
(ii) subject to Clause 12, impose any obligation on the
Purchaser or any Relevant Purchaser for or in respect of
any product delivered by any Business Seller or any
service performed by any Business Seller prior to
Completion.
2.2.3 Nothing in this Agreement shall require the Purchaser to assume
any Liabilities in relation to any countries which assumption
would be in violation of US export control regulations.
2.2.4 The Excluded Liabilities shall be excluded from the sale and
purchase pursuant to this Agreement and the Subsidiary
Agreements.
2.3 INDEMNITIES
2.3.1 The Vendor shall, or shall procure that each other Relevant
Seller shall, indemnify and keep indemnified the Purchaser and
each other Relevant Purchaser against:
(i) any Liability of any Relevant Seller (excluding any
liability in respect of Tax) which is not an Assumed
Liability including any such Liability which is deemed
to be, or becomes, a Liability of the Purchaser and/or
any other Relevant Purchaser by virtue of any applicable
law and which is not otherwise assumed by the Purchaser
and/or any other Relevant Purchaser under this Agreement
or any Subsidiary Agreement;
(ii) any Losses which the Purchaser and/or any other Relevant
Purchaser may suffer by reason of the Purchaser and/or
any other Relevant
<PAGE> 23
Purchaser taking any reasonable action to avoid, resist
or defend against any Liability referred to in Clause
2.3.1(i); and
(iii) subject to the provisions of the Tax Deed of Covenant,
any liability in respect of Tax which the Purchaser and
each Relevant Purchaser is indemnified against pursuant
to the Tax Deed of Covenant.
2.3.2 The Purchaser shall, or shall procure that each other Relevant
Purchaser shall, indemnify and keep indemnified each Business
Seller against:
(i) all Assumed Liabilities and any Liability of the Purchaser
and/or any other Relevant Purchaser and/or any other
person incurred in the course of carrying on the
Operations after Completion including, for the avoidance
of doubt, any such Liability which is or is deemed to be
or becomes a Liability of any Business Seller by virtue of
any applicable law; and
(ii) any Losses which any Business Seller may suffer by reason
of such Business Seller taking any reasonable action to
avoid, resist or defend against any Liability referred to
in Clause 2.3.2(i);
Provided that no Relevant Purchaser shall be liable under this
Clause 2.3.2 to the extent such Relevant Purchaser has a valid
claim against the Vendor or other Business Seller under this
Agreement or the Tax Deed of Covenant in respect of the
Liability in question.
2.4 SUBSIDIARY AGREEMENTS
2.4.1 The Vendor shall, and shall procure that each other Relevant
Seller shall, and the Purchaser shall, and shall procure that
each other Relevant Purchaser shall, enter into the relevant
Subsidiary Agreement on Completion or, if applicable, any
Subsequent Completion.
2.4.2 The Purchaser agrees for itself and each of the other Relevant
Purchasers that no claim shall be made under the Subsidiary
Agreements and, accordingly, any claim which could otherwise be
made thereunder shall be
<PAGE> 24
made under this Agreement or, as the case may be, the Tax Deed
of Covenant, in each case subject to the limitations contained
in this Agreement or the Tax Deed of Covenant.
2.4.3 To the extent that the provisions of this Agreement are
inconsistent with or additional to the provisions of a
Subsidiary Agreement, the provisions of this Agreement shall
prevail and the Vendor and the Purchaser shall procure that the
provisions of the relevant Subsidiary Agreement are adjusted to
the extent necessary to give effect to the provisions of this
Agreement and/or that the Relevant Seller and the Relevant
Purchaser comply with the provisions of this Agreement as
though they were bound by such provisions in place of the
provisions of the relevant Subsidiary Agreement.
2.4.4 If there is an adjustment under Clause 3.2 of this Agreement
which relates to the part of the Operations which is the
subject of such Subsidiary Agreement, then the Vendor and the
Purchaser will procure that the Relevant Seller and Relevant
Purchaser enter into a supplemental agreement reflecting such
adjustment, if appropriate.
2.4.5 As soon as reasonably practicable hereafter and in any event
before Completion, the Vendor shall procure that the Relevant
Sellers shall, and the Purchaser shall procure that the
Relevant Purchasers shall, incorporate in the relevant
Subsidiary Agreements (to the extent not already so
incorporated) the terms on which the transfer of each relevant
Property outside the United Kingdom is to be dealt with.
2.4.6 The Vendor and the Purchaser shall enter into an agreement for
lease (the PRESCOT AGREEMENT) substantially in the form
attached as Annexure [ ] (save where specified therein as being
"to be agreed") in respect of part of Prescot (as defined in
paragraph 3 of Part 2 of Schedule 14) as soon as reasonably
practicable after the date of this Agreement.
<PAGE> 25
3 CONSIDERATION
3.1 AMOUNT AND PAYMENT
The aggregate consideration for the purchase of the Operations under
this Agreement and each Subsidiary Agreement shall be an amount which
is equal to:
3.1.1 (pound)170,600,000 (ONE HUNDRED AND SEVENTY MILLION SIX HUNDRED
THOUSAND POUNDS);
3.1.2 less the Third Party Indebtedness;
3.1.3 less the amount of Intra-Group Indebtedness (where the
aggregate amount owed by the Relevant Group Companies to
members of the Vendor's Group exceeds the aggregate amount owed
by members of the Vendor's Group to Relevant Group Companies)
or, as the case may be, plus the amount of Intra-Group
Indebtedness (where the reverse is the case);
3.1.4 plus the amount of the Relevant Group Companies' Cash Balances
(the PURCHASE PRICE) (subject to adjustment as expressly
provided in this Agreement), allocated as set out in Schedule
3. The consideration is exclusive of any VAT and any transfer
taxes in respect of which the provisions of Schedule 10 shall
apply. The Purchase Price shall be paid by the Purchaser on
behalf of itself and the other Relevant Purchasers to the
Vendor on behalf of itself and the other Relevant Sellers,
subject to any legal requirements under any Subsidiary
Agreement for any direct payments thereunder or as otherwise
agreed by the Purchaser and the Vendor.
3.2 ADJUSTMENTS
The Purchase Price may be reduced or increased in accordance with the
provisions of Clause 9 or in accordance with any other provisions of
this Agreement stated to take effect as an adjustment to the Purchase
Price.
<PAGE> 26
3.3 METHOD OF PAYMENT
Wherever in this Agreement or any Subsidiary Agreement provision is
made for payment by one party (the PAYER) to another (the PAYEE), such
payment shall be made by telegraphic transfer in immediately available
funds in the currencies and to the account(s) specified in the Payment
Account Details of the payee unless the payee by notice to the payer,
not later than three Business Days prior to the due date for payment,
elects to be paid by banker's draft drawn on any international bank
reasonably acceptable to the payer. Payment of such sum shall be a good
discharge to the payer (and those on whose behalf such payment is made)
of its obligation to make such payment and the payer (and those on
whose behalf such payment is made) shall not be obliged to see to the
application of the consideration as between the Relevant Sellers, in
the case of a payment to the Vendor, or as between the Relevant
Purchasers, in the case of a payment to the Purchaser.
3.4 REDUCTION OF CONSIDERATION
If any payment is made by any Relevant Seller to any Relevant Purchaser
in respect of any claim against any Relevant Seller for any breach of
this Agreement, any Subsidiary Agreement or the Tax Deed of Covenant,
the payment shall be made by way of adjustment of the consideration
paid by the Purchaser for the Operations under this Agreement and any
relevant Subsidiary Agreement and the Purchase Price shall be deemed to
have been reduced by the amount of such payment.
4 CONDITIONS
4.1 CONDITIONS PRECEDENT
Completion of this Agreement is conditional upon:
4.1.1 the passing at a general meeting of the Vendor of a resolution
to approve the transactions contemplated by this Agreement;
<PAGE> 27
4.1.2 the North American Sale and Purchase Agreement becoming
unconditional in accordance with its terms (other than the
satisfaction of any condition relating to this Agreement);
4.1.3 the Purchaser receiving written confirmation from the Office of
Fair Trading that, on the information at present before him,
the Secretary of State has decided not to refer its proposed
acquisition of the Business (to the extent carried on in the
United Kingdom) to the Competition Commission under the Fair
Trading Act 1973; and
4.1.4 the conditions set out in Part 1 of Schedule 5 in relation to
the Companies specified therein having been satisfied .
4.2 RESPONSIBILITY FOR SATISFACTION
4.2.1 The Vendor hereby undertakes to use all reasonable endeavours
to ensure the satisfaction of the condition set out in Clause
4.1.1 as soon as reasonably practicable after the date hereof
subject to compliance by the directors of the Vendor with their
fiduciary duties.
4.2.2 The Vendor undertakes to the Purchaser that it will, as soon as
reasonably practicable, despatch a circular to the shareholders
of the Vendor so as to inform them of this Agreement and so as
to convene the general meeting of the Vendor referred to in
Clause 4.1.1 on or before 15 May 1999.
4.2.3 The Vendor and the Purchaser undertake to each other that they
will use their respective reasonable endeavours to procure that
the condition set out in Clause 4.1.2 is satisfied as soon as
reasonably practicable.
4.2.4 The Purchaser hereby undertakes to use all reasonable
endeavours to ensure satisfaction of the conditions set out in
Clauses 4.1.3 and 4.1.4 as soon as reasonably practical after
the date hereof and in relation to the condition specified in
Clause 4.1.3 shall shall make a notification to the Director
General of Fair Trading of the proposed acquisition, such
notification to be in a form agreed between the parties.
<PAGE> 28
4.2.5 The Purchaser and the Vendor shall keep each other informed at
all times of any dealings with any government, governmental,
supranational or trade agency or regulatory authority in
relation to the proposed acquisition and shall cooperate in any
such dealings and all requests and enquiries from any such body
shall promptly be dealt with by the Purchaser and Vendor in
consultation with each other.
4.3 NON-SATISFACTION
4.3.1 The Vendor and the Purchaser shall promptly give notice to the
other of the satisfaction of the conditions set out in Clauses
4.1.1, 4.1.3 and 4.1.4 by close of business on the day of the
satisfaction of such conditions.
4.3.2 If the conditions in Clause 4.1 are not satisfied on or before
31 July 1999 save as expressly provided, this Agreement shall
lapse and no party shall have any claim against any other under
it, save for any claim arising from breach of the undertakings
contained in Clause 4.2, Clause 17, Clause 21.1 and Clause
21.2.
4.4 LOCAL CONDITIONS
4.4.1 Completion of the sale and purchase of the Shares in each of
the Companies set out in column (1) of Part 2 of Schedule 5 is
conditional on satisfaction of the condition(s) set out
opposite each such Company in column (2) of Part 2 Schedule 5.
4.4.2 The Vendor and the Purchaser each undertakes to the other on
its own behalf and on behalf of the other Relevant Sellers and
Relevant Purchasers respectively that it shall use reasonable
endeavours to procure that the conditions set out in Part 2 of
Schedule 5 are satisfied as soon as reasonably practicable
after the date hereof.
4.4.3 Save in relation to Germany, in respect of which Clause 5.9
shall apply, if any of the conditions referred to in Clause
4.4.1 are not satisfied or waived on or before 12 months from
the Completion Date then the Shares to which the
<PAGE> 29
relevant conditions relate shall not be sold hereunder and all
terms of this Agreement relating to such Shares shall forthwith
cease to apply and neither party shall have a claim against the
other in relation to such Shares not being sold.
4.5 TERMINATION
4.5.1 If at any time before Completion a Material Adverse Effect
occurs, the Purchaser shall be entitled, subject to the other
provisions of this Clause 4.5, to terminate this Agreement
before Completion, by notice in writing to the Vendor, without
liability on its part. If the Purchaser duly exercises its
right of termination hereunder it shall have no claim against
the Vendor.
4.5.2 If the Purchaser wishes to terminate this Agreement in
accordance with Clause 4.5.1 it shall forthwith give notice of
its intention to do so to the Vendor (TERMINATION NOTICE). The
Termination Notice shall be delivered by hand to the Vendor's
Chief Executive and Company Secretary at (i) Devonshire House,
Mayfair Place WIX 5FH and (ii) at the home addresses of those
individuals notified in writing to the Purchaser on the date
hereof for the purpose of this Clause together with a copy to
Linklaters & Paines (for the attention of Mark Stamp) at the
address specified in the Agreement.
4.5.3 If the Purchaser validly serves a Termination Notice alleging
that a Material Adverse Effect falling within part (i) of the
definition of "Material Adverse Effect" has occurred the Vendor
may contest the validity of the Purchaser's right to terminate
by giving notice in writing to the Purchaser not later than 5
pm on the day being three days after the date of the
Termination Notice. This clause is without prejudice to any
right that the Vendor may have to contest the validity of any
Termination Notice alleging that a Material Adverse Effect
falling within part (ii) of the definition of Material Adverse
Effect has occurred.
4.5.4 If the Vendor gives valid notice to the Purchaser then the
parties shall seek the advice of a managing director of at
least 3 years standing at the London office of Goldman Sachs
(the EXPERT). The Expert shall give due weight to
<PAGE> 30
any representations put forward by either party received by him
and shall as a matter of urgency (and in any event no later
than 3 days after the date of appointment) advise the parties
in writing if in his opinion, on the basis of the information
available, a Material Adverse Effect falling within part (i) of
the definition of Material Adverse Effect has occurred. If the
Expert opines that such a Material Adverse Effect has occurred
then this Agreement shall be deemed to have been validly
terminated by the Purchaser. If the Expert opines that no such
Material Adverse Effect has occurred then the parties shall
complete this Agreement in accordance with its terms.
4.5.5 In giving such advice the Expert shall act as an expert and not
as an arbitrator. His advice, in the absence of manifest error,
shall be final and binding upon the parties and not subject to
challenge in any way for the purpose of determining whether or
not a Material Adverse Effect falling within part (i) of the
definition of Material Adverse Effect has occurred. His fees
shall be payable by the Purchaser if he does not advise that
such a Material Adverse Effect occurred and by the Vendor if he
does so advise.
5 ACTION PENDING COMPLETION AND SUBSEQUENT COMPLETION
5.1 VENDOR'S GENERAL OBLIGATIONS
The Vendor undertakes to procure that pending Completion the Business
Sellers and the Relevant Group Companies shall:
5.1.1 conduct the Operations as a going concern in the ordinary
course (including the payment and discharge of all debts and
liabilities of the Operations as and when they fall due in the
ordinary course of business), save in so far as agreed in
writing with the Purchaser;
5.1.2 allow the Purchaser and its agents, upon reasonable notice,
reasonable access to the Operations provided that the
obligations of the Vendor under this Clause shall be subject to
any applicable data protection laws or regulations in force in
any of the Jurisdictions and shall not extend to allowing
<PAGE> 31
access to information which is reasonably regarded as
confidential to the activities of Vendor's Group otherwise than
in connection with the Operations; and
5.1.3 notify the Purchaser of all tenders for new contracts to the
extent that such contracts, if awarded, would have a contract
value in excess of(pound)15 million in respect of product
manufactured wholly or mainly at the Erith site (details of
which are set out in paragraph 1, Part 2 of Schedule 14) or in
excess of (pound)10 million otherwise. The Vendor shall, so far
as it is reasonably able to do so, notify the Purchaser
hereunder a reasonable time prior to the submission of the
tender and shall have regard to reasonable representations made
by the Purchaser on the terms of such tender.
5.2 RESTRICTIONS ON SELLERS
5.2.1 Without prejudice to the generality of Clause 5.1, Clause 5.3
or Clause 5.4, in relation to any of the Businesses or Relevant
Group Companies, the Vendor shall procure that the Relevant
Sellers shall collaborate with representatives of the Purchaser
(nominated in advance by the Purchaser for such purpose and
agreed in writing by the Vendor) in relation to all material
matters concerning the running of such Businesses or Companies
between the date of this Agreement and Completion (or
Subsequent Completion as the case may be) and during that
period shall procure that in relation to the Operations, the
Business Sellers and the Relevant Group Companies shall not,
without the prior written consent of the Purchaser such consent
not to be unreasonably withheld or delayed:
(i) conduct such Operations in any manner except in the
ordinary course and consistent with the manner carried
on immediately prior to the date hereof, in particular
any established procedure for the approval of contracts
shall continue to be followed; or
(ii) except for liabilities incurred in the ordinary course
of business or budgeted capital expenditure within the
approval limits of the general
<PAGE> 32
management of such Operations, incur or agree to incur
any obligation or liability relating to such Operations
(absolute or contingent) that individually calls for
payment by a Relevant Seller of more than(pound)100,000
in any specific case or(pound)250,000 in the aggregate;
or
(iii) grant any general or uniform increase in the rates of
pay or benefits to employees (or a class thereof)
employed in such Operations (other than those employed
by BICC (Central Africa) (Private) Limited or Zimbabwe
Cables (Pte) Limited) in excess of 3 1/2 per cent. per
annum or, except in connection with any severance or
termination that will occur prior to Completion, enter
into any new severance agreement that would be required
to be disclosed pursuant to the Warranties or any
collective bargaining agreement with respect to such
Operations; or
(iv) sell, transfer, mortgage, encumber or otherwise dispose
of any assets or liabilities relating to such
Operations, except (a) for dispositions of property in
the ordinary course not greater than (pound)250,000 in
aggregate save in respect of the Business Sellers'
Properties in England and Wales where (subject to Clause
5.8) there shall be no right for the Vendor or the
relevant Business Seller to make any such disposition or
(b) dispositions of Stock relating to such Operations in
the ordinary course of business; or
(v) (in the case of any Relevant Group Company) resolve to
change its name or to alter its Memorandum or Articles
of Association (or other constitutional documents); or
(vi) other than pursuant to any contract entered into prior
to the date hereof, the contents of which have been
fairly disclosed to the Purchaser in the Disclosure
Letter, allot or issue or agree to allot or issue any
shares, quotas or any securities or grant or agree to
grant
<PAGE> 33
rights which confer on the holder any right to acquire
any shares or other such interest; or
(vii) other than as part of an Internal Reorganisation (in the
case of a Relevant Group Company), declare, pay or make
any dividend or other distribution, repay, redeem,
reduce or purchase any of its share capital or
registered capital, resolve to be voluntarily wound up
or pass any resolution or obtain any consent from its
members or any class of its members; or
(viii) make any material changes in the terms or conditions of
employment of, or employ, or agree to employ, any Senior
Employee; or
(ix) enter into any new loan facilities with banks or other
financial institutions; or
(x) issue any guarantee or indemnity for, or in respect of
the obligations of, any member of the Vendor's Group
(excluding any Group Company); or
(xi) amend, vary or waive any material provisions of any
shareholders' or joint venture agreement to which it may
be a party in respect of any Group Company; or
(xii) enter into any Material Contract save that this
restriction shall not apply to:
(a) the submission of any tender for new contracts nor
the award of any contracts resulting therefrom; or
(b) any supply or delivery of product pursuant to a
"call off" in a Supply Agreement in existence at
the date hereof.
5.2.2 The Vendor shall use its reasonable endeavours (subject to the
fiduciary duties of the directors of any Majority Owned Group
Company or Minority Group Company Group Company who have been
appointed by a member of the Vendor's Group) to procure
compliance with the provisions of Clause 5.2.1
<PAGE> 34
in relation to the Operations which are not wholly owned by the
Vendor's Group.
5.2.3 The Vendor shall continue to maintain (or procure the
maintenance of) all the insurances currently in force in
relation to the Operations and shall co-operate with the
Purchaser in requesting that any insurer note (where permitted
to do so) the interest of the Purchaser on the relative
policies.
5.3 INTERNAL REORGANISATIONS
Nothing in Clause 5.1 or Clause 5.2 shall apply to or restrict any of
the Internal Reorganisations.
5.4 PURCHASER'S GENERAL OBLIGATIONS
The Purchaser hereby covenants and agrees that, prior to Completion no
member of the Purchasers' Group (or any employee, director, agent,
representative or adviser thereof) other than those persons who have
been identified in writing (the APPROVED PERSONS) to M. J. Downie, N.
D. Taylor or P.J.L. Zinkin (the NOTIFIED PERSONS) shall approach or
communicate with any employee, agent, representative, adviser, supplier
or customer of the Vendor regarding the Operations or visit any of the
Properties and no Approved Person shall take any such action if
notified by the Notified Persons of their reasonable objections
thereto.
5.5 ESTIMATED INDEBTEDNESS STATEMENTS
The Vendor shall deliver to the Purchaser five Business Days prior to
Completion the Estimated Indebtedness Statements prepared in accordance
with Part 2 of Schedule 7.
5.6 VENDOR'S OBLIGATIONS PENDING SUBSEQUENT COMPLETION
The Vendor undertakes, in relation to each Group Company the Shares in
which are subject to Subsequent Completion:
<PAGE> 35
5.6.1 to procure that following Completion and pending Subsequent
Completion:
(i) each Share Seller which is a shareholder of such Group
Company, shall exercise the voting and other rights
available to it to permit and facilitate the management
of such Group Company and the Operations carried on by
it, to be carried out in accordance with the reasonable
instructions of the Purchaser (or a Relevant Purchaser),
to the extent such Share Seller is able to do the same,
having regard to any shareholders or other similar
agreements and/or applicable laws;
(ii) the Purchaser or a Relevant Purchaser shall be allowed
full access to information held by any member of the
Vendor's Group concerning each relevant Group Company
and its affairs and business, when reasonably requested
by such Purchaser, subject to any confidentiality
obligations owed by any member of the Vendor's Group;
and
(iii) the relevant Share Sellers shall hold the Shares in such
Group Companies on trust absolutely for the Purchaser
and shall account to the Purchaser for any dividend
payment or other distribution or economic benefit
deriving from such Shares during that period; and
5.6.2 that it will, in consultation with the Purchaser, fulfil or
procure fulfilment of all existing obligations of any member of
the Vendor's Group to make any capital contribution (debt or
equity) to, or to provide any loans, guarantees or security of
any kind in respect of, such Group Company or its business,
which obligations arise to be fulfilled between Completion and
Subsequent Completion but so that between the date hereof and
Completion, it will, not commit or agree to commit to make any
further capital contributions or provide any further loans,
guarantees or security.
5.7 NEW ZEALAND
5.7.1 The Purchaser may elect, ten Business Days prior to Completion,
by notice in writing to the Vendor to elect to purchase BICC
Holdings New Zealand
<PAGE> 36
Limited, in substitution for BICC Cables New Zealand Limited in
which case references in this Agreement to BICC Cables New
Zealand Limited shall be to BICC Holdings New Zealand Limited.
5.7.2 If the Purchaser makes such an election the parties shall agree
an appropriate adjustment to the amount of the Net Asset Value
referred to in Clause 9.6.4 to reflect the matters set out in
Clause 5.7.1.
5.8 PROPERTY AT NOTTINGHAM
The Vendor shall be entitled at any time prior to Completion to sell
the freehold Property at Daybrook Square, Mansfield Road, Nottingham as
more fully described in paragraph 7 of Part 2 of Schedule 14
(NOTTINGHAM) to a third party. If such sale occurs then:
(i) any reference to Nottingham as an asset to be sold under
this Agreement shall be deemed to be deleted and the
sale shall be treated as an Internal Reorganisation;
(ii) the Vendor shall procure (at the Vendor's cost) that all
machinery used exclusively or primarily in the
Operations and located at Nottingham is transferred to
the site at Leigh (as described in paragraph 5, Part 2
of Schedule 14);
(iii) the proceeds of any sale shall be used by the Vendor to
provide for (i) the redundancy of Employees based at
Nottingham (THE NOTTINGHAM EMPLOYEES) and (ii) the
transfer of machinery referred to in paragraph (ii)
above;
(iv) the Nottingham Employees will cease to be within the
definition of European Employees or Employees;
(v) the Purchaser and any Relevant Purchaser shall have no
liability whatsoever in relation to any Nottingham
Employees and the Vendor (on behalf of itself and the
Relevant Seller) shall be responsible for and shall
fully indemnify and keep indemnified the Purchaser (on
<PAGE> 37
behalf of itself and the Relevant Purchaser) from and
against all and any Losses arising from or in connection
with any of the Nottingham Employees; and
(vi) if the sale of Nottingham occurs pursuant to this
Clause, the parties shall agree an appropriate
adjustment to the amount of the Net Asset Value referred
to in Clause 9.6.4 to reflect the sale and other matters
contemplated hereunder.
5.9 GERMANY
The following provisions shall apply in relation to the sale of the
Vendor's indirect 50 per cent interest (GERMAN PARTNERSHIPS INTERESTS)
in Kaiser KWO Kabel Energie GmbH & Co and Kaiser KWO Kabel Telekom GmbH
& Co (GERMAN PARTNERSHIPS):
5.9.1 The Warranties shall only be given in respect of the German
Partnerships Interests as at the date of the Subsequent
Completion of such sale (and, for the avoidance of doubt, not
at the date of this Agreement or at Completion).
5.9.2 As soon as it is reasonably able to do so having regard to the
provisions of the various agreements with NKF BV, the Vendor
shall prepare and deliver a copy to the Purchaser a Disclosure
Letter in respect of the sale of the German Partnerships
Interests (the GERMAN DISCLOSURE LETTER).
5.9.3 If the German Disclosure Letter discloses matters which
demonstrate that the fair market value of the German
Partnerships Interests (either alone or together) has since the
date of this Agreement been reduced by an amount of (pound)1
million or more (a GERMAN MATERIAL ADVERSE EFFECT) then the
Purchaser may elect by written notice to the Vendor within 30
days of the service of the German Disclosure Letter not to
purchase the German Partnerships Interests. If the Purchaser so
elects then the references in Part 1 of Schedule 2 to the
German Partnerships Interests shall be deemed to have been
deleted and the Purchase Price shall be reduced by an amount of
(pound)10 million (the GERMAN
<PAGE> 38
PURCHASE PRICE), being the amount allocated to the German
Partnerships Interests pursuant to Schedule 3.
5.9.4 If (a) the German Disclosure Letter does not disclose a German
Material Adverse Effect or, (b) notwithstanding that a German
Material Adverse Effect has occurred the Purchaser elects to
complete the sale of the German Partnerships Interests or (c)
no written notice is received from the Purchaser in accordance
with Clause 5.9.3 then, as soon as the conditions relating
thereto specified in Part 2 of Schedule 5 shall have been
satisifed the Vendor and Purchaser shall complete the sale of
the German Partnerships Interests in accordance with the terms
of this Agreement.
5.9.5 The Purchaser may elect by written notice to the Vendor within
30 days of the service of the German Disclosure letter to
insert in Part 2 of Schedule 5 such conditions relating to the
acquisition of the German Partnerhips Interests as it may
reasonably require.
5.9.6 If there is a dispute between the parties as to whether a
German Material Adverse Effect has occurred then the provisions
of Clauses 4.5.3 to 4.5.5 shall apply, mutatis mutandis, save
that (a) the references to "3 days" therein shall be to 30 days
and (b) the reference to Termination Notice shall be deemed to
be a reference to the notice served by the Purchaser pursuant
to Clause 5.9.3 above and (c) the reference to "Material
Adverse Effect" shall be to "German Material Adverse Effect".
5.9.7 Notwithstanding that the Purchaser becomes obliged to purchase
the German Partnerships in accordance with Clause 5.9.4 and the
relevant outstanding conditions relating thereto set out in
Schedule 5 have been satisfied, the Purchaser shall not be
obliged to complete the sale of the German Partnerships
Interests prior to 1 January 2000. If the Purchaser elects to
do so then the German Purchase Price shall be reduced by an
amount equal to any pro rata forecast loss for the German
Partnerships for the period between the date of Subsequent
Completion and 1 January 2000 (having regard to the
<PAGE> 39
Vendor's 50 per cent interest in the German Partnerships). For
the purpose of this Clause the forecast loss shall be derived
from the aggregate forecast loss set out in the latest forecast
results prepared by each German Partnership.
5.9.8 If any of the conditions referred to in Clause 5.9.5 are not
satisfied or waived on or before 12 months from the date of
delivery of the German Disclosure Letter then the German
Partnerships Interests shall not be sold hereunder and all
terms of this Agreement relating to the German Partnerships
Interests shall forthwith cease to apply and neither party
shall have a claim against the other in relation to the German
Partnerships Interests not being sold.
5.10 ITALY
The Vendor and Purchaser shall use their reasonable endeavours to agree
as soon as practical after the date hereof to an "Emergency remedial
Plan for Year 2000 Compliance" (the PLAN) in respect of BICC Ceat Cavi
Srl, such plan to include agreement as to the division of costs in
connection with its implementation but, in any event, not requiring the
Vendor to contribute a total of more than U.S.$600,000. Once agreed the
parties shall implement the Plan in accordance with its terms. If the
parties are unable to agree the terms of the Plan prior to Completion,
the Vendor shall pay to the Purchaser at Completion the sum of
U.S.$600,000 in full settlement of its obligation under this Clause.
5.11 LEASE AT SETTIMO, ITALY
5.11.1 The Purchaser acknowledges that the Vendor has contracted to
procure the grant to a subsidiary of Corning Inc. of a lease of
office space in the main administration building of the
Overseas Property at Settimo, Italy listed at Part 3 of
Schedule 13 for a term expiring on 31 December 1999 (the
SETTIMO LEASE).
5.11.2 The parties acting reasonably having regard to the draft lease
attached as Exhibit A will agree as soon as reasonably
practicable after the date hereof the terms of the Settimo
Lease. The Vendor shall be entitled to grant the
<PAGE> 40
Settimo Lease, once agreed with the Purchaser, at any time
prior to Completion.
5.11.3 The Purchaser agrees that if the Settimo Lease is not granted
before Completion, the Purchaser shall procure that the Settimo
Lease is granted on the terms agreed between the parties and a
subsidiary of Corning Inc. before Completion or between the
Purchaser and a subsidiary of Corning Inc. after Completion and
the Purchaser shall indemnify the Vendor against all Losses
arising from the failure by the Purchaser to grant the Settimo
Lease.
6 COMPLETION AND SUBSEQUENT COMPLETION
6.1 DATE AND PLACE
Subject as hereinafter provided:
6.1.1 Completion shall take place simultaneously at the relevant
locations specified in Part A of Part 1 of Schedule 6 or at
such other locations agreed to by the parties, on the last
Business Day of the Vendor's accounting period (as set out in
Part 3 of Schedule 6) during which the conditions set out in
Clause 4.1 are satisfied or deemed to be satisfied or waived
and falling not less than 30 days after the date of this
Agreement or at such other place, time or date as may be agreed
between the Purchaser and the Vendor provided that such later
date shall be the last Business Day of an accounting period of
the Vendor;
6.1.2 Subsequent Completion in respect of the Shares in any Company
shall, subject to Completion taking place pursuant to Clause
6.1.1, take place at the relevant locations specified in Part B
of Part 1 of Schedule 6 or at such other locations agreed to by
the parties, on the last Business Day of the Vendor's
accounting period (as set out in Part 3 of Schedule 6) during
which the condition(s) set out in column (2) of Part 2 of
Schedule 5 opposite such Company is satisfied.
<PAGE> 41
6.2 COMPLETION EVENTS
On Completion and any Subsequent Completion, the parties shall procure
that the events set out in Part 2 of Schedule 6 (to the extent
applicable) and the Subsidiary Agreements with respect to Completion or
Subsequent Completion for which they (or a Relevant Seller or Relevant
Purchaser) are respectively responsible shall take place. Either party
may waive the Completion or Subsequent Completion obligations of the
other party as set out in Part 2 of Schedule 6 or in the Subsidiary
Agreements.
6.3 PAYMENT OF PRICE
6.3.1 Subject to Clause 6.3.2, against compliance with the foregoing
provisions, on Completion the Purchaser on behalf of itself and
the other Relevant Purchasers shall pay the Vendor on behalf of
itself and the other Relevant Sellers, in the manner specified
in Clause 3, an amount which is equal to:
(i) the amount referred to in Clause 3.1.1;
(ii) less the Estimated Third Party Indebtedness
attributable to the Relevant Companies being sold at
Completion;
(iii) less the amount of Expected Intra-Group Indebtedness
attributable to the Relevant Group Companies sold at
Completion (where the aggregate amount owed by the
Relevant Group Companies to be sold at Completion to
members of the Vendor's Group exceeds the aggregate
amount owed by members of the Vendor's Group to such
Relevant Group Companies) or, as the case may be, plus
the amount of such Expected Intra-Group Indebtedness
(where the reverse is the case);
(iv) plus the amount of the Estimated Cash relating to the
Relevant Group Companies being sold at Completion.
6.3.2 The payment made pursuant to Clause 6.3.1 shall be reduced by
the amount of consideration which has been allocated in respect
of any Shares which are the subject of a Subsequent Completion
(as set out in Schedule 3).
<PAGE> 42
6.4 SUBSEQUENT COMPLETION PAYMENTS
6.4.1 Subject to Clause 6.4.2, on each Subsequent Completion, the
Purchaser on behalf of itself and the other Relevant Purchasers
shall pay to the Vendor on behalf of itself and the other
Relevant Sellers, in the manner specified in Clause 3, an
amount equal to:
(i) the amount allocated to the relevant Shares set out in Schedule
3;
(ii) less the Estimated Third Party Indebtedness attributable to the
Relevant Group Company being sold at the Subsequent Completion;
(iii) less the amount of the Expected Intra-Group Indebtedness
attributable to the Relevant Group Companies sold at Subsequent
Completion (where the aggregate amount owed by the Relevant
Group Company sold at Subsequent Complation to members of the
Vendor's Group exceeds the aggregate amount owed by members of
the Vendor's Group to such Relevant Group Company) or, as the
case may be, plus the amount of such Expected Intra-Group
Indebtedness (where the reverse is the case);
(iv) plus the amount of Estimated Cash attributable to the Relevant
Company being sold at the Subsequent Completion.
6.4.2 If at the date of the relevant Subsequent Completion, the
Actual Indebtedness Statement has been drawn up in accordance
with Clause 9.5 then amounts in the Estimated Indebtedness
Statement in respect of that Relevant Group Company being sold
at that Subsequent Completion shall be treated as amounts in
the Actual Indebtedness Statement unless either party
disagrees. Either party may object not later than 5 Business
Days prior to the purported Subsequent Completion Date by
serving written notice on the other. Upon such service of the
notice the parties shall procure that an Actual Indebtedness
Statement is drawn up as at the Subsequent Completion Statement
Date and contemporaneously with the preparation of the Deferred
Net Asset Statement applying, mutatis mutandis, the provisions
of Clause 9.2.
<PAGE> 43
Adjustments to the amounts payable under Clause 6.4 shall be
made applying, mutatis mutandis, the provisions of Clauses
9.6.1 and 9.6.2.
6.5 REIMBURSEMENT OF COSTS ON SUBSEQUENT COMPLETION
On each Subsequent Completion, the Purchaser shall or shall procure
that a Relevant Purchaser shall reimburse the Vendor for all payments
made by the Vendor pursuant to Clause 5.6.2.
6.6 REPAYMENT OF LOANS IMMEDIATELY FOLLOWING COMPLETION OR SUBSEQUENT
COMPLETION
Immediately following Completion or Subsequent Completion, as the case
may be:
6.6.1 the Purchaser shall procure that each of the Relevant Group
Companies repays to the relevant member of the Vendor's Group
the amount of any outstanding loans set out in the Expected
Intra-Group Indebtedness Statement; and
6.6.2 the Vendor shall procure that each member of the Vendor's Group
repays to the Relevant Group Companies the amount of any
outstanding loans set out in the Expected Intra-Group
Indebtedness Statement.
6.7 TITLE AND RISK
Title to the Shares and the Business Sellers' Assets (and the risk of
loss or damage thereto except as expressly provided for in this
Agreement in relation to the Business Sellers' Properties) shall,
subject as provided below, pass to the Relevant Purchasers on
Completion provided that title to the Shares specified in Part 2 of
Schedule 6 shall pass to the Relevant Purchasers on the relevant
Subsequent Completion.
7 WARRANTIES
7.1 INCORPORATION OF SCHEDULE 8
7.1.1 The Vendor on behalf of itself and the other Relevant Sellers
warrants to the Purchaser on behalf of itself and the other
Relevant Purchasers in the terms set out in Schedule 8 and
paragraph 2 of Schedule 16 subject only to:
<PAGE> 44
(i) any matter which is fairly disclosed in or pursuant to
the Disclosure Letter and any matter expressly provided
for under the terms of this Agreement and so that
"fairly disclosed" means disclosed in such manner and
such detail as to enable a reasonable purchaser to make
an informed assessment of the information disclosed;
and
(ii) any matter or thing hereafter done or omitted to be
done pursuant to this Agreement or otherwise at the
written request or with the written approval of the
Purchaser.
7.1.2 The Vendor on behalf of itself and the other Relevant Sellers
acknowledges that the Purchaser has entered into this Agreement
on its own behalf and on behalf of the other Relevant
Purchasers in reliance upon the Warranties. Save as expressly
otherwise provided, the Warranties shall be separate and
independent and shall not be limited by reference to any other
paragraphs of Schedule 8.
7.2 WARRANTIES FROM THE PURCHASER
The Purchaser on behalf of itself and the other Relevant Purchasers
warrants to the Vendor on behalf of itself and the other Relevant
Sellers in the terms set out in Schedule 9.
7.3 UPDATING TO COMPLETION
7.3.1 The Vendor on behalf of itself and the other Relevant Sellers
further warrants to the Purchaser on behalf of itself and the
other Relevant Purchasers that:
(i) subject to Clause 7.1, the Warranties (other than the
Warranties set out in Schedule 20) will be fulfilled
down to and will be true and accurate at Completion in
each case as if they had been given afresh at
Completion; and
(ii) if after the signing of this Agreement and before
Completion, any event shall occur or matter shall arise
of which the Vendor or any other Relevant Seller
becomes aware and which results or may result in any
<PAGE> 45
of the Warranties being unfulfilled, untrue, misleading
or incorrect at Completion, the Vendor or other
Relevant Seller shall immediately notify the Purchaser
or other Relevant Purchaser in writing thereof prior to
Completion.
7.4 WARRANTIES RELATING TO MINORITY COMPANIES
Insofar as any of the Warranties (other than any Warranties as relate
to the ability of a Relevant Seller to transfer title to Assets or
Shares) are given in respect of Minority Companies or BICC Celcat,
Cabos de Energie e Telecomunicaciones SA and BICC CAFCA Limited each
such Warranty if not already so qualified, shall be deemed to be
qualified by reference to the best of the knowledge of the Vendor (as
such term is defined in Clause 1.9) .
8 LIMITATION OF LIABILITY AND CONDUCT OF CLAIMS
8.1 WARRANTY LIMITATION
The Vendor's and the other Relevant Sellers' liability for breach of
any of the Warranties (save as provided in Clause 8.10), shall be
subject to the following limitations:
8.1.1 TIME LIMITS
No liability shall arise in respect of any claim unless written
notice of such claim is given by the Relevant Purchaser to the
Relevant Seller setting out reasonable details of the specific
matter in respect of which the claim is made including an
estimate of the amount of such claim if practicable:
(i) in the case of a claim arising under paragraph 4.4 of
Schedule 8, within eight years following Completion;
(ii) in the case of a claim under paragraph 7 of Schedule 8
or the Tax Deed of Covenant, within 60 days after the
latest date on which the relevant taxation authorities
can make an assessment or similar claim or demand in
relation to the taxation liability in question; and
<PAGE> 46
(iii) in the case of any other claim under this Agreement
within 24 months following Completion;
and any such claim shall (if it has not been previously
satisfied, settled or withdrawn) be deemed to be withdrawn six
months after the relevant time limit set out above unless legal
proceedings in respect of it (i) have been commenced by being
both issued and served and (ii) are being pursued with
reasonable diligence;
8.1.2 MINIMUM CLAIMS
No liability shall arise in respect of any claim arising from
any single circumstance if the amount of the liability of the
Relevant Seller in respect of that claim (excluding interest,
costs and expenses) does not exceed (pound)15,000 (save that
claims relating to a series of connected matters shall be
aggregated for this purpose);
8.1.3 AGGREGATE MINIMUM CLAIMS
No liability shall arise in respect of any claim unless the
aggregate amount of all claims in excess of the sum specified
in Clause 8.1.2 exceeds (pound)500,000 but so that if the
aggregate liability in respect of all such claims exceeds that
figure then all claims, including claims previously notified,
shall accrue against and be recoverable from the Relevant
Sellers;
8.1.4 CONTINGENT LIABILITIES
No liability shall arise in respect of any liability which is
contingent unless and until such contingent liability becomes
an actual liability and is due and payable but this sub-clause
shall not operate to avoid a claim made in respect of a
contingent liability within the applicable time limits
specified in Clause 8.1.1 above if the requisite details of
such claim have been delivered before the expiry of the
relevant period (even if such liability does not become an
actual liability until after the expiry of such period);
<PAGE> 47
8.1.5 FUTURE ACTS
No liability shall arise in respect of any matter, act,
omission or circumstance (or any combination thereof)
(including, for the avoidance of doubt, the aggravation of a
matter or circumstance) to the extent that the same would not
have occurred but for:
(i) ACCOUNTING AND TAXATION CHANGES
any change in accounting or Taxation policy, bases or
practice of a Relevant Purchaser or any of the Group
Companies introduced or having effect after Completion
(or Subsequent Completion, as the case may be);
(ii) CHANGES IN LEGISLATION
the passing of, or any change in, after the date of
this Agreement, any law, rule, regulation or generally
published interpretation or practice of any government,
governmental department, agency or regulatory body
including (without prejudice to the generality of the
foregoing) any increase in the rates of Taxation or any
imposition of Taxation or any withdrawal of relief from
Taxation not actually (or prospectively) in effect at
the date of this Agreement; or
(iii) VOLUNTARY ACTS OF PURCHASER
any voluntary act, omission or transaction of a
Relevant Purchaser or any member of the Purchaser's
Group or any of the Group Companies, or their
respective directors, employees or agents or successors
in title, after Completion (or Subsequent Completion,
as the case may be) outside the ordinary course of
business;
8.1.6 INSURANCE
No liability shall arise in respect of any claim to the extent
that any Losses arising from such claim are recoverable under a
policy of insurance in force on the date of this Agreement.
<PAGE> 48
8.2 MAXIMUM CLAIM
No liability shall arise in respect of any claim to the extent that the
aggregate amount of the liability of the Relevant Sellers for all
claims (other than those pursuant to Clause 2.3.1 or 11.4 or in
relation to any matter referred to in Clause 8.10) made under this
Agreement, the Subsidiary Agreements, the Tax Deed of Covenant, the
North American Sale and Purchase Agreement (other than those claims set
out in Section 2.3.5(d) thereof) or any other agreement entered
pursuant thereto or in connection therewith would exceed
(pound)160,000,000 (one hundred and sixty million pounds).
8.3 MITIGATION OF LOSS
The Purchaser shall procure that all reasonable steps are taken and all
reasonable assistance is given to avoid or mitigate any Losses which in
the absence of mitigation might give rise to a liability in respect of
any claim under this Agreement or the Subsidiary Agreements.
8.4 CONDUCT OF CLAIMS
8.4.1 If any party to this Agreement or any Subsidiary Agreement (the
CLAIMANT) becomes aware of any matter that may give rise to a
claim against another party to this Agreement or any Subsidiary
Agreement (the RECIPIENT) under this Agreement or the
Subsidiary Agreements (other than in respect of a breach of the
Warranty contained in paragraph 7 of Schedule 8 or under the
Tax Deed of Covenant where the claim shall be dealt with in the
manner set out in the Tax Deed of Covenant), notice of that
fact shall be given to the Recipient as soon as practicable but
any failure to give such notice shall not affect the rights of
the Claimant except to the extent that the Recipient is
prejudiced by such failure.
8.4.2 Without prejudice to the validity of the claim or alleged claim
in question, the Claimant shall allow, and shall procure that
the relevant Associated Companies of the Claimant allow, the
Recipient and its accountants and
<PAGE> 49
professional advisers fully to investigate the matter or
circumstance alleged to give rise to such claim and whether and
to what extent any amount is payable in respect of such claim
and for such purpose the Claimant shall give, and shall procure
that the relevant Associated Companies of the Claimant give,
subject to the Recipient providing an indemnity in terms
reasonably satisfactory to the Claimant in respect of all
reasonable costs and expenses, all such information and
assistance, including access to premises and personnel, and the
right to examine and copy or photograph any assets, accounts,
documents and records, as the Recipient or its accountants or
professional advisers may reasonably request.
8.4.3 If the claim in question is a result of or in connection with a
claim by or liability to a third party then:
(i) no admission of liability shall be made by or on behalf
of the Claimant or an Associated Company of the
Claimant and the claim shall not be compromised,
disposed of or settled without the consent of the
Recipient (such consent not to be unreasonably withheld
or delayed);
(ii) the Recipient shall, subject to providing an indemnity
in terms reasonably satisfactory to the Claimant in
respect of all costs, liabilities, claims and expenses
which may be incurred by the Claimant as a result of
and which would not have been incurred but for the
same, be entitled at its own expense in its absolute
discretion to take such action as it shall deem
necessary to avoid, dispute, deny, defend, resist,
appeal, compromise or contest such claim or liability
(including, without limitation, making counterclaims or
other claims against third parties) in the name of and
on behalf of the Claimant or any Associated Company of
the Claimant concerned and to have the conduct of any
related proceedings, negotiations or appeals;
(iii) the Claimant will give and procure that the relevant
Associated Companies of the Claimant give, subject to
their being paid all
<PAGE> 50
reasonable out of pocket costs and expenses, all such
information and assistance, including access to
premises and personnel, and the right to examine and
copy or photograph any assets, accounts, documents and
records, for the purpose of avoiding, disputing,
denying, defending, resisting, appealing, compromising
or contesting any such claim or liability as the
Recipient or its professional advisers reasonably
request. The Recipient agrees to keep (and to procure
that any Associated Company to which such information
is provided keep) all such information confidential and
only to use it for such purposes.
8.4.4 To the extent any claim is covered by the provisions of Clause
12, the conduct of claims set out in that Clause shall prevail
to the extent it conflicts with this Clause 8.4.
8.5 PRIOR RECEIPT
If the Vendor or any other Relevant Seller pays an amount in discharge
of any claim under this Agreement or the Subsidiary Agreements and a
Relevant Purchaser or any Group Company subsequently recovers (whether
by payment, discount, credit, relief or otherwise) from a third party a
sum which is referable to the subject matter of the claim and which
would not otherwise have been received by such Relevant Purchaser or
Group Company, the Purchaser shall pay, or shall procure that the
Relevant Purchaser or Group Company pays, to the Vendor or another
Relevant Seller an amount equal to (i) the sum recovered from the third
party less any reasonable costs and expenses incurred in obtaining such
recovery or (ii) if less, the amount previously paid by the Relevant
Seller to the Relevant Purchaser.
8.6 DOUBLE CLAIMS
The Relevant Purchasers shall not be entitled to recover from the
Vendor or any other Relevant Seller under this Agreement, the
Subsidiary Agreements or the Tax Deed of Covenant more than once in
respect of the same damage suffered, and accordingly the Vendor and the
other Relevant Sellers shall not be liable in respect of any breach
<PAGE> 51
of this Agreement or the Subsidiary Agreements if and to the extent
that the Losses are or have been included in a claim under the Tax Deed
of Covenant which has been satisfied, nor shall the Vendor or any other
Relevant Seller be liable in respect of a claim under the Tax Deed of
Covenant if and to the extent that the Losses are or have been included
in a claim for breach of the Agreement which has been satisfied.
8.7 TAX
In calculating the liability of the Vendor and the other Relevant
Sellers for any breach of this Agreement or the Subsidiary Agreements,
there shall be taken into account the amount (if any) by which any
Taxation for which a Relevant Purchaser or any Group Company would
otherwise have been accountable or liable to be assessed is actually
reduced or extinguished as a result of the matter giving rise to such
liability.
8.8 ENVIRONMENTAL CLAIMS
The provisions of Schedule 16 shall apply to any claims relating to
Environmental Losses or Environmental Warranties (as such terms are
defined in Schedule 16).
8.9 EFFECT OF COMPLETION
The Warranties and all other provisions of this Agreement and the
Subsidiary Agreements in so far as the same shall not have been
performed at Completion or any Subsequent Completion shall not be
extinguished or affected by such completion, or by any other event or
matter whatsoever (including, without limitation, any satisfaction of
the conditions contained in Clause 4.1), except by a specific and duly
authorised written waiver or release by the Purchaser.
8.10 TITLE WARRANTIES
The Limitations on the Warranties contained in Clauses 8.1.1 to 8.1.4
shall not apply to any Warranties insofar as such relate to the ability
of a Relevant Seller to transfer title to Assets or Shares to a
Relevant Purchaser in accordance with Clause 2.1.1.
<PAGE> 52
8.11 PROVISIONS IN THE ACCOUNTS
No liability shall arise in respect of any claim under this Agreement
or any Subsidiary Agreement if any allowance, provision or reserve is
made for the matter giving rise to the claim in the Net Asset
Statement.
8.12 INDEMNITIES
To the extent that any Indemnity is given by the Vendor in this
Agreement to the Purchaser in favour of or relating to a Majority Owned
Group Company or Minority Owned Group Company, for the avoidance of
doubt, the Vendor shall only be liable to contribute to the Purchaser
or relevant Group Company thereunder an amount equal to the relevant
Proportionate Share of the indemnified Loss.
9 NET ASSET STATEMENT, ACTUAL INDEBTEDNESS STATEMENTS AND ADJUSTMENTS TO
THE PURCHASE PRICE
9.1 BASIS OF PREPARATION OF NET ASSET STATEMENT
The Vendor shall procure that, as soon as practicable and in any event
not later than 60 days following Completion, there shall be drawn up a
statement of the aggregate of the amounts of the Assets less the
aggregate of the amount of the Liabilities of the Operations as at
Completion, determined in accordance with the principles set out in
Part 1 of Schedule 7 (the NET ASSET STATEMENT).
9.2 PREPARATION OF NET ASSET STATEMENT
9.2.1 The draft Net Asset Statement shall be delivered to the
Purchaser by the Vendor within the timescale referred to in
Clause 9.1. Prior to such delivery, the Vendor shall so far as
is practicable consult with the Purchaser with a view to
reducing the potential areas of disagreement relating to such
draft Net Asset Statement.
9.2.2 In order to enable the Vendor to prepare and the Vendor's
accountants to review the draft Net Asset Statement, the
Purchaser shall, and shall procure that the Relevant Purchasers
shall, keep up-to-date and make available to the
<PAGE> 53
Vendor's representatives and to the Vendor's accountants all
books and records relating to the Operations during normal
office hours and co-operate with them with regard to the
preparation and review of the draft Net Asset Statement. The
Purchaser agrees, in so far as it is reasonable to do so, to,
and to procure that the Relevant Purchasers shall, make
available the services of the Employees to assist the Vendor in
the performance of its duties under this Agreement.
9.2.3 If the Purchaser does not within 60 days of presentation to it
of the draft Net Asset Statement give notice to the Vendor that
it disagrees with the draft Net Asset Statement or any item
thereof such notice stating the reasons for the disagreement in
reasonable detail and specifying the adjustments which in the
Purchaser's opinion should be made to the draft Net Asset
Statement in order to comply with the requirements of this
Agreement (the PURCHASER'S DISAGREEMENT NOTICE), the draft Net
Asset Statement shall be final and binding on the parties for
all purposes. If the Purchaser gives a valid Purchaser's
Disagreement Notice within such 60 days, the parties shall
attempt in good faith to reach agreement in respect thereof
and, if they are unable to do so within 21 days of such
notification, either party may by notice to the other require
that the draft Net Asset Statement be referred to the Reporting
Accountants (an APPOINTMENT NOTICE).
9.2.4 Within 21 days of the giving of an Appointment Notice, the
Vendor may by notice to the Purchaser indicate that, in the
light of the fact that the Purchaser has not accepted the draft
Net Asset Statement in its entirety, it wishes the Reporting
Accountants to consider matters relating to the Net Asset
Statement in response to those specified in the Purchaser's
Disagreement Notice, such notice stating in reasonable detail
the reasons why and in what respects the Vendor believes that
the draft Net Asset Statement should be altered (the VENDOR'S
DISAGREEMENT NOTICE).
<PAGE> 54
9.2.5 The Reporting Accountants shall be engaged jointly by the
parties, as soon as practical following agreement on their
terms of engagement, on the terms set out in this Clause 9.2
and otherwise on such terms as shall be agreed; provided that
neither party shall unreasonably (having regard, inter alia, to
the provisions of this Clause 9.2) refuse its agreement to
terms proposed by the Reporting Accountants or by the other
party. If the terms of engagement of the Reporting Accountants
have not been settled within 30 days of their identity having
been determined (or such longer period as the parties may
agree) then, unless one party is unreasonably refusing its
agreement to those terms, those accountants shall be deemed
never to have become the Reporting Accountants and new
Reporting Accountants shall be selected in accordance with the
provisions of this Agreement.
9.2.6 Except to the extent that the parties agree otherwise, the
Reporting Accountants shall determine their own procedure save
that:
(i) apart from procedural matters and as otherwise set out
in this Agreement, the Reporting Accountants shall
determine only:
(a) whether any of the arguments for an alteration
to the draft Net Asset Statement put forward in
the Purchaser's Disagreement Notice or the
Vendor's Disagreement Notice is correct in whole
or in part; and
(b) if so, what alterations should be made to the
draft Net Asset Statement in order to comply
with the requirements of this Agreement;
(ii) the Reporting Accountants shall apply the principles
set out in Part 1 of Schedule 7;
(iii) the Reporting Accountants shall make their
determination pursuant to paragraph (i) above as soon
as is reasonably practicable but in any event, unless
otherwise specified, within 40 days of the referral to
them; and
<PAGE> 55
(iv) the procedure of the Reporting Accountants shall:
(a) give the parties a reasonable opportunity to
make written and oral representations to them;
(b) require that the parties supply each other with
a copy of any written representations at the
same time as they are made to the Reporting
Accountants;
(c) permit each party to be present while oral
submissions are being made by any other party;
and
(d) for the avoidance of doubt, the Reporting
Accountants shall not be entitled to determine
the scope of their own jurisdiction.
9.2.7 The Reporting Accountants' determination pursuant to Clause
9.2.6(i) shall (i) be made in writing and made available for
collection by the parties at the offices of the Reporting
Accountants at such time as the Reporting Accountants shall
determine and (ii) unless otherwise agreed by the parties
include reasons for each relevant determination.
9.2.8 The Reporting Accountants shall act as experts and not as
arbitrators and their determination of any matter falling
within their jurisdiction shall be final and binding on the
parties save in the event of manifest error (when the relevant
part of their determination shall be void and the matter shall
be remitted to the Reporting Accountants for correction). In
particular, without limitation, their determination shall be
deemed to be incorporated into the draft Net Asset Statement,
which shall then be final and binding on the parties save as
aforesaid.
9.2.9 The expenses of the Reporting Accountants shall be borne as
they shall direct at the time they make any determination under
Clause 9.2.6(i) or, failing such direction, equally between the
Purchaser, on the one hand, and the Vendor, on the other.
<PAGE> 56
9.2.10 The parties shall co-operate with the Reporting Accountants and
comply with their reasonable requests made in connection with
the carrying out of their duties under this Agreement. In
particular, without limitation, the Purchaser shall, and shall
procure that the Relevant Purchasers shall, keep up to date
and, subject to reasonable notice, make available to the
Vendor's representatives, the Vendor's accountants and the
Reporting Accountants, all books and records relating to the
Businesses and the Group Companies during normal office hours
during the period from the appointment of the Reporting
Accountants down to the making of the relevant determination.
9.2.11 Subject to Clause 9.2.12, nothing in this Clause 9.2 shall
entitle a party or the Reporting Accountants to access to any
information or document which is protected by legal
professional privilege, or which has been prepared by the other
party or its accountants and other professional advisers with a
view to assessing the merits of any claim or argument.
9.2.12 A party shall not be entitled by reason of Clause 9.2.11 to
refuse to supply such part or parts of documents as contain
only the facts on which the relevant claim or argument is
based.
9.2.13 Each party and the Reporting Accountants shall, and shall
procure that its accountants and other advisers shall, keep all
information and documents provided to them pursuant to this
Clause 9.2 confidential and shall not use the same for any
purpose, except for disclosure or use in connection with the
preparation of the Net Asset Statement, the proceedings of the
Reporting Accountants or another matter arising out of this
Agreement or in defending any claim or argument or alleged
claim or argument relating to this Agreement or its subject
matter.
9.3 NET ASSET STATEMENT AT COMPLETION
Once the Vendor and the Purchaser reach (or pursuant to Clause 9.2.3
are deemed to reach) agreement on the draft Net Asset
<PAGE> 57
Statement or the draft Net Asset Statement is finally determined at any
stage of the procedures set out in this Clause 9:
9.3.1 the draft Net Asset Statement as so agreed or determined shall
constitute the Net Asset Statement for the purposes of this
Agreement and shall be final and binding on the parties; and
9.3.2 the Net Asset Value shall be derived from the Net Asset
Statement.
9.4 NET ASSET STATEMENT AT SUBSEQUENT COMPLETION
If the Shares of any Group Company (a DEFERRED COMPANY) are not sold to
a Share Purchaser at Completion in accordance with Clause 6.1.1 then:
9.4.1 the value of the net assets attributable to the Deferred
Company for inclusion in the Net Asset Statement shall be the
value of such net assets set out in the Combined Accounts (the
TARGET AMOUNT);
9.4.2 the Vendor and Purchaser shall procure that a statement (the
DEFERRED NET ASSET STATEMENT) of the aggregate of the amounts
of the assets less the Liabilities of the relevant Deferred
Company shall be drawn up as at relevant Subsequent Completion,
determined in accordance with the principles set out in Part 1
of Schedule 7. The Deferred Net Asset Statement shall be drawn
up in accordance with Clause 9.2 save that references therein
to "draft Net Asset Statement" shall be to the "draft Deferred
Net Asset Statement". The net asset value attributable to the
Deferred Company (the DEFERRED NET ASSET VALUE) shall be
derived from the Deferred Net Asset Statement.
9.5 ACTUAL INDEBTEDNESS STATEMENTS
The Vendor shall procure that, as soon as practicable following
Completion, the Vendor's accountants shall draw up the Actual
Indebtedness Statements to determine the amount of the Intra-Group
Indebtedness, the Third Party Indebtedness and the Relevant Group
Companies' Cash Balances in accordance with the provisions set out in
Part 2 of Schedule 7.
<PAGE> 58
9.6 ADJUSTMENTS TO PURCHASE PRICE
9.6.1 INTRA-GROUP INDEBTEDNESS
(i) If the Expected Intra-Group Indebtedness is a negative
number and the Intra-Group Indebtedness is a larger
negative number or if the Expected Intra-Group
Indebtedness is a positive number and the Intra-Group
Indebtedness is a smaller positive number or is a
negative number:
(a) the Vendor (on behalf of itself and the other
Relevant Sellers) shall repay to the Purchaser
(on behalf of itself and the other Relevant
Purchasers) an amount equal to the difference;
and
(b) the Purchaser shall procure that the Relevant
Group Companies pay to the relevant members of
the Vendor's Group and/or, as appropriate, the
Vendor shall procure that the relevant members
of the Vendor's Group repay to the Relevant
Companies the amounts specified in the
Intra-Group Indebtedness Statement such that the
additional amounts being, in aggregate, received
by members of the Vendor's Group (after taking
account of payments made to the Relevant Group
Companies hereunder) are equal to the difference
between the Intra-Group Indebtedness and the
Expected Intra-Group Indebtedness repaid to the
Purchaser pursuant to Clause 9.6.1(i)(a) above;
such payments to be made on the day falling 10 Business Days
after the Intra-Group Indebtedness Determination Date; and
(ii) If the Expected Intra-Group Indebtedness is a positive
number and the Intra-Group Indebtedness is a larger
positive number or if the Expected Intra-Group
Indebtedness is a negative number and the Intra-Group
Indebtedness is a smaller negative number or a positive
number:
<PAGE> 59
(a) the Purchaser (on behalf of itself and the other
Relevant Purchasers) shall pay to the Vendor (on
behalf of itself and the other Relevant Sellers)
an amount equal to such difference; and
(b) the Vendor shall procure that the relevant
members of the Vendor's Group repay to the
Relevant Group Companies and/or, as appropriate,
the Purchaser shall procure that the Relevant
Group Companies pay to the relevant members of
the Vendor's Group, the amounts specified in the
Intra-Group Indebtedness Statement such that the
additional amounts being, in aggregate, received
by the Relevant Group Companies (after taking
account of payments made by the Relevant Group
Companies hereunder) are equal to the difference
between the Intra-Group Indebtedness and the
Expected Intra-Group Indebtedness repaid to the
Vendor pursuant to Clause 9.6.1 (ii)(a) above;
such payments to be made on the day falling 10 Business Days
after the Intra-Group Indebtedness Determination Date;
9.6.2 THIRD PARTY INDEBTEDNESS
(i) If the amount of the Third Party Indebtedness exceeds
the Estimated Third Party Indebtedness the Vendor (on
behalf of itself and the other Relevant Sellers) shall
repay to the Purchaser (on behalf of itself and the
other Relevant Purchasers) an amount equal to such
excess; or
(ii) If the amount of the Third Party Indebtedness is less
than the Estimated Third Party Indebtedness the
Purchaser (on behalf of itself and the other Relevant
Purchasers) shall pay to the Vendor (on behalf of
itself and the other Relevant Sellers) an additional
amount equal to such deficiency;
such payments to be made on the day falling 10 Business Days
after the Third Party Indebtedness Determination Date.
<PAGE> 60
9.6.3 CASH
(i) If the amount of the Relevant Group Companies' Cash
Balances is less than the Estimated Cash the Vendor (on
behalf of itself and the other Relevant Sellers) shall
repay to the Purchaser (on behalf of itself and the
other Relevant Purchasers) an amount equal to such
deficiency; or
(ii) If the amount of the Relevant Group Companies' Cash
Balances exceeds the Estimated Cash the Purchaser (on
behalf of itself and the other Relevant Purchasers)
shall pay to the Vendor (on behalf of itself and the
other Relevant Sellers) an additional amount equal to
such excess;
such payments to be made on the day falling 10 Business Days
after the Cash Determination Date;
9.6.4 CALCULATION OF AMOUNTS IN CLAUSES 9.6.1, 9.6.2 AND 9.6.3
For the purpose of calculating the amounts in Clauses 9.6.1,
9.6.2 and 9.6.3, the Intra-Group Indebtedness, Third Party
Indebtedness and Relevant Group Companies Cash Balances
attributable to Relevant Group Companies which have not been
sold at the time of drawing up the Actual Indebtedness
Statements shall be deemed to be equal to the relevant amounts
attributable to such Companies in the Estimated
Indebtedness Statements.
9.6.5 NET ASSETS
(i) if the Net Asset Value is less than (pound)311,000,000
(THREE HUNDRED AND ELEVEN MILLION POUNDS), then the
Vendor (on behalf of itself and the other Relevant
Sellers) shall pay to the Purchaser (on behalf of
itself and the Relevant Purchasers) an amount equal to
the difference; or
(ii) if the Net Asset Value is more than (pound)311,000,000
(THREE HUNDRED AND ELEVEN MILLION POUNDS), then the
Purchaser (on behalf of
<PAGE> 61
itself and the Relevant Purchasers) shall pay to the
Vendor (on behalf of itself and the other Relevant
Sellers) an amount equal to the difference;
such payment to be made on the day falling no later than three
Business Days following agreement or determination of the Net
Asset Statement in accordance with this Clause 9;
9.6.6 DEFERRED NET ASSETS
(i) If the Deferred Net Asset Value is less than the Target
Amount, then the Vendor (on behalf of itself and the
other Relevant Sellers) shall pay to the Purchaser (on
behalf of itself and the Relevant Purchasers) an amount
equal to the difference; or
(ii) if the Deferred Net Asset Value is more than the Target
Amount, then the Purchaser (on behalf of itself and the
Relevant Purchasers) shall pay to the Vendor (on behalf
of itself and the other Relevant Sellers) an amount
equal to the difference;
such payment to be made on the day falling not later than ten
Business Days following agreement or determination of the
Deferred Net Asset Value in accordance with this Clause 9.
9.6.7 PAYMENT
Where any payment is required to be made pursuant to this
Clause 9.6:
(i) interest shall accrue on the relevant amount calculated
from the Completion Date or, as the case may be,
Subsequent Completion in accordance with Clause 21.8;
(ii) the Purchase Price shall be reduced or increased
accordingly; and
(iii) the allocation of the consideration in Schedule 3 shall
be adjusted accordingly in such manner as the Vendor on
behalf of itself and the
<PAGE> 62
other Relevant Sellers and the Purchaser on behalf of
itself and the Relevant Purchasers shall agree in
accordance with Schedule 3.
10 TRANSFER TAXES AND VAT
The provisions of Schedule 10 shall apply.
11 THE CONTRACTS
11.1 THE VENDOR'S OBLIGATIONS IN RESPECT OF CONTRACTS
(i) The Vendor shall, subject to the indemnity given in
Clause 2.3.2, procure that up to Completion the
Contracts are carried out and completed and that the
obligations of any of the Business Sellers under the
Contracts are performed in the ordinary course (where
applicable) in a proper and workmanlike manner and in
accordance with their respective terms and the Vendor
shall, or shall procure that another Relevant Seller
shall, indemnify the Purchaser and/or each Relevant
Purchaser against all Losses incurred by the Purchaser
and/or each Relevant Purchaser in respect of the
Contracts by reason of the non-performance or the
negligent or defective performance of the Contracts by
the Business Sellers prior to Completion save to the
extent (i) any liability for a defective product or
defective service (as such terms are defined in Clause
12.2) shall be dealt with in accordance with Clause 12
or (ii) the Losses which would otherwise be indemnified
by the Vendor or a Relevant Seller pursuant to this
Clause are an Assumed Liability.
(ii) The Vendor shall procure that up to Completion, any
contracts to which any Relevant Group Company is a
party (COMPANY CONTRACTS) are carried out and completed
and that the obligations of any Relevant Group Company
under any Company Contract are performed in the
ordinary course (where applicable) in a proper and
workmanlike manner and accordance with their respective
terms and the Vendor
<PAGE> 63
shall indemnify each Relevant Group Company against all
Losses incurred by such company by reason of the
non-performance or the negligent or defective
performance of the Company Contracts by the Relevant
Group Company prior to Completion save to the extent
(i) any liability for a defective product or defective
service (as such terms are defined in Clause 12.2)
shall be dealt with in accordance with Clause 12 or
(ii) the Losses which would otherwise be indemnified by
the Vendor or a Relevant Seller pursuant to this Clause
are an Assumed Liability.
11.2 THE PURCHASER TO COMPLETE CONTRACTS
The Purchaser shall, without prejudice to the indemnity given in Clause
2.3.1, procure that with effect from Completion each of the Contracts
is carried out and completed by a Relevant Purchaser and that the
relevant Business Sellers' obligations under the Contracts are
performed (to the extent that the same have not been previously carried
out or completed) in the ordinary course (where applicable) in a proper
and workmanlike manner and in accordance with their respective terms
and the Purchaser shall, or shall procure that the Relevant Purchasers
shall, indemnify the relevant Business Sellers against all Losses
incurred by the Business Sellers in respect of the Contracts by reason
of or in connection with the non-performance or the negligent or
defective performance of the Contracts after Completion by any Relevant
Purchaser Provided that the Purchaser (or Relevant Purchaser as the
case may be) shall not be so obliged and this indemnity shall not apply
to the extent that the Purchaser (or Relevant Purchaser as the case may
be) has or would have (in either case disregarding Clause 8.1) a valid
right of action under this Agreement or any Subsidiary Agreement
against the Business Sellers in respect of the Contract(s) in question.
11.3 PAYMENTS RECEIVED BY BUSINESS SELLERS
To the extent that any payment is made to any Business Seller in
respect of any Contract after the Completion Date, the Vendor shall
procure that such Business
<PAGE> 64
Seller shall receive the same as trustees and pay the same to the
Purchaser (or Relevant Purchaser, as the case may be) (net of any tax
payable by such Business Seller thereon) as soon as reasonably
practicable following receipt.
11.4 SUBSTANTIAL CONTRACTS
The Relevant Sellers and Relevant Purchasers agree to co-operate and to
use all reasonable endeavours prior to and after Completion to ensure
that the Substantial Contracts are lawfully novated or assigned to the
Relevant Purchasers with effect from Completion or as soon as
reasonably practicable thereafter. Any costs associated with assigning
or novating or otherwise transferring the benefit of any Substantial
Contracts (including any payments made to any party as a condition to
giving their consent) and shall be for the account of the Relevant
Seller. To the extent that any Relevant Seller is unable to transfer
the economic benefit of any Substantial Contract the Vendor shall
indemnify the Relevant Purchaser against all Losses directly arising
therefrom up to an amount which, when aggregated with amounts payable
under Section 2.3.2(e) of the North American Agreement, does not exceed
(pound)10 million. The Purchaser shall procure that each Relevant
Purchaser shall take all reasonable steps to eliminate or reduce any
costs which may be payable by a Relevant Seller or the Vendor
hereunder.
11.5 BICC CAVI SUD S.P.A
The Vendor shall indemnify BICC Ceat Cavi Srl (CEAT CAVI) against any
and all Losses arising out of or in connection with the contract
entered into between Ceat Cavi, the Vendor and Thomas Bolton Group
Limited dated 30 December 1998, relating to purchase of the shares of
BICC Cavi Sud S.p.A.
11.6 EMPLOYEES AT SETTIMO SITE IN ITALY
The Vendor shall indemnify the Purchaser from and against all Losses
arising from the termination after Completion (or with the Purchaser's
consent prior to Completion) of the employment of 21 Employees located
at the Settimo, Italy site, details of which are set out in Schedule
13, up to a maximum amount of (pound)750,000.
<PAGE> 65
12 DEFECTIVE PRODUCT OR SERVICE
12.1 LIABILITY FOR DEFECTIVE PRODUCT OR SERVICE
The Vendor and Purchaser agree that any liability for defective product
(as defined in Clause 12.2 below) manufactured or defective service (as
defined in Clause 12.2 below) supplied by (i) any of the Business
Sellers in connection with the Operations or (ii) any of the Relevant
Group Companies, in either case prior to Completion (or Subsequent
Completion as the case may be), shall remain the responsibility of such
Relevant Seller or in the case of a Relevant Group Company the Vendor;
and that any defective product manufactured or defective service
supplied after Completion (or Subsequent Completion as the case may be)
by any of the Businesses or the Group Companies shall be the
responsibility of the Relevant Purchaser or Group Company, failing
which the Purchaser.
12.2 MEANING OF DEFECTIVE PRODUCT AND DEFECTIVE SERVICE
A DEFECTIVE PRODUCT and a DEFECTIVE SERVICE means a product or service
supplied by any of the Businesses or the Relevant Group Companies that
does not conform to its express or implied contractual requirements,
whether in terms of performance, quality, time of delivery or in any
other respect. A product shall be considered as manufactured when it
has passed through final testing at the factory of the Operations and
any reference to manufacturing or manufacture in this Clause 12 shall
have such a meaning.
12.3 VENDOR RECEIVES CLAIM
12.3.1 If, following Completion (or Subsequent Completion as the case
may be), a Relevant Seller or Relevant Group Company receives a
claim from any person in respect of a defective product
manufactured and/or sold or defective service supplied before
Completion (or Subsequent Completion as the case may be), it
shall inform the Purchaser immediately and take steps to
investigate, report on, and take (in its view) appropriate and
prompt remedial action in respect of such defective product or
defective service.
<PAGE> 66
12.3.2 If the claim can be settled by a payment alone, the Vendor
shall be responsible, or shall procure that such Relevant
Seller is responsible, for meeting the contractual obligations
of the supplier/provider of the defective product or defective
service in that respect.
12.3.3 If the claim involves the supply of a replacement and/or the
removal, repair and reinstallation of the defective product or
the re-engineering or re-doing of work pursuant to a service
supplied, the Purchaser shall, or shall procure that the
Relevant Purchaser or the Relevant Group Company shall, carry
out the necessary work for such Relevant Seller, at the fully
absorbed manufacturing cost plus 5 per cent (together with any
value added or similar tax applicable thereon and any other
taxes) and duties payable thereon such costs to be paid by the
Vendor or any Relevant Seller within 30 days following delivery
of an invoice therefor.
12.3.4 If the claim involves both a payment and the repair or
replacement of a product or part of a product or the
re-engineering or other re-doing of work in respect of a
service, the payment shall remain the responsibility of such
Relevant Seller, but the provisions of Clause 12.3.3 shall
apply to the repair, replacement or re-engineering.
12.4 PURCHASER RECEIVES CLAIM
If a claim in respect of a defective product manufactured and/or sold
or defective service supplied before Completion (or Subsequent
Completion as the case may be) is made against a Relevant Purchaser or
any Relevant Group Company, it shall inform the Vendor forthwith and:
12.4.1 if, in the joint opinion of Vendor and Purchaser, the claim is
partly or wholly justified on contractual grounds, the
Purchaser shall, or shall procure that the Relevant Purchaser
or Relevant Group Company shall, take all reasonable steps as
instructed by the Vendor or another Relevant Seller, without
prejudicing the legitimate interests of such Relevant Seller,
to repair, replace and make good the defective product or
defective service and/or compensate
<PAGE> 67
the claimant to the extent appropriate in accordance with the
terms of the relevant applicable contract. The Vendor shall
procure that such Relevant Seller shall, failing which the
Vendor shall, indemnify and keep the Relevant Purchaser or
Relevant Group Company indemnified accordingly, provided that
in respect of a defective product or service, the indemnity
shall cover only sums equivalent to those specified in Clause
12.3.3 incurred by the Relevant Purchaser or Relevant Group
Company; and
12.4.2 where the Vendor and the Purchaser are unable to reach
agreement on the extent to which the claim is justified and how
it is to be dealt with within 21 days of either party receiving
notice of the claim (both parties acting reasonably and
negotiating in good faith), the Relevant Purchaser or Relevant
Group Company shall be entitled to take such action as it
thinks reasonably appropriate having regard to the provisions
of the relevant contract relating thereto, but with an
overriding responsibility to minimise the costs thereof,
whereupon the indemnity set out in Clause 12.4.1 shall apply to
such claim.
12.5 VENDOR RECEIVES CLAIM FOR POST COMPLETION PRODUCT OR SERVICE
If a claim in respect of a defective product manufactured or defective
service supplied after Completion (or Subsequent Completion as the case
may be) is made against a Relevant Seller, it shall inform the
Purchaser forthwith and the Relevant Purchaser or Relevant Group
Company shall take over and deal with the claim, and the Purchaser
shall procure that the Relevant Purchaser or Relevant Group Company,
failing which the Purchaser, shall indemnify such Relevant Seller
accordingly.
12.6 CLAIM MADE FOR PRODUCT OR SERVICE SPANNING COMPLETION
If a claim is made against a Relevant Seller or Relevant Purchaser or
Relevant Group Company after Completion (or Subsequent Completion as
the case may be) in respect of a defective product partly manufactured
or defective service partly supplied in the period both before and
after Completion (or Subsequent Completion as the case may be), then
unless the defect can be clearly established as being wholly
<PAGE> 68
attributable to acts or omissions either before or after Completion (or
Subsequent Completion as the case may be) (in which case Clause 12.3 or
Clause 12.4 or Clause 12.5 (as the case may be) above shall apply), the
parties shall in good faith negotiate and use their reasonable
endeavours to agree a fair and equitable apportionment of the claim.
12.7 INDEMNITIES REDUCED BY RECOVERY FROM THIRD PARTIES
Indemnities applicable under this Clause 12 shall be reduced to the
extent that (i) any provision for the relevant matter has been made in
the Net Asset Statement or (ii) a Relevant Seller or a Relevant
Purchaser or Relevant Group Company is able to recover any costs
incurred either from insurance or from a third party, and each of the
Vendor and the Purchaser undertakes to use its best endeavours to
review the possibility of all such recoveries and act accordingly,
keeping the other fully informed of its actions, and (in the case of
legal proceedings) consulting with the other at each stage of the
proceedings.
13 THIRD PARTY CONSENTS
13.1 FAILURE TO NOVATE OR ASSIGN
If in respect of a Business any of the Contracts cannot be vested in a
Relevant Purchaser except by way of novation or assignment, in each
case requiring relevant third party agreement (which term shall for the
purposes of this Clause include any waiver or other document required)
or consents, then the relevant Contracts shall not, so as to cause a
breach thereof or event of default (or the like) thereunder, be
assigned by this Agreement but:
13.1.1 shall be held in trust for the Relevant Purchaser absolutely
from Completion until such agreement or consent is obtained and
the relevant Contract is so novated or assigned, until which
time the Purchaser shall perform, or procure that a Relevant
Purchaser performs (as agent or sub-contractor), all the
obligations of the relevant Business Seller thereunder and the
Vendor shall otherwise cooperate in any reasonable arrangements
proposed by the
<PAGE> 69
Purchaser designed to procure for the Purchaser or a Relevant
Purchaser the benefits of the relevant Contract. If the
relevant Contract prohibits a Relevant Purchaser from so acting
as agent or sub-contractor, the Vendor shall or shall procure
that another Relevant Seller shall, subject to being
indemnified for any losses (including Taxation) it may incur in
connection therewith, do (or procure to be done) all such acts
required for the performance of the relevant Contract so as to
provide the Relevant Purchaser with the benefits, subject to
the burdens on the basis provided in this Agreement, of the
relevant Contract;
13.1.2 the Vendor shall, or shall procure that another Relevant Seller
shall, at the Relevant Purchaser's request either make or
assist the Relevant Purchaser in making application for any
such agreement or consent and together with the Relevant
Purchaser endeavour to obtain such novation or assignment as
aforesaid, such that the relevant novation or assignment is
effective from Completion. The costs of making such
applications and of procuring such for assignments or novations
shall be for the account of the Relevant Sellers which shall
include the payment of reasonable fees and expenses necessary
to obtain such consent or assignment PROVIDED THAT the Relevant
Seller need only exercise its reasonable endeavours in
obtaining the relevant consents or assignments. The Purchaser
shall supply or shall procure that the Relevant Purchaser
supplies, to the Relevant Seller such information and
references regarding the financial position of the Relevant
Purchaser as may reasonably be requested by the Relevant Seller
and shall enter into, or procure that the Relevant Purchaser
enters into, such direct covenants in favour of any relevant
third party as may reasonably be requested in respect of any
rents, royalties, fees or other outgoings or liabilities for
which the Relevant Purchaser will from Completion become
liable. If required by any third party, the Purchaser shall
give, or procure that the Relevant Purchaser gives, such
reasonable additional covenants requested by any third party as
a condition of giving their consent and shall generally use,
and shall procure that
<PAGE> 70
the Relevant Purchaser uses, all reasonable endeavours to
secure such consent; and
13.1.3 unless and until any relevant Contracts are novated or
assigned, the Vendor will, and shall procure that the other
Relevant Sellers will (so far as it lawfully may) give all
reasonable assistance to the Relevant Purchaser to enable the
Relevant Purchaser to enforce its rights under such Contract.
14 EMPLOYEES
The provisions of Schedule 11 shall apply.
15 EMPLOYEE BENEFIT ARRANGEMENTS
The provisions of Schedule 12 shall apply.
16 THE BUSINESS SELLERS' PROPERTIES IN ENGLAND AND WALES
The provisions of Schedule 14 shall apply.
17 REIMBURSEMENT OF EXPENSES
If the condition set out in Clause 4.1.1 is not satisfied then the
Vendor will reimburse the Purchaser for all of its professional and
other fees, costs and expenses incurred in the conduct of its due
diligence investigations into the Global Operations and in negotiating
this Agreement, the North American Sale and Purchase Agreement and all
other agreements referred to therein up to a maximum of US $5,000,000.
The Purchaser will accompany any claim under this Clause with copies of
relevant invoices and the Vendor will reimburse such fees, costs and
expenses within 7 days of presentation of appropriate invoices.
<PAGE> 71
18 POST-COMPLETION OBLIGATIONS
18.1 THE ASSUMED LIABILITIES
18.1.1 The Vendor shall procure that if any Relevant Seller becomes
aware after Completion of any claim which constitutes or may
constitute an Assumed Liability, the Relevant Seller shall as
soon as reasonably practicable give written notice thereof to
the Relevant Purchaser and shall not admit, compromise, settle,
discharge or otherwise deal with such claim without prior
consultation with and the prior agreement of the Relevant
Purchaser.
18.1.2 The Vendor shall procure that the Relevant Seller shall at the
Relevant Purchaser's expense take such action as the Relevant
Purchaser may reasonably request to avoid, dispute, resist,
appeal, compromise, defend or mitigate any claim which
constitutes an Assumed Liability but subject to the Relevant
Seller being indemnified and secured to its reasonable
satisfaction by the Purchaser against all Losses which may
thereby be incurred. In connection therewith the Vendor shall,
or shall procure that the Relevant Seller shall, make or
procure to be made available to the Relevant Purchaser or its
duly authorised agents, at the Relevant Purchaser's cost, on
reasonable notice during normal business hours all relevant
books of account, records and correspondence relating to the
Operations which have been retained by the Relevant Seller (and
shall permit the Relevant Purchaser to take copies thereof) for
the purposes of enabling the Relevant Purchaser to ascertain or
extract any information relevant to the claim.
18.2 BONDS AND GUARANTEES
18.2.1 The Purchaser on behalf of itself and the Relevant Purchasers
agrees to use its best efforts with the Relevant Sellers'
assistance to procure, effective from the Completion Date, the
release of the Relevant Seller or any member of the Vendor's
Group from such of the bonds or guarantees issued by banks on
behalf of any of them in respect of the Operations as shown in
Schedule 18
<PAGE> 72
(for the period up to and including 31 December 1998) as relate
to any of the Contracts, and after 31 December 1998 to
Completion for such bonds or guarantees entered into in the
ordinary course of the Operations or in any event as soon as
practicable after Completion.
18.2.2 After Completion but prior to such release the Purchaser on
behalf of itself and the Relevant Purchasers undertakes to the
Vendor (for itself and as trustee for the Relevant Sellers and
each member of the Vendor's Group) to keep each member of the
Vendor's Group fully, indemnified against any Liabilities
arising after Completion, but only to the extent of any
Relevant Purchaser's or Group Companies' actions relating to
any such bonds or guarantees referred to in Clause 18.2.1 or
their respective underlying contracts or tenders.
18.2.3 After Completion if any of the bonds referred to in Clause
18.2.1 are called then the Relevant Seller, failing which the
Vendor, will indemnify the Relevant Purchaser for any loss
related thereto which is attributable to the actions of any
Relevant Seller or Group Company (as the case may be) before
Completion as agreed to by the Vendor and Purchaser.
18.3 VENDOR'S GENERAL OBLIGATIONS
If at any time after Completion, any Business Seller or any member of
the Vendor's Group receives any monies (other than insurance proceeds)
in respect of any Claim or in respect of any Receivable, then the
Vendor shall procure that the relevant Business Seller or member of the
Vendor's Group shall pay to the Purchaser as soon as reasonably
practicable the amount recovered less any Taxation which would not have
arisen but for the receipt of such monies.
18.4 VENDOR'S CONTINUING OBLIGATION
Notwithstanding Completion, the Vendor shall, and shall procure that
each of the Relevant Sellers shall, execute such documents and do such
acts and things as the
<PAGE> 73
Purchaser may reasonably require for the purpose of giving to the
Relevant Purchasers the full benefit of all the provisions of this
Agreement.
18.5 NAME
18.5.1 The Purchaser shall, subject to Clause 18.5, have the right to
continue to use and the right to sublicence any of the Relevant
Group Companies to use (but only for so long as such remain
subsidiaries of the Purchaser) any trade marks and trade names
used by the Vendor in relation to the Operations and which are
not comprised in the Assets sold hereunder on a royalty free,
non-exclusive basis for a period of 12 months from the
Completion Date but solely on the products on and in the manner
in which they were being used immediately before Completion;
provided that after 30 days from Completion (or Subsequent
Completion as the case may be) the Purchaser shall, or shall
procure that the Relevant Purchaser shall, use reasonable
endeavours to make clear on all publicity material (excluding
factory signs), cheques letterheads and invoices that the
relevant Businesses and Group Companies are part of the
Purchaser's Group.
18.5.2 The Purchaser shall be entitled to use and have the right to
sublicence to any member of the Purchaser's Group (but only for
so long as such remain subsidiaries of the Purchaser) the name
"BICC" in conjunction only with the name "General Cable" as the
name of any corporate entity, partnership, or other vehicle
which, in all cases, is primarily involved in the manufacture,
sale or distribution of cables.
18.5.3 The Purchaser shall be entitled to use and have the right to
sublicence to any member of the Purchaser's Group (but only for
so long as such remain subsidiaries of the Purchaser) the name
"Brand Rex" only preceded by the name "General Cable" as the
name of any corporate entity, partnership or other vehicle
which, in all cases, is solely involved in the manufacture,
sale or distribution of Specialty Cables in the United States
of America, Canada or Mexico.
<PAGE> 74
18.5.4 The Purchaser shall not be entitled to register or use in any
manner whatsoever the trade mark "Brand Rex" or any confusingly
similar trade mark on any Data Cable product wherever
manufactured or sold. The Purchaser acknowledges that the
Vendor shall be entitled to use "Brand Rex" name on any Data
Cable product world-wide and on any Specialty Cables (other
than sales to customers located in the United States, Canada or
Mexico).
18.5.5 The Vendor shall not be entitled to apply for a trade mark
registration, register or use in any manner whatsoever employ
the trade mark "Brand Rex" on any Specialty Cable sold to
manufacturers located in the United States, Canada or Mexico.
18.5.6 The Purchaser shall procure that within three months of
Completion (or such later date as the Vendor may agree) it will
remove "BICC" from the name of each Group Company which uses
such name as part of its corporate name, save to the extent
otherwise permitted by clause 18.5.2.
18.5.7 The Vendor shall procure that within three months of Completion
(or such later date as the Purchaser may agree), it shall
change the name of any company within the Vendor's Group to
exclude the word "Pyrotenax" or any combination of words "Rod
and Wire" and "Thermoheat and Wire".
18.5.8 For the purpose of this Clause 18.5:
(i) Specialty Cables are cables sold for use in Airplanes,
Ships, Locomotives, Trucks, or other forms of vehicular
transport (or otherwise currently manufactured in the
United States by the Brand Rex division of BICC Cables
Corporation other than Data Cables; and
(ii) Data Cables are cables primarily intended for the
transmission of data in local or wide area networks,
examples being category 5, 6, and 7 data cables.
<PAGE> 75
18.6 LEGAL ASSIGNMENTS OF RECEIVABLES
If it becomes necessary for the Business Purchaser of the Business in
the United Kingdom to enforce any Receivable relating to the Business
in the United Kingdom against the relevant debtor, then if so requested
by the Purchaser, the Vendor and the Purchaser agree to procure that
the Relevant Seller and the Relevant Purchaser enter into a legal
assignment of the relevant Receivable.
18.7 WASTE REGULATIONS
The Purchaser shall, and shall procure that each of the Relevant
Purchasers shall, use its reasonable endeavours to supply any relevant
records, correspondence and information necessary for the Vendor and/or
any other Relevant Seller to meet its residual obligations relating to
the Operations in respect of the period up to Completion under the
relevant national requirements relating to the EC Producer
Responsibility Packaging Waste Regulations.
18.8 RETAINED INTELLECTUAL PROPERTY AND RETAINED KNOW HOW
18.8.1 The Vendor hereby grants and shall procure that each member of
the Vendor's Group shall grant to each of the Relevant
Purchasers with effect from Completion a royalty-free,
irrevocable, perpetual licence to use the Retained Intellectual
Property and Retained Know-How required for the Operations (as
carried on at Completion) to be used for the purposes of the
Operations, as each of the Operations develop from time to
time, with a right to sub-licence to other members of the
Purchaser's Group (so long as such remain Subsidiaries of the
Purchaser's Group).
18.9 DOMAIN NAMES
The Vendor shall cancel or procure the cancellation of the domain name
registration "biccceat.com" and shall take all reasonable steps to
procure the transfer, to the Purchaser of the domain names
"supertension.com" and "cryobicc.com" and to the extent that the Vendor
is unable to procure such transfer it shall procure that the relevant
domain name registrations are cancelled.
<PAGE> 76
18.10 REDUNDANCY REIMBURSEMENT
18.10.1 The Vendor shall reimburse the Purchaser for 50 per cent of all
actual cash expenditure incurred by the Vendor up until the
Completion Date or the Purchaser or, as the case may be, any
Relevant Purchaser thereafter until 31 December 1999 up to a
maximum of(pound)6,000,000 (six million pounds) in respect of
redundancy and reorganisation costs which would be properly
chargeable against the reorganisation provision of(pound)10
million identified in note 7 to the accounts relating to the
Global Operations in the agreed terms and other redundancy
provisions of(pound)2,000,000 (two million pounds) in such
Accounts.
18.10.2 The Vendor shall make payment required to be made under Clause
18.10.1:
(i) in respect of cash expenditure made prior to the
Completion Date at Completion; and
(ii) in respect of cash expenditure made by the Purchaser or
Relevant Purchaser within ten Business Days of receipt
of appropriate evidence demonstrating that the
appropriate expenditure has been made.
18.11 EUROPEAN EMPLOYEE INDEMNITY
The Vendor (on behalf of itself and the Relevant Seller) shall fully
indemnify and keep indemnified the Purchaser (on behalf of itself and
the Relevant Purchaser) from and against all and any Losses which the
Relevant Purchaser may incur in relation to any European Employee who,
at the date of this Agreement, earns a basic salary which exceeds
(pound)200,000 per annum, where such Losses arise solely as a result of
or in connection with the change of his employer (provided such change
is significant and to his detriment) occurring by virtue of the
Transfer Provisions under the relevant European Country and/or the
entering into and or completion of this Agreement.
<PAGE> 77
19 RESTRICTIVE COVENANTS
19.1 SCOPE OF RESTRICTIVE COVENANT
In order to protect the goodwill of the Operations and the Confidential
Information (as defined in Clause 21.2.5 for the purposes of Clause
21.2.1) the Vendor agrees with the Purchaser that without the prior
consent in writing of the Purchaser it will not and it will procure
that to the extent that it is able to do so that no member of the
Vendor's Group will directly or indirectly, whether by itself, its
employees or agents and whether on its own account or on behalf of or
in conjunction with or through the medium of any other person, firm or
company or otherwise howsoever, for a period beginning on Completion
and ending three years after the date of this Agreement:
19.1.1 carry on or be otherwise engaged or interested in any capacity
(whether for reward or otherwise) in, any business which
competes with any of the Businesses anywhere in the world where
the Operations are currently carried on;
19.1.2 in relation to the Businesses, solicit or canvass, seek to
procure or accept orders from or otherwise do business with or
procure directly or indirectly any other person to procure
orders from or do business with any person, firm, company or
other organisation who or which:
(i) was a customer, supplier or agent of the Vendor or any
Group Company in relation to any of the Businesses at
any time during the two years prior to Completion; or
(ii) at the date of Completion was in the process of
negotiating to do business with the Vendor or any Group
Company in relation to any of the Businesses;
or otherwise interfere or seek to interfere with, or with the
continuance of, the supply of goods or services to or by the
Businesses (or any of them) PROVIDED THAT this paragraph shall
not preclude any member of the Vendor's Group from doing
business with any person who is or was a
<PAGE> 78
customer, supplier or agent of the Vendor's Group prior to
Completion in relation to any business of the Vendor's Group
which is not being transferred under this Agreement;
19.1.3 (with a view to employment) solicit or entice away, or
endeavour to solicit or entice away, from the Purchaser or any
Group Company, any Senior Employee who at Completion was
employed or otherwise engaged by the Vendor (or any Relevant
Seller) in relation to any of the Businesses and whose
employment was transferred to the Purchaser on Completion
(PROHIBITED EMPLOYEES) (provided that nothing in this paragraph
shall prevent any member of the Vendor's Group from making
generalised employment searches, by advertisement or by
engaging firms to conduct searches which are not focussed on
Prohibited Employees).
19.2 EXCLUSIONS FROM RESTRICTIVE COVENANT
The restriction in Clause 19.1 shall not operate to prohibit:
19.2.1 the Vendor from holding in aggregate up to 10 per cent of the
shares of any company which carries on or is about to carry on
any such business as is mentioned in this clause and the shares
of which are listed or dealt on a recognised stock exchange;
19.2.2 the Vendor from fulfilling any obligation of the Vendor
pursuant to this Agreement or the Asset and Share Purchase
Agreement dated 26 February 1999 between the Vendor, Corning
International Corporation and Corning Incorporated or any
General Services and Supply Agreements;
19.2.3 the Vendor from carrying on any business not sold to the
Purchaser pursuant to the terms of this Agreement in particular
the business presently carried on under the name "BICC Brand
Rex" with manufacturing facilities outside the United States,
Canada and Mexico to be renamed "Brand Rex"; or
19.2.4 the Companies specified in Part 2 of Schedule 5 from carrying
on their business up to the date of Subsequent Completion (or
if Subsequent
<PAGE> 79
Completion does not so occur, indefinitely) where the sale and
purchase of those Companies are not completed on or with effect
from the Completion Date.
19.3 SEPARATE AND INDEPENDENT RESTRICTION
Each of the restrictions in Clause 19.1.1, 19.1.2, 19.1.3 and 19.1.4
shall constitute an entirely separate and independent restriction on
the Vendor.
20 GUARANTEES
20.1 VENDOR'S GUARANTEED OBLIGATIONS
In consideration of the Purchaser's Guarantor entering into the
guarantee in Clause 20.3, the Vendor hereby unconditionally and
irrevocably guarantees to the Purchaser and/or the Relevant Purchaser
(as the case may be) the due and punctual performance and observance by
the Relevant Sellers of all their obligations, commitments,
undertakings, warranties and indemnities under or pursuant to this
Agreement or any Subsidiary Agreement or the Tax Deed of Covenant (the
VENDOR'S GUARANTEED OBLIGATIONS).
20.2 RELEVANT SELLERS DEFAULT
If and whenever any of the Relevant Sellers defaults for any reason
whatsoever in the performance of any of the Vendor's Guaranteed
Obligations the Vendor shall forthwith upon written demand served in
accordance with this Agreement unconditionally perform (or procure
performance of) and satisfy (or procure the satisfaction of) the
Vendor's Guaranteed Obligations in regard to which such default has
been made in the manner prescribed by this Agreement and so that the
same benefits shall be conferred on the Purchaser or the Relevant
Purchaser (as the case may be) as it would have received if the
Vendor's Guaranteed Obligations had been duly performed and satisfied
by the Relevant Seller.
<PAGE> 80
20.3 PURCHASER'S GUARANTEED OBLIGATIONS
In consideration of the Vendor entering into this Agreement, the
Purchaser's Guarantor hereby unconditionally and irrevocably guarantees
to the Vendor and/or the Relevant Seller (as the case may be) the due
and punctual performance and observance by the Purchaser and the other
Relevant Purchasers of all their obligations, commitments,
undertakings, warranties and indemnities under or pursuant to this
Agreement or any Subsidiary Agreement (the PURCHASER'S GUARANTEED
OBLIGATIONS).
20.4 PURCHASER'S DEFAULT
If and whenever any of the Relevant Purchasers defaults for any reason
whatsoever in the performance of any of the Purchaser's Guaranteed
Obligations, the Purchaser's Guarantor shall forthwith upon written
demand served in accordance with this Agreement unconditionally perform
(or procure performance of) and satisfy (or procure the satisfaction
of) the Purchaser's Guaranteed Obligations in regard to which such
default has been made in the manner prescribed by this Agreement and so
that the same benefits shall be conferred on the Vendor or the Relevant
Seller (as the case may be) as it would have received if the
Purchaser's Guaranteed Obligations had been duly performed and
satisfied by the Relevant Purchaser.
21 OTHER PROVISIONS
21.1 ANNOUNCEMENTS
21.1.1 Pending Completion or, in relation to the relevant part of the
Operations, any Subsequent Completion, the Vendor and the
Purchaser shall, subject to the requirements of law or any
regulatory body or the rules and regulations of any recognised
stock exchange, consult together as to the terms of, the
timetable for and manner of publication of, any formal
announcement or circular to shareholders, employees, customers,
suppliers, distributors and sub-contractors and to any
recognised stock exchange or other authorities or to the media
or otherwise which either party may desire or be obliged to
make
<PAGE> 81
regarding this Agreement or any Subsidiary Agreement. Any other
communication which the Purchaser or the Vendor may make
concerning the foregoing matters shall, subject to the
requirements of law or any regulatory body or the rules and
regulations of any recognised stock exchange, be consistent
with any such formal announcement or circular as aforesaid.
21.1.2 Subject to Clause 21.1.1, neither party shall pending
Completion or, in relation to the relevant part of the
Operations, any Subsequent Completion, make or authorise or
issue any formal announcement, circular or other communication
concerning the subject matter of this Agreement or any
Subsidiary Agreement.
21.1.3 If Completion does not take place, the Purchaser shall
forthwith hand over or procure the handing over of all
accounts, records, documents and papers of or relating to the
Relevant Sellers which shall have been made available to it and
all copies or other records derived from such materials and
expunge any information derived from such materials or
otherwise concerning the subject matter of this Agreement or
any Subsidiary Agreement from any computer, wordprocessor or
other device containing information Provided that this shall
not apply to information available from public records or
information acquired by a Relevant Purchaser otherwise than
from the Relevant Sellers or their agents.
21.2 CONFIDENTIAL INFORMATION
21.2.1 The Vendor:
(i) shall not and shall procure that no other member of the
Vendor's Group or any director, officer or employee or
adviser or agent of the Vendor's Group shall disclose
to any person Confidential Information; and
(ii) shall use all reasonable endeavours to prevent the
disclosure of Confidential Information by any person
other than by members of the Purchaser's Group.
<PAGE> 82
21.2.2 The Purchaser:
(i) shall not and shall procure that no other member of the
Purchaser's Group or any director, officer or employee
or adviser or agent of the Purchaser's Group shall
disclose to any person Confidential Information; and
(ii) shall use all reasonable endeavours to prevent the
disclosure of Confidential Information by any person
other than by members of the Vendor's Group.
21.2.3 Clause 21.2.1 does not apply to:
(i) disclosure of Confidential Information to or at the
written request of a Relevant Purchaser;
(ii) disclosure of Confidential Information required to be
disclosed by law, regulation, any revenue authority or
any Stock Exchange;
(iii) disclosure of Confidential Information to professional
advisers for the purpose of advising a Relevant Seller
provided that such advisers shall be made aware of the
confidential nature of such information;
(iv) disclosure of Confidential Information for the purposes
of defending any claim under the Warranties or
otherwise under this Agreement (including making any
claims or counterclaims against third parties pursuant
to Clause 8.4); or
(v) Confidential Information which is in the public domain
other than by the Vendor's breach of Clause 21.2.1.
21.2.4 Clause 21.2.2 does not apply to:
(i) disclosure of Confidential Information to or at the
written request of a Relevant Seller;
(ii) disclosure of Confidential Information required to be
disclosed by law, regulation, any revenue authority or
any Stock Exchange;
<PAGE> 83
(iii) disclosure of Confidential Information to professional
advisers for the purpose of advising a Relevant
Purchaser provided that such advisers shall be made
aware of the confidential nature of such information;
or
(iv) Confidential Information which is in the public domain
other than by the Purchaser's breach of Clause 21.2.2.
21.2.5 CONFIDENTIAL INFORMATION means, for the purposes of Clause
21.2.1 all information relating to any Group Company's or
Business Seller's business, or financial or other affairs
(including future plans and targets) of any Group Company or
Business Seller and which is not in the public domain and
means, for the purposes of Clause 21.2.2, all information
relating to the business, financial or other affairs (including
future plans and targets) of any company in the Vendor's Group
and which is not in the public domain.
21.3 REMEDIES
21.3.1 This Agreement, the Subsidiary Agreements and the Tax Deed
Covenant contain the whole agreement between the parties
relating to the subject matter of this Agreement at the date
hereof to the exclusion of any terms implied by law which may
be excluded by contract. The Purchaser on behalf of itself and
the other Relevant Purchasers acknowledges that it has not been
induced to enter this Agreement by, and so far as is permitted
by law and except in the case of fraud, hereby waives any
remedy in respect of any warranties, representations and
undertakings not incorporated into this Agreement.
21.3.2 So far as is permitted by law and except in the case of fraud,
the parties agree and acknowledge that the only right and
remedy which shall be available to a Relevant Purchaser in
connection with or arising out of or related to any of the
statements contained in the Warranties shall be damages in
contract for breach of this Agreement and not rescission of
this Agreement, nor damages in tort or under statute (whether
under the Misrepresentation Act 1967 or otherwise), nor any
other remedy.
<PAGE> 84
21.3.3 Each party to this Agreement confirms it has received
independent legal advice relating to all the matters provided
for in this Agreement, including the provisions of this Clause,
and agrees, having considered the terms of this Clause and the
Agreement as a whole, that the provisions of this Clause are
fair and reasonable.
21.3.4 In Clause 21.3.1 to 21.3.3, this Agreement includes the
Disclosure Letter and all documents entered into pursuant to
this Agreement.
21.4 SUCCESSORS AND ASSIGNS
21.4.1 Either the Vendor or the Purchaser may, except as otherwise
expressly provided in this Agreement and without the consent of
the other, assign to an Associated Company the benefit of all
or any of the other party's obligations under this Agreement
provided however that such assignment shall not be absolute but
shall be expressed to have effect only for so long as the
assignee remains an Associated Company.
21.4.2 This Agreement is, subject to Clause 21.4.1, personal to the
parties to it. Accordingly, neither the Purchaser nor the
Vendor may, without the prior written consent of the other,
assign the benefit of all or any of the other's obligations
under this Agreement, nor any benefit arising under or out of
this Agreement nor shall the Purchaser be entitled to make any
claim against the Vendor in respect of any loss which it does
not suffer in its own capacity as beneficial owner of the
Shares and/or Businesses.
21.5 VARIATION ETC.
No variation of this Agreement shall be effective unless in writing and
signed by or on behalf of each of the parties to this Agreement.
21.6 TIME OF THE ESSENCE
Any time, date or period referred to in any provision of this Agreement
may be extended by mutual agreement between the parties but as regards
any time, date or
<PAGE> 85
period originally fixed or any time, date or period so extended time
shall be of the essence.
21.7 THIRD PARTY COSTS
The Vendor shall bear all legal, accountancy and other third party
costs and expenses incurred by it in connection with this Agreement,
the Subsidiary Agreements and the Tax Deed of Covenant and the sale of
the Operations. The Purchaser shall bear all such costs and expenses
incurred by it and any other Relevant Purchaser.
21.8 INTEREST
If any Relevant Seller or any Relevant Purchaser defaults in the
payment when due of any sum payable under this Agreement, the
Subsidiary Agreements or the Tax Deed of Covenant (whether determined
by agreement or pursuant to an order of a court or otherwise) their
liability shall be increased to include interest on such sum from the
date when such payment is due until the date of actual payment (as well
after as before judgment) at a rate per annum of 2 per cent above the
base rate from time to time of The Hong Kong and Shanghai Banking
Corporation Limited. Such interest shall accrue from day to day.
21.9 SET-OFF
Under no circumstances shall any amounts (if any) payable by any
Relevant Purchaser to any Relevant Seller or by any Relevant Seller to
any Relevant Purchaser pursuant to this Agreement be set off against
each other.
21.10 LONG STOP LIMITATION OF LIABILITY
Notwithstanding any other provision in this Agreement or any provision
in any Subsidiary Agreement or the Tax Deed of Covenant, under no
circumstances shall any Relevant Seller have any liability whatsoever
pursuant to this Agreement, any Subsidiary Agreement or the Tax Deed of
Covenant following the twentieth anniversary of the date of this
Agreement.
<PAGE> 86
21.11 NOTICES
21.11.1 Any notice or other communication requiring to be given or
served under or in connection with this Agreement shall be in
writing and, other than in relation to Clause 4.5, shall be
sufficiently given or served if delivered or sent:
(i) in the case of any of the Vendor or Relevant Sellers to
such party care of:
BICC plc
Devonshire House
Mayfair Place
London W1X 5FH
Fax: 0171 409 0070
Attention: The Company Secretary of BICC plc
(ii) in the case of any of the Relevant Purchasers or the
Purchaser's Guarantor to such party care of:
General Cable Corporation
4 Tesseneer Drive
Highland Heights
Kentucky 41076
Fax: (00 1) 606 572 8444
Attention: General Counsel
21.11.2 Any such notice or other communication shall be delivered by
hand or sent by courier, fax or prepaid first class post. If
sent by courier or fax such notice or communication shall
conclusively be deemed to have been given or served at the time
of despatch, in case of service in the United Kingdom, or on
the following Business Day in the case of international
service. If sent by post such notice or communication shall
conclusively be deemed to have been received two Business Days
from the time of posting, in the case of inland mail in the
United Kingdom, or three Business Days from the time of posting
in the case of international mail.
<PAGE> 87
21.12 SEVERANCE
If any term or provision of this Agreement is held to be illegal or
unenforceable, in whole or in part, under any enactment or rule of law,
such term or provision or part shall to that extent be deemed not to
form part of this Agreement but the enforceability of the remainder of
this Agreement shall not be affected.
21.13 REFERENCES TO THE REPORTING ACCOUNTANTS
Whenever any matter is referred under this Agreement (other than Clause
9) to the Reporting Accountants for determination, the provisions of
Clause 9 which apply to the Reporting Accountants' determination of the
Net Asset Statement shall apply to their determination of any such
matter.
21.14 GENERAL SERVICES AND SUPPLY AGREEMENTS
The Vendor and Purchaser hereby agree that they will need to settle by
Completion or as soon as practicable thereafter the General Services
and Supply Agreements.
21.15 TRANSITIONAL SERVICES
The Vendor agrees to use reasonable endeavours to provide to the
Operations such transitional services, such as central payroll and
other functions, at cost, as are reasonably requested by the Purchaser
and which are required for the Operations for a period of up to 12
months from Completion and the Purchaser shall give at least three
months' written notice prior to any termination of the provision of
transitional services by the Vendor.
21.16 COUNTERPARTS
This Agreement may be executed in any number of counterparts each of
which shall be deemed an original, but all the counterparts shall
together constitute one and the same instrument.
<PAGE> 88
21.17 GOVERNING LAW AND SUBMISSION TO JURISDICTION
This Agreement and the Subsidiary Agreements and the documents to be
entered into pursuant to them, save as expressly referred to therein,
shall be governed by and construed in accordance with English law and
the parties irrevocably agree that the courts of England are to have
exclusive jurisdiction to settle any disputes which may arise out of or
in connection with this Agreement, the Subsidiary Agreements and such
documents.
21.18 APPOINTMENT OF PROCESS AGENTS
21.18.1 The Purchaser irrevocably appoints Norose Notices Limited at
Kempson House, Camomile Street, London EC3A 7AN as its agent
for the service of process in England in relation to any matter
arising out of this Agreement, service upon whom shall be
deemed completed whether or not forwarded to or received by the
Purchaser.
21.18.2 The Purchaser shall inform the Vendor, in writing, of any
change in the address of its process agent within 28 days of
such change.
21.18.3 If such process agents cease to have an address in England, the
Purchaser irrevocably agrees to appoint new process agents
acceptable to the Vendor and to deliver to the Vendor within 14
days a copy of a written acceptance of appointment by its new
process agents.
21.18.4 Nothing contained in this Agreement shall affect the right to
serve process in any other manner permitted by law or the right
to bring proceedings in any other jurisdiction for the purposes
of the enforcement or execution of any judgment or other
settlement in any other courts.
<PAGE> 89
IN WITNESS whereof this Agreement has been duly executed on the date
first set out above
SIGNED by Peter Zinkin on |
behalf of BICC plc in the |
presence of - Peter Zinkin
Mark Stamp |
Linklaters |
One Silk Street
London EC2Y 8HQ
SIGNED by Robert J. Siverd |
on behalf of GK Technologies, |
Incorporated in the presence - Robert J. Siverd
of |
Mauro Mattiuzzo |
Kempson House
Camomile Street
London EC3A 7AN
SIGNED by Robert J. Siverd |
on behalf General Cable |
Corporation in the presence of - Robert J. Siverd
Mauro Mattiuzzo |
Kempson House |
Camomile Street
London EC3A 7AN
<PAGE> 90
SCHEDULE 1
OPERATIONS
1 England and Wales (all as defined in Part 2 of Schedule 14)
1.1 Erith
(i) Design, manufacture, marketing and installation of High
Voltage and Extra High Voltage land and subsea cable
systems
(ii) Technology research and development
(iii) Jointing and installation training school
1.2 Prescot
(i) Design, manufacture and distribution of components for
energy cable networks
(ii) Management services for BICC Energy Cables in UK,
Europe, Africa and the Middle East
(iii) Manufacture of mineral-insulated cable and accessories
(iv) Manufacture of copper rod and wire
1.3 Wrexham (excluding Wrexham II)
(i) Design, manufacture and marketing of low and medium
voltage power cable systems (mainly for power
distribution networks)
(ii) Technology research and development
1.4 Nottingham
(i) Manufacture of wire braid
1.5 Hebburn
(i) Manufacture of mineral-insulated thermocouple and
heating cable and accessories
(ii) Manufacture of monitoring cables for aircraft
applications
<PAGE> 91
1.6 Leigh (excluding the Brand Rex Premises)
(i) Design, manufacture and marketing of industrial and
specialist cables (including compounding)
1.7 Swansea
(i) Sales office
2 ITALY:
2.1 Settimo Site
(i) Design manufacture and marketing of low and medium
voltage power cable systems (mainly for power
distribution networks)
(ii) Compound unit (elastomeric)
2.2 Ascoli Site
(i) Design and manufacture of general industrial and
metallic telecommunications cables.
3 SPAIN:
Manlleu Site -
| Design, manufacture and marketing of both
| transmission and distribution land power
Montcada Site | cable systems and construction power and
| wiring cable systems and general industrial
| cables
Abrera Site -
Barcelona Site
(i) Management services for energy cables
<PAGE> 92
3.5 Teulada Site -
|
|
3.6 Pamplona Site | Sales Services
|
|
3.7 Seville Site |
|
|
3.8 Bilbao Site |
|
|
3.9 Valencia Site -
4 NORWAY:
(i) Distribution services
5 BRAZIL:
(i) Import and sales services for energy cables
6 PORTUGAL:
6.1 Morelena Site
(i) Design, manufacture and marketing of distribution power
cable systems, construction power and wiring cable
systems and metallic telecom cables, optical cables and
general industrial cables
(ii) Management services
6.2 Oporto Site
(i) Sales services for energy and metallic telecom cables
7 MOZAMBIQUE:
(i) Manufacture and sale of energy cables
8 ANGOLA:
(i) Sale of energy cables
<PAGE> 93
9 DUBAI:
(i) Design, manufacture and marketing of distribution and
construction power and wiring cable systems
10 EGYPT:
10.1 Site at Giza, Cairo
(i) Design, manufacture and marketing of construction wiring
cables systems
10.2 Zamalek Site
(i) Sales/management services
11 JERSEY:
(i) Holding company services for Egyptian companies
12 ZIMBABWE:
Harare Site
(i) Design, manufacture and marketing of energy distribution
and construction power and wiring cable systems and
metallic telecom cables
(ii) Management services
13 CHINA:
13.1 Shanghai Site
(i) Sales services
13.2 Beijing Site
(i) Representative office
14 NEW ZEALAND:
14.1 Christchurch Site
(i) Design, manufacture and sale of energy and metallic
telecommunication cables systems
<PAGE> 94
(ii) Sale only of optical cables
14.2 Wellington Sites - Distribution of energy and telecom cables;
|
14.3 Auckland Site - administration and sales
15 FIJI:
(i) Design, manufacture and sale of energy cables
16 SINGAPORE:
16.1 Office at 435 Orchard Road (17th Floor)
(i) Sales services
16.2 Office at 435 Orchard Road (21st Floor)
(i) Management services
16.3 Pasir Panjang Sites
(i) Management/sales services
17 MALAYSIA:
Kuala Lumpur Sites (Shah Alam and Bukit Raja)
(i) Design, manufacture and sale of energy cables and
aluminium rod
18 INDONESIA:
Jakarta Site
(i) Design, manufacture and sale of energy and optical
telecom cables (non-operational)
19 HONG KONG:
Wanchai and Chai Wan Sites
(i) Sales services for energy cables
20 SAUDI ARABIA:
(i) Sales Services
<PAGE> 95
21 ABU DHABI:
(i) Sales Services
22 QATAR:
(i) Sales Services
23 BAHRAIN:
(i) Sales Services
24 ARGENTINA:
(i) Distribution Services
25 THAILAND:
Bangkok Site
(i) Sales Services
26 TAIWAN:
(i) Representative Office
27 GERMANY:
Britz and Kopernick Sites
(ii) Design, manufacture and marketing of medium-voltage and
other energy cables and metallic telecom cables
(iii) Design, manufacture and marketing of optical power
ground wire
<PAGE> 96
SCHEDULE 2
PART 1
DETAILS OF THE SHARES AND THE BUSINESSES
1 Particulars of Share Sellers and Shares to be Sold
<TABLE>
<CAPTION>
(1) (2)
NAME OF SHARE SELLER COMPANIES AND
SHARES SOLD
(*100% OF THE ISSUED SHARE CAPITAL)
<S> <C>
1.1 BICC Cables Energia y (i) BICC General Cable SA*
Comunicaciones SA 510,000 nominative shares of 5,000 pesetas each
1.2 BICC Overseas Investments (i) BICC Ceat Cavi Srl*
Limited nominal quota of 80,000,000,000 lire
(ii) BICC Portugal SGPS SA*
600,000 non-redeemable shares of Esc 1,000 each and
875,000 redeemable shares of Esc 1,000 each
(iii) BICC CAFCA Limited
2,046,630 ordinary shares of Z$0.50 each in the name of
BICC Overseas Investments Limited and 21,029,544
ordinary shares of Z$0.50 each in the name of Midland
Bank Nominees
(74% of the issued share capital)
(iv) Dubai Cable Co. Limited
11,955 shares of Dhs 1,000 each
(30% of the issued share capital)
(v) BICC Cables Asia-Pacific Pte Ltd
95,779,000 "A" shares of S$1 each
(50% of the issued share capital)
1.3 BICC plc (i) BICC - Ducab Investments Limited
2,285,002 ordinary shares of(pound)0.01 each
(50% of the issued share capital)
(ii) RPG-BICC Power Cables Pvt Ltd
260,013 shares of 10 Rp each
(26% of the issued share capital)
</TABLE>
<PAGE> 97
<TABLE>
<CAPTION>
(1) (2)
NAME OF SHARE SELLER COMPANIES AND
SHARES SOLD
(*100% OF THE ISSUED SHARE CAPITAL)
<S> <C>
1.4 BICC International Holdings (i) BICC Cables Asia Pacific Pte Ltd
Pty Limited
95,779,000 "B" shares of S$1 each
(50% of the issued share capital)
1.5 BICC Holdings New Zealand BICC Cables New Zealand Limited*
Limited
48,200 ordinary shares of NZ$1 each
1.6 BICC Cables Pty Ltd (i) Dominion Wire & Cables Limited
153,000 ordinary shares of F$1 each
(51% of the issued share capital)
1.7 Electric Transmission Limited (i) Trans-Power Cables Pte Ltd*
1,500,000 ordinary shares of S$1 each
1.8 Mayfair Place Investments (i) BICC Supertension Cables (1980) Limited*
Limited
98 ordinary shares of (pound)1 each and 4,999,900 redeemable
ordinary shares of (pound)1 each held in the name of Mayfair
Place Investments and 2 ordinary shares of (pound)1 each held
by Bical Nominees Limited
1.9 BICC Cables Projects (i) 50% interest in Kaiser KWO Kabel Engergie Gmbh & Co
Limited
(ii) 50% interest in Kaiser KWO Kabel Telekom Gmbh & Co
</TABLE>
<PAGE> 98
2 PARTICULARS OF THE SUBSIDIARIES
<TABLE>
<CAPTION>
JURISDICTION COMPANY BICC SHAREHOLDER
<S> <C> <C>
2.1 Portugal BICC Celcat, Cabos de Energia de BICC Portugal SGPS SA (50.7%)
Telecomunicacoes SA
2.2 Mozambique Cel Moque-Fabrica Nacional de BICC Celcat, Cabos de Energia e
Contudores Electricos SARL Telecomunicacoes SA (29%)
BICC CAFCA Limited (18%)
2.3 Angola Condel-Fabrica de Contudores BICC Celcat, Cabos de Energia e
Electricos de Angola SARL Telecomunicacoes SA
2.4 Egypt BICC Egypt SAE BICC - Ducab Investments Ltd
2.5 Egypt BICC Egypt Trading Ltd BICC Egypt SAE
2.6 Zimbabwe BICC (Central Africa) (Private) BICC CAFCA Limited
Limited
2.7 Zimbabwe Zimbabwe Cables (Pte) Limited BICC CAFCA Limited
2.8 Norway BICC NORSPA A/S BICC General Cable SA (51%)
2.9 Brazil BICC Novacoes Ltda BICC General Cable SA (80%)
2.10 Argentina BICC Cables Argentina SA BICC General Cable SA
(1 share is owned by BICC
Cables Energia y
Comunicaciones, SA)
2.11 Brunei BICC Cables (Brunei) BICC Energy Cables Pte Ltd
Sdn Bhd
2.12 Singapore BICC Energy Cables Pte Ltd BICC Cables Asia - Pacific Pte Ltd
2.13 China BICC Cables China Ltd BICC Cables Asia - Pacific Pte Ltd
2.14 Malaysia Power Cables Malaysia BICC Cables Asia - Pacific Pte Ltd
Sdn Bhd (40%)
2.15 Malaysia BICC (Malaysia) Sdn Bhd BICC Cables Asia - Pacific Pte Ltd
(30%)
2.16 Malaysia BICC Cables Malaysia Pte Ltd BICC Cables Asia - Pacific Pte Ltd
2.17 Singapore Reliance Cables Pte Ltd BICC Cables Asia - Pacific Pte Ltd
2.18 Indonesia PT BICC Berca Cables BICC Cables Asia - Pacific Pte Ltd
(50%)
2.19 Bahrain BICC Middle East Traders Dubai Cable Co Ltd (45%)
2.20 Qatar JBK BICC Dubai Cable Co Ltd (49%)
2.21 Abu Dhabi BICC Al Jallaf Dubai Cable Co Ltd (49%)
</TABLE>
<PAGE> 99
SCHEDULE 2
PART 2
PARTICULARS OF THE BUSINESS SELLERS AND THE BUSINESSES TO BE SOLD
(1) (2)
NAME OF BUSINESS SELLER BRIEF DESCRIPTION OF
BUSINESS/ASSET TO BE SOLD
1 BICC plc See paragraph 1 of Schedule 1
2 BICC Cables Limited The benefit of the Contracts
entered into by it as undisclosed
agent for any Vendor Group
Company in relation to the
Businesses
3 BICC Components Limited The benefit of the Contracts
entered into by it as undisclosed
agent for any Vendor Group
Company in relation to the
Businesses.
<PAGE> 100
SCHEDULE 3
ALLOCATION OF CONSIDERATION
The Purchase Price shall be allocated between the Shares and the Businesses as
follows:
<TABLE>
<CAPTION>
(1) (2) (3) (4)
NAME OF SELLER JURISDICTION PARTICULARS OF ALLOCATION
COMPANY/BUSINESSES (POUND)
<S> <C> <C> <C> <C>
3.1 BICC plc UK Sale of assets- see 96,000,000
paragraph 1 of Schedule 1
3.2 BICC plc Jersey BICC - Ducab Investments nominal
Limited
3.3 BICC plc India RPG - BICC Power Cables nominal
Pvt Ltd.
3.4 BICC Cables Energia Spain BICC General Cable SA 19,000,000
y Comunicaciones SA
3.5 BICC Cables Projects Germany Kaiser KWO Kabel 10,000,000
Limited Energie GmbH & Co and
Kaiser KWO Kabel Telekom
GmbH & Co
3.6 BICC Overseas Dubai Dubai Cable Co. Limited 23,000,000
Investment Limited
3.7 BICC Overseas Italy BICC Ceat Cavi Srl 1,000,000
Investments Limited
3.8 BICC Overseas Portugal BICC Portugal SGPS SA 3,400,000
Investments Limited
3.9 BICC Overseas Zimbabwe BICC CAFCA Limited 1,000,000
Investments Limited
3.10 BICC Overseas Malaysia, BICC Cables Asia-Pacific Pte 1,500,000
Investments Limited Singapore, Limited
Indonesia and
China
3.11 BICC International Malaysia, BICC Cables Asia-Pacific Pte 1,500,000
Holdings Pty Limited Singapore, Limited
Indonesia and
China
</TABLE>
<PAGE> 101
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
3.12 BICC Holdings New New Zealand BICC Cables New Zealand 11,000,000
Zealand Limited Limited
3.13 Electric Transmission Singapore Trans-Power Cables Pte Ltd 1,000,000
Limited
3.14 Mayfair Place UK BICC Supertension Cables 200,000
Investments Limited (1980) Limited
3.15 BICC Cables Pty Ltd Fiji Dominion Wire & Cables 2,000,000
Limited
</TABLE>
The allocation of the Purchase Price between each of the Business
Sellers' Assets included in a sale of a Business shall, subject to
Clause 9.6.6 (iii) of the Agreement, be agreed between the Vendor and
the Purchaser within seven Business Days prior to Completion or,
failing agreement within this period, shall be referred to the
Reporting Accountants for determination, such determination to be made
by Completion.
Adjustments to the Purchase Price (pursuant to Clause 9 or otherwise)
shall be allocated as agreed between the Vendor on behalf of itself and
the other Relevant Sellers and the Purchaser on behalf of itself and
the other Relevant Purchasers, or failing agreement, as determined by
the Reporting Accountants on the application of either party.
<PAGE> 102
SCHEDULE 4
INTERNAL REORGANISATIONS
1 BICC Brand Rex Inc and BICC Brand Rex Pte Ltd will be sold by BICC
Cables Asia - Pacific Pte Ltd to BICC Overseas Investments Ltd.
2 BICC General Cable SA will distribute surplus cash by way of dividend
to BICC Cables Energia y Communicaciones SA; and/or BICC Cables Energia
y Communicaciones SA will subscribe further equity in BICC General
Cable SA to the extent necessary to enable BICC General Cable SA to
repay all indebtedness.
3 BICC Holdings New Zealand Limited will subscribe for further equity in
BICC Cables New Zealand Limitd to discharge a net intra-group liability
of NZ$ 115 million.
4 BICC Overseas Investments Ltd will subscribe for equity in BICC Ceat
Cavi Srl to the extent necessary for BICC Ceat Cavi Srl to repay
substantially all indebtedness and to eliminate any deficiency of net
assets.
5 The shares which BICC Ceat Cavi Srl owns in BICC Cables Energia y
Communicaciones SA will be disposed of by BICC Ceat Cavi Srl either by
sale to BICC Overseas Investments Ltd or by BICC Cables Energia y
Communicaciones SA redeeming the said shares.
6 BICC plc will subscribe for further shares in BICC Ducab Investments
Ltd to enable BICC Ducab Investments Ltd to subscribe for further
shares in BICC Egypt SA.
7 100% of the shares in General Cable Sistemas SA are expected to be
transferred to BICC General Cable S.A. by 17 April 1999.
8 BICC plc may subscribe further equity in BICC Cables Asia - Pacific Pte
Ltd to enable it or its 100% subsidiaries to discharge all
indebtedness.
<PAGE> 103
9 BICC will continue to negotiate with Hong Kong and Shanghai Banking
Corporation Limited (Indonesia branch) to finalise the documentation
relating to the loan arrangements with PT BICC Berca Cables.
10 Recapitalisation of BICC Cables Asia-Pacific Pte and possible disposals
and/or liquidations by BICC Cables Asia-Pacific Pte of dormant
companies.
11 BICC General Cable SA will sell the property kown as c/Cresques 18-40,
Buen Pastor, Barcelona, Spain to BICC Cables Energia y Comunicaciones
S.A. or to another entity nominated by BICC Plc.
<PAGE> 104
SCHEDULE 5
CONDITIONS APPLICABLE TO THE PURCHASE OF CERTAIN SHARES/BUSINESSES
<TABLE>
<CAPTION>
(1) (2)
COMPANY/BUSINESS CONDITION
<S> <C>
PART 1
(I) BICC Ceat Cavi Srl The Italian Antitrust Authority having received due
notification of the proposed acquisition of the
Business by the Purchaser or by the Relevant
Purchaser pursuant to Act 287/1990 and (i) having
issued within the subsequent 30 (thirty) days its
decision not to start an investigation into such
proposed acquisition in accordance with section
16.4 of Act 287/1990 or (ii) having issued within
such time period no decision and no request to be
supplied with further information and/or documents
in addition to the information and/or documents
supplied by the Purchaser or the Relevant Purchaser
as part of the above notification.
(II) the Business in the United Kingdom The receipt by one or both of the parties of a
statement in writing by the Minister for
Enterprise, Trade and Employment of Ireland,
indicating that she has decided not to make an
order under section 9 of the Mergers, Takeovers and
Monopolies (Control) Act, 1978 (as amended) in
relation to the sale contemplated by the Agreement
or, in the event of a conditional order under that
Act having been made by the Minister, the parties,
acting reasonably, being satisfied with and
accepting the conditions of that order.
</TABLE>
<PAGE> 105
<TABLE>
<CAPTION>
(1) (2)
COMPANY/BUSINESS CONDITION
<S> <C>
(iii) BICC Cables New Zealand Limited 1. Receipt by the Purchaser, in writing on terms
acceptable to the Purchaser, of any clearances or
authorisations as may be considered reasonably
necessary by the Purchaser under Part III of the
Commerce Act 1986 for the implementation of this
Agreement.
2. Receipt by the Purchaser, in writing on terms
reasonably acceptable to the Purchaser, of any
consents required under the Overseas Investment
Regulations 1995 for the implementation of this
Agreement.
PART 2
(i) Dubai Cable Co Limited and 1. Receipt of the consent of Dubai Cable Company
BICC-Ducab Investments Limited Limited (DUCAB) in a form reasonably satisfactory
to the Purchaser to the transfer of the shares in
BICC-Ducab Investments Limited and a waiver of
Ducab's pre-emption rights in respect thereof.
2. Receipt of a "no objection" letter in a form
reasonably satisfactory to the Purchaser from the
legal adviser to the Ruler to the transfer of the
shares in Ducab.
3. Receipt in a form reasonably satisfactory to the
Purchaser of the consent of each of the Government
of Dubai and the General Industrial Corporation of
Abu Dhabi to the transfer of the shares in Ducab
and the waiver of their pre-emption rights in
respect
</TABLE>
<PAGE> 106
<TABLE>
<CAPTION>
(1) (2)
COMPANY/BUSINESS CONDITION
<S> <C>
thereof.
4. Receipt by the Purchaser of a waiver, in a form
reasonably satisfactory to the Purchaser, from each
of the Nationale Society General Bank SA and
International Company for Electrical and
Electronics Industries SAE of their right of
termination for change of control pursuant to the
joint venture agreement in respect of BICC Egypt
SAE.
5. Receipt by the Purchaser of any consent, in a form
reasonably satisfactory to the Purchaser, of the
Egyptian General Authority for Investment required
in respect of the change of control of BICC Egypt
SAE.
(ii) BICC CAFCA Limited 1. Receipt of a waiver or appropriate release, in a
form reasonably satisfactory to the Purchaser, from
any obligations under the rules of the Zimbabwe
Stock Exchange to make a bid for all the shares in
BICC CAFCA Limited.
2. Receipt by the Purchaser, in a form reasonably
satisfactory to the Purchaser, of any permission
required from the Reserve Bank of Zimbabwe pursuant
to the Exchange Control (General) Order, 1996.
</TABLE>
<PAGE> 107
<TABLE>
<CAPTION>
(1) (2)
COMPANY/BUSINESS CONDITION
<S> <C>
(iii) BICC Cables Asia-Pacific Pte Ltd and 1. Receipt by the Purchaser of a waiver, in a form
Trans-Power Cables Pte Ltd reasonably satisfactory to the Purchaser, from PT
Berca Indonesia in respect of its right of
termination for change of control pursuant to the
joint venture agreement in respect of PT BICC Berca
Cables Limited.
(iv) Dominion Wire & Cables Limited 1. Receipt by the Purchaser of the consent, in a
form reasonably satisfactory to the Purchaser, of
the Reserve Bank of Fiji to the transfer of shares
in Dominion Wire and Cable Limited.
2. Receipt by the Purchaser of the consent, in a
form reasonably satisfactory to the Purchaser, of
the other shareholder in Dominion Wire and Cable
Limited to the transfer of the shares therein, and
the waiver of its pre-emption rights in respect of
such shares.
(v) RPG-BICC Power Cables Pvt Ltd 1. Receipt by the Purchaser of the consent, in a
form reasonably satisfactory to the Purchaser, of
RPG Industries Limited to the transfer of the
shares in RPG-Orion Power Cables Limited and the
waiver of its pre-emption rights in respect
thereof.
2. Receipt by the Purchaser of the consent, in a
form reasonably satisfactory to the Purchaser, of
the Reserve Bank of India to the transfer of the
shares in RPG-Orion Power Cables Limited.
(vi) BICC Portugal SGPS SA 1. Receipt by the Purchaser of a waiver, in a form
</TABLE>
<PAGE> 108
<TABLE>
<CAPTION>
(1) (2)
COMPANY/BUSINESS CONDITION
<S> <C>
reasoanbly satisfactory to the Purchaser, from the
Portugese Stock Exchange of the obligation to make
an offer for 100% of the shares in BICC Celcat,
Cabos de Energia de Telecommunicaciones SA
</TABLE>
<PAGE> 109
SCHEDULE 6
PART 1
COMPLETION
PART A: COMPLETION
<TABLE>
<CAPTION>
(1) (2)
RELEVANT JURISDICTION RELEVANT COMPLETION LOCATION
<S> <C>
1 United Kingdom Linklaters & Paines
1345 Avenue of the Americas
19th Floor, New York, NY 10105
2 Spain Uria & Menendez,
Jorge Juan 6, 28001 Madrid
3 Italy Marena, Aghina, Bonvicini e Ludergnani,
Via degli Omenoni, 2, 20121 Milano
4 New Zealand Simpson Grierson,
Simpson Grierson Building, 92-96 Albert Street,
Wellesley Street Auckland
</TABLE>
<TABLE>
<CAPTION>
PART B: SUBSEQUENT COMPLETION
(1) (2)
RELEVANT JURISDICTION RELEVANT COMPLETION LOCATION
<S> <C>
1 Dubai Denton Hall, 501-502 City Tower
1 Sheikh Zayed Road, P.O. Box 1756
Dubai
2 Jersey To Be Determined
3 Zimbabwe Scanlen & Holderness
CABS Centre
74 Jason Moyo Avenue
4 Germany Oppenhoff & Radler,
Hohenstaufenring 62, D-50674, Koln
5 Portugal Goncalves Pereira, Castelo Branco & Asociados,
</TABLE>
<PAGE> 110
<TABLE>
<CAPTION>
<S> <C>
Praca Marques de Pombal, 1-8(0), 1250-160 Lisbon
6. Singapore Lee & Lee
Level 19, UIC Building, No. 5 Slenton Way,
Singapore 068808
7 Fiji Simpson Grierson,
Simpson Grierson Building, 92-96 Albert Street,
Wellesley Street Auckland
8 India To Be Determined
</TABLE>
<PAGE> 111
SCHEDULE 6
PART 2
1 On the Completion Date the Vendor shall, or shall procure that the
Relevant Seller shall, deliver or make available to the Purchaser (or
the Relevant Purchaser):
1.1 evidence of the due fulfilment of the conditions set out in Clause 4
and Schedule 5 for which the Relevant Seller is responsible;
1.2 duly executed transfers or assignments of the Business Sellers'
Properties in England and Wales together with the relevant documents of
title (duly scheduled) save for the Leased Properties insofar as
consents to assign are required but have not been obtained by the
Completion Date in which case the relevant provisions of Schedule 14
shall apply;
1.3 such conveyances, transfers, assignments and novations (duly signed or
sealed as a deed by the Relevant Seller and, if so reasonably required
by the Vendor, the Relevant Purchaser) in relation to the Contracts
together with the relative documents of title and such requisite Third
Party Consents as the Relevant Seller may have obtained provided that
the Vendor shall not be obliged to convey, assign, transfer or novate,
or procure the conveyance, assignment, transfer or novation of, any
Business Sellers' Assets otherwise than to or in favour of the
Purchaser where any relative Third Party Consent is required and has
been obtained in favour of the Purchaser only;
1.4 statutory Declarations in agreed terms relating to the matters referred
to in the Special Conditions of Sale;
1.5 an undertaking to use reasonable endeavours to assist the Purchaser to
answer any requisitions which may be raised by HM Land Registry in
connection with any of the Purchaser's applications to register the
relevant transfers to the Purchaser of each of the Business Sellers'
Properties which are registrable;
<PAGE> 112
1.6 those Business Sellers' Assets comprised in the Operations which are
capable of transfer by delivery;
1.7 in each case where the said information is not at the Properties all
books, records and other information relating to the Operations or
Relevant Employees of the Operations and all information relating to
customers, suppliers, agents and distributors and other information
relating exclusively or primarily to the Operations or the relevant
Employees of the Operations as the Purchaser may reasonably require and
copies or, at the Vendor's option, originals of any such books,
records, documents or other information in the possession or control of
a Relevant Seller which relate only in part to the Operations and which
the Purchaser may reasonably require;
1.8 resolutions of the, Board of Directors of each of the Relevant Sellers
for acknowledgement or approval of the transfer or assumption of the
Businesses or Assumed Liabilities whenever any such acknowledgement or
approval is required by law or under the constitutional documents of
the Relevant Seller;
1.9 Deeds of Assignment or Novation in the agreed terms for the transfer or
novation of all the Contracts in the Operations and with effect from
the Completion Date, duly signed by or for the relevant Business Seller
and (where necessary) the Purchaser or the Relevant Purchaser;
1.10 subject to the matters specified in paragraph 3.6 of Part 1 of Schedule
14 vacant possession of the Business Sellers' Properties in England and
Wales;
1.11 releases in respect of any Encumbrances affecting any of the Business
Sellers' Assets or the Businesses;
1.12 the Tax Deed of Covenant duly executed by the Covenantor named in it;
2 OTHER ISSUES
2.1 The Vendor and the Purchaser shall respectively procure that each
Relevant Seller and each Relevant Purchaser uses all reasonable
endeavours together to procure such transfers of Environment Permits
and written notification to any Environment
<PAGE> 113
Authorities as are required by Environmental Laws or pursuant to any
Environmental Permit.
2.2 The Vendor and the Purchaser shall respectively procure that each
Relevant Seller and each Relevant Purchaser complies in all respects
with its obligations under the relevant Subsidiary Agreement on
Completion (or Subsequent Completion, as the case may be).
3 BOARD RESOLUTIONS
On Completion the Vendor shall procure the passing of board resolutions
(to the extent necessary) (if requested by the Purchaser) revoking all
existing authorities given to banks (in respect of the operation of its
bank accounts) and giving authority in favour of such persons as the
Relevant Purchaser may nominate to operate such accounts.
4 STAMP DUTY
The Vendor and the Purchaser agree to cooperate in mitigating liability
to stamp duty (and to procure cooperation by any Relevant Seller and
Relevant Purchaser to mitigate such liability) in respect of this
Agreement and any document contemplated by this Agreement and in
particular to execute any documents in suitable jurisdictions which do
not require the payment of stamp duty or any other transaction tax
merely because a document is executed there and only to bring such
documents into the United Kingdom after informing the other party at
least 21 days in advance.
<PAGE> 114
SCHEDULE 6
PART 3
VENDOR'S ACCOUNTING PERIODS
Set out below are the dates of the last Business Day of the Vendor's relevant
accounting periods for the first four periods following the signing of this
Agreement:
30/04/1999
28/05/1999
02/07/1999
30/07/1999
The last Business Day of such other of the Vendor's accounting periods as may be
required for the purposes of this Agreement shall be notified by the Vendor to
the Purchaser within 10 Business Days of the date of this Agreement.
<PAGE> 115
SCHEDULE 7
PART 1 - NET ASSET STATEMENT
1 The Net Asset Statement shall be prepared in accordance with UK GAAP
prevalent as at 31 December 1998, excluding the impact of FRS 11 and on
a basis consistent with the Combined Accounts and shall be drawn up in
accordance with the provisions of paragraphs 2-6 below, and following
to the extent not inconsistent therewith:
1.1 the accounting policies for the relevant parts of the Operations
attached as Exhibit B, and to the extent not inconsistent therewith;
1.2 the accounting policies and principles applied in the preparation of
the audited accounts relating to the BICC Group for the period ended 31
December 1998 excluding the impact of FRS 11`
2 No account shall be taken of events taking place after Completion and
regard shall only be had to information available to the parties to
this Agreement at Completion.
3 The Net Asset Statement shall include all assets and liabilities of the
Relevant Gorup Companies or those relating to the Operations being
transferred other than:
3.1 Cash;
3.2 Third Party Indebtedness;
3.3 Intra-Group Indebtedness;
3.4 Any liability for Taxation; and
3.5 Dividends payable.
4 The Net Asset Statement shall only include the proportionate share of
the net assets (as defined in paragraph 3 above) of the Minority Owned
Group Companies after taking into account such Group Companies' cash
balances and indebtedness - that is the equity accounting method.
5 The Net Asset Statement shall exclude all Intra-Group Indebtedness and
all Third Party Indebtedness taken into account in any adjustments to
the Purchase Price in accordance with Clause 9.6.
<PAGE> 116
6 The Net Asset Statement shall be expressed in pounds sterling. Amounts
in other currencies shall be translated into sterling at the exchange
rates specified in the Exchange Cross Rates Table published in the
Financial Times, London Edition, prevailing at the Completion Date.
<PAGE> 117
SCHEDULE 7
PART 2 - DETERMINATION OF INDEBTEDNESS
1 The Estimated Indebtedness Statements and the Actual Indebtedness
Statements shall be drawn up in accordance with the provisions of
paragraph 1 of Part 1 of this Schedule 7.
2 The Estimated Indebtedness Statements and the Actual Indebtedness
Statements shall be expressed in pounds sterling. Amounts in other
currencies shall be translated into sterling at the exchange rates
specified in the Exchange Cross Rates Table as published in the
Financial Times, London Edition, prevailing at the Completion Date.
3 The provisions of Clause 9.2 shall apply mutatis mutandis to the
preparation of the Actual Indebtedness Statements.
4 The Indebtedness Statements
<TABLE>
<CAPTION>
RELEVANT GROUP INTRA-GROUP THIRD PARTY
COMPANY COUNTER PARTY INDEBTEDNESS INDEBTEDNESS CASH
Owed to Owed from
(negative (positive
amount) amount)
<S> <C> <C> <C> <C> <C>
BICC General
Cable SA
BICC NORSPA
A/S
BICC Novacoes
Ltda
BICC Argentina
SA
BICC Ceat Cavi
Srl
BICC Portugal
SGPS SA
Condel-Fabrica de
Contudores
Electricos de
Angola SARL
</TABLE>
<PAGE> 118
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
BICC CAFCA
Limited
BICC (Central
Africa) Private Ltd
Zimbabwe Cables
(Pte) Ltd
BICC Cables New
Zealand Limited
BICC Cables Asia-
Pacific Pte Limited
BICC Energy
Cagles Pte Ltd
BICC Cables
(Brunei) Sdn Bhd
BICC Cables
China Ltd
BICC Cables
Malaysia Pte Ltd
Reliance Cables
Pte Ltd
BICC-Ducab
Investments Ltd
Trans-Power
Cables Pte Ltd
BICC
Supertension
Cables (1980)
Limited
Dominion Wire &
Cables Limited ----------------------
</TABLE>
----------------------
---------------------------------------
---------------------------------------
<PAGE> 119
SCHEDULE 8
WARRANTIES GIVEN BY THE VENDOR UNDER CLAUSE 7
Unless the context otherwise requires, specific references in this
Schedule 8 to the BUSINESS SELLERS or to a BUSINESS SELLER shall be
deemed to refer to each or such Business Seller only in connection with
the Business carried on by the relevant Business Seller (and not to any
unrelated business or activity of the relevant Business Seller).
1 AUTHORITY AND CAPACITY
1.1 Each Relevant Seller and each Group Company is a company duly
incorporated and validly existing under the laws of its incorporation.
1.2 The Vendor has the legal right and full power and authority to enter
into and perform this Agreement and the Tax Deed of Covenant and any
other documents to be executed by the Vendor pursuant to or in
connection with this Agreement which when executed will constitute
valid and binding obligations on the Vendor, in accordance with their
respective terms.
1.3 Each of the Relevant Sellers which is a party thereto has the legal
right and full power to enter into and perform the Subsidiary
Agreements.
1.4 This Agreement, the Tax Deed of Covenant, the Subsidiary Agreements and
any other agreements executed or to be executed in connection herewith
or therewith, will when duly executed, constitute valid and binding
obligations on each of the Relevant Sellers which are party thereto, in
accordance with their respective terms.
1.5 The execution and delivery of, and the performance by the Relevant
Sellers of their obligations under, this Agreement and the Tax Deed of
Covenant and any other documents to be executed by the Relevant Sellers
pursuant to or in connection with this Agreement, and the execution and
delivery of, and the performance by each Relevant Seller of its
obligations under the Subsidiary Agreement to which it is a party and
any other documents to be executed by the Relevant Sellers pursuant to
or in connection with the Subsidiary Agreements, will not:
<PAGE> 120
1.5.1 result in a breach of any provision of the constitutional
documents of any Relevant Seller or Group Company; or
1.5.2 subject to the need for any Third Party Consent referred to in
Clause 4.1, Schedule 5 or in any Subsidiary Agreement, result
in a violation of any law or regulation in any jurisdiction
having the force of law or result in a breach of any order,
judgment or decree of any court, governmental agency or
regulatory body to which any Relevant Seller or Group Company
is a party or by which any Relevant Seller or Group Company is
bound; or
1.5.3 result in a material breach of, or constitute a default under,
any agreement or instrument to which any Business Seller or
Group Company is a party.
1.6 All corporate action required to be taken (i) by the Vendor
validly and duly to authorise the execution and delivery of,
and (ii) by the Relevant Sellers to exercise rights and perform
their obligations under, this Agreement, the Subsidiary
Agreements and all such action in relation to the Tax Deed of
Covenant and any other documents to be executed by the Relevant
Sellers pursuant to or in connection with this Agreement, have
been duly taken or will have been duly taken by Completion.
1.7 No Third Party Consent is required to authorise the execution,
delivery and validity of this Agreement, the Tax Deed of
Covenant or the Subsidiary Agreements or (save as set out in
Schedule 5 or in any Subsidiary Agreement) the transfer in
favour of the Relevant Purchasers of any of the Shares.
2. DISCLOSURE LETTER AND DATA ROOM
2.1 The Disclosure Letter (other than documents attached thereto or listed
therein as agreed disclosures) has been prepared by the Vendor in good
faith and the Vendor has not knowingly included any matter which is
untrue or knowingly omitted from it any matter the omission of which
would make its contents materially misleading in the context in which
it appears.
2.2 So far as the Vendor is aware, each document specified in the
Disclosure Letter as being attached thereto or listed therein as an
agreed disclosure is a true and complete
<PAGE> 121
copy of the original of such document and, so far as the Vendor is
aware, there is no later document which supersedes or replaces any such
document.
2.3 The Data Room has been collated by the Vendor in good faith.
3 ACCOUNTS AND RECORDS
3.1 COMBINED ACCOUNTS
The Combined Accounts:
(a) have been prepared on a basis consistent with the accounting
policies and principles set out in paragraph 1, Part 1 of
Schedule 7 (excluding the reference to paragraphs 2-6 therein)
and the basis of preparation set out therein;
(b) fairly present in all material respects the state of affairs of
the Operations as at the Balance Sheet Date for the financial
year ended on that date.
3.2 MANAGEMENT ACCOUNTS
The Management Accounts have been properly prepared in accordance with
the principles set out in Part 1 of Schedule 7.
3.3 ACCOUNTING AND OTHER RECORDS
The statutory books and books of account and other records of
whatsoever kind relating to the Operations are up-to-date and
maintained in accordance with all applicable legal requirements on a
proper and consistent basis and contain complete and accurate records
of all matters required to be dealt with in such books. All such books
and records and all other documents (including documents of title for
all assets owned by the Business Sellers and Group Companies and copies
of all subsisting agreements to which any Group Company or Business
Seller is a party) are in the possession (or under the control) of the
relevant Group Company or Business Seller and no notice or allegation
that any is incorrect or should be rectified has been received.
<PAGE> 122
CHANGES SINCE BALANCE SHEET DATE
3.4.1 Since the Balance Sheet Date, the Operations have been carried
on in the ordinary course, without any interruption or
alteration in their nature, scope or manner and so as to
maintain the same as a going concern.
3.4.2 During the period between the Balance Sheet Date and the date
of this Agreement, there has been no material adverse change in
the financial or trading position of the Operations.
3.4.3 During the period between the Balance Sheet Date and the date
of this Agreement, no Wholly Owned Group Company has declared,
made or paid to its members any dividend or other distribution,
except as provided for in the relevant balance sheet.
3.4.4 Since the Balance Sheet Date, no Relevant Group Company has
allotted or issued or agreed to allot or issue any share or
loan capital or any other security giving rise to a right over
capital.
3.4.5 Since the Balance Sheet Date, no Relevant Group Company has
redeemed or purchased or agreed to redeem or purchase any of
its share capital.
4 LEGAL MATTERS
The Warranties set out at paragraphs 4.1, 4.2 and 4.3 shall not apply
to the Properties and no reference to any law or Licence (howsoever
expressed) in paragraphs 4.1 or 4.2 below shall be deemed to include a
reference (directly or indirectly) to any Environmental Laws (as
defined in Schedule 16) or Health and Safety Laws (as defined in
paragraph 10 of this Schedule). Save as set out in Schedule 16, it is
expressly acknowledged that no representation or warranty is given by
or on behalf of the Vendor or the Vendor's Group in this Agreement, in
any Subsidiary Agreement or otherwise in respect of any Environmental
Laws. The only represenatation or warranty given by or on behalf of the
Vendor or the Vendor's Group in respect of Health and Safety Laws is
set out in paragraph 10 of this Schedule.
<PAGE> 123
4.1 COMPLIANCE WITH LAWS
The Operations have at all times been carried on and are being carried
on so that there have been no breaches of applicable laws, regulations
and by-laws in each country in which they are carried on and there have
not been and are not any breaches by any Business Seller or Group
Company of its constitutional documents which would have a material
adverse effect on the Operations and neither the Vendor nor any Group
Company has received notice that there is any investigation or enquiry
by, or order, decree, decision or judgment of, any court, tribunal,
arbitrator, governmental agency or regulatory body outstanding or
anticipated against any Business Seller or Group Company or any person
for whose acts or defaults they may be vicariously liable which will
have a material adverse effect upon the Operations, nor has any notice
or other communication (official or otherwise) from any court,
tribunal, arbitrator, governmental agency or regulatory body been
issued with respect to an alleged actual or potential violation and/or
failure to comply with any such applicable law, regulation, by-law or
constitutional document, or requiring it/them to take or omit any
action and the Vendor is not aware of any circumstances which are
likely to give rise to any such investigation or enquiry.
4.2 LICENCES AND CONSENTS
Nothing in this paragraph 4.2 applies to Licences of Intellectual
Property Rights (including computer software).
4.2.1 All Third Party Consents (other than those relating to
Contracts) which are necessary for the transfer to a Relevant
Purchaser of the Operations or any part thereof or the entry
into or completion of this Agreement or any Subsidiary
Agreement have been obtained (other than those still required,
details of which are set out in the Disclosure Letter).
4.2.2 All licences, consents, authorisations, orders, warrants,
confirmations, permissions, certificates, approvals and
authorities (LICENCES) necessary for carrying on the Operations
as now carried on:
<PAGE> 124
(i) have been obtained, are in full force and effect, are in
the name of the Relevant Business Seller or Group
Company, have been and are being complied with in all
material respects and are not subject to any unusual or
onerous material conditions; and
(ii) the Vendor is not aware of any reason why any of them
should be suspended, threatened or revoked.
4.3 LITIGATION
4.3.1 During the two year period prior to Completion, no claim for
damages or otherwise has been made against any Business Seller
or against any Group Company which is or was material in the
context of the relevant Business or Group Company.
4.3.2 As at the date hereof, none of the Business Sellers or Group
Companies (or any person for whose acts or defaults any
Business Seller or Group Company may be vicariously liable) is
involved whether as plaintiff or defendant or other party in
any claim, legal action, proceeding, suit, litigation,
prosecution, investigation, enquiry or arbitration or other
legal proceedings or in any proceedings or hearings before any
statutory or governmental body, department or agency (other
than as plaintiff in the collection of debts arising in the
ordinary course of business) which is material in the context
of the relevant Business or Group Company and, so far as the
Vendor is aware, no such claim, legal action, proceeding, suit,
litigation, prosecution, investigation, enquiry or arbitration
has been threatened in writing or (so far as the Vendor is
aware) is pending by or against any Business Seller or Group
Company (or any person for whose acts or defaults any Business
Seller or Group Company may be vicariously liable).
4.3.3 As at the date hereof, so far as the Vendor is aware, there are
no investigations, disciplinary proceedings or other
circumstances likely to lead to any such claim or legal action,
proceeding, suit, litigation, prosecution, investigation,
enquiry or arbitration.
<PAGE> 125
4.3.4 There is no outstanding judgment, order, decree, arbitral award
or decision of any court, tribunal, arbitrator or governmental
agency against any Business Seller or Group Company (or any
person for whose acts the Business Seller or Group Company may
be vicariously liable) which is material in the context of the
relevant Business or Group Company.
4.4 ENVIRONMENTAL LIABILITY
The only environmental warranties relating to the Operations are
contained in paragraph 2 of Schedule 16.
4.5 INSOLVENCY
4.5.1 No order has been made, petition presented, resolution passed
or meeting convened for the winding up (or other process
whereby the business is terminated and the assets of the
company concerned are distributed amongst the creditors and/or
shareholders or other contributories) of any Group Company or
any Business Seller and there are no cases or proceedings under
any applicable insolvency, reorganisation or similar laws in
any jurisdiction concerning any Group Company or Business
Seller and, so far as the Vendor is aware, no events have
occurred which, under applicable laws, would justify any such
cases or proceedings.
4.5.2 No petition has been presented or other proceedings have been
commenced for an administration order to be made (or any other
order to be made by which, during the period it is in force,
the affairs, business and assets of the company concerned, are
managed by a person appointed for the purpose by a court,
governmental agency or similar body) in relation to any Group
Company or Business Seller in relation to the Operations, nor
has any such order been made.
4.5.3 No receiver (including an administrative receiver), liquidator,
trustee, administrator, custodian or similar official has been
appointed in any jurisdiction in respect of the whole or any
part of the business or assets of any Group Company or Business
Seller or in respect of any of the Business
<PAGE> 126
Seller's Assets and, so far as the Vendor is aware, no step has
been taken for or with a view to the appointment of such a
person.
4.5.4 No Group Company or Business Seller is insolvent or unable to
pay its debts as they fall due.
5 TRADING AND CONTRACTUAL ARRANGEMENTS
6.1 CAPITAL COMMITMENTS
There are no material capital commitments entered into or proposed by
or on behalf of any of the Business Sellers or Group Companies. For
these purposes, a material commitment is one involving capital
expenditure of over (pound)400,000.
5.2 ARRANGEMENTS WITH CONNECTED PERSONS ETC.
5.2.1 There is no indebtedness (actual or contingent) nor any
material indemnity, guarantee or security arrangement between
any Business Seller or Group Company or member of the Vendor's
Group and any current or former employee or director of any
Group Company or Business Seller or any husband or wife of such
persons.
5.2.2 No Business Seller or Group Company or member of the Vendor's
Group is or has been party to any material contract,
arrangement or understanding with any current or former
employee of director of any Group Company or Business Seller or
any husband or wife of such persons, or in which any such
person as aforesaid is interested (whether directly or
indirectly), other than on normal commercial terms in the
ordinary course of business.
5.2.3 There are no existing contracts or arrangements with a value in
excess of (pound)250,000 per annum between or involving any
Business Seller or Group Company and any member of the Vendor's
Group.
5.3 CONTRACTS
5.3.1 None of the Business Sellers or the Group Companies is party to
any unusual, long-term or onerous commitments, contracts or
arrangements or any such not wholly on an arm's length basis in
the ordinary course of business. For the purposes of this
warranty a long-term commitment, contract or arrangement is
<PAGE> 127
one which is incapable of termination by the relevant Business
Seller or Group Company on six months' notice or less.
5.3.2 None of the Business Sellers or the Group Companies is party to
any commitment, contract or arrangement which:
(i) involves hire purchase, conditional sale, sale of
receivables, credit sale, leasing, hiring or similar
arrangements in each case other than in the ordinary
course of business; or
(iii) involves income in excess of (pound)5,000,000 (five
million pounds) per annum OR, expenditure in excess of
(pound)5,000,000 (five million pounds) per annum (a
MATERIAL CONTRACT).
5.3.3 None of the Business Sellers or the Group Companies is party to
any agency, distributorship, marketing, purchasing,
manufacturing or licensing agreement or arrangement or any
agreement or arrangement which restricts its freedom to carry
on its business as currently carried on in any part of the
world in such manner as it thinks fit as to have a material
adverse effect on the relevant Business.
5.3.4 There are no powers of attorney or other authorities (express
or implied) which are still outstanding or effective to or in
favour of any person to enter into any contract or commitment
or to do anything on behalf of any Group Company (other than on
such authority of directors or of employees as either is
ostensible or is implied to enter into routine contracts in the
normal course of their duties).
5.4 COMPLIANCE WITH MATERIAL CONTRACTS
(i) No Business Seller or Group Company is in material
breach of any Material Contracts; and
(iii) so far as the Vendor is aware, there are no grounds for
rescission, avoidance or repudiation of any of the
Material Contracts.
<PAGE> 128
5.5 ANTI-TRUST
So far as the Vendor is aware, no Business Seller or Group Company is a
party to any agreement, arrangement or concerted practice or is
carrying on any practice which in whole or in part contravenes or is
invalidated by any competition, anti-trust, fair trading, state aid,
public procurement consumer protection or similar legislation
applicable in any jurisdiction where the Businesses are carried on
(including as regards the United Kingdom, and without prejudice to the
generality of the foregoing, the provisions of both the Competition Act
1998 and any legislation which ceases or will cease to have effect in
whole or in part by virtue of the Competition Act 1998) or in respect
of which any filing, registration or notification is, was or will be
required by such legislation or is advisable pursuant to such
legislation (whether or not the same has in fact been made).
5.6 Neither the Business Sellers nor any Group Company has paid to any
person any sum in the nature of a bribe or inducement.
5.7 Neither the Business Sellers nor any Group Company is a party to any
material confidentiality or secrecy agreement or undertaking or other
agreement which may restrict its use or disclosure of any information.
5.8 Other than restrictive covenants entered into by or binding upon the
Business Sellers or the Group Companies, no substantial part of the
Operations is carried on under the agreement or consent of third party,
nor is there any agreement which significantly restricts the field in
which the Business Sellers or the Group Companies carry on the
Operations.
5.9 There are not now outstanding any agreements or arrangements (whether
by way of guarantee, indemnity, warranty, representation or otherwise)
under which any Group Company is under a prospective or contingent
liability in respect of any disposal by such Group Company of its
assets or business or any substantial part thereof.
5.10 Neither the Vendor nor any member of the Vendor's Group nor any
Relevant Seller has given any guarantee or indemnity or created any
other like obligation in support of the Businesses or the Group
Companies that remains outstanding.
<PAGE> 129
5.11 None of the Group Companies have given any indemnity or created any
other like obligation in respect of any member of the Vendor's Group or
any Relevant Seller which remains outstanding.
5.12 Completion of this Agreement or any Subsidiary Agreement will not
result in the creation, crystallisation or enforcement of any charge,
mortgage, debenture or other security interest over any material asset
of any Business or Group Company.
6 EMPLOYEES
6.1 GENERAL
6.1.1 There are no persons employed in any of the Businesses or Group
Companies other than the Employees.
6.1.2 The Disclosure Letter contains details of the numbers and
categories of Employees at each Property as at the stated date.
The Disclosure Letter also contains details of the numbers and
categories of Employees employed at locations other than the
Properties.
6.1.3 Where Senior Employees have an individual contract of
employment, full details thereof have been disclosed in the
Disclosure Letter and where standard terms or collective
bargaining arrangements are applicable to Senior Employees,
full details thereof have been disclosed in the Disclosure
Letter (including details of which Senior Employees are
employed on which such terms and conditions and arrangements).
6.1.4 No Business Seller or Group Company is party to any contractual
arrangement to make material changes to remuneration or other
benefits or other terms of employment or collective bargaining
arrangements or to establish any new bonus or other incentive
arrangements for the Employees nor have there been any
proposals or announcements in relation to such matters.
6.1.5 True, up-to-date and complete copies of a representative sample
of the contracts of employment of the different categories of
Employees at each
<PAGE> 130
Property, and of those Employees employed at locations other
than the Properties, and any other material documents currently
in force relating to the terms and conditions of employment and
benefit entitlements of the Employees have been disclosed in
the Disclosure Letter together with copies of all consultancy
agreements currently in force relating to any Business or any
Group Company.
6.1.6 (i) There is no existing, pending or, so far as the Vendor is
aware, threatened dispute between any Business Seller or Group
Company and any Employee (or group of Employees) or any
consultant or any trade union or employee representatives of
any Employee and, (ii) so far as the Vendor is aware, there are
no circumstances (including this Agreement and Completion)
which are likely to give rise to any such dispute as is
referred to in (i).
6.1.7 In the case of each Business Seller in relation to each of its
present and former employees employed in any Business, and in
the case of each Group Company in relation to each of its
present and former employees, so far as the Vendor is aware,
each Business Seller and each Group Company has complied in all
material respects with all applicable laws and all of its
contractual obligations in relation to such employees and their
trade unions or employee representatives.
6.1.8 No Business Seller in relation to any Business, and no Group
Company, has agreed to make any payment or agreed to provide
any benefit, to any employee or former employee or any
consultant or former consultant in connection with the actual
or proposed termination of employment or consultancy or the
actual or proposed variation of any employment contract or
consultancy agreement of any such employee or former employee
or consultant or former consultant in each case where such
agreement to make or provide such payment or benefit has not
been discharged or otherwise satisfied. There are no agreements
or arrangements whether binding or otherwise, in relation to
any Employee for the payment of compensation on
<PAGE> 131
the termination of employment (other than as are required by
law or in accordance with the contracts of employment,
consultancy agreements and details of enhanced redundancy
entitlements which are disclosed in the Disclosure Letter).
6.1.9 All of the European Employees are employed by the Vendor or the
Relevant Seller at the Completion Date and are employed
exclusively in the Businesses and none of the European
Employees are required to perform duties for any other person.
6.2 TERMINATION OF EMPLOYMENT
For the purposes of this Clause 6.2 only, Senior Consultant means those
consultants engaged by the Businesses or the Group Companies whose fees
exceed (pound)60,000 per annum.
6.2.1 There are no proposals to terminate the employment of any
Senior Employees or Senior Consultants or to materially vary or
amend their terms of employment on consultancy (whether to
their detriment or benefit).
6.2.2 As at the date of this Agreement:
(i) no Senior Employee or Senior Consultant has given or
received notice terminating his employment or
engagement; and
(ii) so far as the Vendor is aware, neither this Agreement
nor Completion nor any Subsequent Completion will, or
is likely, to cause any such Senior Employee or Senior
Consultant to terminate his employment or engagement.
6.2.3 As at the date of this Agreement, no person previously employed
by any Business Seller or Group Company has a right to return
to work or any right to be reinstated or re-engaged by any
Business Seller or Group Company whether under statute or
otherwise.
6.2.4 No liability which remains undischarged has been incurred by
any Business Seller or Group Company for breach of any contract
of service or for
<PAGE> 132
termination payments or for compensation for dismissal, equal
pay, sex, race, disability or other discrimination or failure
to comply with any order for the reinstatement or re-engagement
of any of the Employees or former employees of a Business
Seller or Group Company.
6.3 PAYMENTS ON TERMINATION
6.3.1 The Business Sellers and each Group Company have paid to the
appropriate authorities all taxes and other contributions and
charges due and payable in respect of the Employees in respect
of their employment by any of the Business Sellers or Group
Companies up to Completion or such amounts have been or will be
accrued for in the Net Asset Statement.
6.3.2 Particulars of all loans made by any Business Seller or Group
Company to Employees or former employees or consultants which
are in excess of (pound)2,000 and which shall remain
outstanding at Completion, together with any sums promised or
owed by the Business Seller or Group Company to any Employee or
former employee or consultant (other than remuneration and
other contractual benefits accrued in the normal course of
business during the calendar month immediately prior to the
date of this Agreement) which are in excess of (pound)2,000 are
disclosed in the Disclosure Letter.
6.4 TERMINATIONS
Within the period of one year preceding the date hereof, where the
Business Sellers in relation to the Businesses, or any Group Company,
has been obliged by statute to give notice of the termination of
employment of any Employee to a relevant authority or start
consultations with any employee representative body, for example, a
trade union or Works Council, relating to any such termination the
relevant Business Seller or Group Company has complied with such
obligation. Save as disclosed in the Disclosure Letter there have been
no transfers covered by the Transfer Provisions relating to any
Business or Group Company.
6.5 COLLECTIVE BARGAINING
<PAGE> 133
6.5.1 The national collective bargaining agreements, industry wide
collective agreements, the other collective agreements, union
recognition agreements and European Works Council agreements,
all as disclosed in the Disclosure Letter are in all material
respects true, up-to-date and complete copies of all the
agreements whether or not legally binding between the Business
Sellers or Group Companies and any groups of employees, trade
unions or other representative bodies. The Business Sellers and
the Group Companies have in all material respects complied with
all such agreements.
6.5.2 The Disclosure Letter contains full details of (a) any enhanced
redundancy entitlement and any special redundancy procedure
applicable to any Employee; and (b) any redundancy programme
which is currently being implemented or negotiated in respect
of the Employees or any of them and any such programme will be
implemented in accordance with its original terms and time
schedule between the date of this Agreement and Completion.
6.6 PENSIONS AND OTHER EMPLOYEE BENEFITS
6.6.1 SCHEMES
(i) Other than the Employee Benefit Arrangements and the
State Schemes there are no arrangements in existence at
the date of this Agreement (or in respect of which any
proposal or announcement has been made) for the payment
of, provision for, or contribution towards, any
pensions, allowances, lump sums or other like benefits
on retirement, death, disability or voluntary
withdrawal from, or involuntary termination of,
employment which are for the benefit of any Employee or
any past employee of a Group Company or for the benefit
of persons dependent on any such Employee or past
employee.
(ii) Other than the BICC Savings-Related Share Option Scheme
1991, the BICC Executive Share Option Scheme 1991, the
BICC UK Executive Share Option Scheme (Unapproved), the
BICC CAFCA Share Option Scheme and the BICC Long-Term
Incentive Plan (together, the
<PAGE> 134
EMPLOYEE SHARE SCHEMES) there are no arrangements in
existence for the grant of options over shares and/or
for the grant of shares in the Vendor to Employees.
6.6.2 DISCLOSURE
(i) There have been disclosed to the Purchaser in the
Disclosure Letter copies of such relevant documents
governing or relating to the Employee Benefit
Arrangements necessary to establish entitlements to
benefits together with full information about
discretionary practices in relation to the Employee
Benefit Arrangements.
(ii) There have been disclosed to the Purchaser in the
Disclosure Letter copies of all such relevant documents
governing or relating to the Employee Share Schemes
necessary to establish entitlement to benefits.
(iii) There has been disclosed to the Purchaser in the
Disclosure Letter for each Employee Benefit Arrangement
in respect of which there is a legal requirement to
have an actuarial valuation and the liability for which
will transfer to the Purchaser after the Completion
Date, a copy of the most recent actuarial valuation,
together with the latest trustees' report and accounts
(or nearest equivalent in jurisdictions outside the
United Kingdom).
6.6.3 REGULATION
The Employee Benefit Arrangements and the Employee Share
Schemes are in material compliance with their terms and with
all applicable laws, regulations and government taxation or
funding requirements. As far as the Vendor is aware there has
been no failure to comply with any applicable law, regulation
or requirement, or any other circumstance, which would or might
result in the loss of tax approval or other regulatory approval
for or qualification of any of the Employee Benefit
Arrangements or the Employee Share Schemes.
<PAGE> 135
6.6.4 CLAIMS
None of the Business Sellers nor the Group Companies is a party
to any litigation or other proceedings relating to any of the
Employee Benefit Arrangements or the Employee Share Schemes. So
far as the Vendor is aware, there is no litigation or other
proceedings or outstanding claims in relation to any of the
Employee Benefit Arrangements or the Employee Share Schemes
which would or might affect any Employee or any past employee
of a Group Company or any person dependent on any such Employee
or past employee.
6.6.5 DATA
A list or computer data of the Employees and any persons
dependent on such Employees (and any past employees of a Group
Company and any persons dependent on any such past employees)
containing all particulars of them necessary to establish their
entitlement to benefits under the Employee Benefit Arrangements
has been supplied to the Purchaser by electronic submission on
10 March 1999 from Watson Wyatt Partners to Deloitte and
Touche.
6.6.6 CONTRIBUTIONS
The current rates of employer's and employee's contributions
payable in respect of the Employee Benefit Arrangements have
been disclosed in the Disclosure Letter and all such
contributions up to and including the Completion Date have been
paid or will have been paid by the Completion Date.
6.6.7 INSURED BENEFITS
All insured benefits under the Employee Benefit Arrangements
are now and will up to and including the Completion Date be
fully insured under policies effected with insurance companies
as disclosed in the Disclosure Letter; such companies have been
supplied with all appropriate information and such
<PAGE> 136
information was complete and accurate; cover under such
policies is provided at the relevant insurance company's normal
rates and on its normal terms for persons in good health; all
premiums due under such policies have been paid or will have
been paid by the Completion Date; and so far as the Vendor is
aware, there are no grounds on which any such policies may be
avoided.
6.6.8 FUNDING
Each of the Employee Benefit Arrangements is fully funded,
financed or provided for in accordance with local actuarial and
accounting practice and principles for an ongoing pension
scheme.
7 TAXATION
7.1 RETURNS AND INFORMATION
All returns, computations, notices, information and records which are
or have been required to be maintained, made or given by each Group
Company for any Taxation purpose have so far as is material been made
or given within the requisite periods and on a proper basis and are
up-to-date and correct.
7.2 VAT MATTERS RELATING TO THE GROUP COMPANIES
Each Group Company has complied in all material respects with all
statutory requirements, orders, provisions, directions or conditions
relating to VAT.
7.3 RESIDENCE
Save as disclosed in the Disclosure Letter, each Group Company is, and
has since its incorporation been, resident for tax purposes only in the
Jurisdiction in which it is incorporated.
7.4 DOUBLE TAX TREATIES
Save as disclosed in the Disclosure Letter, each Group Company is
entitled to claim the benefit of any double taxation agreement or
convention entered into between the Jurisdiction in which it is
resident and any other relevant jurisdiction.
<PAGE> 137
7.5 The amount of Taxation chargeable on any Group Company during any
accounting period ending on or within three years prior to the Balance
Sheet Date has not, to any material extent, depended on any concession,
agreement or other formal or informal arrangement with any Taxation
authority.
7.6 No chargeable gain or profit would arise if any asset of any Group
Company (other than trading stock) were to be realised for a
consideration equal to the book value thereof as shown in the Accounts.
7.7 All documents in the possession of any Group Company or to the
production of which any Group Company is entitled and which attract
stamp or transfer duty in any jurisdiction have been duly stamped.
8 ASSETS AND LIABILITIES
8.1 TITLE
8.1.1 All the Assets (other than Intellectual Property and the
Properties but including all debts due to each Group Company or
Business Seller) which are included in the Combined Accounts or
which at the Balance Sheet Date were used or held for the
purposes of the business of each Group Company or Business
Seller, were at the Balance Sheet Date the absolute property of
such Group Company or Business Seller (save for those
subsequently disposed of or realised in the ordinary course of
trading) and all such Assets and debts and all Assets and debts
which have been acquired or arisen between the Balance Sheet
Date and the date hereof are at the date hereof the absolute
property of such Group Company or Business Seller and none is
the subject of any assignment or Encumbrance (excepting only
liens arising by operation of law in the normal course of
trading) or the subject of any factoring arrangement,
hire-purchase, conditional sale or credit sale agreement.
8.1.2 All the Assets are, where capable of possession, in the
possession of or under the control of the relevant Business
Seller or Group Company.
8.1.3 The Share Sellers are entitled to sell and transfer to the
Purchaser the full legal and beneficial ownership of the Shares
on the terms of this Agreement
<PAGE> 138
or any Subsidiary Agreement without any Third Party Consent.
The Shares comprise the whole of the allotted and issued share
capital of the Companies, have been properly and validly
allotted and issued and are each fully paid.
8.1.4 A Company or a Group Company (where specified in Schedule 2) is
the sole beneficial owner of all the issued or allotted shares
of the Subsidiaries free from any Encumbrances and all such
shares are fully paid or credited as fully paid.
8.1.5 No person has the right (whether exercisable now or in the
future and whether contingent or not) to call for any
allotment, conversion, issue, sale or transfer of any share or
loan capital or any other security giving rise to a right over
the capital of any Group Company under any option or other
agreement (including conversion rights and rights of
pre-emption) and there are no Encumbrances over such capital or
arrangements or obligations to create any such Encumbrances and
there is no agreement or commitment to give or create any of
the foregoing and no person has claimed in writing to be
entitled to any of the foregoing.
8.1.6 All the information set out in Schedules 1 and 2 is complete
and accurate in all respects.
8.1.7 The Companies have no:
(i) interest in the share capital of, or other investment
in, any body corporate other than the Subsidiaries;
(ii) interest in any partnership joint venture, consortium
or other unincorporated association or arrangement for
sharing profit other than the Subsidiaries.
8.1.8 No Group Company has made or is proposing to make any
distribution or dividend except out of profits available for
the purpose.
<PAGE> 139
8.2 INSURANCE
Summary particulars of the insurances of the Business Sellers and the
Group Companies material to the Operations as at the date of this
Agreement are contained in the Data Room.
8.3 MOVEABLE ASSETS
The Moveable Assets material to the Operations as currently conducted
are in satisfactory working order (allowing for fair wear and tear and
having regard to the age of such Assets) and have been properly
maintained.
8.4 INTELLECTUAL PROPERTY
8.4.1 REGISTERED INTELLECTUAL PROPERTY
(i) The registered Intellectual Property (REGISTERED
INTELLECTUAL PROPERTY) listed in Parts A, B and C of
Schedule 15, is legally and beneficially owned, free
from Encumbrances, by the Group Companies or the
Business Sellers. Schedule 15 sets out complete and
accurate particulars of all Registered Intellectual
Property which is used in connection with the
Operations.
(ii) All registration, application and renewal fees
regarding the Registered Intellectual Property due on
or before Completion have been paid in full and all
steps have been taken to progress applications and
maintain registrations.
(iii) The Registered Intellectual Property is not the subject
of any challenge, claim or proceedings and as far as
the Vendor is aware, there are no facts or matters
which give rise to any challenge, claim or proceedings
in relation to the Registered Intellectual Property.
(iv) The Registered Intellectual Property is not the subject
of any licence in favour of another except as set out
in Schedule 15.
8.4.2 OTHER INTELLECTUAL PROPERTY
(i) All Intellectual Property and Know-how which is
material to the Operations is legally and beneficially
owned by, licensed to or used
<PAGE> 140
under the authority of the owner by the Group Companies
or the Business Sellers.
(ii) All Know-how legally or beneficially owned by the Group
Companies or the Business Sellers is, as far as the
Vendor is aware, free from all Encumbrances save for
any third party rights disclosed in the Disclosure
Letter or Schedule 15.
(iii) All Intellectual Property legally or beneficially owned
by the Group Companies or the Business Sellers is, as
far as the Vendor is aware:
(a) valid and enforceable and not subject to any
current application for licences of right under
the Patents Act 1977 (UK) (or legislation
corresponding thereto in other jurisdictions);
(b) not being infringed or attacked or opposed by
any person; and
(c) subject to any third party rights disclosed in
the Disclosure Letter or in Schedule 15, free
from all Encumbrances.
(iv) As far as the Vendor is aware, no activity of any Group
Company or Business Seller infringes the Intellectual
Property or constitutes the misuse of the Know-how of a
third party and neither the Vendor nor any Group
Company or Business Seller has received any
notification of infringement relating to any such
activity.
8.4.3 Schedule 15 details all material licences or rights in respect
of any Intellectual Property or Know-how of a third party to
which the Group Companies or the Business Sellers are party and
all material software contracts to which the Group Companies or
Business Sellers are party and (in the case of the Business
Sellers) the software is used exclusively or primarily in the
Operations. As far as the Vendor is aware, the Group Companies
and the Business Sellers have not breached the terms of any
Licence Agreement. As far as the Vendor is aware, the Licence
Agreements have been and are being complied with in all
material respects and the Vendor is not aware of any
<PAGE> 141
reason why any of the Licence Agreements should be suspended or
terminated.
8.4.4 Save as disclosed in Schedule 15 the Group Companies and the
Business Sellers have not granted and are not obliged to grant
any licenses under any Intellectual Property and Know-how used
in the Operations owned by it or licensed to it by any person.
8.4.5 As far as the Vendor is aware no disclosure has been made to
any person other than the Purchaser of any of the Confidential
Information (as such term is defined in Clause 21.2.5 for the
purposes of Clause 21.2.1) and Know-how, of the Group Companies
or Business Sellers which is used in the Operations except in
the ordinary course of business and on the footing that such
disclosure is to be treated as being of a confidential nature.
8.4.6 As far as the Vendor is aware, there exists no actual or
threatened infringement or any event likely to constitute an
infringement or breach by any third party of any of the
Intellectual Property owned by the Group Companies or the
Business Sellers. As far as the Vendor is aware, there exists
no actual or threatened mis-use by any third party of any of
the Know-how owned by the Group Companies or the Business
Sellers.
8.4.7 All patentable inventions made by any employees of a Group
Company or the Business Sellers and used in the Operations were
made in the course of the normal duties of the employee
concerned and no claim for compensation under Section 40,
Patents Act 1977 or legislation corresponding thereto in other
jurisdictions or otherwise has been made against the Group
Companies or the Business Sellers nor so far as the Vendor is
aware are any such claims likely to be made.
8.4.8 As far as the Vendor is aware, the Group Companies and the
Business Sellers have complied in all respects with the
provisions of the Data Protection Act 1984 or legislation
corresponding thereto in other jurisdictions.
<PAGE> 142
8.4.9 Schedule 15 sets out details of all collaboration and
development agreements entered into relating exclusively or
primarily to the Operations.
8.4.10 All Intellectual Property and Know-how required for the
Operations as currently being carried on are either included in
the Assets or are Retained Intellectual Property or Retained
Know-how or are owned by or licensed to the Group Companies.
8.4.11 Where Registered Intellectual Propety set ou in Schedule 15 is
owned jointly, subjec to any legislative restrictions, there is
no impediment to the Business Seller assigning its rights in
such Registered Intellectual Property to te Relevant Purchaser
under this Agreement
8.5 INFORMATION TECHNOLOGY
8.5.1 Reasonable steps have been taken to back up electronically
stored information and software which is critical to the
Operations and the Group Companies and the Business Sellers
have made reasonable disaster recovery and security
arrangements in relation to Information Technology material to
the Operations.
8.5.2 As far as the Vendor is aware, in the twelve months prior to
the date hereof, the Group Companies and the Business Sellers
have not suffered any significant failures or bugs in or
breakdowns of Information Technology material to the Operations
which either have not been remediated or which are not being
remedied at the date hereof and whilst such remedies are being
effected the failures, bugs or breakdowns are not causing any
significant disruption to any of the Operations.
8.5.3 The Data Room contains an accurate summary of the policies,
major steps and progress made by the Group Companies and the
Business Sellers to ensure that the Information Technology used
in the Operations will be Millennium Compliant and as far as
the Vendor is aware, the Group Companies and the Business
Sellers have complied with all such policies and steps.
<PAGE> 143
8.5.4 For the purposes of this paragraph 8.5, INFORMATION TECHNOLOGY
means all computer systems, communications systems, software,
computer hardware and other similar information technology used
in connection with or required to carry on the business of the
Group Companies or Business Sellers (as they relate to the
Operations).
8.5.5 For the purposes of paragraph 8.5.3 MILLENNIUM COMPLIANT will
have the meaning given to it in BSIPD-DISC 2000-1.
9 PROPERTIES
9.1 PROPERTIES
Details of all real property owned or occupied or used by any Business
Seller or Group Company are set out in Schedule 13 and the particulars
contained or referred to therein are true and correct.
9.2 TITLE
Each relevant Business Seller or Group Company listed in Schedule 13 is
the legal and (where applicable in the relevant Jurisdiction)
beneficial owner of the Property or Properties of the tenure specified
against its name.
9.3 RIGHTS AND EASEMENTS
Each Property has the benefit of such rights and easements which are
necessary for the existing use of the Property.
9.4 PERFORMANCE OF OBLIGATIONS AFFECTING PROPERTIES
So far as the Vendor is aware, the relevant Business Seller has not
received any subsisting written notice of any material breach of any
obligation, condition, restriction, agreement or statutory requirement
affecting each Property, its occupation of such Property or the
existing use thereof.
9.5 DISPUTES AND NOTICES
So far as the Vendor is aware, there is no outstanding dispute or
notice affecting any Property which has a material adverse effect on
the Operations carried out at such Property.
<PAGE> 144
9.6 USE
So far as the Vendor is aware, there is no written notice of any
outstanding dispute as to the use of the Property or any contravention
of the relevant planning legislation or any alleged breach of planning
legislation which has a material adverse effect on the Operations
carried out at such Property.
9.7 PLANNING/HIGHWAYS
In relation to each of the Business Seller's Properties in England and
Wales:
9.7.1 The Vendor is not aware of any subsisting notices of breaches
of the Planning and Highway Laws.
9.7.2 No planning application has been submitted by the Vendor which
awaits determination.
9.7.3 So far as the Vendor is aware no:
(i) enforcement action within the meaning of section
171A(2) of the Town and Country Planning Act 1990;
(ii) claim for breach of any Planning Agreement; or
(iii) prosecution under the terms of any permission,
authorisation or agreement under Planning and Highway
laws or in connection with such Laws
which is subsisting has been served upon the Vendor by any
relevant Planning Authority in respect of any such Business
Seller's Properties.
9.7.4 So far as the Vendor is aware, no Group Company is required
under Planning and Highway Laws to incur any material
expenditure or take or desist from taking any action which
would require unbudgeted expenditure under the 1999 budget of
BICC Cables - BICC Energy (disclosed in the Data Room) on any
such Business Seller's Properties in excess of (pound)100,000
per item of expenditure or loss as the case may be.
For the purposes of warranty 9.7 the following definitions will apply:
<PAGE> 145
PLANNING AGREEMENT means any legally binding agreement made between the
Vendor and any Planning Authority in respect of such Business Seller's
Properties under section 52 of the Town and Country Planning Act 1971,
section 106 of the Town and Country Planning Act 1990 and section 278
of the Highways Act 1980 or such equivalent predecessor statutory
provisions;
PLANNING AUTHORITY means any local or central government authority
granted powers under Planning and Highway Laws; and
PLANNING AND HIGHWAY LAWS means all the laws of the United Kingdom
relating to town and country planning and the use of public highways
that may apply to such Business Seller's Properties.
9.8 LEASES
So far as the Vendor is aware:
(i) there is no material breach of lease terms which are
likely to adversely affect the business carried out at
the relevant Property;
(ii) any principal rent payable in respect of the Property
is not in the course of being reviewed other than on
rent review terms provided in the relevant Lease.
9.9 PROPERTY SUBJECT TO OCCUPATIONAL INTERESTS
Where any Property is subject to any lease or licence in favour of a
third party, so far as the Vendor is aware it has had no reason to
notify the lessee or licensee of any breach of its obligations under
the lease or licence.
9.10 TITLE
All the documents relating to the title to each of the Business
Sellers' Properties in England and Wales have been produced to the
Purchaser's Lawyers (save as disclosed by the Special Conditions of
Sale).
9.11 ENQUIRIES
So far as the Vendor is aware the written replies given by or on behalf
of the Vendor to enquiries raised by the Purchaser's Lawyers in respect
of each of the Properties in
<PAGE> 146
England , Wales and Italy are true, complete and accurate in all
respects and not misleading.
9.12 BICC SUPERTENSION CABLES (1980) LIMITED
The Company known as BICC Supertension Cables (1980) Limited has not at
any time been the owner of any interest in real property whether
freehold or leasehold.
10 HEALTH & SAFETY
10.1 DEFINITIONS:
10.1.1 HEALTH AND SAFETY LAWS means all applicable laws (including for
the avoidance of doubt common law) statutes regulations
statutory guidelines and final and binding court and other
tribunal decisions of any relevant jurisdiction or any
constituent part thereof (including without limitation the law
of the European Union) in force in the relevant jurisdiction at
Completion which relate to the health and safety (including for
the avoidance of doubt the protection of hearing) of employees
contractors and invitees in the workplace and all bylaws,
codes, regulations, decrees, demands or demand letters,
injunctions, judgements, notices or notice demands, orders or
plans issued or promulgated or approved thereunder or in
connection therewith to the extent that the same have force of
law at Completion.
10.1.2 HEALTH AND SAFETY PROCEEDINGS MEANS:
(a) any civil, criminal or regulatory suit or proceedings;
(b) any application for judicial review;
(c) any arbitration or dispute resolution procedure;
(d) any application for injunctive relief or for a
declaration;
(e) any investigation undertaken by or on behalf of any
relevant regulatory authority under Health & Safety
Laws pursuant to which the authority may order
enforcement action or compel Remedial Action; and
(f) any court order, or any statutory or legislative notice
or written notification issued by a relevant regulatory
authority forming part of an administrative or judicial
action or regulatory procedure which
<PAGE> 147
determines a violation of any Health and Law, assesses
any civil, regulatory or criminal penalty, prohibits or
imposes restrictions upon the operations of the
Business or which requires action to be taken or
operations to be modified.
relating to, concerning or affecting any Health and Safety Laws.
10.1.3 "RELEVANT PERIOD" shall bear the meaning ascribed to it in
Schedule 16.
10.2 HEALTH AND SAFETY WARRANTIES:
10.2.1 Each Group Company and Business Seller is operating and so far
as the Vendor is aware during the Relevant Period has conducted
the Operations in compliance in all material respects with
Health and Safety Laws.
10.2.2 Neither the Vendor nor any Group Company has received written
notice during the Relevant Period of Health and Safety
Proceedings against the Vendor or any Group Company or its past
or present directors, secretary or senior employees in their
capacity as such.
10.2.3 Neither the Vendor nor any Group Company has received written
notification during the Relevant Period that it is or is likely
to be required by any Health and Safety Laws or as a result of
any Health and Safety Proceedings to incur any material
expenditure or to desist from taking any action which might
have a material adverse effect on the financial condition of
the Operations.
<PAGE> 148
SCHEDULE 9
WARRANTIES FROM THE PURCHASER
1 AUTHORITY AND CAPACITY
1.1 The Purchaser is and each Relevant Purchaser is or will on Completion
be a company duly incorporated and validly existing under its
respective laws of incorporation.
1.2 The Purchaser has and each Relevant Purchaser will have, the legal
right and full power and authority to enter into and perform this
Agreement and any other agreement entered into pursuant to this
Agreement and each such agreement when executed will constitute valid
and binding obligations on the Purchaser, and/or each Relevant
Purchaser (as the case may be) in accordance with their respective
terms.
1.3 The execution and delivery of, and the performance by the Purchaser
and/or each Relevant Purchaser (as the case may be) of their respective
obligations under, this Agreement and any other agreement entered into
pursuant to this Agreement will not:
1.3.1 result in a breach of any provision of the constitutional
documents of the Purchaser and/or each Relevant Purchaser (as
the case may be); or
1.3.2 result in a breach of any agreement, licence or other
instrument, order, judgment or decree of any Court,
governmental agency or regulatory body to which the Purchaser
and/or each Relevant Purchaser (as the case may be) is a party
or by which the Purchaser and/or each Relevant Purchaser (as
the case may be) is bound.
1.4 All corporate action required by the Purchaser and/or each Relevant
Purchaser (as the case may be) validly and duly to authorise the
execution and delivery of, and to exercise its rights and perform its
obligations under, this Agreement and any other agreement entered into
pursuant to this Agreement has been duly taken.
2 FINANCING
<PAGE> 149
The Purchasers' Guarantor has entered into a definitive commitment
letter and term sheet with The Chase Manhattan Bank and Chase
Securities Inc. (collectively, CHASE), dated 6th April 1999, which
among other things, commits Chase to provide up to approximately
$1,100,000,000 of senior secured financing (such commitment letter and
term sheet, being the COMMITMENT). The Commitment has not been modified
or amended in any respect (except as approved in writing by the Vendor)
and is in full force and effect as of the date hereof and as of the
Completion Date. Together with proceeds to be made available under the
Commitment, the Purchasers' Guarantor has available, and will make
available to each Purchaser and Relevant Purchaser (as defined in both
this Agreement and the North American Sale and Purchase Agreement),
sufficient funds to pay the Purchase Price (as defined in both this
Agreement and the North American Sale and Purchase agreement) and
consummate the transactions contemplated pursuant to each such
agreements in accordance with the terms and conditions thereof. The
Purchasers' Guarantor is not aware of any fact or circumstance which
would prevent the financing described in the Commitment from being
provided to the Purchaser.
<PAGE> 150
SCHEDULE 10
TRANSFER TAXES AND VAT
1 UK - VAT GENERAL
The parties intend that the UK Business shall be sold as a going
concern for VAT purposes and accordingly the following actions shall be
taken in the United Kingdom:
1.1 the Vendor and the Purchaser shall when required to do so give notice
of such sale, or procure that notice of such sale is given, to the
relevant Taxation authorities as may be required by law;
1.2 the Vendor (having obtained any necessary direction from any Taxation
authority) shall procure that all records are retained and preserved in
such a manner and for such periods as may be required by law and to
give the Purchaser as from Completion reasonable access during normal
business hours to such records; and
1.3 after Completion the Purchaser shall, or shall procure that the
Relevant Purchaser shall, to the extent required by applicable law for
the purposes of any exemption or relief from VAT:
1.3.1 use the Assets comprised in the UK Business in carrying on the
same kind of business, whether or not as part of any existing
business of the Relevant Purchaser, as that carried on by the
Vendor; and
1.3.2 be registered for VAT or (as a result of acquiring the UK
Business) be liable to be registered, in the same country as
the Vendor.
2 UK - GOING CONCERN
2.1 The Vendor shall promptly apply to HM Customs and Excise for
confirmation that the sale of the UK Business is to be treated as
neither a supply of goods nor a supply of services for VAT purposes.
The Vendor and Purchaser shall promptly agree the form of that
application and use all reasonable endeavours to ensure that
satisfactory confirmation is obtained as soon as possible thereafter
from HM Customs and Excise that the sale is to be so treated.
<PAGE> 151
2.2 If and to the extent that HM Customs and Excise have before Completion
expressly indicated that the sale of the UK Business cannot be treated
in the manner contemplated by paragraph 1 above, the Purchaser shall
(against production of tax invoices in respect thereof) in addition to
any amounts expressed in this Agreement to be payable by the Purchaser
pay on Completion the amount of any VAT which as a result of that
indication may be chargeable on the sale of the UK Business under this
Agreement. If no such indication shall have been given before
Completion, then no amount in respect of VAT shall be paid by the
Purchaser on Completion, but to the extent that VAT shall subsequently
be determined by the relevant Taxation authority to be payable on the
sale of the UK Business, the Purchaser shall in addition to any amount
expressed in the Agreement to be payable by the Purchaser pay to the
Vendor such VAT and, unless due to unreasonable delay or default by the
Vendor, any penalty or interest incurred by the Vendor for late payment
thereof, such payment by the Purchaser to be made forthwith against
evidence that the due date for payment of such tax has fallen due or
will fall due within seven days or if later against delivery by the
Vendor to the Purchaser of the appropriate tax invoice.
2.3 Nothing in this paragraph 2 shall require the Vendor to make any appeal
to any tribunal or court against or otherwise challenge any
determination of any Taxation authority that the sale does not fall to
be treated as the transfer of a going concern.
2.4 If any amount paid by the Purchaser to the Vendor in respect of VAT
relating to the sale of the UK Business pursuant to this Agreement is
subsequently found to have been paid in error the Vendor shall if has
not yet been accounted for the VAT to the relevant Taxation authority,
procure that such amount is promptly repaid to the Purchaser, and if
such VAT has already been so accounted for then the Vendor shall at the
expense of the Purchaser use reasonable endeavours to obtain repayment
thereof from the relevant Taxation authority and on receiving repayment
from the relevant Taxation authority shall pay to the Purchaser the
total amount repaid together with any repayment supplement.
<PAGE> 152
The Vendor warrants that no Property comprised in the UK Business is a
capital item the input tax on which may be subject to adjustment in
accordance with the provisions of Part XV of the Value Added Tax
Regulations 1995.
3 UK PROPERTIES AND VAT
3.1 Where in relation to any Property comprised in the UK Business the
Vendor has within 14 days prior to Completion:
3.1.1 notified the Purchaser in writing that the transfer of that
Property under this Agreement would, but for the sale being
treated in the manner contemplated in paragraph 1 above, fall
within paragraph (a) of Item 1 of Group 1 of Schedule 9 VATA
1994; or
3.1.2 notified the Purchaser in writing that the Vendor or a relevant
associate of the Vendor (as defined for the purposes of the
relevant legislation) has elected under the provisions of
Article 13(C)(b) of the EEC Sixth Directive (77/388/EEC) and
that the election has not been revoked and has delivered to the
Purchaser a certified copy of such election together with a
certified copy of the written permission of the relevant
Taxation authority to make such election where such written
permission is required by law;
the Relevant Purchaser shall elect under the provisions of Article
13(C)(b) of the EEC Sixth Directive (77/388/EEC) in relation to that
Property with effect on or prior to the earliest date on which the
Property concerned is to be transferred and shall give written
notification to the relevant Taxation authority as required by law no
later than that date and shall not seek the revocation of the election
prior to the transfer of the Property. The Purchaser shall deliver
copies of such election stamped by the relevant Taxation authority
showing receipt thereof and in default of delivery thereof by
Completion shall in addition to any amounts expressed in the Agreement
to be payable by the Purchaser (on behalf of the Relevant Purchaser) in
respect of the said Property pay to the Vendor at Completion (against
delivery by the Vendor of an appropriate tax invoice for VAT purposes)
an additional amount in respect of VAT thereon.
<PAGE> 153
3.2 Save as the Vendor shall have notified otherwise to the Purchaser in
writing in accordance with paragraph 3.1, neither the Vendor nor any
relevant associate has made an election under the provisions of Article
13(C)(b) of the Sixth Directive (77/388/EEC), in relation to any land
or buildings to be transferred under this Agreement, and no transfer of
land or buildings under this Agreement would, but for the sale being
treated as neither a supply of goods nor a supply of services for VAT
purposes, fall within paragraph (a) of Item 1 of Group 1 of Schedule 9
VATA 1994.
4 OTHER BUSINESSES AND SHARES - VAT
4.1 Any VAT which is payable in respect of the sale of any Shares or of the
Businesses other than the UK Business shall be paid by the Purchaser in
addition to the consideration expressed to be payable in Clause 3. Such
VAT shall be paid by the Purchaser on Completion, unless the Purchaser
applies or requests the Vendor to apply for any relief or exemption
from VAT. If an application is made for any relief or exemption from
VAT but the relevant Taxation authority determines that such relief or
exemption is not available, the Purchaser shall promptly pay, on
receipt of such determination to the Vendor an amount in respect of any
VAT chargeable on the sale of the relevant Shares or Business together
with any interest and penalties incurred for late payment thereof
(unless due to unreasonable delay or default by the Vendor).
4.2 The Vendor shall, at the expense of the Purchaser, provide the
Purchaser with such reasonable assistance as the Purchaser may request
in order to obtain any relevant exemption or relief from VAT in the
relevant jurisdictions in respect of the sale of any of the Shares or
Businesses other than the UK Business.
5 TRANSFER TAXES
The Purchaser and the Vendor shall each pay, or procure payment of, 50
per cent of all stamp and other transfer and registration taxes and
duties payable in respect of the sale and purchase of the Operations.
<PAGE> 154
SCHEDULE 11
EMPLOYEES
1 COMPANIES EMPLOYEES
1.1 The Vendor shall procure that each Relevant Group Company shall where
required by the relevant local law inform and consult with recognised
trade unions or other employee representatives about the sale of the
Shares and/or fulfil any obligations to notify any statutory or other
authority whatsoever about the sale of the Shares.
1.2 The Vendor (on behalf of itself and the Relevant Seller) and the
Purchaser (on behalf of itself and the Relevant Purchaser) shall give
each other such assistance as either may reasonably require in
contesting or otherwise dealing with any claim by any Companies
Employee resulting from or in connection with this Agreement.
2 EUROPEAN EMPLOYEES
2.1 The Vendor (on behalf of itself and the Relevant Seller) and the
Purchaser (on behalf of itself and the Relevant Purchaser) accept and
agree that by virtue of Completion the Transfer Provisions shall
operate to transfer the contract of employment of each European
Employee to the Relevant Purchaser in accordance with the legal effect
of the Transfer Provisions in the relevant European Country and
accordingly the Purchaser shall, or shall procure that the Relevant
Purchaser shall, in so far as the Transfer Provisions in the relevant
European Country requires employ each such European Employee with
effect from the Completion Date (which shall be the time of transfer
under the Transfer Provisions) and the Purchaser shall, or shall
procure that the Relevant Purchaser shall, in so far as the Transfer
Provisions in the relevant European Country requires treat each such
Employee's continuous period of service with the Vendor or Relevant
Seller as continuous with such Employee's continuous period of service
with the Relevant Purchaser.
2.2 Save as otherwise provided in the Net Asset Statement the Vendor will,
or will procure that each Relevant Seller will, perform and discharge
all their obligations in respect of each European Employee in relation
to any period prior to the Completion Date (which shall for the
avoidance of doubt include, but not be limited to wages, salary,
<PAGE> 155
bonus, commission, pension contributions and taxes arising out of the
employment relationship).
2.3 Save as otherwise provided in the Net Asset Statement the Purchaser
will, or will procure that the Relevant Purchaser will, perform and
discharge all their obligations transferred to them under the Transfer
Provisions in the relevant European Country in respect of each European
Employee in relation to any period from and including the Completion
Date (which shall for the avoidance of doubt include, but not be
limited to, wages, salary, bonus, commission, pension contributions,
and taxes arising out of the employment relationship).
2.4 The Vendor (on behalf of itself and the Relevant Seller) shall be
responsible for and shall fully indemnify and keep indemnified the
Purchaser (on behalf of itself and the Relevant Purchaser) from and
against all and any Employment Liabilities arising from any actual or
alleged act or omission of the Vendor or the Relevant Seller in
relation to any European Employee in respect of any period prior to the
Completion Date (whether brought by a European Employee or any trade
union or other employee representative) including those which are
deemed by virtue of the Transfer Provisions in the relevant European
Country to be an act or omission of the Relevant Purchaser (including
the Purchaser) after the Completion Date (provided that for the
avoidance of doubt it is agreed this indemnity is not intended to
indemnify the Purchaser from and against any Employment Liabilities
arising on or after the Completion Date solely by reason of the Vendor
or Relevant Seller entering into a contract of employment or collective
agreement in the normal course of business so far as in the case of a
contract of employment such contract is in a form disclosed in the Data
Room and, in the case of a collective agreement, it is disclosed in the
Data Room.
2.5 The Purchaser (on behalf of itself and the Relevant Purchaser) shall be
responsible for and shall fully indemnify the Vendor and keep the
Vendor indemnified (on behalf of itself and the Relevant Seller) from
and against all and any Employment Liabilities arising from any actual
or alleged act or omission of the Purchaser or the Relevant Purchaser
in relation to any European Employee (except those Employees who fall
<PAGE> 156
within Clause 2.6 below) in relation to any period on or after the
Completion Date (whether brought by a European Employee or any trade
union or other employee representative).
2.6 If, within the period of three months following the Completion Date,
the Transfer Provisions are found not to apply to any person who is a
European Employee, the Purchaser (on behalf of itself and the Relevant
Purchaser) agrees that:
(g) in consultation with the Vendor, the Relevant Purchaser
shall within five Business Days of being so requested
by the Vendor, or if the Relevant Purchaser so chooses,
make or procure to be made to each such European
Employee an offer in writing to employ him or her under
a new contract of employment to take effect upon the
termination referred to below; and
(h) the offer to be made will be such that (i) the
provisions of the new contract shall be as nearly the
same as the corresponding provisions of his or her
contract of employment as existing immediately prior to
Completion as is reasonably practicable save as to the
identity of the employer and (ii) it provides that his
or her period of continuous service with the Relevant
Seller shall be counted as continuous service with the
Relevant Purchaser.
Upon that offer being accepted, the Vendor shall terminate (or procure
the termination of) the employment of the European Employee concerned
and the Purchaser shall (on behalf of itself and the Relevant
Purchaser) be responsible for and shall indemnify the Vendor or the
Relevant Seller from and against all and any Employment Costs and
Employment Liabilities arising from any actual or alleged act or
omission of the Purchaser or the Relevant Purchaser in relation to such
European Employee on or after the date of commencement of the relevant
European Employee's employment with the Purchaser or the Relevant
Purchaser. To the extent that the Purchaser or the Relevant Purchaser
has between Completion and the date of commencement of such employment
enjoyed the services of any such European Employee the Purchaser (on
<PAGE> 157
behalf of itself and the Relevant Purchaser) shall reimburse the Vendor
or the Relevant Seller in respect of any Employment Costs which the
Vendor or Relevant Seller has thereby incurred on or after the
Completion Date.
2.7 The parties intend that the Transfer Provisions shall only be
applicable in relation to the European Employees and accordingly the
Vendor (on behalf of itself and the Relevant Seller) shall fully
indemnify and keep indemnified the Purchaser (on behalf of itself and
the Relevant Purchaser) from and against all Employment Costs and
Employment Liabilities arising under or in relation to:
(a) any contract of employment (including, without
prejudice to the generality of the foregoing the
termination thereof) with; or
(b) any duty or liability of the Vendor or the Relevant
Seller in relation to any matter whatsoever (whether
arising before or after the Completion Date) to;
any former, existing or future employee of the Vendor or the Relevant
Seller who is not a European Employee, or any trade union or employee
representative(s) of any such employee, and which contract, duty or
liability is transferred to the Relevant Purchaser (including the
Purchaser) by operation of law or is alleged to have been so
transferred.
2.8 As soon as practicable after Completion, the Vendor (on behalf of
itself and the Relevant Seller) shall deliver to the Purchaser (on
behalf of itself and the Relevant Purchaser) either originals or copies
(if originals no longer exist or are not under the Vendor's or Relevant
Seller's custody or control) of all records in relation to taxes
arising out of the employment relationship and of any other documents
or records (including, but not limited to, personnel records and files)
which are relevant to the European Employees provided that:
(a) the Vendor or the Relevant Seller shall be entitled as far as
the law allows to retain a copy of any such record or document
where the original is delivered to the Purchaser (on behalf of
itself or the Relevant Purchaser);
<PAGE> 158
(b) in the event of the Vendor or the Relevant Seller being a party
to any claim by or against any European Employee arising after
Completion, the Purchaser shall, or shall procure that the
Relevant Purchaser shall so far as the law permits and at the
reasonable cost of the Vendor, allow the Vendor reasonable
access to any and all records and documents, in its possession
which are or are likely to be relevant to such claim;
(c) in the event that the Purchaser or the Relevant Purchaser
intends at any time after Completion to dispose of or destroy
any such records or documents, the Purchaser shall not, or
shall procure that the Relevant Purchaser shall not, do so
without first informing the Vendor of its intention and if the
Vendor so requests the Purchaser shall, or shall procure that
the Relevant Purchaser shall so far as the law permits and at
the reasonable cost of the Vendor, as soon as practicable
deliver such records or documents as the Vendor may request to
the Vendor.
2.9 The Vendor shall, or shall procure that the Relevant Seller shall and
the Purchaser shall, or shall procure that the Relevant Purchaser
shall, inform and consult with recognised trade unions or any elected
representatives, as appropriate, to the extent required by the Transfer
Provisions in the relevant European Country and the Vendor (on behalf
of itself and the Relevant Seller) and the Purchaser (on behalf of
itself and the Relevant Purchaser) shall indemnify each other against
any Losses they may incur as a result of that person's failure to
adhere to its particular obligations under the Transfer Provisions in
the relevant European Country. The Purchaser warrants on its own behalf
and on behalf of the other Relevant Purchasers, that each of them has
given to the Vendor all information required by the Vendor in order for
the Vendor to fulfil its obligations under Article 6 of the Transfer
Provisions in the relevant European Country.
2.10 The Vendor (on behalf of itself and the Relevant Seller) and the
Purchaser (on behalf of itself and the Relevant Purchaser) shall each
notify the other on becoming aware of any claim which might give rise
to any liability to indemnify the other under the
<PAGE> 159
paragraphs of this clause 2 and shall give each other such assistance
as either may reasonably require:
(a) to comply with the Transfer Provisions in the relevant European
Country in relation to the European Employees;
(b) in contesting or otherwise dealing with any claim by any
European Employee resulting from or in connection with this
Agreement.
2.11 On the Completion Date the Vendor (on behalf of itself and the Relevant
Seller) and the Purchaser (on behalf of itself and the Relevant
Purchaser) shall jointly communicate to the European Employees an
agreed notice.
3 OTHER EMPLOYEES
3.1 In sufficient time to allow proper contractual or statutory notice of
termination of employment to be given by the Relevant Seller or in such
timescale as the parties may agree but in any event prior to the
Completion Date, the Purchaser shall, or shall procure that the
Relevant Purchaser shall, make or procure to be made, an offer to each
Other Employee (other than those under notice of termination of
employment (for whatever reason) at the time the Purchaser or the
Relevant Purchaser makes its offer) to employ him or her under a new
contract of employment to commence immediately from the Completion
Date. The offer to be made will be such that:
(a) the provisions of the new contract shall be as nearly the same
as the corresponding provisions of his or her contract of
employment as existing immediately prior to Completion as is
reasonably practicable, save as to the identity of the
employer;
(b) it provides that his or her period of continuous service with
the Relevant Seller shall be counted as continuous service with
the Relevant Purchaser.
3.2 If an Other Employee wishes to accept the offer referred to in
paragraph 3.1 above, then the Vendor shall, or shall procure that the
Relevant Seller shall so far as permitted by law waive any requirement
on the Other Employee concerned to give any period of notice of
termination of his or her employment under the terms of his or
<PAGE> 160
her employment so as to allow the Other Employee to commence employment
with the Relevant Purchaser from the Completion Date.
3.3 The Vendor (on behalf of itself and the Relevant Seller) and the
Purchaser (on behalf of itself and the Relevant Purchaser) shall give
each other such assistance as either may reasonably require in
contesting or otherwise dealing with any claim by any Other Employee
resulting from or in connection with this Agreement.
3.4 The Vendor (on behalf of itself and the Relevant Seller) shall be
responsible for and shall fully indemnify and keep indemnified the
Purchaser (on behalf of itself and the Relevant Purchaser) from and
against all and any Employment Costs and Employment Liabilities
arising, directly or indirectly, from any actual or alleged act or
omission of the Relevant Seller in relation to the Other Employees
prior to the Completion Date including any which are deemed by virtue
of relevant local law to be an act or omission of the Relevant
Purchaser after the Completion Date.
3.5 The Purchaser (on behalf of itself and the Relevant Seller) shall, be
responsible for and shall fully indemnify and keep indemnified the
Vendor (on behalf of itself and the Relevant Seller) from and against
all Employment Costs and Employment Liabilities in relation to any
Other Employees who accept the offer referred to in paragraph 3.1 above
arising from any actual or alleged act or omission of the Relevant
Purchaser after the Completion Date or, if later, on or after the date
of commencement of the such employee's employment with the Relevant
Purchaser. To the extent that the Purchaser or the Relevant Purchaser
has between Completion and the date of commencement of such employment
engaged the services of any such Other Employee the Purchaser (on
behalf of itself and Relevant Purchaser) shall reimburse the Vendor or
the Relevant Seller in respect of any Employment Costs which the Vendor
or the Relevant Seller has thereby incurred on or after the Completion
Date.
3.6 On the Completion Date the Vendor (on behalf of itself and the Relevant
Seller) and the Purchaser (on behalf of itself and the Relevant
Purchaser) shall jointly communicate to the Other Employees an agreed
notice.
<PAGE> 161
4 SHARE SCHEMES
The Vendor undertakes that:
4.1 it will meet in full its obligations under the terms of the BICC
Savings-Related Share Option Scheme 1991, the BICC Executive Share
Option Scheme 1991, and the BICC UK Executive Share Option Scheme
(Unapproved) ("the Option Schemes") and the BICC Long-Term Incentive
Plan ("the Plan") to Employees who are participants in the Option
Schemes and/or the Plan and procure that BICC Employees' Trustees
Limited in its capacity as Trustee of the BICC Employee Share Ownership
Trust meets its obligations to Employees who are participants in the
Plan;
4.2 it will inform the Purchaser as soon as reasonably practicable if it
receives from any of the Employees a valid notice of exercise of an
option under the Option Schemes or if the interest of any of the
Employees under the Plan vests and in such event pay to the Purchaser
in cleared funds the full amount which the Purchaser or other of the
Relevant Group Companies is liable to pay by way of tax or social
security contributions to the Inland Revenue or other relevant
governmental authorities arising out of the said exercise or vesting;
4.3 it will indemnify the Purchaser or other Relevant Group Companies in
respect of any Taxation arising out of the failure of the Vendor to
make any of the payments required by paragraph 4.2 above;
4.4 all sums payable by the Vendor to the Purchaser under paragraph (c)
above shall be paid free and clear of all deductions, withholdings,
set-offs or counterclaims whatsoever save only as may be required by
law. If any deductions or withholdings are required by law the Vendor
shall be obliged to pay to the Purchaser such sum as will after such
deduction or withholding has been made leave the Purchaser with the
same amount as it would have been entitled to receive in the absence of
any such requirement to make a deduction or withholding;
4.5 if any Taxation authority charges to Taxation any sum paid to the
Purchaser under paragraph 4.3 above then the amount so payable shall be
grossed up by such amount as will ensure that after payment of the
Taxation so charged there shall be left
<PAGE> 162
a sum equal to the amount that would otherwise be payable under
paragraph 4.3 above.
5 SINGAPORE EMPLOYEES
The parties shall between the date of this Agreement and the Completion
Date meet to determine whether the six Singapore-based expatriate
European Employees whose names are set out in page 1 of the list in the
agreed terms working for BICC Cables Asia-Pacific Pte Ltd (BICCAP) as
at the date of this Agreement shall continue to be employed in the
Operations in Singapore whether as secondees to BICCAP, on the basis of
short term employment with BICCAP, or otherwise. To the extent the
parties determine that the said employees shall not be employed in the
Operations in Singapore following Completion, or Subsequent completion,
or that such employment will not last for more than six months from the
Completion Date (or Subsequent Completion Date as the case may be), the
Vendor shall be responsible for all Losses incurred in terminating the
employment of these Singapore-based expatriate European Employees.
<PAGE> 163
SCHEDULE 12
EMPLOYEE BENEFIT ARRANGEMENTS
1 In this Schedule, the following expressions shall, unless the context
otherwise requires, have the following meanings:
ACTUARY means the Vendor's Actuary or the Purchaser's Actuary as the
context requires
THE PARTICIPATION PERIOD means the period commencing on Completion and
ending six months thereafter or on such other date as the parties (with
the consent of the Inland Revenue) shall otherwise agree
THE PAYMENT DATE means such date agreed by the Vendor and the Purchaser
being not more than one calendar month after the later of:
(a) the date of determination of the aggregate of the Transfer
Values; and
(b) the date on which the Vendor receives confirmation from the
Purchaser that the Purchaser's Scheme is legally able to
receive a transfer payment from the relevant Vendor's Scheme
such confirmation to include a copy of the PSO approval (if
necessary) to the said transfer payment and any requisite DSS
documentation; and
(c) the date on which the Vendor receives copies of the consents
referred to in the definition of the Transferring Employees
THE PENSION TRANSFER DATE means the day after the last day of the
Participation Period
PENSIONABLE EMPLOYEES means such Employees who are active members of
either of the Vendor's Schemes at Completion
PURCHASER'S ACTUARY means such actuary as the Purchaser may appoint
PURCHASER'S SCHEME means the retirement benefits scheme or schemes
established or nominated pursuant to paragraph 5.2
<PAGE> 164
UK PURCHASER means the Relevant Purchaser of the Business in the United
Kingdom
VENDOR'S ACTUARY means such actuary as the Vendor may appoint
THE VENDOR'S LETTER means each of the letters written by the Vendor's
Actuary to Mr. D I Thackray dated 31 March 1999 copies of which are
annexed hereto
VENDOR'S SCHEMES means the two retirement benefits schemes known as the
BICC Group Pension Fund and the BICC Group Senior Executive Pension
Fund respectively
THE TRANSFER AMOUNT means the aggregate of the Transfer Values adjusted
to the Payment Date as specified in the relevant Vendor's Letter
THE TRANSFER VALUE means the sum or sums calculated in respect of each
Transferring Employee in accordance with the actuarial method and
assumptions as set out in the relevant Vendor's Letter at the Pension
Transfer Date and includes, for the avoidance of doubt, the amount in
respect of additional voluntary contributions paid to purchase added
years at that date. The Transfer Value in respect of each Transferring
Employee will not be less than the cash equivalent for each such
employee at the Pension Transfer Date as required under Part IV Chapter
IV of the Pension Schemes Act 1993
THE TRANSFERRING EMPLOYEES means such Pensionable Employees who become
members of the Purchaser's Scheme with effect from the Pension Transfer
Date and who immediately before the Pension Transfer Date were active
members of either of the Vendor's Schemes and who before the Payment
Date consent to the transfer of their accrued benefits under the
relevant Vendor's Scheme to the Purchaser's Scheme, such consent to be
in writing, and do not withdraw their consent prior to the Payment Date
2 In respect of the Vendor's Schemes, during the Participation Period the
Purchaser shall procure that there shall be paid in respect of each
Pensionable Employee the following contributions so long as they remain
active members of the appropriate scheme:
<PAGE> 165
GROUP PENSION FUND
Contributions to the BICC Group Pension Fund are at the following rates
which are based on the standard annual earnings (as defined in the
rules of the Fund), less a deduction of (pound)2964 pa for each member.
Employer contribution:
Senior Executive Pension
Fund members who joined that
Fund prior to 1 January 1994 16.8% per annum
All other members 13.2% per annum
Members contribution:
All members 5% per annum
SENIOR EXECUTIVE PENSION FUND
For the Senior Executive Pension Fund members there is an additional
employer contribution to the BICC Group Senior Executive Pension Fund
based on standard earnings (as defined in the Fund rules) less
(pound)2964 per annum at the rate of 4.3% per annum thereof for seNIOR
management roll members and at the rate of 12.0% per annum thereof for
executive roll members and senior executive roll members.
All such employer and member contributions (which will be inclusive of
all liability to contribute to the administration and management and
other costs of the Vendor's Schemes) shall be remitted to the trustees
of the relevant Vendor's Scheme within 14 days of the end of the
calendar month in respect of which the contributions were due or
collected, as appropriate.
3 If the Purchaser fails to procure the payment of the contributions
referred to in paragraph 2 the Vendor may either make the payment
itself and recover the amount from the Purchaser as a debt or notify
the relevant trustees that the contributions cannot be made, in which
case the trustees may elect by notice in writing to the Purchaser to
cease to permit the UK Purchaser to participate in the relevant scheme.
<PAGE> 166
4 Up to and including the Payment Date, the Vendor shall ensure that:
4.1 subject to the consent of the Inland Revenue the Vendor will use its
best endeavours to ensure that the UK Purchaser can participate in the
Vendor's Schemes in respect of the Pensionable Employees during the
Participation Period;
4.2 the Vendor's Schemes remain in full force and effect in respect of the
Pensionable Employees and retain their contracted out and Inland
Revenue approved status;
4.3 no alterations are made to, or powers or discretions exercised under,
the Vendor's Schemes which affect the accrued, contingent or future
interests of the Pensionable Employees except with the consent of the
Purchaser (such consent not to be unreasonably withheld or delayed);
4.4 all death-in-service benefits applicable to the Pensionable Employees
are continued during the Participation Period.
4.5 The Vendor shall procure that any Pensionable Employee who for any
reason during the Participation Period becomes eligible for a benefit
under either of the Vendor's Schemes (including for the avoidance of
doubt, an early retirement pension on the terms set out in the relevant
Vendor's Scheme) shall (subject to the consent of the Purchaser) be
granted such benefit without further contribution being required of the
Purchaser or of the Pensionable Employee, except where the amount of a
benefit is augmented at the request or with the consent of the
Purchaser, in which case the grant of such additional benefit under the
relevant Vendor's Scheme shall be conditional on payment by the UK
Purchaser to the trustees of the relevant Vendor's Scheme of such
amount by way of additional contribution as shall be agreed between the
Vendor's Actuary and the Purchaser's Actuary as being equal to the
excess (if any) of the value (on the basis of the method and
assumptions set out in the relevant Vendor's Letter) of the augmented
benefit over the non-augmented benefit.
5 TRANSFER PAYMENTS
5.1 The Vendor and the Purchaser will each take steps within its competence
to ensure that by such date that is no later than 45 days after the
Pension Transfer Date each Pensionable Employee is given the
opportunity of consenting in terms approved by
<PAGE> 167
the trustees of the Vendor's Schemes (such approvals not to be
unreasonably withheld or delayed) to a transfer of assets being made
for him from the relevant Vendor's Scheme to the Purchaser's Scheme in
accordance with the provisions of this Schedule.
5.2 The Purchaser undertakes to establish or nominate one or more
retirement benefits schemes on or before the Pension Transfer Date.
5.3 Subject to receipt of the Transfer Amount, the Purchaser's Scheme shall
provide in respect of each of the Transferring Employees (subject to
Inland Revenue limits on benefits not being exceeded) benefits on a
basis for service prior to the Pension Transfer Date which is in the
opinion of the Purchaser's Actuary and agreed by the Vendor's Actuary
no less favourable in value than the basis of the benefits for such
service to which that Transferring Employee is entitled under the
relevant Vendor's Scheme at the Completion Date provided that for the
avoidance of doubt there shall be deemed to be no obligation to
equalise benefits in the Vendor's Scheme or the Purchaser's Scheme
arising as a result of Guaranteed Minimum Pensions. Any notional money
purchase underpin applicable to additional voluntary contributions paid
to purchase added years in the Vendor's Schemes which increases the
Transfer Amount shall also be given value in the Purchaser's Scheme on
the same basis as referred to above.
5.4 Immediately following the Pension Transfer Date, the Vendor's Actuary
shall calculate the Transfer Value in respect of each of the
Transferring Employees and shall pass the results of his calculations
to the Purchaser's Actuary by such date which is three months after the
Pension Transfer Date (or the date which is three months after the date
of receipt of any data requested pursuant to paragraph 5.6, if later).
5.5 The Purchaser's Actuary will have two months from the date of his
receipt of the results of the Vendor's Actuary's calculations (or the
date which is two months after the date of receipt of any data
requested pursuant to paragraph 5.6, if later) to agree the results of
those calculations or to raise any objections he may have. Any such
objections are to be notified in writing.
<PAGE> 168
5.6 The Vendor and the Purchaser shall use their respective reasonable
endeavours to procure that any information which the Vendor's Actuary
or the Purchaser's Actuary may reasonably require in order to calculate
and verify the Transfer Values shall be provided to the Vendor's
Actuary or the Purchaser's Actuary (as appropriate) as soon as is
reasonably practicable and that such information shall be true and
complete in all material respects.
5.7 If no objections are raised by the Purchaser's Actuary pursuant to
paragraph 5.5 the Transfer Values will be binding upon the parties.
5.8 If any objections are notified pursuant to paragraph 5.5 the parties
are to instruct their respective Actuaries to negotiate with a view to
resolving any differences between them.
5.9 If those differences remain unresolved at the end of thirty days after
the objections have been notified pursuant to paragraph 5.5 either
party may refer the matter to the Expert. The provisions of paragraph 6
will then apply in this matter.
5.10 The Vendor shall use its reasonable endeavours to procure that, on the
Payment Date an amount in specie equal to the Transfer Amount
consisting of 60% UK equity and 40% overseas equity investments
(comprising 131/3 % in North America, 131/3% in Europe excluding the
UK, 62/3% in Japan and 62/3% in the Pacific Basin excluding Japan) (but
excluding interests in pooled funds which are not index-tracking funds)
based on their mid-market values on the Business Day prior to the
Payment Date shall be transferred by the Investment Managers on behalf
of the trustees of the Vendor's Schemes to the trustees or managers of
the Purchaser's Scheme. The equities transferred will be a reasonable
cross section of those held by the Vendor's Schemes as agreed by the
Vendor and the Purchaser (such agreement not to be unreasonably
withheld or delayed). To the extent that such agreement is not reached,
an amount in cash equal to the balance of the Transfer Amount subject
to a realisation charge of 1/2% shall be transferred.
5.11 If on the Payment Date the aggregate amount transferred by the trustees
of the Vendor's Schemes to the trustees or managers of the Purchaser's
Scheme in relation
<PAGE> 169
to the Transferring Employees is less than the Transfer Amount (the
difference between such aggregate amount transferred and the Transfer
Amount being the "Underpayment"), the Vendor shall forthwith pay to the
Purchaser or as it may direct (by way of reduction of the purchase
consideration) a cash amount equal to the Underpayment together with
interest thereon at the rate of 2 per cent above the base rate from
time to time of The Hong Kong and Shanghai Banking Corporation Limited
in respect of the period from and including the Payment Date up to but
excluding the date of actual payment under this paragraph 5.11.
5.12 As soon as reasonably practicable after receipt of the Underpayment,
the Purchaser shall, or shall procure that the UK Purchaser will, pay
into the Purchaser's Scheme an amount equal to the Underpayment. The
Purchaser shall, promptly upon it and the UK Purchaser receiving any
net tax benefit in respect of such payment, pay (or procure the payment
of) to the Vendor (by way of increase of the purchase consideration) an
amount equal to such net tax benefit (taking into account any tax
liability of the Purchaser or the UK Purchaser on receipt of the
Underpayment and any tax deduction in respect of the payment by the
Purchaser or the UK Purchaser into the Purchaser's Scheme).
5.13 The Vendor will use its best endeavours to ensure that the appropriate
funds in respect of additional voluntary contributions not paid to
purchase added years attributable to the Transferring Employees is
transferred to the Purchaser's Scheme on the Payment Date.
5.14 The funds transferred in accordance with paragraph 5.13 above shall be
used for the exclusive benefit of those Transferring Employees who have
made additional voluntary contributions as referred to in that
paragraph.
6 Any dispute between the Vendor and the Purchaser or between the
Vendor's Actuary and the Purchaser's Actuary concerning the matters
referred to in this Schedule shall in the absence of agreement between
them be referred to an independent actuary ("the Expert") appointed by
the parties or to be appointed at the request of either party hereto by
the President for the time being of the Institute of Actuaries if
agreement as
<PAGE> 170
to the independent actuary to act as the Expert cannot be reached. The
person so appointed shall act as an expert and not as an arbitrator.
The decisions of the Expert shall be final and binding on the parties
hereto. The costs of the Expert shall be borne as the Expert shall
direct.
7 The Purchaser shall procure that the UK Purchaser will authorise the
Vendor to exercise all powers, rights and discretions conferred on the
UK Purchaser under the Pensions Act 1995 by virtue of its participation
in the Vendor's Schemes. In particular, the Purchaser shall procure
that the UK Purchaser will:
7.1 nominate the Vendor as the "appropriate person" to act for each of them
for the purposes of section 21(9) of the Pensions Act 1995 in relation
to the Vendor's Schemes.
7.2 agree that:
(a) the Vendor should act on their behalf for the purposes
of section 58(4) of the Pensions Act 1995 in respect of
the Vendor's Schemes; and
(b) the Vendor will consult with the trustees of the
Vendor's Schemes pursuant to section 35(5) of the
Pensions Act 1995 in place of the UK Purchaser.
8 INDEMNITIES
8.1 The Vendor shall indemnify the Purchaser (for itself and as agent and
trustee for the UK Purchaser, the employer of the employees concerned
as referred to in (c) below and the Purchaser's Scheme) against all
actions, proceedings, costs, claims, damages and expenses brought or
made against or incurred by the Purchaser or the UK Purchaser, or the
employer of the Employees concerned as referred to in (c) below or the
Purchaser's Scheme (including, without limitation, any additional
contributions payable to the Purchaser's Scheme) insofar as the same
arise from: (a) the Purchaser or the UK Purchaser or the Purchaser's
Scheme being required to provide benefits to any Employees in respect
of the whole or part of their service prior to the Completion Date in
excess of the benefits provided under paragraph 5.3 where such
requirement arises by reference to the provisions of European Community
law or
<PAGE> 171
sections 62 to 66 of the Pensions Act 1995 relating to the equal access
requirements or relating to the equal treatment requirements insofar as
they apply to members of the BICC Group Senior Executive Fund who
joined that Fund prior to 2 March 1987. For the avoidance of doubt this
requirement shall not include the equalisation of guaranteed minimum
pensions; (b) the Purchaser or the UK Purchaser being liable for any
deficiency under the Vendor's Schemes pursuant to section 75 of the
Pensions Act 1995 or otherwise howsoever in relation to the Vendor's
Schemes (except for amounts payable by the Purchaser or the UK
Purchaser pursuant to paragraphs 2 and 4.5 or except in so far as
attributable to any act or omission of the Purchaser or the UK
Purchaser); (c) the Purchaser or the UK Purchaser or the Purchaser's
Scheme or the employer of the employees concerned being liable in
relation to any participation prior to the Completion Date by
ex-patriate employees in the Vendor's Schemes in contravention of
Inland Revenue requirements (including, without limitation, Mr N
Blackwell, ex-patriate employee based in Egypt, and Mr W Bailey,
ex-patriate employee based in Dubai). The indemnity in sub-paragraph
(c) is conditional on the Purchaser, the UK Purchaser and the
Purchaser's Scheme and the employer of the employees concerned
co-operating with the Vendor in minimising any such liability including
in particular complying with any requirements or conditions that may be
imposed by the Inland Revenue (whether as to the nature of the
Purchaser's Scheme to which such benefits are transferred or
otherwise).
8.2 The Vendor shall indemnify the Purchaser (for itself and as agent and
trustee for the Relevant Purchaser of the Shares in BICC General Cable
SA against all Losses suffered by the Purchaser or the Relevant
Purchaser (including, without limitation, any additional payments
required to be made to Sud America Vida y Pensiones, S.A. or
Sudamericana Seguros) in so far as the same arise from the assets held
at the Completion Date in respect of the policies issued by Sud America
Vida y Pensiones, S.A. or Sudamericana Seguros in relation to employees
of such Relevant Purchaser (including Saenger, S.A. and any other
companies whose businesses have been merged with such Relevant
Purchaser) being less than the liabilities at the Completion Date in
relation to such employees (assessed on the same basis as the actuarial
<PAGE> 172
valuation dated 1 January 1998) Provided that due account will be taken
for this purpose of any allowance made in the Net Asset Statement in
respect of any such underfunding.
<PAGE> 173
SCHEDULE 13
PART 1
NON-LEASED PROPERTIES
BRIEF DETAILS OF PROPERTY
1 Erith Works, Church Manorway, Erith, Kent
2 Wrexham Site (save for Wrexham II), Oak Road, Wrexham Trading Estate,
Clwyd
3 Prescot Works, Hall Lane, Prescot, Lancashire
4 The Sports and Social Club off Warrington Road, Prescot, Lancashire
5 Leigh Works (save for the Brand Rex Premises), West Bridgewater Street,
Leigh, Lancashire
6 Hebburn Works, Hedgeley Road, Hebburn, Durham
7 Daybrook Square, Mansfield Road, Nottingham
<PAGE> 174
SCHEDULE 13
PART 2
LEASED PROPERTIES
Address of Property:
Suite 3, RVB House, Llys Felin Newydd,
Phoenix Way, Enterprise Park, Swansea
Parties: RVB Investment Limited (1) and
BICC Components Limited (2)
Current tenant and guarantor: BICC Components Limited. No guarantor.
Term (including options to break and renew):
3 years commencing on 14 December 1998, Tenant's only option to break on each
anniversary of lease on giving 3 months prior notice to Landlord.
Current rent and rent review dates:
(pound)9,645 per annum. No rent review.
<PAGE> 175
SCHEDULE 13
PART 3
LIST OF OVERSEAS PROPERTIES
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
OWNER PROPERTY TENURE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
ITALY:
BICC Ceat Cavi srl Energy Cables Division, Via Piceno Freehold
Aprutina 55/B, 63100 Ascoli Piceno, Italy
BICC Ceat Cavi srl Via Brescia 16, 10036 Settimo Torinese, Freehold
Turin, Italy
- ---------------------------------------------------------------------------------------------------
SPAIN:
BICC General Cable SA Carretera de Ribas Km 13,2, Montcada i Freehold
Reixach (Barna), Spain
BICC General Cable SA c/Rusinol 63, Manlleu (Barna), Spain Freehold
BICC General Cable SA Ctra Martorell a Olesa Km 4,3, Arbrera, Freehold
Spain
BICC General Cable SA Casanova 150, Barcelona, Spain Freehold
BICC General Cable SA Partida, Castello, Teulada (Alicante), Freehold
Spain
BICC General Cable SA Avda Garcia de Najera 4, Pamplona Leasehold
(Navarra), Spain
BICC General Cable SA Ctra Nacional IV, Edificio Eurosevilla, Leasehold
Sevilla, Spain
BICC General Cable SA Juan de Ajuriaguerra 26, Bilbao, Spain Leasehold
BICC General Cable SA Cirilo Amoros 27, Valencia, Spain Leasehold
BICC General Cable SA Rusinol 57, Manlleu (Barna), Spain Leasehold
- ---------------------------------------------------------------------------------------------------
NORWAY:
BICC Norspa A/S Berghahan 5, Langhus 1401 Ski, Norway Leasehold
- ---------------------------------------------------------------------------------------------------
BRAZIL:
BICC Novacoes Ltda Avda Paulo Miguel Bohomoletz, 12 Civi-1, Leasehold
Serra Espirito Santo, Brazil
- ---------------------------------------------------------------------------------------------------
PORTUGAL:
BICC Celcat Cabos de Energia e Av Marques de Pombal 36/38, Morelena, Freehold
Telecommunicaciones SA 2715 Pero Pinheiro, Portugal
BICC Cabos de Energia e Porto Branch, Rua Goncaio Cristovao Leasehold
Telecommunicaciones SA 312-4 BeC, 4000 Porto, Portugal
- ---------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 176
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
OWNER PROPERTY TENURE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
MOZAMBIQUE:
Celmoque Cabos de Energia e Av Zedequias Mangalhela 1430, Maputo, Leasehold
Telecommunicaciones SA Mozambique
Celmoque Cabos de Energia e (Head Office), Estrada Nacional No6 Alto Installations
Telecommunicaciones SA da Manga, Beira-Provincia da Sofala, Owned
Mozambique Land
Nationalised
- ---------------------------------------------------------------------------------------------------
ANGOLA:
Condel Fabrica de Contudores Cazenga 5a Avenida, Luanda, Angola Freehold
Electrizos de Angola SARL
Condel Fabrica de Contudores Av Rainha Ginga 147-6o Luanda, Angola Leasehold
Electrizos de Angola SARL
- ---------------------------------------------------------------------------------------------------
DUBAI:
Dubai Cable Company (Private) Ltd. PO Box 11529, Dubai, United Arab Emirates Land
allocated
by
State
Dubai Cable Company (Private) Ltd. Dubai City and Distribution sites in Abu Leasehold
Dhabi, Bahrain and Oatar
- ---------------------------------------------------------------------------------------------------
EGYPT:
BICC Egypt SAE Abou Rawash Industrial Zone, Giza, Freehold
Cairo, Egypt
BICC Egypt SAE 33 Ahmed Hishmet Street, Zamalek, Cairo, Leasehold
Egypt
- ---------------------------------------------------------------------------------------------------
ZIMBABWE:
BICC CAFCA Limited PO Box 1651 Lytton Road, Workington, Freehold
Harare, Zimbabwe
- ---------------------------------------------------------------------------------------------------
CHINA:
BICC Cables Asia-Pacific Pte Ltd. Shanghai Rep Office, 1104/05 Hong Kong Leasehold
Plaza, 263 Huai Hei Middle Road,
Shanghai 200021, Peoples Republic of
China
BICC Cables Asia-Pacific Pte Ltd. Beijing Rep Office, Unit 12 10/F, Jingan Leasehold
Centre, 8 East Road, Northern 3 Ring
Road, Chao Yang District, Beijing,
Peoples Republic of China
- ---------------------------------------------------------------------------------------------------
TAIWAN:
BICC Energy Cables Pte Ltd. Taiwan Rep Office, Room 23 21/F, 50 Leasehold
Chung Hsalo West Road, Taipei, Taiwan
- ---------------------------------------------------------------------------------------------------
NEW ZEALAND:
BICC Cables New Zealand Ltd. Riccarton Factory, 73/89 Main South Freehold
Road, Riccarton, Christchurch, New
Zealand
- ---------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 177
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
OWNER PROPERTY TENURE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
BICC Cables New Zealand Ltd. Auckland Service Centre, 14-18 Vestey Leasehold
Drive, Mt. Wellington, Auckland, New
Zealand
BICC Cables New Zealand Ltd. Wellington Service Centre, 43 Barnes Leasehold
Street, Wellington, New Zealand
BICC Cables New Zealand Ltd. Wellington Warehouse, 67 Port Road, Leasehold
Petone, Wellington, New Zealand
- ---------------------------------------------------------------------------------------------------
FIJI:
Dominion Wine and Cables Ltd. Ba factory, Lot 3 Kings Road, Nailaga, Freehold
BA, Fiji Island
- ---------------------------------------------------------------------------------------------------
SINGAPORE:
BICC Energy Cables Pte Ltd. Wisma Atria Office, 435 Orchard Road, Leasehold
#17-02 Wisma Atria, Singapore 238877
BICC Energy Cables Pte Ltd. Pasir Panjang, Pasir Panjang Distrpark, Leasehold
Pasir Panjang Road, Singapore 118500
Trans-Power Cables Pte Limited Trans-Power Cables Pte Ltd, Units Leasehold
#01-01, 01-02, 01-04, Pasir Panjang
Building, 15 West Coast Highway,
Singapore 117861
Trans-Power Cables Pte Limited Trans-Power Cables Pte Ltd, Unit 16, Leasehold
Pasir Panjang Distrpark, West Coast
Highway, Singapore
BICC Cables Asia-Pacific Pte Ltd. Wisma Atria Regional Office, 435 Orchard Leasehold
Road, #21-01/02/03 Wisma Atria,
Singapore 238877
- ---------------------------------------------------------------------------------------------------
MALAYSIA:
BICC Energy Cables Pte Ltd 42 Jalan Molek 2/1 Leasehold
Taman Molek, 81100
Johor Bahru, Maylasia
Power Cables Malaysia Sdn Bhd Shah Alam factory, Lot 2, Jalan Kawal Leasehold
15/18, 40702 Shah Alam, Selangor,
Malaysia
Power Cables Malaysia Sdn Bhd Bukit Raja aluminium rod plant, Lots 31 Freehold
and 32, Bukit Raja Industrial Park,
Klang, Selangor, Malaysia
- ---------------------------------------------------------------------------------------------------
INDONESIA:
PT BICC Berca Cables Balaraja factory, Blok F1 3/4, Jalan Freehold
Raya Serang Km28.5, Balaraja-Tangerang,
West Java, Republic of Indonesia
- ---------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 178
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
OWNER PROPERTY TENURE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
HONG KONG:
BICC Cables China Ltd. Great Eagle Centre, Room 1011, Great Leasehold
Eagle Centre, Wanchai, Hong Kong
BICC Cables China Ltd. Chai Wan warehouse, Unit 44, 7/F Chai Leasehold
Wan Industrial City, 70 Wing Tai Road,
Chai Wan, Hong Kong
- ---------------------------------------------------------------------------------------------------
ARGENTINA:
BICC Cables Argentina SA J M Campos No 1255, Villa Zagala, Leasehold
Partida de San Martin, Provincia de
Buenos Aires, Argentina
- ---------------------------------------------------------------------------------------------------
THAILAND:
BICC Energy Cables Pte Ltd. Thailand Rep Office, Unit 1701, One Leasehold
Pacific Place, 140 Sukumvit Road,
Klongtoay, Bangkok 10110, Thailand
- ---------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 179
SCHEDULE 14
The provisions of this Schedule 14 apply only to those Properties located in
England or Wales
PART 1
TERMS OF SALE OF THE BUSINESS SELLERS' PROPERTIES IN ENGLAND AND WALES
1 Insofar as the same are applicable and are not consistent with or
varied by the express terms of this Agreement, this Agreement shall
incorporate the Standard Conditions of Sale (Third Edition)
("Conditions") as varied in the manner set out below which shall apply
in respect of Properties in England and Wales.
1.1 In paragraphs (a) and (b) of Condition 1.3.6 the words "unless returned
undelivered" shall be added after the word "posting".
1.2 Paragraph (c) of Condition 3.1.2 shall be amended to read "those of
which the seller does not have actual knowledge" and the following
paragraph (f) shall be added to the Condition:
"(f) all other matters disclosed or reasonably to be expected to be
disclosed by searches and as a result of enquiries made by or for the
buyer or which a prudent buyer ought to make".
1.3 In Condition 3.1.3 the words "of which he receives actual knowledge"
shall be inserted after the words "new public requirement" and shall
also be substituted for the words "which he learns about".
1.4 Condition 4.3.2 shall not apply.
1.5 Conditions 5.1.1 and 5.1.2 shall not apply and the risk of damage to or
destruction of the Business Seller's Properties passes to the Purchaser
from the date of this Agreement save that the Vendor shall continue to
insure the Business Seller's Properties (other than the Business
Sellers' Leased Property) on the current terms (so far as it is able)
and in the event of any damage or destruction of them the Vendor will
pay the insurance proceeds received by it to the Purchaser and if any
insurance money shall be irrecoverable due to any act or neglect of the
Vendor or any Business
<PAGE> 180
Seller or any of their respective undertenants, employees, servants,
agents, licencees or mortgagees, then the Vendor shall pay to the
Purchaser the irrecoverable amount. Condition 5.1.3 shall not apply.
1.6 In the case of the Business Seller's Leased Properties the following
proviso shall be added at the end of Condition 6.6:
"PROVIDED that the production of such receipt shall not be a condition
of completion but if the seller is unable to produce the same then the
seller shall furnish such other evidence (if any) as may be available
in respect thereof"
and in paragraph (a) of Condition 8.3.2 the words "but the seller shall
not be obliged to pay a premium for such consent" shall be added after
the words "obtain it" and Condition 8.3.4 shall not apply.
2 BUSINESS SELLERS' LEASED PROPERTIES
2.1 The Vendor shall procure that the relevant Business Seller shall:
2.1.1 apply at its own expense for consent to assign any Business
Sellers' Leased Property; and
2.1.2 use all reasonable endeavours to obtain such consent; and
2.1.3 keep the Purchaser fully informed of all progress made with
regard to the obtaining of such consent.
2.2 The Purchaser shall in connection with obtaining the consent referred
to in paragraph 2.1.1 above:
2.2.1 provide all information and references reasonably required by
the landlord;
2.2.2 enter into direct covenants and provide such other security as
required under the relevant lease or as the landlord may
otherwise reasonably require.
2.3 In the event that any necessary consent to assign any Business Sellers'
Leased Property has not been obtained by the Completion Date then the
following provisions shall apply:
<PAGE> 181
2.3.1 completion of the transfer of the relevant Business Seller's
Leased Property shall be deferred until three Business Days
after such consent has been obtained and a copy provided to the
Purchaser;
2.3.2 during the period from Completion until the date of actual
completion of the transfer of the relevant Business Seller's
Leased Property (the INTERIM PERIOD) the Vendor shall procure
that the relevant Business Seller shall:
(i) hold the relevant Business Seller's Leased Property on
trust for the Purchaser; and
(ii) permit the Purchaser to occupy the relevant Business
Seller's Leased Property as licensee for the purposes
for which it has been used by the relevant Business
Seller prior to the date hereof; and
(iii) not without the prior consent of the Purchaser
surrender or sell or vary or agree any revised rent for
any Lease or agree to do any of the same.
2.4 During the Interim Period the Purchaser shall:
2.4.1 within five Business Days of written demand put the Vendor in
funds so as to enable the relevant Business Seller to pay all
rents, service charges and other outgoings and expenses payable
in respect of the relevant Business Seller's Leased Property
and which relate to the Interim Period;
2.4.2 save insofar as the same are the express responsibility of the
Vendor under this Agreement, observe and perform the covenants
and conditions on the part of the lessee contained in the Lease
or otherwise affecting the relevant Business Seller's Leased
Property;
2.4.3 not without the Vendor's prior written consent, erect or affix
on the relevant Business Seller's Leased Property any signs or
other notifications that the relevant Business Seller's Leased
Property is no longer occupied by the relevant Business Seller;
and
<PAGE> 182
2.4.4 indemnify the Vendor and the relevant Business Seller against
the acts and omissions of the employees servants agents and
invitees of the Purchaser in or about the relevant Business
Seller's Leased Property occurring on or after Completion.
2.5 If such consent has not been obtained to assign the relevant Business
Seller's Leased Property within six months after Completion then either
party may (provided it has complied substantially with its obligations
under paragraph 2) at any time before such consent has been obtained
exclude the relevant Business Seller's Leased Property from the sale
and purchase pursuant to this Agreement by notice in writing to the
other party in which case neither party is to be treated as in breach
of contract.
3 THE BUSINESS SELLERS' PROPERTIES
3.1 The Business Sellers' Properties are sold together with all easements,
rights and licences attaching or appurtenant thereto and all
buildings, structures and fixed and non-severable plant, machinery and
equipment thereon except:
3.1.1 property belonging to the suppliers of gas, water, electricity,
telecommunications or other services; and
3.1.2 landlord's fixtures and fittings on any of the Business
Sellers' Leased Properties; and
3.1.3 tenant's and trade fixtures and fittings on any part of any
Business Seller's Property that is subject to any lease or
tenancy in favour of a third party;
but subject to the easements, rights, rent charges, covenants,
restrictions, leases, tenancies (including statutory tenancies),
licences, agreements, overriding interests (as defined in Section 70(1)
of the Land Registration Act 1925) or matters which would be overriding
interests if the title to the Business Sellers' Property were
registered and other matters affecting the same at the date of this
Agreement and as regards the Business Sellers' Properties mentioned in
Part 3 of this Schedule 14, the special conditions respectively
expressed therein to apply to them and the Business Sellers' Leased
Properties are sold subject also to the rents, covenants and
<PAGE> 183
conditions reserved by or contained in the leases under which the same
are respectively held.
The Purchaser shall raise no requisitions nor make any objection in
respect of any of the above, save as may arise as a result of the
Purchaser's pre-completion searches.
3.2 The transfer of any Business Seller's Property (other than the Business
Sellers' Leased Property) to the Purchaser shall include the following
declaration:
"This Transfer is made with full title guarantee but the covenant set
out in Section 3(1) of the Law of Property (Miscellaneous Provisions)
Act 1994 (the "1994 ACT") does not extend to any charge (other than any
financial charge or mortgage), encumbrance or other right of which the
Transferor is unaware (whether or not the Transferor could reasonably
be expected to be aware of it) or which was created or imposed after
[the date of this Agreement] (other than by the Transferor)".
3.3 In the assignment of any Business Seller's Leased Property to the
Purchaser:
3.3.1 There shall be the following declaration:
"This Assignment is made with the full title guarantee but:
(i) the covenant set out in section 3(1) of the Law of
Property (Miscellaneous Provisions) Act 1994 (the "1994
ACT") does not extend to any charge (other than any
financial charge or mortgage), encumbrance or other
right of which the Assignor is unaware (whether or not
the Assignor could reasonably be expected to be aware
of it) or which was created or imposed after [the date
of this Agreement] (other than by the Assignor); and
(ii) the Assignor shall not be liable under any of the
implied covenants set out in Section 3 or Section 4 of
the 1994 Act for the consequences of any breach of the
lessee's covenants contained in or other terms of the
Lease relating to the state or condition of the
Property.
3.3.2 The Purchaser (as the assignee) will covenant with the relevant
Business Seller (as the assignor) as follows:
<PAGE> 184
"The Assignee hereby covenants with the Assignor that the
Assignee and the Assignee's successors in title will henceforth
during the continuance of the term of the Lease pay the rents
reserved thereby and observe and perform the lessee's covenants
and the conditions contained therein and will indemnify the
Assignor and the successors in title of the Assignor from and
against all actions, proceedings, costs, claims, expenses and
liability for or on account of (i) any future breach,
non-observance or non-performance thereof and (ii) any past or
existing breach, non-observance or non-performance of any
covenants concerning the state or condition of the Property"
3.4 The Purchaser shall raise no objection if any lease or tenancy
agreement of any Business Seller's Leased Property shall be found to be
an underlease or sub-tenancy or if the covenants in any such lease or
tenancy agreement do not correspond with the covenants in any superior
lease or tenancy.
3.5 The Purchaser is deemed to buy with knowledge in all respects of the
authorised uses of the Business Seller's Properties for the purposes of
the enactments from time to time in force relating to town and country
planning.
3.6 Upon actual completion of the sale and purchase of the Business
Seller's Properties vacant possession will be given with the exception
of the premises comprised in the Erith Lease, the Prescot Leases, the
Prescot Social Club Leases, the Nottingham Leases and the Wrexham
Leases (all as defined in the Special Conditons of Sale and any
electricity substations on any Business Seller's Property.
3.7 In respect of those Business Sellers' Properties listed at paragraph 6
("Hebburn"), paragraph 7 ("Nottingham") and paragraph 8 ("Swansea") of
Part 2 of Schedule 14, the Vendor shall procure that Pyrotenax Limited
in the case of Hebburn, Fine Wires Limited in the case of the part of
Nottingham owned by it, and BICC Compontents Limited in the case of
Swansea, shall each transfer their respective legal interests in those
Business Sellers' Properties to the Purchaser with full title
guarantee.
3.8 Save as provided in paragraph 3.7 above or in the Special Conditions of
Sale, the Vendor shall transfer or convey the Business Sellers'
Properties with full title
<PAGE> 185
guarantee and in respect of Hebburn, Nottingham and Swansea the Vendor
shall transfer or convey to the Purchaser the Vendor's beneficial
interests therein with full title guarantee.
3.9 In respect of those Business Sellers' Properties listed at paragraph 2
("Wrexham") and paragraph 5 ("Leigh") of Part 2 of Schedule 14, the
provisions of Annexure 2 and 3 (relating to works to be undertaken to
separate properties shall apply.
3.10 The Vendor and Purchaser shall not later than 15 working days after
completion of the works referred to in Annexures 2 and 3 enter into a
deed (or deeds) in a form to be agreed between the Vendor and Purchaser
(each acting reasonably) granting and reserving (save where the rights
are expressed to be temporary only) the rights set out or referred to
in Annexures 2 and 3.
3.11 The Vendor and the Purchaser shall act in good faith in the best
interests of a successful completion of the separation of Wrexham and
Leigh from the land retained by the Vendor and:
3.11.1 the Vendor and the Purchaser shall, and shall use all
reasonable endeavours to procure that any third party shall, do
and execute all other acts, deeds, documents and things as may
be necessary for giving effect to the provisions of Annexures 2
and 3; and
3.11.2 if the rights and agreements referred to in Annexures 2 and 3
are inadequate or insufficient to enable such separation the
Vendor and the Purchaser shall, and shall use all reasonable
endeavours to procure that any third party shall, enter into
such deeds or agreements to rectify such inadequacy or
insufficiency granting or reserving as applicable such
easements and rights as shall be reasonably necessary for the
separation and subsequent use and enjoyment of Wrexham and
Leigh and the land retained by the Vendor.
3.12 Any dispute between the Vendor and the Purchaser as to their respective
rights, duties and obligations in respect of the separation of Wrexham
and Leigh from the land retained by the Vendor shall, if required, be
referred to an independent expert (acting as an expert and not as an
arbitrator) to be agreed upon by the Vendor and
<PAGE> 186
the Purchaser or if they fail to agree to be nominated by the President
or next most senior available officer of the Royal Institution of
Chartered Surveyors on the application of either party. The decision of
the expert (whether of fact or law) shall be final and binding on the
parties and shall be given without reasons. Any dispute or question
relating to the independent expert's terms of reference, whether of
fact or law, shall be in the exclusive jurisdiction of the independent
expert. The independent's expert's fees and expenses shall be paid by
the Vendor and the Purchaser in equal shares.
3.13 On Completion the Vendor shall pay to the Purcdhaser 50 per cent of the
stamp duty payable on the respective transfers of the Business Sellers'
Properties in England and Wales.
<PAGE> 187
SCHEDULE 14
PART 2 - BUSINESS SELLERS' PROPERTIES
BUSINESS SELLERS' NON-LEASED PROPERTIES
1 Erith Works, Church Manorway, Erith, Kent as the same are shown for the
purposes of identification only edged red on the plan annexed hereto
and numbered 1 (ERITH)
2 Wrexham Site, Oak Road, Wrexham Trading Estate, Clywd as the same is
shown for the purposes of identification only edged red on the plan
annexed hereto and numbered 2 (WREXHAM) (except for that part of
Wrexham shown for the purpose of identification only edged green on
plan 2 annexed and known as WREXHAM II)
3 Prescot Works, Hall Lane, Prescot, Lancashire as the same is shown for
the purposes of identification only edged red (save for the land shown
for the purposes of identification only edged blue on plan 3 annexed)
on the plan annexed hereto and numbered 3 (PRESCOT)
4 The Sports and Social Club off Warrington Road, Prescot, Lancashire as
the same is shown for the purposes of identification only edged red on
the plan annexed hereto and numbered 4 (PRESCOT SOCIAL CLUB)
5 Leigh Works, West Bridgewater Street, Leigh, Lancashire as the same are
shown for the purposes of identification only edged red on the plan
annexed hereto and numbered 5 (LEIGH) (except for that part of Leigh
shown for the purposes of identification only edged green on plan 5
annexed and known as the BRAND REX PREMISES)
6 Hebburn Works, Hedgeley Road, Hebburn, Durham as the same are shown for
the purposes of identification only edged red on the plans annexed
hereto and numbered 6 (HEBBURN)
7 Daybrook Square, Mansfield Road, Nottingham registered at H.M. Land
Registry under the numbers NT289090, NT98172, NT78063, NT72820,
NT64705, NT59845, NT66997, NT65304, NT96593, NT80206 and NT72827
(NOTTINGHAM).
<PAGE> 188
BUSINESS SELLERS' LEASED PROPERTIES
8 Suite 3, RVB House, Llys Felin Newydd, Phoenix Way, Enterprise Park,
Swansea ("SWANSEA") as the same is more fully described in and demised
by a lease dated 14 December 1998 made between RVB Investments Limited
(1) and BICC Components Limited (2) (the "SWANSEA LEASE").
<PAGE> 189
SCHEDULE 14
PART 3
SPECIAL CONDITIONS RELATING TO THE BUSINESS SELLERS' PROPERTIES
SPECIAL CONDITIONS - ERITH
1 The title to Erith will commence with:
1.1 as to part a Conveyance dated 17 January 1902 and made between Frances
Maria Dashwood & George Ashdown Hubbard (1) and Callenders Cable &
Construction Company Limited (2)
1.2 as to part a Conveyance dated 29 February 1952 and made between Maypole
Estates Limited (1) Lever Brothers & Unilever Limited (2) The British
Oil and Cake Mills Limited (3) and British Insulated Callender's Cables
Limited (4)
1.3 as to part a Deed of Exchange dated 21 July 1924 and made between Erith
Oil Works Limited (1) and Callender's Cable & Construction Company
Limited (2)
1.4 as to part a Conveyance dated 31 January 1898 and made between Messrs F
Parish & F Hickson (1) and Callenders Cable & Construction Company
Limited (2)
1.5 as to part a Conveyance dated 21 November 1924 and made between E G
Dixon (1) Callender's Cable & Construction Company Limited (2)
1.6 as to part a Conveyance dated 20 September 1917 and made between E G
Dixon & A W Stone (1) and Callender's Cable & Construction Company
Limited (2)
1.7 as to part a Conveyance dated 2 December 1995 made between Unilever
Limited (1) and British Insulated Callender's Cables Limited (2)
1 Copies of the title documents having been produced to the Purchaser's
Lawyers prior to the date of this Agreement the Purchaser shall neither
make nor raise any objection or requisition regarding the title to
Erith save for any matter which arises as a result of the Purchaser's
pre-completion seaches.
2 In the transfer of Erith the Purchaser (as the Transferee) will
covenant with the Vendor (as Transferor) as follows:
<PAGE> 190
"1. The Transferee with the object and intention of affording to
the Transferor a full and sufficient indemnity but not further
or otherwise hereby covenants with the Transferor that the
Transferee and the persons deriving title under the Transferee
will at all times hereafter observe and perform all covenants
restrictions stipulations agreements and conditions contained
or referred to in the documents set out below so far as they
relate to Erith and are subsisting and capable of being
enforced and taking effect and will keep the Transferor and the
successors in title of the Transferor indemnified from and
against all costs, claims, actions, proceedings, expenses and
liability whatsoever for or on account of any breach,
non-observance or non-performance thereof so far as aforesaid
Conveyance dated 4 August 1971 and made between British
Insulated Callenders Cables Limited (1) and Charrington Gardner
Locket (London) Limited (2)
Transfer dated 13 January 1972 made between British Callenders
Cables Limited (1) and Pioneer Concrete (Holdings) Limited (2)
Conveyance dated 9 July 1982 and made between BICC Public
Limited Company (1) and James McNaughton Paper Group Limited
(2)
Copy Letter dated 4 November 1983 from BICC plc to London
Borough of Bexley
Transfer dated 4 March 1988 made between BICC Public Limited
Company (1) and Western Motor Works Chislehurst Limited (2)
Deed of Covenants dated 10 May 1902 and made between Callenders
Cable & Construction Company Limited and (1) The British
Firelighter Company Limited (2)
Agreement dated 16 May 1903 and made between The Commissioners
of Sewers (1) and Callenders Cable & Construction Company
Limited (2)
Agreement dated 19 July 1905 and made between The Commissioners
of Sewers (1) and Callender's Cable & Construction Company
Limited (2)
Agreement dated 24 September 1923 and made between The Erith
Urban District Council (1) and Callender's Cable & Construction
Company Limited (2)
Agreement dated 13 December 1928 and made between The
Commissioners of Sewers (1) and Callenders Cable and
Construction Company Limited (2)
Agreement dated 27 July 1942 and made between Kent Rivers
Catchment Board (1) and Callender's Cable & Construction
Company Limited (2)
Conveyance dated 20 December 1946 and made between Callenders
Cable & Construction Company Limited (in liquidation) (1)
Harold Hockley (2) and British Insulated Callender's Cables
Limited (3)
Conveyance dated 16 September 1958 and made between British
Insulated Callender's Cables Limited (1) and Kent River Board
(2)
Letter dated 8 December 1978 from London Electricity to British
Insulated Cables Limited
<PAGE> 191
Deed of Easement dated 21 October 1986 made between BICC plc
(1) and Thames Water Authority (2)
Agreement dated 11 January 1963 made between Kent River Board
(1) and BICC Limited (2)
Conveyance dated 2 December 1913 made between Sir James
Whitehead (1) Erith Oil Works, Limited (2)
Licence dated 22 May 1973 and made between Unilever Limited (1)
and British Insulated Callender's Cables Limited (2)"
"2. The Transferee hereby covenants with the Transferor that the
Transferee and the Transferee's successors in title will
henceforth during the continuance of the term of the lease
("the Erith Lease") dated 8 July 1971 made between British
Insulated Callender's Cables Limited (1) and the Mayor Aldermen
and Burgesses of the London Borough of Bexley (2) observe and
perform the landlord's obligations contained in or arising
under the Erith Lease and will indemnify the Transferor and the
successors in title of the Transferor from and against all
actions, proceedings, costs, claims, expenses and liability in
respect of the same"
3 The Vendor is unable to locate any title documents to the land coloured
green and coloured blue hatched black on the plan annexed hereto and
marked "ESC" and the Purchaser shall raise no requisition nor make any
objection with regard thereto. The Vendor will hand over to the
Purchaser on completion the Statutory Declaration made by Martin John
Pink on 9 February 1999 relating to the Vendor's title to such land
4 In respect of those parts of Erith title to which is registered at HM
Land Registry under title numbers SGL162761 and SGL579129 the
registered proprietor of the land within each title is Balfour Beatty
Limited. By a transfer dated 15th February 1999 Balfour Beatty Limited
transferred the land within title numbers SGL162761 and SGL 579129 to
the Vendor (the "TRANSFER"). In respect of the Transfer the Vendor
shall:
(a) procure that the Transfer is presented forthwith to the Inland
Revenue and properly stamped either with ad valorem duty or
marked to indicate the Transfer is exempt from such duty; and
(b) forthwith following satisfaction of the obligation set out in
paragraph 5(a) above deliver the Transfer to Croydon District
Land Registry (Ref. SGL162761/D/222) and advise the Purchaser's
Lawyers accordingly;
<PAGE> 192
(c) promptly and fully satisfy all requisitions raised by HM Land
Registry in connection with the registration of the Transfer at
HM Land Registry and copy all correspondence relating thereto
to the Purchaser's Lawyers.
5
(a) As soon as reasonably practicable after Completion the Vendor
will give notice to terminate an agreement dated 9th July 1982
between BICC Public Limited Company (1) and James McNaughton
Paper Group Limited (2) ("the McNaughton Agreement") in
accordance with the provisions thereof and the Vendor will
provide to the Purchaser
a copy of such notice.
(b) As from the Completion Date the Purchaser will perform all the
obligations on the part of the Vendor contained in the
McNaughton Agreement until the McNaughton Agreement terminates
and will fully and effectively indemnify and at all times keep
the Vendor indemnified against all claims demands actions costs
expenses and liabilities under the McNaughton Agreement in
respect of the period commencing on the Completion Date.
(c) The Vendor will demand all sums properly receivable for the
services provided under the McNaughton Agreement until the
McNaughton Agreement terminates and the Vendor will upon
receipt pay such sums to the Purchaser.
(d) If James McNaughton Paper Group Limited default in paying any
sums owing under the McNaughton Agreement to the Vendor, the
Vendor will take all reasonable steps to enforce the payment
obligation of James McNaughton Paper Group Limited at the cost
of the Vendor.
<PAGE> 193
BUSINESS SELLERS' SPECIAL CONDITION
PROPERTY AFFECTED
PRESCOT 1. As to the unregistered freehold land title will
commence with: as to part an Indenture made the 16
September 1925 between Robina Hughes (1) and The British
Insulated and Helsby Cables Limited (2)
as to part an Indenture made the 31 December 1924 between
Ottiwell Ward and his mortgagee (1) and British Insulated
Cables Limited (2)
as to part a Conveyance made 27 November 1928 between
Catherine Kerfoot (1) and British Insulated Cables Limited
(2)
as to part a Conveyance made the 1st August 1935 between
William Francis Reakes (1) and British Insulated Cables
Limited (2)
as to part a Conveyance made 30 January 1942 between
Messrs W A Cross and W Coombes (1) and British Insulated
Callender's Cables Limited (2)
as to part a Conveyance made 30 January 1942 between
Charles Wood (1) William Caldwell (1) and British
Insulated Cables Limited (3)
as to part a Conveyance made 30 January 1942 between
Elizabeth Jane Humphreys-Jones and others (1) Walter
Coombs (2) and British Insulated Cables Limited (3)
as to part a Conveyance made the 22 March 1974 between
Prescot Urban District Council (1) and British Insulated
Callender's Cables Limited (2)
<PAGE> 194
BUSINESS SELLERS' SPECIAL CONDITION
PROPERTY AFFECTED
as to part a Conveyance made the 22 March 1974 between
Prescot Urban District Council (1) and British Insulated
Callender's Cables Limited (2)
as to part a Deed of Exchange made 20 January 1944 between
the Prescot Urban District Council (1) and British
Insulated Cables Limited (2)
as to part a Conveyance made 18 October 1943 between
Charles Wood (1) and British Insulated Cables Limited (2)
as to the remainder ("the Green Land") a Statutory
Declaration dated 25 March 1971 by Emlyn Dickin
2. Title to the freehold land comprised in title number
MS85907 will be deduced in accordance with Section 110 of
the Land Registration Act 1925
3. The Vendor is unable to locate any title documents
to the Green Land other than the Statutory Declaration of
Emlyn Dickin referred to above and the Purchaser shall
raise no requisition nor make any objection with regard
thereto. The Vendor will hand over to the Purchaser on
completion Statutory Declaration in agreed terms made by
Victor Harold Bellard on 31 March 1999 relating to the
Vendor's title to the Green Land and to the boundaries of
the whole of Prescot.
4. As respects the Green Land the Vendor agrees to
transfer its estate right and interest in the Green Land
and shall be expressed to transfer the same with no title
guarantee.
5. Copies of the title documents (save as mentioned in
paragraph 3 above) having been produced to the Purchaser's
Lawyers prior to the date of this Agreement the Purchaser
shall neither make nor raise any objection or requisition
regarding title to Prescot save for any matter which
arises as a result of the Purchaser's pre-completion
searches.
6. In the transfer of Prescot the Purchaser (as the
Transferee) shall enter into the following covenants with
the Vendor (as the Transferor):
"The Transferee with the object and intention of affording
to the
<PAGE> 195
BUSINESS SELLERS' SPECIAL CONDITION
PROPERTY AFFECTED
Transferor a full and sufficient indemnity but not further
or otherwise HEREBY COVENANTS with the Transferor that the
Transferee and the persons deriving title under the
Transferee will at all times hereafter observe and perform
the covenants, restrictions, stipulations, agreements and
conditions contained or referred to in the documents set
out below so far as they relate to [Prescot] and are
subsisting and capable of being enforced and taking effect
and will keep the Transferor and the successors in title
of the Transferor indemnified from and against all costs,
claims, actions, proceedings, expenses and liability
whatsoever for or on account of any breach, non-observance
or non-performance thereof:
Agreement made 10 September 1942 between the Prescot Urban
District Council (1) and British Insulated Cables Limited
(2);
Deed of Grant made 3 August 1972 between British Insulated
Callender's Cables Limited (1) and The Lord Mayor Aldermen
and Citizens of the City of Liverpool (2);
Agreement made 1 April 1998 between Richwalk Properties
Limited (1) and the Vendor (2);
Services Agreement made 1 April 1998 between Richwalk
Properties Limited (1) and the Vendor (2)"
7. Prescot is sold subject to and with the benefit of
the tenancies and licences ("the Prescot Leases") short
particulars of which are set out below:
09.06.1989 The Vendor(1) 75 years from
The Merseyside 09.06.1989
and North Wales
Electricity
Board (2)
[23.11.1989] The Vendor(1)
British Gas (2)
02.01.1997 BICC Cables 12 months from
Limited (1) 1 January 1997
MVM Construction
<PAGE> 196
BUSINESS SELLERS' SPECIAL CONDITION
PROPERTY AFFECTED
and Building
Services (2)
and in the transfer of Prescot the Purchaser (as the
Transferee) will covenant with the Vendor (as the
Transferor) as follows:
"The Transferee HEREBY COVENANTS with the Transferor that
the Transferee and the Transferee's successors in title
will henceforth during the continuance of the terms of
[the Prescot Leases] observe and perform the landlord's
obligations contained in or otherwise arising under [the
Prescot Leases] and will indemnify the Transferor and the
successors in title of the Transferor from and against all
actions, proceedings, costs, claims, expenses and
liability in respect of the same"
8. On or before Completion the Vendor will procure the
surrender by BICC Rod & Wire Limited ("R&WL") of the
lease (the "LEASE") by operation of law of part of
Prescot dated 6th January 1981 made between (1) the
Vendor and (2) R&WL (then known as Prescot Rod Rollers
Limited) (as the same is registered at HM Land Registry
under title number MS151817) and at Completion will
deliver to the Purchaser: (a) The orginal Lease and any
documents made supplemental thereto;
(b) A properly completed and dated deed of release
executed by R&WL containing a release of the lessor under
the terms of the Lease from its covenants and obligations
contained in the Lease;
(c) The land certificate relating to title MS151817;
(d) Vacant possession of the premises which are the
subject of the Lease
9. At Completion the Vendor will enter into a deed of
assignment in such form as the parties shall agree with
the Purchaser pursuant to which it will assign to the
Purchaser the benefit of an agreement dated 1st April 1998
between (1) Richwalk Properties Limited and (2) the Vendor
and which creates a right of pre-emption over land
adjoining Prescot in favour of the Vendor.
10. The Vendor is unable to locate the lease which is
believed to be dated 23rd November 1989 and made between
the Vendor (1) and British Gas (2) and the Purchaser shall
raise no requisition
<PAGE> 197
BUSINESS SELLERS' SPECIAL CONDITION
PROPERTY AFFECTED
nor make any objection with regard thereto.
PRESCOT SOCIAL CLUB 1. As to the unregistered freehold land title will
commence with:
as to part an Indenture made 12th July 1916 between
Prescot & Helsby Estates Limited (1) and The British
Insulated and Helsby Cables Limited (2)
as to the remainder an Indenture made 16th June 1927
between Prescot and Helsby Estates Limited (1) and The
British Insulated Cables Limited (2)
2. Copies of the title documents having been produced
to the Purchaser's Lawyers prior to the date of this
Agreement the Purchaser shall neither make nor raise any
objection or requisition regarding title to Prescot Social
Club save for any matter which arises as a result of the
Purchaser's pre-completion searches.
3. In the transfer of the Prescot Social Club the
Purchaser (as the Transferee) shall enter into the
following covenant with the Vendor (as the Transferor):
"The Transferee with the object and intention of affording
to the Transferor a full and sufficient indemnity but not
further or otherwise HEREBY COVENANTS with the Transferor
that the Transferee and the persons deriving title under
the Transferee will at all times hereafter observe and
perform the obligations on the part of the licensee
contained in two Agreements made 16 February 1972 and 17
March 1972 between The British Railways Board (1) and
British Insulated Callender's Cables Limited (2) so far as
they are subsisting and capable of being enforced and
taking effect and will keep the Transferor and the
successors in title of the Transferor indemnified from and
against all costs, claims, actions, proceedings, expenses
and liability whatsoever for or on account of any breach
non-observance or non-performance thereof"
4. Prescot Social Club is sold subject to and with the
benefit of a residential tenancy in favour of Andrew
Kearns relating to 103 Warrington Road Prescot (which
forms part of Prescot Social Club) and of the lease short
particulars of which are set out below ("the
<PAGE> 198
BUSINESS SELLERS' SPECIAL CONDITION
PROPERTY AFFECTED
Prescot Social Club Leases"):
DATE PARTIES TERM
06.04.1983 The Vendor (1) 125 years from
Metropolitan 25 March 1983
Borough of
Knowsley (2)
and in the transfer of Prescot Social Club the Purchaser
(as the Transferee) will covenant with the Vendor (as the
Transferor) as follows:
"The Transferee HEREBY COVENANTS with the Transferor that
the Transferee and the Transferee's successors in title
will henceforth during the continuance of the terms of
[the Prescot Social Club Leases] observe and perform the
landlord's obligations contained in or otherwise arising
under [the Prescot Social Club Leases] and will indemnify
the Transferor and the successors in title of the
Transferor from and against all actions, proceedings,
costs, claims, expenses and liability in respect of the
same"
HEBBURN 1. The title to Hebburn will commence with:
as to part a Conveyance made 24 July 1964 between the
Carr-Ellison Hebburn Estates Limited (1) and Pyrotenax
Limited (2)
as to part a Conveyance made 15 November 1967 between the
Urban District Council of Hebburn (1) and Pyrotenax
Limited (2)
as to part a Conveyance made 16 April 1971 between The
North Eastern Housing Association Limited (1) The Public
Works Loan Commissioners (2) The Minister of Housing and
Local Government (3) The Urban District Council of Hebburn
(4) and Pyrotenax Limited (5)
as to part a Conveyance made 2 September 1971 between
Wailes Dove Bitumastic Limited
(1) Lloyds Bank Limited (2) and Pyrotenax Limited (3)
as to part a Conveyance made 9 August 1972 between Wailes
Dove Bitumastic Limited (1) Lloyds Bank Limited (2) and
Pyrotenax Limited (3)
as to the remainder a Conveyance made 23 August 1962
between
<PAGE> 199
Wailes Dove Bitumastic Limited (1) and Pyrotenax Limited
(2)
2. Copies of the title documents having been produced
to the Purchaser's Lawyers prior to the date of this
Agreement the Purchaser shall neither make nor raise any
objection or requisition regarding the title to Hebburn.
3. In the transfer of Hebburn the Purchaser (as the
Transferee) will covenant with the relevant Business
Seller (as the Transferor) as follows:
"The Transferee with the object and intention of affording
to the Transferor a full and sufficient indemnity but not
further or otherwise hereby covenants with the Transferor
that the Transferee and the persons deriving title under
the Transferee will at all times hereafter observe and
perform the covenants restrictions stipulations agreements
and conditions contained or referred to in the documents
set out below so far as they relate to Hebburn and are
subsisting and capable of being enforced and taking effect
and will keep the Transferor and the successors in title
of the Transferor indemnified from and against all costs,
claims, actions, proceedings, expenses and liability
whatsoever for or on account of any breach, non-observance
or non-performance thereof so far as aforesaid:
- the covenants contained in a Conveyance made 24
July 1964 between the Carr-Ellison Hebburn Estates
Limited (1) and Pyrotenax Limited (2)
- the covenants on the part of the vendor contained
in a Conveyance made 29 August 1991 between
Pyrotenax Limited (1) and Barrett Newcastle
Limited (2)
- the covenants contained in a Conveyance made 15
November 1967 between The Urban District Council
of Hebburn (1) and Pyrotenax Limited (2)
- the provisions of an Agreement made 8 February
1957 between The British Transport Commission (1)
and the Hebburn Urban District Council (2)
- the covenants and provisions referred to in a
Conveyance made 14 April 1920 between Ralph Henry
Carr-Ellison (1) Peter William Purves and Anor (2)
and The Urban District Council of Hebburn (3)
insofar as they were not released by a Deed made
15 November 1967 between John Craddock
Carr-Ellison and Others (1) and Pyrotenax Limited
(2)
<PAGE> 200
- the covenants and conditions contained in a
Conveyance made 14 January 1938 between The Urban
District Council of Hebburn (1) and the North
Eastern Housing Association Limited (2)
- the covenant on the part of the purchaser
contained in a Conveyance made 16 April 1971
between The North Eastern Housing Association
Limited (1) The Public Works Loan Commissioners
(2) The Minister of Housing and Local Government
(3) The Urban District Council of Hebburn (4) and
Pyrotenax Limited (5)
- the covenants and other matters contained
mentioned or referred to in a Conveyance made 6
December 1926 between John Campbell Carr-Ellison
(1) Peter William Purves and Anor (2) and Wailes
Dove Bitumastic Limited (3)
- the covenants contained in a Conveyance made 2
September 1971 between Wailes Dove Bitumastic
Limited (1) Lloyds Bank Limited (2) and Pyrotenax
Limited (3)
- the provisions of two Agreements made 24 October
1924 and 24 May 1925 between The London and North
Eastern Railway Company (1) and Wailes Dove
Bitumastic Limited (2)
- the covenants contained in a Conveyance made 9
August 1972 between Wailes Dove Bitumastic Limited
(1) Lloyds Bank Limited (2) and Pyrotenax Limited
(3) and
- the covenants on the part of the Purchaser
contained in a Conveyance made 23 August 1962
between Wailes Dove Bitumastic Limited (1) and
Pyrotenax Limited (2)
4. The Vendor will hand over to the Purchaser on
Completion the Statutory Declaration made by David Smart
on 31 March 1999 relating to the relevant Business
Seller's title to Hebburn.
NOTTINGHAM 1. Title to Nottingham will be deduced in accordance
with section 110 of the Land Registration Act 1925.
2. Nottingham is sold subject to and with the benefit
of the tenancies and licences (the "Nottingham Leases")
short particulars of which are set out below:
Date Document Parties
<PAGE> 201
02.02.1996 Agreement for use of Temco Limited(1)
land and
A.R. Bond(2)
08.11.1995 Lease of site of Fine Wires Limited(1)
electricity sub-station and
East Midlands
Electricity Plc(2)
22.06.1995 Lease of land for BICC Public Limited
display of Company(1)
advertisements and
Maiden Outdoor
Advertising Limited(2)
and in the transfer of Nottingham the Purchaser (as the
Transferee) will covenant with the relevant Business
Seller (as the Transferor) as follows:
"The Transferee hereby covenants with the Transferor that
the Transferee and the Transferee's successors in title
will henceforth during the continuance of the terms of
["the Nottingham Leases"] observe and perform the
landlord's obligations contained in or otherwise arising
under ["the Nottingham Leases"] and will indemnify the
Transferor and the successors in title of the Transferor
from and against all actions, proceedings, costs, claims,
expenses and liability in respect of the same".
3. In the transfer of Nottingham the Purchaser (as the
Transferee) will covenant with the relevant Business
Seller (as the Transferor) as follows:
"The Transferee with the object and intention of
affording to the Transferor a full and sufficient
indemnity but not further or otherwise hereby covenants
with the Transferor that the Transferee and the persons
deriving title under the Transferee will at all times
hereafter observe and perform the covenants contained or
referred to in the Charges Registers of the title numbers
NT98172, NT78063, NT72820, NT64705, NT59845, NT66997,
NT65304, NT96593, NT80206 and NT72827 so far as they are
still subsisting and capable of being enforced and taking
effect and will keep the Transferor indemnified from and
against all costs, claims, actions, proceedings, expenses
and liability whatsoever for or on account of any breach
non-observance or non-performance thereof so far as
aforesaid".
4. The Vendor cannot produce the original or a copy or
an abstract of the Conveyances dated 5 February 1885, 5
February 1895 and 7 October 1919 referred to in the
Charges Registers of
<PAGE> 202
title numbers NT80206 and NT78063 and the Purchaser shall
not make or raise any objection or requisition with regard
to the loss or non-production thereof.
SWANSEA Title to Swansea will consist of:
Sub-Underlease dated 14 December 1998 and made between (1)
R.V.B Investments Limited and (2) BICC Components Limited
Schedule of Condition prepared by Matthews & Goodman in
November 1998
Underlease dated 21 February 1990 and made between (1)
Sylfaen Construction Limited and (2) R.V.B Investments
Limited
Lease dated 21 February 1990 and made between (1) The
Council of the City of Swansea and (2) Sylfaen
Construction Limited
A copy of each of the above documents having been produced
to the Purchaser's Lawyers prior to the date of this
Agreement the Purchaser shall neither make nor raise any
objection or requisition regarding the title to Swansea.
LEIGH 1 As to the unregistered land title will commence with:
as to part a Conveyance and Assignment dated 1 September
1952 and made between The Anchor Cable Company Limited (1)
and British Insulated Callender's Cables Limited (2)
as to part a Conveyance dated 23 October 1961 and made
between The Mayor Alderman and Burgesses of the Borough of
Leigh (1) British Insulated Callender's Cables Limited (2)
as to part a Conveyance dated 24 June 1964 and made
between McGregor Bros Limited (1) British Insulated
Callender's Cables Limited (2)
as to part a Conveyance dated 14 December 1972 and made
between British Railways Board (1) and British Insulated
Callender's Cables Limited (2)
as to part a Statutory Declaration made by Geoffey Howard
Saunders on 31 March 1999
2 Title to the freehold land comprised in title number
GM554320 which will be deduced in accordance with Section
110 of Land Registration Act 1925
3 Copies of the title documents having been produced to
the Purchaser's Lawyers prior to the date of this
Agreement the Purchaser shall neither make nor raise any
objection or requisition regarding the title to Leigh
4 The Vendor is unable to locate any title documents to
the land coloured brown on the plan annexed to the
Statutory Declaration
<PAGE> 203
made by Geoffrey Howard Saunders on 31 March 1999 ("the
Statutory Declaration") relating to the Vendor's title to
Leigh and the Purchaser shall raise no requisition nor
make any objection with regard thereto. The Vendor will
hand over to the Purchaser on completion the Statutory
Declaration
5 The Vendor is selling that half of the road shaded
blue and hatched green on plan 1 attached to the Statutory
Declaration bordering the land comprised in title number
GM 648967 with limited title guarantee
6 In the transfer of Leigh the Purchaser (as the
Transferee) shall enter into the following covenant with
the Vendor (as the Transferor):
"The Transferee with the object and intention of affording
to the Transferor a full and sufficient indemnity but not
further or otherwise HEREBY COVENANTS with the Transferor
that the Transferee and the persons deriving title under
the Transferee will at all times hereafter observe and
perform the covenants, restrictions, stipulations,
agreements and conditions contained or referred to in the
documents set out below so far as they relate to Leigh and
are subsisting and capable of being enforced and taking
effect and will keep the Transferor and the successors in
title of the Transferor indemnified from and against all
costs, claims, actions, proceedings, expenses and
liability whatsoever for or on account of any breach,
non-observance or non-performance thereof so far as
aforesaid:
Conveyance and Assignment dated 1 September 1952 between The Anchor Cable
Company Limited (1) and British Insulated Callender's Cables Limited (2).
Conveyance dated 9 November 1901 between the Trustees of the Will of the late
Duke of Bridgewater (1) and The Anchor Cable Company Limited (2) insofar as they
were not released by a Deed of Release dated 8th April 1993 between Starcrest
Developments Limited (1) and BICC Plc (2).
Agreement dated 6 October 1939 between J.W. Unsworth & others (1) and The Anchor
Cable Company Limited (2)
With the exception of Clause 4(a) the Conveyance and Assignment dated 18 July
1988 between BICC Plc (1) and Mr. P. Boydell (2)
Clauses 12.3 and 12.4 of the Agreement dated 6 January 1993 between BICC Plc (1)
and Cumbria Leisure Limited (2)
Option Agreement dated 13 July 1993 between Wapping Leisure Limited (1) and BICC
PLC (2).
Sterilization Agreement dated 15 November 1955 between The National Coal Board
(1) and British Insulated Callender's Cables Limited (2).
<PAGE> 204
Supplemental Deed to Sterilization Agreement dated 4 September 1984 between BICC
PLC (1) and the National Coal Board (2).
Deed of Grant dated 30 November 1957 between The Manchester Ship Canal Company
(1) and British Insulated Callender's Cables Limited (2)
Agreement dated 20 July 1960 between The Manchester Ship Canal Company (1) and
British Insulated Callender's Cables Limited (2)
Agreement dated 22 January 1975 between The Manchester Ship Canal Company (1)
and British Insulated Callender's Cables Limited (2)
Licence to Abstract Water dated 21 January 1966 between Mersey and Weaver River
Authority (1) and British Insulated Callendar's Cables Limited (2)
Electricity Agreement dated 28 August 1957 between The North Western Electricity
Board (1) and British Insulated Callender's Cables Limited (2)
Agreement dated 12 December 1896 between The Trustees under the Will of Francis
Duke of Bridgewater (1) The Right Honourable Francis Charles Granville Egerton
Earl of Ellesmere (2) and Leigh Atherton Joint Sewerage Authority (3).
Deed of Grant dated 30 May 1899 between The Trustees under the Will of Francis
Duke of Bridgewater (1) The Right Honourable Francis Granville Egerton Earl of
Ellesmere (2) and Urban District Council of Leigh (3).
Deed of Grant dated 15 March 1916 between John Francis Granville Scrope Fourth
Earl of Ellesmere (1) and Joseph Albert Pearse (2).
Conveyance dated 28 July 1922 between John Francis Granville Scrope Fourth Earl
of Ellesmere (1) and Thomas Henry Frederick Egerton (The Ellesmere Settlement
Trustees) (2) and Leigh Football Club Ltd.(3).
Conveyance dated 9 May 1925 between The Leigh Football Club Limited (1) William
Moss (2) and The Anchor Cable Company Limited (3).
Agreement dated 21 February 1861 between The London & North Western Railway Co.
(1) The Trustees of the Will of Francis late Duke of Bridgewater (2) and The
Right Honourable George Granville Egerton Earl of Ellesmere (3).
Conveyance dated 31 December 1925 between Bridgewater Estates Limited (1) The
Trustees of the Debenture Stockholders (2) and The Anchor Cable Company Limited
(3).
Conveyance dated 5 October 1901 between The Trustees of the Will of the Duke of
Bridgewater (1) Earl of Ellesmere (2) and Alexander Cunningham McGregor and
Richard McGregor (3) insofar as they were not released by a Deed of Release
between Starcrest Developments Limited (1) and BICC Plc (2).
Conveyance dated 28 October 1902 between Alexander McGregor and Richard McGregor
(1) and McGregor Bros. Limited (2).
Conveyance dated 17 November 1926 between McGregor Bros. Limited (1) and The
Anchor Cable Company Limited (2).
Conveyance dated 22 October 1940 between George Shaw & Company Limited (1) and
The Anchor Cable Company Limited (2).
<PAGE> 205
Conveyance dated 19 December 1924 between The Leigh Football Club Limited (1)
George Shaw and Company Limited (2) and The Mayor Aldermen and Burgesses of the
Borough of Leigh (3).
Conveyance dated 23 October 1961 between The Mayor Aldermen and Burgesses of the
Borough of Leigh (1) and British Insulated Callender's Cables Limited (2).
Conveyance dated 24 June 1964 between McGregor Bros. Limited (1) and British
Insulated Callender's Cables Limited (2).
Conveyance dated 31 December 1863 between The Right Honourable Robert Lord Ebury
and others (1) George Law (2) and the London and North Western Railway Company
(3).
Conveyance dated 14 December 1972 between British Railways Board (1) and British
Insulated Callender's Cables Limited (2).
Transfer dated 22 December 1998 between BICC PLC (1) and John Derek Hart and
Alan Fred Taylor (2)
The matters referred to in the Charges Register for Title Number GM554320 (if
applicable)
6. The Vendor shall indemnify the Purchaser against any loss suffered by
the Purchaser as a result of any payments properly made by the
Purchaser in respect of moneys due to Mr P. Boydell pursuant to the
Conveyance and Assignment dated 18 July 1988 referred to above.
7. The Vendor cannot produce the original or a copy or an abstract of
7.1 the following Conveyances and Agreements noted on the
Conveyance and Assignment dated 1 September 1952 between The
Anchor Cable Company Limited (1) and British Insulated
Callender's Cables Limited (2):
Agreement dated 21 July 1971 between British Insulated
Callender's Cables Limited (1) and The Mayor Alderman &
Burgesses of the Borough of Leigh (2).
Agreement dated 12 February 1973 between Bridgewater Estates
Limited (1) BICC Limited (2) and The Mayor Alderman & Burgesses
of the Borough of Leigh (3).
Transfer dated 15 November 1976 between BICC Limited (1) and
Carndale Property Company Limited (2).
Assignment dated 19 August 1983 between BICC plc (1) and
Carndale Property Limited (2).
Transfer dated 19 August 1983 made between BICC plc (1) and J&D
J Parnall (2).
<PAGE> 206
Assignment dated 7 May 1984 between BICC plc (1) and JJ and MC
Lawton (2).
Assignment dated 19 August 1983 made between BICC plc (1) and
Hightown Homes Limited (2).
Transfer dated 6 September 1983 made between BICC plc (1) and
The Greater Manchester County Council (2).
Conveyance dated 15 November 1985 and made between BICC plc (1)
and Norman Fletcher and William Herbert Bates (2).
7.2 such other Conveyances and Assignments and Transfers which may
have been entered into for the disposal of land formerly
forming part of Leigh
and the Purchaser shall neither make nor raise any objection
or requisition with regard to the loss or non production
thereof.
8. Leigh is sold subject to and with the benefit of the provisions of
Annexure o which will take effect from Completion.
WREXHAM 1 As to the unregistered land title will commence
with: as to part a Conveyance dated 19 November
1966 and made between Herbert Bellis (1) and
British Insulated Callender's Cables Limited (2)
as to the remainder a Conveyance dated 19 November
1966 and made between Marston Frank Freeman (1)
and British Insulated Callender's Cables Limited
(2).
2 Title to the freehold land comprised in title
number WA4134 will be deduced in accordance with
Section 110 of Land Registration Act 1925
3 Copies of the title documents having been produced
to the Purchaser's Lawyers prior to the date of
this Agreement the Purchaser shall neither make
nor raise any objection or requisition regarding
the title to Wrexham
4 In the transfer of Wrexham the Purchaser (as the
Transferee) shall enter into the following
covenant with the Vendor (as the Transferor):
"The Transferee with the object and intention of
affording to the Transferor a full and sufficient
indemnity but not further or otherwise HEREBY
COVENANTS with the Transferor that the Transferee
and the persons deriving title under the
Transferee will at all times hereafter observe and
perform the covenants, restrictions, stipulations,
agreements and conditions contained or referred to
in the documents set out below so far as they
relate to Wrexham and are subsisting and capable
of being
<PAGE> 207
enforced and taking effect and will keep the
Transferor and the successors in title of the
Transferor indemnified from and against all costs,
claims, actions, proceedings, expenses and
liability whatsoever for or on account of any
breach, non-observance or non-performance thereof
so far as aforesaid:
A Conveyance dated 30 January 1959 made between The Minister of Agriculture
Fisheries and Food and another (1) and Herbert Bellis (2).
Deed of Exchange dated 12 November 1986 made between Ian Pilson and Barbara Ann
Pilson (1) Abbey National Building Society (2) and BICC plc (3).
Conveyance dated 29 March 1960 made between The Minister of Agriculture
Fisheries and Food (1) and Marston Frank Freeman (2).
Conveyance dated 31 October 1962 made between Stanley Davis (1) and Marston
Frank Freeman (2).
Conveyance dated 2 June 1964 made between The Minister of Agriculture Fisheries
and Food (1) and Marston Frank Freeman (2).
Conveyance dated 10 October 1966 made between Herbert Bellis (1) and Marston
Frank Freeman (2).
The Charges Register for Title Number WA4314
5 Wrexham is sold subject to and with the benefit of the oral tenancies
and licences ("the Wrexham Leases") in favour of the following
occupants:
5.1 PPAR Construction
5.2 Lex Harvey
5.3 BICC Athletic and Social Club and
5.4 Angling Club
6. The Vendor cannot produce the original or a copy or an abstract of
6.1 the following Conveyances noted on the Conveyance dated 19
November 1966 and made between Marston Frank Freeman (1) and
British Insulated Callender's Cables Limited (2):
Conveyance dated 31 October 1972 made between British
Insulated Callender's Cables Limited (1) and Richard
Blantern (2) and
Conveyance dated 20 August 1984 made between BICC Plc (1)
and Peter Bryan Edwards and Joyce Edwards (2)
6.2 The Conveyance dated 19 November 1959 made between the Minister
of Agriculture Fisheries and Food (1) and Herbert Bellis (2)
referred to in a Deed of Exchange dated 12 November 1986 made
between Ian Pilson and Barbara Ann Pilson (1) Abbey National
Building Society (2) and BICC Plc (2)
6 6.3 The Conveyance dated 25 March 1949 made between the Minister
of
<PAGE> 208
Supply (1) and the Board of Trade (2)
6.4 The Conveyance dated 13 November 1970 made between John Garry
Bellis and Sheila Keys (1) and Charles Stanley Colling and
Margaret Beatrice Colling (2)
6.5 The Conveyance dated 3 December 1979 made between Charles
Stanley Colling and Margaret Beatrice Colling (1) and Matthew
Rowe Thomas and Alice Mary Thomas(2)
6.6 The Deed dated 30 January 1951 made between the Board (1) and
Wrexham & East Denbighshire Water Company (2)
6.7 The Deed dated 9 April 1951 made between the Board (1) and
Wales Gas Board (2)
6.8 The Conveyance dated 12 May 1948 made between Right Honorable
Lloyd Tyrell-Kenyon 5th Lord Kenyon Baron of Credington (1) and
The Board (2)
6.9 The Deed of Grant dated 28 November 1949 made between The Board
(1) and Wrexham Rural District Council (2)
6.10 Licence dated 7 February 1950 made between The Board (1) and
Wrexham and East Denbighshire Water Company(2)
and the Purchaser shall not make or raise any objection or
requisition with regard to the loss or non-production
thereof.
7. The Vendor will hand over to the Purchaser on completion the Statutory
Declaration made by Malcolm Delmar Jones on 1 April 1999 relating to
the Vendor's title to Wrexham.
8. Wrexham is sold subject to and with the benefit of the provisions of
Annexure o which will take effect as from the date of this Agreement.
<PAGE> 209
SCHEDULE 15
LIST OF SELLERS' INTELLECTUAL PROPERTY
PART A PATENTS OWNED BY THE RELEVANT SELLERS TO BE TRANSFERRED TO
THE PURCHASER OR RELEVANT PURCHASER (AS THE CASE MAY BE)
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR
RELEVANT SELLER
<S> <C> <C> <C> <C> <C>
Skin modification NZ Granted 235875 235875
Char stabiliser tape US Granted 5310964 07/917316
Irradiated Prespiral CA Pending 2144144
US Granted 56679192 08/398517
Lead-Free with Zn AR Pending 336634
MX Pending GB96/01252
US Pending 08/945825
PE Pending 00403
Oxygen Dipole Additive CA Pending 2259349
WO Pending 98/21278
Preformed-slug barrier CA Granted 1122129 341740
US Granted 4301325 103628
Labyrinth flame barrier CA Granted 1149036 357769
Multiturn trefoil cleat (base) CA Granted 1161624 383712
DE Granted 3174460 81303648
EP Granted 0048086 81303648
ES Granted 260001 260001
ES Granted 263279 263279
ES Granted 263280 263280
FR Granted 0048086 81303648
GB Granted 2082242 8124453
HK Granted 793/84
IT Granted 0048086 81303648
MY Granted 687/1985
NL Granted 0048086 81303648
SE Granted 0048086 81303648
SG Granted 461/84 8490461-4
US Granted 4397436 291779
Sabah Granted 292/1985
Sarawak Granted C2299
ZA Granted 81/5493 815493
</TABLE>
<PAGE> 210
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR
RELEVANT SELLER
<S> <C> <C> <C> <C> <C>
Multiturn trefoil cleat - strap AT Granted E16631 81303647
tensioner
CA Granted 1147932 383713
CH Granted 0047075 81303647
</TABLE>
<PAGE> 211
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
Multiturn trefoil cleat - strap DE Granted 3172984 81303647
tensioner
(Continued) DK Granted 151832 813604
EP Granted 0047075 81303647
ES Granted 260002 260002
FR Granted 0047075 81303647
GB Granted 2081802 8124452
HK Granted 148/85
IT Granted 0047075 81303647
MY Granted 1125/1985
NL Granted 0047075 81303647
NO Granted 159414 812734
SE Granted 0047075 81303647
SG Granted 884/84
Sabah Granted 30/86
Sarawak Granted C 2516
ZA Granted 81/5492 815492
Variable pohl clamp - sub- CA Granted 1159036 384619
assembly
Spider washer CA Granted 1079029 403544
GB Granted 0093524 83302094
US Granted 4515991 06/482144
Cable tie clip GB Granted 2140858 8411276
NO Granted 158553 841762
Optional-claw cleat DE Granted 9105112 9105112
GB Granted 2244087 9109104
HK Granted 94420
BL Cleat CA Pending 2162389
GB Granted 2292180 9522278
Thickened Shroud Seal US Pending 08/867812
ZA Granted 9510312 9510312
Sheath Pierce Termination GB Granted 2300765 9509667
Snap Gland GB Pending 9904480
Inside Entry Gland GB Published 9801998
Sealed Pierce Connector GB Pending 9902956
</TABLE>
<PAGE> 212
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
Helical Earth Bond GB Pending 9624610 Rights jointly owned by
Preformed Line Products
Ltd & BICC plc
Compressed Pierce GB Pending 9624609 Rights jointly owned by
Connector Preformed Line Products
Ltd & BICC plc
Flameproof locking ring CA Granted 1184986 412177
Modular boot GB Granted 2265501 9306276
Groovy Wiring Cable GB Granted 2275816 9403946
HK Granted 326/1997
Tear Off Reel GB Pending 9821266.5
Pressline End Cleat GB Granted 1019819 1019819
Sleeved rubber moulding GB Granted 2249223 9120337
HK Granted 1125/95 9120337
SG Granted 9591027-9 9120337
Curved Termination FR Granted 9502411 9502411
GB Granted 2287366 9504294
Stud Extender FR Granted 9613725 9613725
GB Published 9719494
Street Light Harness GB Pending 9808688
Heat Sink sheath CH Granted 0366473 89311077
EP Granted 0366473 89311077
GB Granted 0366473 89311077
HK Granted 1902/1996 89311077
IT Granted 0366473 89311077
SG Granted 9592259
Char stabiliser tape AT Granted 0526081 92306675
BE Granted 0526081 92306675
CA Granted 2074572 2074572
CH Granted 0526081 92306675
DE Granted 0526081 92306675
DK Granted 0526081 92306675
</TABLE>
<PAGE> 213
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
EP Granted 0526081 92306675
ES Granted 0526081 92306675
FR Granted 0526081 92306675
GB Granted 0526081 92306675
GR Granted 0526081 92306675
HK Granted 1000743 97102347
Char stabiliser tape IT Granted 0526081 92306675
(Continued) LU Granted 0526081 92306675
NL Granted 0526081 92306675
PT Granted 0526081 92306675
SE Granted 0526081 92306675
SG Granted 44741 9606680
Viscosity monitor CA Granted 1311866 559897
Semiconducting Monosil CA Granted 1166324 386092
Box reel - corrugated hub CA Granted 1217623
Reel/box reel manufacture CA Granted 1235291 446512
Laminated moisture barrier CA Granted 2003427 2003427
GB Granted 2225480 8926657
US Granted 5006670 07/438008
Vacuum filling strand GB Granted 2244849 9111555
Flexible Glover barrier CA Granted 1210619 429952
On-line void detection CA Granted 1222073 456927
Fill/draw/in-line anneal CA Granted 1068084 265153
Metallic constant watt AU Granted 594413 8767525
IT Granted 1205701 8747528
MI/cable/EMAT CA Granted 2013787 2013787
GB Granted 2232250 9007644
Temperature sensor CA Granted 2061212 2061212
pockets
Tip Clearance Probe CA Pending 2244886
EP Published 97903454
JP Pending 529096/97
US Granted 5760593 08/615372
</TABLE>
<PAGE> 214
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
Thermocouple Probe GB Published 9815821
Capacitance Transducer CA Pending 2243215 Rights jointly owned by
Apparatus and Cables BICC plc & Fylde
Electronics Ltd
EP Published 97902437 Rights jointly owned by
BICC plc & Fylde
Electronics Ltd
Capacitance Transducer HK Pending 99100647 Rights jointly owned by
Apparatus and Cables BICC plc & Fylde
(Continued) Electronics Ltd
JP Pending 527427/97 Rights jointly owned by
BICC plc & Fylde
Electronics Ltd
US Pending 09/117208 Rights jointly owned by
BICC plc & Fylde
Electronics Ltd
Tip Clearance Probe - GB Pending 9815823
Concept 5
Continuous fill/draw CA Granted 1187271 395844
Silicone impregnated M.I. GB Granted 2154783 8504380
Fire sealing pot (1) CA Granted 1261416 513461
FR Granted 8610976 8610976
GB Granted 2178606 8618416
IT Granted 1195890 8648341
Forced-flow powder filling AU Granted 615607 9050100
DE Granted 69005478 90301968
EP Granted 0384778 90301968
FR Granted 0384778 90301968
GB Granted 2230894 9004185
M.I. optical cable - case 2 GB Granted 2233788 9015244
Continuous sheathing GB Granted 2241255 9020557
Welding MIC sheath AT Granted 0452087 91303109
AU Granted 637894 9174368
BE Granted 0452087 91303109
CA Pending 2040193 2040193
CH Granted 0452087 91303109
DE Granted 0452087 91303109
DK Granted 0452087 91303109
EP Granted 0452087 91303109
</TABLE>
<PAGE> 215
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
ES Granted 0452087 91303109
FR Granted 0452087 91303109
GB Granted 2243483 9107453
GR Granted 0452087 91303109
IT Granted 0452087 91303109
LU Granted 0452087 91303109
NL Granted 0452087 91303109
SE Granted 0452087 91303109
Shaped M.I. conductor GB Granted 2247982 9119334
Hinged seal AU Granted 659095 9183825
CA Pending 2051823
DE Granted 69107748 91308263
EP Granted 0476909 91308263
ES Granted 0476909 91308263
FR Granted 0476909 91308263
GB Granted 0476909 91308263
IT Granted 0476909 91308263
SG Granted 0476909 9591536-9
US Granted 5198619 07/757226
Peelable Blister Pack GB Granted 2258647 9214383
Welding electrode control GB Granted 2257543 9214403
Stripping Head Assembly GB Granted 2288695 9507374
Silica/Silicone MI Cable EP Pending 98903200
WO Published GB98/00438
Mullite/Silica MI Cable EP Pending 98910830
WO Pending GB98/00665
Cable straightening tool GB Granted 2216443 8905994
Cable bending tool GB Granted 2216829 8905915
Ultrasonic drawing down DE Granted 0573313 93304420
EP Granted 0573313 93304420
ES Granted 0573313 93304420
FR Granted 0573313 93304420
GB Granted 0573313 93304420
IT Granted 0573313 93304420
Mullite M.I. Cable GB Pending 9813587
</TABLE>
<PAGE> 216
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
Flatpack Stator EP Published 96303606
Barrier feed joint US Granted 4330681 178790
Simple stop joint US Granted 4354050 1085944
Field moulded joint GB Granted 2268005 9312409
SG Published 9601142-4
O-ring stripping tool GB Granted 2272113 9321610
US Granted 5581885 08357185
3-D Conductive Polymers EP Published 96940028
GB Published 9811694
Foil Laminate Sheath AU Pending 43921/97
EP Pending 97942126
GB Pending 9620394
MY Pending PI9704535
Pinned Insulation WO Pending GB98/02662
ZA Pending 988165
Unbonded Laminate MY Pending PI9804148
Sheath
WO Pending GB98/02707
Chips in Oil GB Pending 9900190
Oversheath Fault Monitor EP Pending 99301696
Radio Discharge Detection GB Pending 9809713
Sub-Cable Discharge Test GB Pending 9900820
Cypermethrin Masterbatch GB Granted 2276171 9404236 Rights jointly owned by
BICC plc & Pirelli General
plc
SG Granted 47815 9604547 Rights jointly owned by
BICC plc & Pirelli General
plc
HK Granted 1000725 97102348 Rights jointly owned by
BICC plc & Pirelli General
plc
Mercury Superconductor BE Granted 0651909 93916112
CA Pending GB9301529
DE Granted 69309069 93916112
ES Granted 0651909 93916112
</TABLE>
<PAGE> 217
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
FR Granted 0651909 93916112
GB Granted 0651909 93916112
IT Granted 0651909 93916112
LU Granted 0651909 93916112
PT Granted 0651909 93916112
US Granted 5550105 GB9301529
Cross Rolling GB Granted 2278081 9310058
Loosely Housed AT Granted 0830692 96916226 Rights jointly owned by
Superconductor BICC plc & BICC CEAT
Cavi Srl
AU Published 59053/96 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
Loosely Housed BE Granted 0830692 96916226 Rights jointly owned by
Superconductor BICC plc & BICC CEAT
Cavi Srl
(Continued) CA Pending 2224272 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
CH Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
CN Published 96195945 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
DE Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
DK Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
EG Pending 512/96 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
EP Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
ES Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
FI Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
FR Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
GB Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
GR Granted 0830692 96916226 Rights jointly owned by
</TABLE>
<PAGE> 218
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
BICC plc & BICC CEAT
Cavi Srl
IE Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
IN Pending 1233/DEL/96 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
IT Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
JP Pending 500218/97 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
LU Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
MC Published 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
MY Pending PI 9602294 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
Loosely Housed NL Granted 0830692 96916226 Rights jointly owned by
Superconductor BICC plc & BICC CEAT
Cavi Srl
(Continued) PH Pending 53427 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
PT Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
SE Granted 0830692 96916226 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
SG Pending 9706091-7 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
TW Granted 088926 85106946 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
US Pending 08/973170 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
ZA Granted 96/4882 96/4882 Rights jointly owned by
BICC plc & BICC CEAT
Cavi Srl
Linear Tape MY Pending Pi9802916
PE Pending 434.98
WO Published GB98/01835
Radial Superconductor GB Pending 9807348
</TABLE>
<PAGE> 219
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
Current Leads - Anchor GB Pending 9819545
Hydral loaded EVA US Granted 4370076 123433
Wiring cable/separable CA Granted 1197297 429951
earth
</TABLE>
<PAGE> 220
PART B REGISTERED DESIGNS OWNED BY THE RELEVANT SELLERS TO BE
- ------ TRANSFERRED TO THE PURCHASER OR RELEVANT PURCHASER
(AS THE CASE MAY BE)
<TABLE>
<CAPTION>
TITLE COUNTRY STATUS PATENT APPLICATION TITLE HOLDER OF RECORD IF
NUMBER NUMBER NOT BICC PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
Through Connector Case 2 GB Granted 1044940 1044940
Through Connector Case 3 GB Granted 1044941 1044941
Tapping Connector Case 1 GB Granted 1044942 1044942
Tapping Connector Case 2 GB Granted 1044943 1044943
'Pressline' end cleat GB Granted 2159206 8512996
Serrated Y Connector GB Granted 1060854 1060854
Reversible Press Line GB Granted 2078732 2078732
Cleat
Press Line Corner Cleat GB Granted 2079273 2079273
Pressline Control Box GB Granted 2079713 2079713
</TABLE>
<PAGE> 221
PART C TRADEMARKS TO BE ASSIGNED FROM RELEVANT SELLER TO THE
- ------ PURCHASER OR RELEVANT PURCHASER (AS THE CASE MAY BE)
<TABLE>
<CAPTION>
TRADEMARK COUNTRY STATUS REGISTRATION APPLICATION OWNER IF NOT BICC
NUMBER NUMBER PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
EASIPEEL CABLES NZ Registered 231502 231502 MM Cables N.Z. Ltd
(Assignment to
BICC plc in progress)
FIRETARD NZ Registered 185049 185049 MM Cables N.Z. Ltd
(Assignment to
BICC plc in progress)
HYPERFLEX NZ Pending 290642 MM Cables N.Z. Ltd
(Assignment to
BICC plc in progress)
RELIANCE GB Registered 577479 577479
TELECLEATS US Registered 1251654 73/279935
BICC ARMAFLEX BX Registered 76989 559251
BIMODRUM GB Registered 1514436 1514436
CONCEL IR Registered 83938 7612464
DEVILEAD LY Pending 8854
DEVILENE LY Pending 8855
DEVILENE IR Registered 82948 7608274
DEVILINE LY Pending 8856
DEVILINE IR Registered 83939 7612462
PHILLIPS CA Registered UCA11491 173600
HELIBOND DK Registered 01565/1996 01018/1996 Jointly owned by BICC
plc and Preformed
Line Products Ltd.
HELIBOND GB Registered 2056335 2056335 Jointly owned by BICC
plc and Preformed
Line Products Ltd.
HELIBOND NO Registered 184203 1996/0929 Jointly owned by BICC
plc and Preformed
Line Products Ltd.
HELIBOND FI Registered 203156 737/96 Jointly owned by BICC
plc and Preformed
Line Products Ltd.
</TABLE>
<PAGE> 222
<TABLE>
<CAPTION>
TRADEMARK COUNTRY STATUS REGISTRATION APPLICATION OWNER IF NOT BICC
NUMBER NUMBER PLC OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
HELIBOND SE Registered 317385 96-01599 Jointly owned by BICC
plc and Preformed
Line Products Ltd.
</TABLE>
<PAGE> 223
<TABLE>
<CAPTION>
TRADEMARK COUNTRY STATUS REGISTRATION APPLICATION OWNER IF NOT BICC PLC
NUMBER NUMBER OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
RANGER GB Registered 2149990 2149990
TELCLEAT GB Registered B1139157 B1139157
BICAST AE Pending
BICAST SA Registered 106/66 2741/1401
BICAST FR Registered 1679793 252517
BICAST FR Registered 1262023 692496
BICAST NZ Registered 107433 107433
BICAST MY Pending M/89028
BICAST BX Registered 325902 301829
BICAST AU Registered A276555 A276555
BICAST GB Registered 997703 997703
BICC BICAST device DE Registered 1008761 B64509/9WZ
BITHANE GB Registered 1396582 1396582
BITHANE GB Registered 1099097 1099097
CORALINE GB Registered 637017 637017
CORALINE NZ Registered 42459 42459
MODULUS GB Registered 2114309 2114309
MODULUS GB Registered 2112546 2112546
BICALFLUX GB Registered 918456 918456
BICASEAL GB Registered 1395944 1395944
BICC BIMOLD GB Registered 1311272 1311272
BICC BIMOLD device GB Registered 1202575 1202575
BIWRAP GB Registered B1176157 1176157
FLAMBIC GB Registered 1160633 1160633
FLAMBIC AU Registered A393624 A393624
</TABLE>
<PAGE> 224
<TABLE>
<CAPTION>
TRADEMARK COUNTRY STATUS REGISTRATION APPLICATION OWNER IF NOT BICC PLC
NUMBER NUMBER OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
FLAMBICC GB Registered 1408029 1408029
FLAMBICC DE Registered 1170377 B88902/9Wz
LSF device GB Registered 1164357 1164357
MULTI-PLUS GB Registered 2129111 2129111
FLEXO GB Registered 1015375 1015375
PoweRise device HK Pending 7198/97
PoweRise device GB Published 2133995 2133995
PRESSLINE GB Published 2152685
PRESSLINE device GB Registered 2153550 2153550
BICC-PHILLIPS CA Registered 454652 758411
CABLES PHILLIPS CA Registered TMA393848 654610
design
LES CABLES PHILLIPS CA Registered TMA242675 427619
design
PHILLIPS CABLES CA Registered TMA196575 358725
PHILLIPS CABLES CA Registered TMA398429 653714
design
BICCROD GB Registered 1030630 1030630
PYROTENAX CA Registered UCA44701 221644
BPTX GB Registered B1191922 1191922
CUMIC GB Registered 878544 878544
CUMIC BX Registered 82031 564124
JOISTRIPPER GB Registered 1119912 1119912
MINERAX ES Registered 2032752 2032752
MINERAX FR Registered 1622163 244062
PYRO GB Registered 1503539 1503539
PYRO GB Registered 1417319 1417319
</TABLE>
<PAGE> 225
<TABLE>
<CAPTION>
TRADEMARK COUNTRY STATUS REGISTRATION APPLICATION OWNER IF NOT BICC PLC
NUMBER NUMBER OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
PYRO MATE GB Registered 1525915 1525915
PYROTENAX SG Registered 49827 49827
PYROTENAX AT Registered 161377 AM1908/94
PYROTENAX DK Registered 2980/1979 522/1979 BICC Pyrotenax Ltd
PYROTENAX GB Registered 842507 842507
PYROTENAX SG Registered 49824 49824
PYROTENAX GB Registered 842506 842506
PYROTENAX GB Registered 799061 799061
PYROTENAX GB Registered 668777 668777
PYROTENAX GB Registered 573864 573864
PYROTENAX AU Registered A70386 A70386
PYROTENAX IN Registered 204690 204690
PYROTENAX GB Registered 1140539 1140539
PYROTENAX NZ Registered 64973 64973
PYROTENAX AU Registered A157445 A157445
PYROTENAX AU Registered A157447 A157447
PYROTENAX BH Registered 5547 167/80 BICC Pyrotenax Ltd
PYROTENAX BH Registered 5548 166/80 BICC Pyrotenax Ltd
PYROTENAX IE Registered 63160 63160 Pyrotenax Ltd
PYROTENAX SG Registered 49826 49826
PYROTENAX NZ Registered 35971 35971
PYROTENAX SG Registered 49825 49825
PYROTENAX NZ Registered 69255 69255
PYROTENAX ZA Registered 59/4145/1 59/4145/1
PYROTENAX ZA Registered 59/4145/2 59/4145/2
PYROTENAX ZA Registered 59/4145/3 59/4145/3
</TABLE>
<PAGE> 226
<TABLE>
<CAPTION>
TRADEMARK COUNTRY STATUS REGISTRATION APPLICATION OWNER IF NOT BICC PLC
NUMBER NUMBER OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
PYROTENAX ZA Registered 59/4145/4 59/4145/4
PYROTENAX ZA Registered 620/37 620/37
PYROTENAX IN Registered 204691 204691
PYROTENAX IE Registered 63161 63161 Pyrotenax Ltd
PYROTENAX ZM Registered 1140/62 1140/62 Pyrotenax Ltd
PYROTENAX PK Registered 5999 5999
PYROTENAX IN Registered 204689 204689
PYROTENAX ZM Registered 1141/62 1141/62 Pyrotenax Ltd
PYROTENAX IN Registered 137052 137052
PYROTENAX MW Registered 1142/62 1142/62
PYROTENAX MW Registered 1141/62 1141/62
PYROTENAX MW Registered 1140/62 1140/62
PYROTENAX LK Registered 20743 20743
PYROTENAX KW Registered 10723 11609
PYROTENAX SA Registered 90/28 3062/1400 BICC Pyrotenax Ltd
PYROTENAX HK Registered 727/71 727/71
PYROTENAX ZM Registered 1142/62 1142/62 Pyrotenax Ltd
PYROTENAX HK Registered 725/71 725/71
PYROTENAX HK Registered 726/71 726/71
PYROTENAX HK Registered 728/71 728/71
PYROTENAX JM Registered 9447 9447
PYROTENAX JM Registered 9448 9448
PYROTENAX JM Registered 9468 9468
PYROTENAX IR Registered 51681 75125 BICC Pyrotenax Ltd
PYROTENAX DE Registered 39514590 39514590.2
PYROTENAX IT Registered 713618 RM95C001686
</TABLE>
<PAGE> 227
<TABLE>
<CAPTION>
TRADEMARK COUNTRY STATUS REGISTRATION APPLICATION OWNER IF NOT BICC PLC
NUMBER NUMBER OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
FLAMSIL GB Registered 1545997 1545997
FLAMSIL DE Registered 2070421 B99485/9WZ
FLAMSIL FR Registered 93/482763 93/482763
MICRIMP GB Registered 844317 844317
MIKABEL DE Registered 794683 P11904
Pyro GB Published 2168468
PYROGRASP series GB Published 2164072
PYROPAK US Registered 679940 72/059435
PERMAHEAT GB Registered 1353299 1353299 BICC Pyrotenax Ltd
PERMAHEAT GB Registered 1390455 1390455 BICC Pyrotenax Ltd
PERMAHEAT device GB Registered 1083057 1083057 BICC Pyrotenax Ltd
PYRO-SIL GB Registered 1498446 1498446
PYROLINE GB Published 2158470
THERMOHEAT GB Registered 2049350 2049350
PYROTENAX US Registered 702182 72/076437
BICCLAM JP Registered 3329700 35206/95
BICCLAM GB Registered 1116169 A1116169
BICCLAM US Published 75/357725
BICCLAM GB Registered 1179099 1179099
BICCLAM CA Registered TMA378803 632231
LEAN ID Pending 22057
LEAN CN Pending 9800145722
LEAN EM Pending 966754
LEAN US Pending 75/621310
LEAN AU Pending 781586
</TABLE>
<PAGE> 228
<TABLE>
<CAPTION>
TRADEMARK COUNTRY STATUS REGISTRATION APPLICATION OWNER IF NOT BICC PLC
NUMBER NUMBER OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
LEAN GB Published 2168474
LEAN ID Pending 22058
LEAN ID Pending 22059
LEAN HK Pending 16974/1998
LEAN HK Pending 16975/1998
LEAN HK Pending 16976/1998
LEAN SG Pending 12691/98
LEAN SG Pending 12692/98
LEAN SG Pending 12693/98
LEAN CN Pending 9800145721
LEAN CN Pending 9800145720
LEAN CA Pending 1000644
ONWOOD GB Registered 2144058 2144058
PANGOLIN GB Registered 1570407 1570407
Cryobicc AU Registered 739351 739351
Cryobicc EM Pending 584458
Cryobicc CA Pending 850946
Cryobicc CN Registered 1244931 970073055
Cryobicc JP Pending 142578/97
Cryobicc MY Pending MA/10108/97
Cryobicc SG Pending S/8858/97
Cryobicc CH Registered 448417 05572/1997
Cryobicc device GB Registered 2138455 2138455
ECONEX EM Pending 1029255
ECONEX US Pending 75/621309
</TABLE>
<PAGE> 229
<TABLE>
<CAPTION>
TRADEMARK COUNTRY STATUS REGISTRATION APPLICATION OWNER IF NOT BICC PLC
NUMBER NUMBER OR RELEVANT
SELLER
<S> <C> <C> <C> <C> <C>
BONUS GB Registered 1511347 1511347
BONUS GB Registered 1511348 1511348
BONUS GB Registered 1511346 1511346
GROUPWHERE series GB Registered 2115297 2115297
GREENGATE NIPLAS GB Registered 1116991 1116991 Sterling Greengate
TUBE WELD Cable Company Ltd
NIPLAS GB Registered 803340 803340
</TABLE>
<PAGE> 230
PART D LICENCES OUT OF SELLERS' INTELLECTUAL PROPERTY AND SELLERS' KNOW-HOW
------
<TABLE>
<CAPTION>
OTHER PARTY SUBJECT AGREEMENT TYPE
<S> <C> <C>
Caribbean Cables Ltd BICC Trademark Registered User Agreement
Incab Industries Ltd XLPE Cables Technical Collaboration
Agreement
Borealis A/S Monosil Semiconducting Screens Know-How Licence and Supply
Agreement
Hawke Cable Glands Ltd Letter Agreement dated 1/11/93
Asian Cables & Industries Ltd Agreement dated 14/6/96
Advanced Elastomer Systems SNV SA Agreement datd 27/3/96
Alcan Chemicals, Ltd Agreement dated 24/6/97
Metal Manufacturers Limited "Pyrotenax" Trade Mark Licence Authorised User Agreement
</TABLE>
<PAGE> 231
PART E LICENCES IN OF SELLERS' INTELLECTUAL PROPERTY AND SELLERS' KNOW-HOW
------
<TABLE>
<CAPTION>
OTHER PARTY SUBJECT AGREEMENT TYPE
<S> <C> <C>
National Research Development Corporation High Modulus Polymers Licence Agreement
Lynxvale Ltd Thallium-Strontium Superconductor Licence Agreement
Compositions
Hawke Cable Glands Ltd. Barrier Cable Glands Licence Agreement
SILEC Elastomeric Cable Terminations Know-how and Patent Licence
Agreement
Hitachi XLPE Cables Technical Collaboration and
Licence Agreement
Hitachi XLPE Cables Technical Collaboration
Agreement
NOR.WEB DPL Ltd. Digital Power Line Collaboration Agreement
Corning, Inc. Licence back of rights acquired from BICC Patent Licence Agreement
for use in its Energy business
Goodwin Emck Agreement dated 7/11/97
Preformed Line Products Agreement dated 15/11/95
</TABLE>
<PAGE> 232
PART F CROSS LICENCES OF SELLERS' INTELLECTUAL PROPERTY AND SELLERS' KNOW-HOW
------
<TABLE>
<CAPTION>
OTHER PARTY SUBJECT AGREEMENT TYPE
<S> <C> <C>
Pacific Dunlop Ltd Fire Resistant Cables Settlement of Opposition
Proceedings and Patent Cross
Licence Agreement
</TABLE>
<PAGE> 233
<TABLE>
<CAPTION>
PART G DEVELOPMENT AGREEMENTS
<S> <C> <C> <C>
Finmeccanica SPA - Azienda Superconducting Cable Collaboration Agreement BICC Cables Ltd
Ansaldo and Ansaldo Richerche (Energy)
S.r.l.
Queens University, Kingston, Feasibility Study to Sponsored Development BICC Pyrotenax Ltd.
Ontario. investigate Sheath Materials Work Agreement
for use in Mineral Insulated
Cables and Thermocouples
Ortech Corporation Positive Temperature Sponsored Development BICC Pyrotenax Ltd.
Coefficient Resistors relating Work Agreement
to Mineral Insulated Heater
Cable
PIRA International Improved Packaging Process Sponsored Development BICC Industrial
Work Agreement Special Cables, Leigh
EA Technology Ltd The development of a novel, Sponsored Development BICC Energy
non-equilibrium plasma system Work Agreement Technology, Wrexham
(atmospheric pressure
microwave) for coating
polymerically insulated power
cables.
Ontario Hydro Technology Electrolumenescence of XLPE Sponsored Development BICC Energy
Cables. Work Agreement Technology, Wrexham
Ontario Hydro Technology Resistance to Failure of EPR Sponsored Development BICC Energy
Cables. Work Agreement Technology, Wrexham
Ontario Hydro Technology Pre-breakdown Defect Detection Sponsored Development BICC Energy
Work Agreement Technology, Wrexham
University of Wales, Bangor Electromechanical Strain at Sponsored Development BICC Energy
Polymer Interfaces and the Work Agreement Technology, Wrexham
Initiation of Failure in High
Voltage Cables.
University of Wales, Bangor Electromechanical Strain at Supplemental Letter BICC Energy
Polymer Interfaces and the Agreement - Technology, Wrexham
Initiation of Failure in High Contribution to
Voltage Cables. Purchase of ab Atomic
Force Microscope.
</TABLE>
<PAGE> 234
<TABLE>
<S> <C> <C> <C>
University of Wales, Bangor Electromechanical Endurance Sponsored Development BICC Energy
Model and Failure in High Work Agreement Technology, Wrexham
Voltage Cables.
University of Wales, Bangor Further Development to the Sponsored Development BICC Energy
Electrokinectic Endurance Work Agreement Technology, Wrexham
Model.
University of Wales, Bangor Further Development to the EKE Draft Extension Letter BICC Energy
Model. Agreement Technology, Wrexham
University of Wales, Bangor Electrokinetic Phenomena Sponsored Studentship BICC Energy
(CASE PhD) Technology, Wrexham
University of Wales, Bangor Scanning Probe Microscope Sponsored Development BICC Energy
Investigation of Insulations Work Agreement Technology, Wrexham
and Screens
University of Wales, Bangor Improving Insulation/Semicon Sponsored Studentship BICC Energy
Interface (CASE PhD) Technology, Wrexham
University of Wales, Swansea Wire-Coating Die-Flow Sponsored Development BICC Energy
Modelling. Work Agreement Technology, Wrexham
Profs. K. Walters and A.R. Viscosity of Polymer Melts Sponsored Development BICC Energy
Davies University of Wales, Work Agreement Technology, Wrexham
Aberystwyth
Lancaster University Studies of the Peroxide Sponsored Studentship BICC Energy
Crosslinking Reaction in (CASE PhD) Technology, Wrexham
Polyolefins Prepared by
Metallocene Catalysis.
Aberdeen University Phase Diagram & Processing Sponsored Studentship BICC Energy
Studies on BiSCCO-2212 (CASE PhD) Technology, Wrexham
University of Durham Fabrication of HTSC coils and Sponsored Studentship BICC Energy
Tapes. (CASE PhD) Technology,
Wrexham
Southampton University Lectureship in Sponsored Development BICC Energy
Institute of Cryogenics Superconductivity Work Agreement Technology,
Wrexham
Cranfield University Engineering and Management of Sponsored Studentship BICC Energy
Manufacturing Systems (MSc) Technology,
Wrexham
</TABLE>
<PAGE> 235
<TABLE>
<S> <C> <C> <C>
Cranfield University Cable Making Production Line - Sponsored Studentship BICC Energy
Simulation Model. (MSc) Technology,
Wrexham
Cranfield University The Use of Information Systems Sponsored Studentship BICC Energy
to Integrate Manufacturing (CASE PhD) Technology,
Systems Wrexham
Cranfield University Next Generation Manufacturing Sponsored Studentship BICC Energy
Systems (EngD) Technology,
Wrexham
Cranfield University Transfer of Information Sponsored Studentship BICC Energy
Systems Technology (EngD) Technology,
Wrexham
Liverpool University Multi-Agent Learning for Sponsored Studentship BICC Energy
Monitoring and Control (CASE PhD) Technology,
Wrexham
University College, London. Mesoscopic Modelling of Sponsored Development BICC Energy
Electrical Breakdown Work Agreement Technology,
Wrexham
Bristol University Concentration Gradient of Dust Sponsored Development BICC Energy
Particles in Divergent Work Agreement Technology,
Electric Fields. Wrexham
CAPCIS Ltd. Corrosion of Submarine Cable Sponsored Development BICC Energy
Installations Work Agreement Technology,
Wrexham
University of Southampton Space-Charge Measurement Sponsored Development BICC Energy
Work Agreement Technology,
Wrexham
University of Reading Polymer Morphology & Sponsored Studentship BICC Energy
Dielectric Breakdown (CASE PhD) Technology,
Wrexham
Leicester University Study into Polymeric DC Consultancy BICC Energy
Insulation's (Fothergill) Technology,
Wrexham
Strathclyde University The Use of Gas Insulated Lines Sponsored Development BICC Energy
in HV Transmission Systems Work Agreement Technology,
Wrexham
Loughborough University of M-TDSC Techniques for the Sponsored Development BICC Energy
Technology Study of Filled Polymers Work Agreement Technology,
Wrexham
European Commission PROGNOSIS - Process Cost Sharing Contract BICC Energy
Diagnostics for Plant Technology,
Performance Enhancement Wrexham
</TABLE>
<PAGE> 236
<TABLE>
<S> <C> <C> <C>
University of Newcastle, etc. PROGNOSIS - Process Collaboration Agreement BICC Energy
Diagnostics for Plant Technology,
Performance Enhancement Wrexham
European Commission SACPA - AC Losses in Actual Cost Contract BICC Energy
Superconductors Technology,
Wrexham
University of Southampton, etc. SACPA - AC Losses in Collaboration Agreement BICC Energy
Superconductors Technology,
Wrexham
University of Surrey, etc. Life-Cycle and Process Collaboration Agreement BICC Energy
Optimisation Approach to Technology,
Polymer Materials Selection Wrexham
University of Surrey, etc. Life-Cycle and Process Actual Cost Contract BICC Energy
Optimisation Approach to Technology,
Polymer Materials Selection Wrexham
DTI, UMIST, etc. Anisotropy Control with Actual Cost Contract BICC Energy
Rotating Die Extrusion Technology,
Wrexham
DTI, UMIST, etc. Anisotropy Control with Collaboration Agreement BICC Energy
Rotating Die Extrusion Technology,
Wrexham
Prof. R Scurlock, University Superconductivity Technology Consultancy Agreement BICC Energy
of Southampton Review Technology,
Wrexham
JMU Services Ltd, for Technology Forecasting Sponsored Development BICC Energy
Liverpool John Moores Work Agreement Technology,
University Wrexham
Philip Holroyd Technology Forecasting Consultancy Agreement BICC Energy
Technology,
Wrexham
Borealis A/S Supply of HDPE and Material Supply BICC Energy
semiconducting screens Agreement Technology,
Wrexham
IPEC Limited Ultrasonic Measurement of Sponsored Development BICC Cables Ltd
Cable Insulations Work Agreement Erith Technology
Centre
ABAQUS Benelux BV Finite Element Modelling of Consultancy Agreement BICC Cables Ltd
Sub-Sea Cables Erith Technology
Centre
</TABLE>
<PAGE> 237
<TABLE>
<S> <C> <C> <C>
University of Lancaster Untitled Studentship Sponsored Studentship BICC Cables Ltd
(A Ponsonby) (CASE PhD) Erith Technology
Assignment and Centre
Supplementary
Agreement
City University Computer Modelling of Power Sponsored Development BICC Cables Ltd
Cables Work Agreement Erith Technology
Centre
University of Bristol Water Treeing Sponsored Development BICC Cables Ltd
Work Agreement Erith Technology
Centre
Dr AS Clough Micro-PIXE Studies of Sponsored Development BICC Cables Ltd
(University of Surrey) Polymeric Cables Work Agreement Erith Technology
Centre
King's College, London Water Treeing in Filled Sponsored Development BICC Cables Ltd
Polymers Work Agreement Erith Technology
Centre
University of Genoa Electrical Treeing in EPR and Sponsored Development BICC Cables Ltd
XLPE Compounds Work Agreement Erith Technology
Centre
Preformed Line Products Ltd BLX Fittings Joint Marketing BICC Components
Agreement Ltd.
Robert Cyril Lyon Cable Cleat Assignment and Revenue BICC Components
Sharing Agreement Ltd.
A T Group Agreement dated 11/8/97 BICC Cables Ltd
Arthur Little Agreement dated 30/11/98 BICC Cables Ltd
Geomica Ltd Agreement dated 2/7/98 BICC Cables Ltd
Rockwell Automation Ltd Agreement dated 16/10/98 BICC Cables Ltd
Siemens Agreement dated 6/6/97 BICC Cables Ltd
</TABLE>
<PAGE> 238
<TABLE>
<S> <C> <C> <C>
Eurotherm Process Automation Agreement dated 2/10/96 BICC Cables Ltd
Christopher Wells & University Agreement dated 1/6/98 BICC Cables Ltd
of Liverpool
Informix Confidentiality BICC Cables Ltd
Agreement
Nokia-Maillefer Agreement dated 1/10/97 BICC Cables Ltd
</TABLE>
<PAGE> 239
PART H DETAILS OF MATERIAL LICENCES OF THIRD PARTY SOFTWARE TO WHICH THE GROUP
COMPANIES OR THE BUSINESS SELLERS ARE A PARTY AND (IN THE CASE OF THE BUSINESS
SELLERS) WHICH IS PRIMARILY OR EXCLUSIVELY USED IN THE OPERATIONS
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SUPPLIER SOFTWARE TYPE OF APPLICATION BUSINESS UNIT USING SOFTWARE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
CPL Package Treasury System Energy Centre
Hexagon Package Bank Payments - Reports Bank Accounts Energy Centre
Rockliffe Chameleon Accounting Ledgers Energy Centre
Hyperion Package Financial Consolidation Energy Centre
PWA Foxpro Personnel Records System (PWA) Energy Centre
Reuters Reuters3000 Reuters - On line Financial Information Energy Centre
Workgroup Systems Quetzal Internal Call Management System BICC IS
Baan Scopus Baan Call Management System BICC IS
Forty-One Sage Accounts Package BICC Energy
Technology
MAX MAX 10 Business Information System ERITH
Datastream MP2 Maintenance / Stores / Purchasing ERITH
Radan Radraft CAD for Accessories Design ERITH
Mitrefinch TMA Time and Attendance system used by 600 Employees ERITH
MGB Ledgers Radius Nominal Ledger / Sales Ledger / Purchase Ledger / Asset ERITH
Register
SDRC Ideas Master Series Finite Element Modelling and Analysis ERITH
HKS Abaqus Advanced Finite Element Package for Structural and ERITH
Thermal Analysis
CFX International CFX 4 / 5 Computational Fluid Dynamics ERITH
</TABLE>
<PAGE> 240
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SUPPLIER SOFTWARE TYPE OF APPLICATION BUSINESS UNIT USING SOFTWARE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Engineering Animation Vislab 3D Visualisation and Animation ERITH
Intelligent Light Field View Computational Fluid Dynamics Post Processing ERITH
Radan Radraft NT CAD for Works Engineers ERITH
Real Time Documents Ltd Docusmart Export Documentation and invoicing ERITH
Baan Baan ERP WREXHAM
STG OPT Finite scheduler WREXHAM
MerciaVision Mainsaver Maintenance management WREXHAM
The CAD division AutoCad CAD WREXHAM
D&H Marpacs (Databus) Production Control/MRP COMPONENTS
Broadgate Ledgers (DB/C) Ledger COMPONENTS
T&G CG Account System SPAIN
META4 N4 Human Resources (Payroll) SPAIN
Micro-strategy DSS-Agent Data warehouse SPAIN
Slam Cerg-Finance Financial SPAIN
Banking communication
SSA BPCS Business planning and control system with the following PORTUGAL
main modules:)
TyG (Spain) CG/IFS Accounting package to generate the Management and Fiscal PORTUGAL.
accounts
Prologica IMMO/400 Fixed Assets accounting and control PORTUGAL.
</TABLE>
<PAGE> 241
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SUPPLIER SOFTWARE TYPE OF APPLICATION BUSINESS UNIT USING SOFTWARE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SSA Iberica EDI To interchange data related to orders, despatch and PORTUGAL
invoicing with telephone and energy utilities.
Uses the standard EDIPAC.
Fidia GEO Tendering ITALY
Cybertec Cyberplan MRP and Scheduling ITALY
Progres Iniziativa Silog Transportation ITALY
Ibimec QMS Raw Material Quality Control ITALY
Omniadata ODAMM Accounts Receivable ITALY
Ceas Progress Raw materials and compounds ITALY
Formula FA Fixed Assets ITALY
Baan Baan IV Under Implementation ITALY
Baan Baan IV NEW ZEALAND
SAP R3 KKK
Reuters Reuters Online Financial Data on-line to Reuters BICC ROD
UNISYS Order Processing Sales Order Processing BICC ROD
Scomagg Plant database Rod Plant SFDC Quality & Despatch BICC ROD
MTAS PILOT Stores Engineering Stores Control BICC ROD
</TABLE>
<PAGE> 242
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SUPPLIER SOFTWARE TYPE OF APPLICATION BUSINESS UNIT USING SOFTWARE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
CEGELEC Controls Alspa Process Control Application BICC ROD
C80-35 &
C90-70
NANO Tech. Furnace Control SCADA Adroit 3.1 - Furnace Control BICC ROD
Manugistics StatGraphicsPlus for Windows Statistical Analyses BICC ROD
MINITAB MINITAB Statistical Analysis Software BICC ROD
ARCSERVE ARCSERVE Server Backup Software BICC ROD
Megatech TAS Books Financial Accounting Software Package BICC ROD
Avery Berkel Weighman for Windows Weighbridge Software BICC ROD
Visual Business Tools Personnel Manager Personnel Records Database BICC ROD
Smart Systems Time Director Time & Attendance Records BICC ROD
DataMetrics File Express Interface Software for UNISYS to TAS Books BICC ROD
DataMetrics Cadet T27 Terminal Emulation UNISYS emulation on Desktop PC's BICC ROD
Software
Hyperion Hyperion Enterprise v4.22 Financial Reports/Consolidation Package BICC ROD
Midland Bank Hexagon Bank Account Enquiry Software BICC ROD
Cristie SDB Backup v2.49 Local DOS Backup software for PC Users BICC ROD
D&H Computers MARPACS Sales Order Processing BICC WIRE
IEG Computing FACTORY Planning and Scheduling System BICC WIRE
Shire Systems Ltd Planned Maintenance Preventative Planned Maintenance system BICC WIRE
</TABLE>
<PAGE> 243
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SUPPLIER SOFTWARE TYPE OF APPLICATION BUSINESS UNIT USING SOFTWARE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Shire Systems Ltd Stock systems Engineering Stores Module integrating with PPM system BICC WIRE
at 5. above
ISS, Manchester EDX Scanner Electron Microscope BICC WIRE
ENTEK Vibration Analysis System BICC WIRE
ARCSERVE ARCSERVE Server Backup Software via external Backup tape drive BICC WIRE
Megatech TAS Books Financial Accounting Software Package BICC WIRE
Visual Business Tools Personnel Manager Personnel Records Database BICC WIRE
Smart Systems Time Director Time & Attendance Records BICC WIRE
AutoCAD AutoCAD Computer Aided Drawing Package BICC WIRE
LT
MAX International MAX Business System PYROTENAX
Unitend Time& Attendance Time & Attendance PYROTENAX
Sitpro Spex V5 Export Shipment PYROTENAX
Kewill Sytec EDI Electronic Data Interchange - Invoices / Sales Orders PYROTENAX
Business Objects Business Objects Management Information System PYROTENAX
DataStream CMMS Computerised Maintenance Management System PYROTENAX
Mercia Software Logol Forecasting System PYROTENAX
McGuffie Brunton Impact Award Integrated Business System THERMOHEAT
Computer Advisory Service Triangle QA Quality System (Paperless) THERMOHEAT
</TABLE>
<PAGE> 244
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
SUPPLIER SOFTWARE TYPE OF APPLICATION BUSINESS UNIT USING SOFTWARE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ICL OMAC Manufacturing database, materials purchasing and LEIGH
control, costing and stock control
Mercia Vision Mainsaver Engineering stores, purchasing and planned maintenance LEIGH
Sitpro SPEX Export shipping documentation LEIGH
Business Objects Business Objects Management Information System LEIGH
Baan Baan IV Under Implementation LEIGH
Baan BaanIV Under implementation DUBAI
Open Mind ? Tendering ASCOLI
Progres Iniziativa Silog Transportations ASCOLI
Omniadata ODAMM Accounts Receivable ASCOLI
Ceas Progress Raw materials and compounds ASCOLI
Formula FA Fixed Assets ASCOLI
Baan Baan IV Under Implementation ASCOLI
Kewill ZIMBABWE
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 245
SCHEDULE 16
ENVIRONMENT
1 DEFINITIONS
For the purpose of this Schedule and Clause 8.8 of the Agreement, the
following expressions shall have the following meanings:
Agreed Proportion means that proportion of any Environmental Loss which
the parties have agreed that the Vendor shall bear in paragraph 5.1
hereof.
Environment means ecological systems including living organisms and the
following media (alone or in combination); air (including the air
within buildings and the air within other natural or man-made
structures whether above or below ground); water (including water under
or within land or in drains or sewers and coastal and inland waters);
and land (including land under water); and in the case of man includes
his property.
Environmental Authority means any legal person or body of persons
(including any government department or government agency or court or
tribunal) having jurisdiction to determine any matter arising under
Environmental Laws and/or relating to the Environment.
Environmental Laws means all applicable laws (including, for the
avoidance of doubt, common law), statutes, regulations, statutory
guidance notes and final and binding court and other tribunal decisions
of any relevant jurisdiction or any constituent part thereof
(including, without limitation, the law of the European Union) in force
in the relevant jurisdiction at Completion which relate to pollution or
protection of the Environment or which relate to emissions, discharges,
or threatened releases or escapes of Hazardous Substances into the
Environment, or to the production, processing, distribution,
management, use, treatment, storage, burial, disposal, transport or
handling of any Hazardous Substances, noise, nuisance and all bye-laws,
codes, regulations, decrees, demands or demand letters, injunctions,
judgments, notices or notice demands, orders or plans issued or
promulgated or approved thereunder or in connection therewith to the
extent that the same have force of law at Completion provided that for
the purposes of this definition Part IIA of the Environmental
Protection Act 1990 and associated statutory guidance and regulations
and sections 161A to 161D of the Water
<PAGE> 246
Resources Act 1991 (as amended and inserted by the Environment Act
1995) shall be deemed to have come into force and effect prior to
completion (in the form first in force);
Environmental Liability means any liability arising under Environmental
Laws (whether criminal, civil or regulatory) (i) out of the operation
of any of the Operations or any part thereof before Completion or (ii)
out of the occupation or ownership of the Properties or any part
thereof by the Vendor or any Relevant Seller before Completion
(including liability under Environmental Law to undertake Remedial
Action) or (iii) out of the acts or omissions of any of the Group
Companies at any Former Property;
Environmental Loss means any loss, damage, liability, cost and expense
(including fines, and penalties, the reasonable cost of Remedial Action
and reasonable legal and other professional fees but excluding any
Operational Expenditure and any consequential loss) which is suffered
or reasonably incurred by any member of the Purchaser Group in respect
of:
(a) any Environmental Liability for any matter under paragraph 3
hereof or
(b) any reasonable action taken by the Purchaser to prevent,
eliminate, reduce, limit or mitigate any such Environmental
Liability.
Environmental Permit means any licence, approval, authorisation,
permission, notification, waiver, order or exemption which is issued,
granted or required under Environmental Law for the operation of any of
the Operations on or before Completion;
Environmental Proceedings means:
(a) any civil, criminal or regulatory suit or proceedings;
(b) any application for judicial review;
(c) any arbitration or dispute resolution procedure
(d) any application for injunctive relief or for a declaration;
(e) any investigation undertaken by or on behalf of an
Environmental Authority under Environmental Law pursuant to
which the Environmental Authority may order enforcement action
or compel Remedial Action; and
<PAGE> 247
(f) any court order, or any statutory or legislative notice or
written notification issued by an Environmental Authority
forming part of an administrative or judicial action or
regulatory procedure which determines a violation of any
Environmental Law, assesses any civil, regulatory or criminal
penalty, prohibits or imposes restrictions upon the operations
of the Business or which requires action to be taken,
operations to be modified or Remedial Action to be undertaken,
relating to, concerning or affecting any Environmental Liability;
Environmental Warranties means the warranties at paragraph 2 of this
Schedule;
Former Properties means any property owned, occupied, or leased by the
Vendor or by any Group Company (i) where such ownership, occupation or
lease ceased prior to Completion, or (ii) where such property does not
form part of the Assets;
Hazardous Substances means wastes, pollutants, contaminants or other
substances (including without limitation liquids, solids, gases, ions,
living organisms, and noise) that are harmful to human health or other
life or the Environment or a nuisance to any person;
Operational Expenditure means in respect of any of the Operations any
future expenditure to the extent that after Completion it is incurred
or is properly to be incurred in the ordinary course of business of any
of the Operations, as part of routine maintenance and upkeep of any
works, plant, equipment and/or buildings and/or their services or to
overcome fair wear and tear of such works, plant, equipment and/or
buildings and/or their services but for the avoidance of doubt shall
exclude any future expenditure incurred by the Purchaser after
Completion in respect of any works required to bring into compliance
with Environmental Laws to the extent such Environmental Laws were
applicable on or before Completion any works, plant, equipment,
buildings or services which were non compliant on or before Completion.
Relevant Period means the period commencing five years before
Completion and ending at Completion.
Remedial Action means any works (including the installation, operation,
repair or replacement of plant or equipment) necessary to investigate,
assess, remove, abate, mitigate, treat,
<PAGE> 248
remediate, ameliorate, monitor and/or contain any matter which has
given or may give rise to an Environmental Loss.
2 ENVIRONMENTAL WARRANTIES
2.1 Each Group Company and Business Seller is operating and so far as the
Vendor is aware, during the Relevant Period has conducted the
Operations in compliance in all material respects with Environmental
Laws.
2.2 All Environmental Permits are in force and are being complied with and,
so far as the Vendor is aware, during the Relevant Period all
Environmental Permits have been complied with in all material respects.
2.3 So far as the Vendor is aware there is no pollution or contamination of
soil or groundwater at any of the Properties in circumstances which are
likely to give rise to material liability on the part of any Group
Company under Environmental Laws.
2.4 Neither the Vendor nor any Group Company has received written notice
during the Relevant Period of any Environmental Proceedings against the
Vendor or any Group Company or any of their directors, secretary or
senior employees in their capacity as such.
2.5 Neither the Vendor nor any Group Company has received written
notification during the Relevant Period that it is or is likely to be
required by any Environmental Permit or any Environmental Law or as the
result of any Environmental Proceedings to incur any material
expenditure or to desist from taking any action which might have a
material adverse effect on the financial condition of the Operations.
2.6 So far as the Vendor is aware, no circumstances exist which would
result in any material Environmental Permit being revoked, suspended,
varied or limited or which may prejudice its renewal nor have there
been any amendments or alteration to the Operations which require the
variation of any material Environmental Permit or which require the
Vendor to obtain an Environmental Permit to enable the continued
operation of the Operations.
<PAGE> 249
3 ENVIRONMENTAL INDEMNITY
The Vendor agrees and covenants with the Purchaser (for itself and the
Relevant Purchasers) to pay the Purchaser an amount equal to the Agreed
Proportion of any Environmental Loss suffered or incurred by the
Purchaser or any Relevant Purchaser or any of the Group Companies after
Completion to the extent that it arises out of:
3.1 any discharge, emission, spillage, leak, escape, migration or release
of any Hazardous Substance from any of the Properties or Former
Properties as a result of any act or omission of the Vendor or any
member of the Vendor's Group or its contractors, invitees or persons
within its control (including the Business Sellers and the Group
Companies) prior to Completion; and/or
3.2 the presence of, or any consequences of the presence of any Hazardous
Substance in, on or under any of the Properties being a Hazardous
Substance which either (i) was present in, on or under such Property at
or before Completion or (ii) originates or derives from any Hazardous
Substance which was in, on or under such Property at or before
Completion; and/or
3.3 any failure on the part of the Vendor any member of the Vendor's Group
or its contractors, invitees or persons within its control (including
the Business Sellers and the Group Companies) on or before Completion
to comply with any Environmental Laws then applicable.
4 APPLICATION OF THE REMAINING PROVISIONS OF THIS SCHEDULE
The remaining provisions of this Schedule together with clauses 8.1.4
to 8.1.6, 8.2, 8.4.1, 8.5 to 8.8, 8.11 and 8.12 of the Agreement shall
apply to any claim by the Purchaser for breach of the Environmental
Warranties or under the indemnities in paragraph 3 hereof.
5 LIMITATIONS ON LIABILITY
5.1 APPORTIONMENT OF ENVIRONMENTAL LOSSES
All Environmental Losses which are the subject of the indemnity in
paragraph 3 above and any liabilities in respect of the Environmental
Warranties will be borne between the Vendor and the Purchaser in the
following ratios respectively:
(a) 95:5, where written notice of such claim is given by
the Purchaser to the Vendor setting out reasonable
details of the specific matter in respect of which
<PAGE> 250
the claim is made (including an estimate of the amount
of such claim if practicable) prior to the third
anniversary of the Completion Date;
(b) 80:20, where written notice of such claim is given by
the Purchaser to the Vendor setting out reasonable
details of the specific matter in respect of which the
claim is made (including an estimate of the amount of
such claim if practicable) on or following the third
anniversary of the Completion Date but prior to the
fifth anniversary of the Completion Date.
(c) 60:40, where written notice of such claim is given by
the Purchaser to the Vendor setting out reasonable
details of the specific matter in respect of which the
claim is made (including an estimate of the amount of
such claim if practicable) on or following the fifth
anniversary of the Completion Date but prior to the
eighth anniversary of the Completion Date.
5.2 LIMITS ON LIABILITY
The Vendor shall not be liable in relation to any claim under Paragraph
3 or any claim for breach of the Environmental Warranties:
5.2.1 to the extent that the aggregate amount of the liability of the
Vendor for all such claims and all other claims under the
Agreement would exceed (pound)160 million as specified in
Clause 8.2 of the Agreement;
5.2.2 in respect of any Operational Expenditure; and
5.2.3 in respect of any claim unless written notice of such claim is
given by the Relevant Purchaser to the Relevant Seller before
the eighth anniversary of Completion in accordance with
paragraph 5.1.
5.3 EXACERBATION
The Vendor shall not be liable in relation to any claim under paragraph
3 or any claim for breach of the Environmental Warranties to the extent
that the loss in respect of which the breach of Environmental
Warranties is alleged or the Environmental Loss which is the subject of
the claim arises by virtue of or is exacerbated by:
(i) any act or omission of the Purchaser or any member of
the Purchaser's Group following Completion except to the
extent that such act or omission was
<PAGE> 251
reasonable in the circumstances and the Purchaser or any
member of the Purchaser's Group did not know or could
not be expected to know that such act or omission would
exacerbate the loss; or
(ii) any Property being closed, redeveloped (other than
redevelopment or construction works for the purposes of
the Operations) or put or to be put to a more sensitive
use than the use to which it was put immediately prior
to Completion.
5.4 MITIGATION
The Purchaser shall take and shall procure that any member of the
Purchaser's Group takes all reasonable steps to avoid or mitigate any
Environmental Loss which gives rise to or might give rise to a claim
under paragraph 3 hereof or any claim for breach of the Environmental
Warranties.
6 PROCEDURE FOR VOLUNTARY ACTION OR REMEDIAL ACTION
6.1 The provisions of this paragraph 6 shall apply in respect of any claim
under paragraph 3 above insofar as it relates to (i) voluntary action
(including voluntary Remedial Action) to prevent, reduce, abate,
eliminate or mitigate any Environmental Liability or (ii) Remedial
Action required by any Environmental Authority pursuant to
Environmental Proceedings.
6.2 Subject to paragraph 6.3 the Purchaser shall consult as fully as is
reasonably practicable with and pay reasonable regard to the views of
the Vendor regarding any voluntary action it considers should be taken
to prevent, reduce, eliminate or mitigate any Environmental Liability
and in respect of which it anticipates making a claim under Paragraph 3
of this Schedule.
6.3 The test for determining whether the voluntary action proposed by the
Purchaser hereunder is reasonable (and therefore whether it falls
within paragraph 3) shall involve consideration of custom and practice
in the relevant industry and jurisdiction, the practice of the
Purchaser in relation to like sites, the attitude of any Environmental
Authority and the likely results if no voluntary action is taken.
6.4 Where any Remedial Action is required as a result of any Environmental
Proceedings or is voluntary action in respect of which paragraph 6.2
applies, the Purchaser shall as soon as
<PAGE> 252
practicable notify the Vendor that in its opinion there is the need for
such Remedial Action. The Vendor shall as soon as reasonably
practicable thereafter prepare or procure that there is prepared a
scope of works for the Remedial Action for the Purchaser's approval,
such approval not to be unreasonably withheld or delayed.
6.5 Subject to the rest of this paragraph 6 the Vendor shall procure that
Remedial Action is carried out:
(i) as soon as practicable after receiving the Purchaser's
approval of the scope of works.
(ii) by appropriately qualified environmental consultants (or
other contractors) to be approved by the Purchaser, such
approval not to be unreasonably withheld;
(iii) where Remedial Action is required pursuant to
Environmental Proceedings, and to the extent that this
is practicable and appropriate having regard to the
particular Environmental Authority involved, in
consultation with and to a standard approved by the
relevant Environmental Authorities and in compliance
with Environmental Law; and
(iv) in accordance with the agreed scope of works and using
all reasonable endeavours to ensure that it is
undertaken competently and in accordance with good
environmental practice.
6.6 The Purchaser shall give and shall procure that any member of the
Purchaser's Group gives the Vendor such access to any relevant property
and such co-operation and assistance as is reasonable in the
circumstances to enable the Remedial Action to be carried out and to
permit the Vendor to comply with its obligations under this paragraph
6.
6.7 The parties shall consult with each other regarding the carrying out of
the Remedial Action and shall take into account each other's reasonable
views and requests. The Vendor shall use its reasonable endeavours to
ensure that the Remedial Action is undertaken without causing any
unreasonable disruptions or disturbance to the operations of any
relevant member of the Purchaser's Group.
<PAGE> 253
6.8 The parties shall keep each other fully informed as to the progress and
of any matters discovered during the Remedial Action or which could
affect the scope, design or execution of the Remedial Action and shall
provide each other with copies of any reports, investigations or
correspondence relevant or relating to the Remedial Action or to any
discussions with the relevant Environmental Authorities.
6.9 Notwithstanding the other provisions of this paragraph 6, the Purchaser
may without consultation take such action relating to any actual or
potential Environmental Loss as is reasonably necessary in case of an
emergency:
(i) to prevent or limit damage to the Environment; or
(ii) to comply with any emergency notice or order of any
Environmental Authority.
6.10 The costs of carrying out any Remedial Action or any reasonable
voluntary action (including voluntary Remedial Action) shall be borne
by the Vendor and the Purchaser in the Agreed Proportions in accordance
with Paragraph 5.1.
6.11 Upon completion of any Remedial Action specified in the scope of works,
the Vendor shall procure that its environmental consultant (or other
contractor) shall supply to the Purchaser a written certificate in a
form reasonably satisfactory to the Purchaser, that such Remedial
Action has been completed in accordance with and to any standard
specified in the scope of works.
7 CONDUCT OF CLAIMS
The provisions of this paragraph 7 shall apply to any matter which may
give rise to or arises by virtue of a claim under paragraph 3 or any
claim for breach of the Environmental Warranties.
7.1 Where the Vendor or any member of the Vendor's Group has or may have a
claim against a third party in relation to a matter which has given or
may give rise to a claim under paragraph 3 or any claim for breach of
the Environmental Warranties, the Purchaser and any relevant member of
the Purchaser's Group shall afford the Vendor all such assistance as
may be reasonable in relation to its conduct of such claim (subject to
any duties of confidentiality owed to third parties and to any right to
maintain legal privilege and without prejudice to any claim asserted by
the Purchaser under paragraph 3), including access to and copies of any
reports, correspondence, documents or other information in the
possession of the Purchaser or any
<PAGE> 254
member of the Purchaser's group of companies provided that the
Purchaser and any relevant member of the Purchaser's Group is
indemnified to its reasonable satisfaction against all reasonable
costs, expenses and liabilities incurred as a result of so doing.
7.2 Without prejudice to the validity of any claim or alleged claim made by
the Purchaser under paragraph 3 or any claim for breach of the
Environmental Warranties, the Purchaser shall promptly provide such
reports, documents, correspondence, information, assistance (including
access to employees, agents or contractors of the Purchaser's Group)
and facilities as are potentially relevant to any such claim and are in
its possession (or in the possession of the Purchaser's Group) as the
Vendor may reasonably request (subject to compliance with any duties of
confidentiality owed to third parties and to the right to maintain
legal privilege) including reasonable access to any relevant part of
any Property or so far as reasonably practicable to any adjacent or
affected property. The Vendor receiving such information etc. shall
without limitation as to time keep all such information confidential
except for disclosure in defending or prosecuting any Environmental
Proceedings or any claim or alleged claim or argument under paragraph 3
or any claim for breach of the Environmental Warranties or as otherwise
required by law.
7.3 If a claim under paragraph 3 or any claim for breach of the
Environmental Warranties arises or may arise as a result of or in
connection with any Environmental Proceedings to which the Purchaser or
any member of the Purchaser's Group is or is likely to become a party
or where the Purchaser or a member of the Purchaser's Group is the
subject of such Environmental Proceedings the Purchaser shall promptly
notify the Vendor in writing of such claim or potential claim and the
actual or anticipated Environmental Proceedings as soon as it becomes
aware of such claim or Proceedings and the following provisions shall
apply:
(i) the Vendor shall have the right at any time to assume
primary responsibility for and control over the conduct
of all or any part of such Environmental Proceedings.
Unless and until the Vendor assumes conduct by notice in
writing to the Purchaser the Purchaser or any member of
the Purchaser's Group shall have conduct of any such
Environmental Proceedings;
<PAGE> 255
(ii) while the Purchaser or any member of the Purchaser's
Group has conduct of any such Environmental Proceedings,
it shall be entitled to avoid, dispute, deny, defend,
resist, appeal, compromise or contest such Environmental
Proceedings (including, without limitation, making
counterclaims or other claims against third parties in
its own name) and to have the conduct of such
Environmental Proceedings, and any related Remedial
Action, negotiations or appeals but no admission of
liability shall be made by or on behalf of the Purchaser
(or any member of the Purchaser's Group), and the claim
shall not be compromised, disposed of or settled without
the consent of the Vendor (such consent not to be
unreasonably withheld or delayed);
(iii) if the Vendor assumes conduct of the Environmental
Proceedings, it shall be entitled to take any action to
avoid, dispute, deny, defend, resist, appeal compromise
or contest such Environmental Proceedings in the name of
the Purchaser or any member of the Purchaser's Group
provided that the Vendor shall consult as fully as is
reasonably practicable with the Purchaser (or the
relevant member of the Purchaser's Group) in respect
thereof and shall not take such action in its name as
may materially adversely affect the value of any
Property or the goodwill or good name of the Purchaser
(or the relevant member of the Purchaser's Group) unless
the Purchaser (or the relevant member of the Purchasers'
Group) consents thereto (such consent not to be
unreasonably withheld or delayed) and the Vendor shall
consult as fully as is reasonably practicable with the
Purchaser (or the relevant member of the Purchaser's
Group) as regards any negotiations and/or appeals
arising out of such Environmental Proceedings.
7.4 The party having conduct of any Environmental Proceedings (the "Conduct
Party") shall ensure that:
(i) the other party shall be informed promptly of any
information, and shall be provided with copies of any
correspondence or documents held by the Conduct
<PAGE> 256
Party which is material to the Environmental Proceedings
(except to the extent this is impossible without waiving
privilege in respect thereof);
(ii) the other party shall be provided with advance notice of
any proposal by the Conduct Party (or any member of its
group of companies) or any third party to undertake
Remedial Action provided that this obligation shall not
apply in case of emergency, that is where there is an
imminent and substantial risk of serious harm to human
health or to the Environment; and
(iii) Each party shall comply with the reasonable requests of
the other for arrangements or procedures to maintain
confidentiality or legal privilege in relation to any
matters arising out of or relating to any Environmental
Proceedings.
7.5 If any amount is recovered in relation to any Environmental Loss or
claim under the Environmental Warranties pursuant to paragraphs 7.1
and/or 7.3 above, after first deducting any costs and expenses incurred
in relation to such recovery, the balance shall be divided between the
Vendor and the Purchaser in accordance with the Agreed Proportion in
which the Environmental Loss or loss arising in relation to the breach
of Environmental Warranties was borne by them.
8 ADDITIONAL REMEDIAL ACTION
8.1 Notwithstanding the provisions of the rest of Schedule 16 and in
particular paragraph 5.1, the parties agree that the Vendor shall be
responsible for undertaking and completing the matters and projects
identified in Schedule 16A (whether before or after Completion) and
that the Vendor should bear 100% of the cost of and liability
associated with so doing (save that the Vendor shall not be liable for
and the Purchaser shall bear any additional costs or liability to the
extent these are attributable to any act or omission of the Purchaser
or any Group Company after Completion which in the circumstances was
unreasonable and such that the Purchaser and/or Group Company could be
expected to know that it would increase the costs of such work or cause
or exacerbate any liability).
<PAGE> 257
8.2 If any part of such matters or projects remain to be undertaken and/or
completed after Completion the provisions of Clauses 6.5 to 6.9 shall
apply to govern their undertaking and/or completion.
<PAGE> 258
SCHEDULE 16A
1 LEIGH, UK
- Completion of the planned replacement of dust extraction
cyclones by installing the outstanding cyclone.
- Achievement of compliance with the air emission limits in
force at Completion for the reconstructed lacquer line.
2 PRESCOT, UK
- Installation of an interceptor to meet the suspended solids
limit in the storm water permit in force at Completion.
- Undertaking such works as are required by the Environmental
Authorities to achieve compliance with the particulate
emissions limit in force at Completion under the rod mill
authorisation (excluding, for the avoidance of doubt, any works
which form part of any improvement programme or upgrade process
which takes place in relation to the authorisation after
Completion).
3 MANLLEU, SPAIN
- Remediation of the soil contamination identified in the 1996
investigation associated with the underground heating oil
storage tank scheduled for removal.
- Removal of wastes left behind by the previous occupier of the
property adjacent to the Manlleu site which is used by Manlleu
for warehousing.
4 MORELENA, PORTUGAL
- Undertaking the corrective action set out in the Specific
Environmental Adoption Plan agreed prior to Completion with the
relevant Environmental Authority to comply with air emission
limits and stack height requirements.
5 ZIMBABWE
- Appropriate disposal of the inventory of hazardous waste
existing at the site at Completion.
<PAGE> 259
6 ASCOLI PICENO
- Removal and appropriate disposal of three out-of-service PCB
containing transfor which were on site prior to Completion.
- Removal and appropriate disposal of any asbestos-containing
waste materials which were on site prior to Completion.
7 SETTIMO
- Making safe to the extent required by applicable law in force
at Completion any asbestos containing roofing or building
materials which was in an unsafe condition at Completion at
buildings F D and G on the attached plan.
8 MM CABLES NZ LIMITED, RICCARTON, NEW ZEALAND
- Completion of the works specified in the Riccarton paragraph
of the Environmental section of the Disclosure Letter to the
extent (i) these works are necessary to bring the site into
compliance with environmental and health and safety law
requirements applicable at Completion and (ii) the cost of so
doing is not already the subject of a provision in the Net
Asset Statement.
9 PCM, MALAYSIA
- Appropriate off-site disposal of any aluminium oxide and
silame waste which was stored on-site at Completion if such
storage was undertaken without an Environmental Permit and an
Environmental Permit should have been held in relation to such
storage.
<PAGE> 260
SCHEDULE 17
EXCLUDED ASSETS
1.1 The Business Sellers' Cash Balances;
1.2 Any real property or interest in land or buildings other than the
Properties;
1.3 The benefit of any Claim made by any of the Business Sellers in respect
of insurance arising or accruing in consequence of anything done or
omitted to be done prior to Completion relating to an Excluded
Liability;
1.4 Debts due from any relevant Taxation authority in respect of Taxation
arising on or before Completion except to the extent reflected in the
Net Asset Statement.
<PAGE> 261
SCHEDULE 18
BONDS AND GUARANTEES
See Exhibit entitled Bonds and Guarantees
<PAGE> 262
SCHEDULE 19
SUBSTANTIAL CONTRACTS
1 Agreement between BICC Cables Limited and EVC Compounds Ltd dated 1
January 1998.
2 Undated agreement between BICC Cables Limited and Scottish Power PLC.
3 Undated agreement between BICC Cables Limited and Kinetica Limited
4 Confidentiality agreement between BICC Cables Limited and Siemens plc
dated 6 June 1997.
5 Confidentiality agreement between BICC Cables Limited and AT Group
dated 11 August 1997.
6 Confidentiality agreement between BICC Cables Limited and
Nokia-Maillefer OY dated 1 October 1997.
7 Agreement between BICC Cables Limited and Amerada Hess Gas Limited
dated 16 September 1998.
8 Agreement between BICC Cables Limited and National Grid Company plc
dated 5 June 1998 (Hurst/Littlebrook).
9 Agreement between BICC Cables Limited and National Grid Company plc
dated 25 March 1998 (Kirby/Lister).
10 Agreement between BICC Cables Limited and National Grid Company plc
dated 28 August 1998 (Damhead).
11 Agreement between BICC Cables Limited and National Grid Company plc
dated 17 September (Skelton Grange).
12 Agreement between BICC Cables Limited and National Grid Company plc
dated 15 October 1998 (Hinkley Point).
13 Agreement between BICC Cables Limited and Pirelli Cables Limited dated
30 November 1998 (Sellindge).
14 Agreement between BICC Cables Limited and Hyder Utilities dated 21
October 1998 (Rover Way).
15 Agreement between BICC Cables Limited and Guthrie Engineering (S) Pte
Ltd dated 12 April 1997 (Singapore 11 Supply).
16 Agreement between Trans-Power Cables Pte Ltd and Guthrie Engineering
(S) Pte Ltd dated 4 July 1997 (Singapore 11 Installation).
17 Agreement between BICC Cables Limited and Guthrie Engineering (S) Pte
Ltd dated 7 September 1998 (Singapore 15 Supply).
18 Agreement between Trans-Power Cables Pte Ltd and Guthrie Engineering
(S) Pte Ltd dated 31 August 198 (Singapore 15 Installation).
19 Agreement between BICC Ceat Cavi Srl and Dubai Electricity & Water
Authority dated 28 September 1998.
20 Agreement between BICC Ceat Cavi Srl and Dubai Electricity & Water
Authority dated 28 September 1998.
<PAGE> 263
21 Agreement between BICC General Cable SA and Union Electricia Fenosa SA
dated 1 July 1998.
22 Agreement between BICC Supertension Cables (1980) Ltd and China Light &
Power Company Limited dated 25 August 1998.
23 Agreement between BICC Cables Limited and China Light & Power Company
Limited dated 26 May 1993.
24 Agreement between BICC Cables Limited and East Midlands Electricity plc
dated 27 February 1998.
25 Agreement between BICC Cables Limited and Castle Peak Power company
Limited dated 18 May 1993.
26 Agreement between BICC Cables Limited and Amerada Hess Gas Limited
dated 1 October 1998.
27 Agreement between BICC Cables Limited and Scottish Power plc dated 1
July 1998.
28 Current tender between BICC Cables Limited and Midlands Electricity
plc.
29 Agreement between BICC Cables Limited and East Midlands Electricity
dated 1 August 1995.
30 Agreement between BICC Cables Limited and Northern Ireland Electricity
plc dated 22 September 1998.
31 Agreement between BICC Cables Limited and Hong Kong Electric Company
Limited dated 12 July 1994.
32 Undated framework agreement between BICC Cables Limited and Yorkshire
Electricity Group plc, having effect from 1 November 1997.
33 Framework agreement between BICC Ceat Cavi Srl and ENEL Spa dated 10
August 1996.
34 Framework agreement between BICC Ceat Cavi Srl and ENEL Spa dated 24
July 1996.
35 Framework agreement between BICC Ceat Cavi Srl and ENEL Spa dated 23
August 1998.
36 Agreement between BICC Ceat Cavi Srl and Sogem Italia dated 22 December
1997.
37 Agreement between BICC Ceat Cavi and Colata Continua Italiana dated 30
July 1997.
38 Agreement between BICC Cables New Zealand Limited and Kembla Metal
Products dated 8 December 1998.
39 The following BICC Rod customer contracts:
Delta/Draka
Essex
MG Metals
Wessel
Gerald
The following BICC Rod supply contracts:
MG Metal
<PAGE> 264
SPCC
Noranda
Cominco
Mount Isa
Olympic Dam
Outukumpu
Mitsubishi
Inco
Falconbridge
Marc Rich
Pechiney
<PAGE> 265
SCHEDULE 20
WARRANTIES NOT UPDATED TO COMPLETION
References to paragraphs set out below are to paragraphs of Schedule 8.
paragraph 2.2
paragraph 4.2.2(ii)
paragraph 5.3.1
paragraph 5.3.2
paragraph 5.4 (ii)
paragraph 5.7
paragraph 5.11
paragraph 6.1.6 (ii)
paragraph 6.2.2(ii)
paragraph 7
paragraph 8.4.1(iv)
paragraph 8.4.2(ii)(b)
paragraph 8.4.6
paragraph 9.4
<PAGE> 266
SCHEDULE 21
VENDOR'S KNOWLEDGE
References to paragraphs set out below are to paragraphs of Schedule 8 (unless
otherwise specified)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
(1) (2)
WARRANTY PERSON
- -------------------------------------------------------------------------------------------------------
<S> <C>
All Warranties qualified by knowledge/awareness Andrew Cox, Finance Director, Energy Cables
of the Vendor, other than paragraphs 4.4, 6, 8.4 Europe
and 9
Antonio Constantino, Managing Director, CELCAT
Peter Farrell, Legal Adviser, Energy Cables
Europe
Kevin Gibbons, Manufacturing Director, Industrial
Cables Europe
Brian Hay, Managing Director, BICC Components
David Hingston, International Director, Energy
Cables Europe
Kevin Lawler, Finance Director, BICC Cables New
Zealand
Ezio Martino, Managing Director, Industrial
Cables Europe
Osvaldo Mattion
Phillip Maw, Finance Director, Asia Pacfic Cables
Andy Nicholls, Managing Director, Distribution
Cables, Wrexham
Chris Pearson, BICC plc Company Solicitor
Ian Plummer, Managing Director, Metals and
Pyrotenax
Bryan Preston, Managing Director, BICC Cables
New Zealand
Andrew Shaw, Managing Director, Power Cables
Malaysia
Nigel Taylor, Managing Director, Asia-Pacific
Cables
Dr John Woodthorpe
Martin Thomas, Finance Director, BICC Ceat Cavi
Juan d'Urquia, Finance Director, BICC Cables
- -------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 267
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
(1) (2)
WARRANTY PERSON
- -------------------------------------------------------------------------------------------------------
<S> <C>
Espana
Peter Zinkin, Managing and Development
Director, BICC plc
Mike Downie, Managing Director, Energy Cables
Europe
Massimo Geroli, Managing Director, BICC Ceat
Cavi
Domingo Goenaga, Managing Director, BICC
Cables Espana
- -------------------------------------------------------------------------------------------------------
paragraph 2 of Schedule 16 Claire Howard, Solicitor BICC plc
Elizabeth Ness, Environmental Manager, Energy
Cables Europe
- -------------------------------------------------------------------------------------------------------
paragraph 6 Paul Holt, Personnel Director, Energy Cables
Europe
Mike Kirkman, Director of Personnel, BICC plc
- -------------------------------------------------------------------------------------------------------
paragraph 8.4 Chris Vear, Intellectual Property Manager, BICC
plc
- -------------------------------------------------------------------------------------------------------
Alan Harrison, IT Manager, BICC Cables
- -------------------------------------------------------------------------------------------------------
paragraph 9 Peter Farrell, (as above)
Claire Howard (as above)
Chris Pearson (as above)
- -------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 1
Exhibit 2.4
CONFORMED COPY
BICC plc
Devonshire House
Mayfair Place
London
W1X 5FH
27 May 1999
Dear Sirs
ACQUISITION OF ENERGY CABLES OPERATIONS
We refer to the agreement dated 6 April 1999 ("THE AGREEMENT") entered into
between BICC plc ("THE VENDOR"), GK Technologies, Incorporated ("THE PURCHASER")
and General Cable Corporation, in relation to the energy cables operations of
the Vendor outside the United States and Canada. Terms defined in the Agreement,
unless otherwise defined in this letter, shall have the same meanings in this
letter.
The purpose of this letter is to record the agreement we have reached in respect
of the variation of certain provisions of the Agreement, as follows:
1 TRANS-POWER CABLES PTE LIMITED
1.1 Part B of Part 1 of Schedule 6 to the Agreement (which sets
out those Jurisdictions in respect of which completion is to
take place on a Subsequent Completion Date) includes the
Jurisdiction of Singapore. There are two Group Companies which
are incorporated in Singapore, namely Trans-Power Cables Pte
Limited ("Trans-Power") and BICC Cables Asia Pacific Pte
Limited ("BCAP"). Part 2 of Schedule 5 to the Agreement
provides (inter alia) that completion of the acquisition of
Trans-Power and BCAP is conditional upon the receipt by the
Purchaser of a waiver in respect of the right of termination
under the joint venture agreement in respect of PT BICC Berca
Cables Limited.
1.2 The parties have agreed that, notwithstanding the provisions
of the Agreement, completion of the acquisition of Trans-Power
should take place at the same time as completion of the
acquisition of the UK Business.
1.3 Accordingly, the parties have agreed that:
(a) completion of the acquisition of Trans-Power shall
take place on the Completion Date;
(b) the acquisition of Trans-Power shall not be
conditional upon satisfaction of the condition set
out in Part 2 in Schedule 5 in respect thereof (as
- --------------------------------------------------------------------------------
- 1 -
<PAGE> 2
referred to in paragraph 1(a) above), provided
however that nothing in this letter shall be treated
as a waiver of such condition in respect of the
acquisition of BCAP;
(c) the definition of "Completion" in the Agreement shall
be construed accordingly.
2 DOMINION WIRE & CABLES LIMITED
2.1 Part B of Part 1 of Schedule 6 to the Agreement also includes
the Jurisdiction of Fiji, the country of incorporation of
Dominion Wire & Cables Limited ("DOMINION").
2.2 The parties have agreed that, notwithstanding the provisions
of the Agreement, completion of the acquisition of Dominion
should take place on a date to be agreed between the parties
but in any event as soon as reasonably practicable following
satisfaction of the conditions relating to Dominion set out in
Part 2 of Schedule 5 to the Agreement, provided that
completion of such acquisition shall for all purposes be
treated as having taken place on the Completion Date.
3 USE OF "BICC" NAME
3.1 The parties have agreed that in addition to the right
conferred on the Purchaser under Clause 18.5.2 to use the name
"BICC" in conjunction with the name "General Cable" (subject
to the terms and conditions more particularly set out in that
clause) the Purchaser shall be entitled to use and have the
right to sublicence to any member of the Purchaser's Group
(but only for so long as such remain subsidiaries of the
Purchaser) the name "BICC" in conjunction with the name
"General" as the name of any corporate entity, partnership or
other vehicle which, in all cases, is primarily involved in
the manufacture, sale or distribution of cables. Clause 18.5.2
shall be deemed to be amended accordingly.
3.2 In addition to all rights conferred on the Purchaser under the
Agreement:
(a) The Vendor hereby agrees that with effect from
Completion the Purchaser (and members of the
Purchaser's Group) shall have the exclusive right to
use and to sublicense the use of the trade mark "BICC
General" in connection with the Businesses and the
Vendor further agrees that neither the Vendor nor any
member of the Vendor's Group shall use the mark
"BICC" or any mark incorporating the name "BICC"
other than in connection with BICC's retained cables
businesses.
(b) The Vendor agrees that the Purchaser and members of
the Purchaser's Group shall have the right to
register in all jurisdictions around the world the
trade mark "BICC General" in classes relevant to the
- --------------------------------------------------------------------------------
- 2 -
<PAGE> 3
Businesses. The Vendor shall at the Purchaser's cost
assist in the making of such applications by:
(i) at the Purchaser's request, and if
practicable, amending the specifications for
any trade marks it may have incorporating
the name "BICC" to exclude cable products
(except such products as relate to BICC's
retained cables businesses); or
(ii) at the Purchaser's request, cancelling any
registered trade marks it may own
incorporating the name "BICC' where such
trade marks are registered in respect of
cable products other than such products as
relate to BICC's retained cables businesses.
3.3 The parties have agreed that, without prejudice to the
provisions of Clause 18.5.7, the Vendor shall procure that
within three months of Completion (or such later date as the
Purchaser may agree) it shall change the name of any company
within the Vendor's Group to exclude the words "Fine Wires".
Clause 18.5.7 shall be deemed to be amended accordingly.
3.4 The parties have agreed that the Purchaser's Group shall have
a period of three months following Completion to effect such
company name changes as are required by the Agreement.
3.5 The parties have agreed that, without prejudice to the rights
conferred on the Purchaser under Clause 18.5.3, the Purchaser
shall be entitled to use and have the right to sublicence to
any member of the Purchaser's Group (but only for so long as
such remain subsidiaries of the Purchaser) the name "BICC
General Brand Rex Cables" as the name of any corporate entity,
partnership or other vehicle which, in all cases, is solely
involved in the manufacture, sale or distribution of Specialty
Cables in the United States of America, Canada or Mexico.
Clause 18.5.3 shall be deemed to be amended accordingly.
4 BICC SUPERTENSION CABLES (1980) LIMITED
The Purchaser acknowledges that pursuant to Clause 5.2 of the Agreement
it consented to the payment by BICC Supertension Cables (1980) Limited
("SUPERTENSION") of a dividend of approximately (pound)5.3 million to
Mayfair Place Investments Limited ("MAYFAIR") and to the redemption by
Supertension of 4,999,900 redeemable ordinary shares of (pound)1 each
held by Mayfair and the Purchaser hereby irrevocably waives any claim
which it may have pursuant to Clause 5.2 of, or paragraph 3.4 of
Schedule 8 to, the Agreement against the Vendor in connection with such
actions.
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- 3 -
<PAGE> 4
5 TRANSITIONAL SERVICES
The parties have agreed that in addition to the services agreed to be
provided in Clause 21.15 of the Agreement, the Purchaser will use all
reasonable endeavours to provide to the Vendor's Group during normal
business hours such transitional services, including legal and
corporate housekeeping, environmental and management assistance
(including access to, and the co-operation of, relevant personnel), as
are reasonably requested by the Vendor and which are required for the
businesses retained by the Vendor's Group for a period of up to 12
months from Completion.
6 VAT RECORDS
The parties have agreed that notwithstanding the provisions of Schedule
10 to the Agreement, the Vendor shall deliver to the Purchaser the VAT
records relating to the UK Business.
7 SUBSTANTIAL CONTRACTS
7.1 Schedule 19 to the Agreement contains a list of contracts
which constitute "Substantial Contracts" for the purposes of
the Agreement. On execution of the Agreement, the contracts
listed in Appendix I to this letter were omitted, in error,
from Schedule 19.
7.2 The parties have agreed that the contracts listed in Appendix
I shall be deemed to be included in Schedule 19, and the
definition of "Substantial Contracts" shall be deemed to be
amended accordingly.
8 PERU
The parties have agreed that the Vendor will use its best endeavours to
facilitate the Purchaser's participation in the sale or restructuring
of the Vendor's shareholding in BICC Communications S.A. and, subject
to any pre-emption rights and at the Purchaser's request, to transfer
to the Purchaser or one of its wholly-owned subsidiaries, all of the
Vendor's shareholding in BICC Communications S.A. and any inter-company
loans between the Vendor's Group and BICC Communications S.A. for an
aggregate consideration of (pound)1.
9 EQUIPMENT AT CLAYTON FACTORY, AUSTRALIA
The parties have agreed as follows:
(a) within 21 days of Completion, the Vendor shall
deliver to the Purchaser a schedule ("THE SCHEDULE")
of machinery located at the factory in Clayton,
Australia (the "CLAYTON FACTORY") which is not
required for use in the Brand Rex business retained
by the Vendor;
- --------------------------------------------------------------------------------
- 4 -
<PAGE> 5
(b) the Purchaser may acquire any equipment set out in
the Schedule for an aggregate consideration of US$1
(ex-works) (the "PURCHASED EQUIPMENT"); and
(c) the Purchaser shall remove any Purchased Equipment
from the Clayton Factory within 90 days of delivery
of the Schedule or within such longer period as the
parties agree, such removal to be wholly at the
Purchaser's cost and to be carried out in a safe and
proper manner leaving the Clayton Factory in a safe
and tidy state following removal of the Purchased
Equipment.
10 FOREIGN EXCHANGE
The parties have agreed as follows:
(a) within 21 days of Completion, the parties will agree
a schedule of all foreign exchange transactions
entered into prior to Completion by BICC Cables
Limited in relation to the Vendor's energy cables
business (the "FX TRANSACTIONS");
(b) with effect from Completion and subject to paragraph
(c) below, the Purchaser will procure that the FX
Transactions are administered on behalf of the
Vendor's Group and that such transactions are settled
in full on the due date with the relevant
counterparty and the Purchaser shall fully indemnify
and keep indemnified the Vendor from and against all
Losses which the Vendor or any member of the Vendor's
Group may incur as a result of the failure to so
settle the FX Transactions; and
(c) the Vendor retains the discretion to close out any of
the FX Transactions which have a maturity date later
than 31 December 1999 prior to the maturity date of
such transactions having given the Purchaser 3 days'
prior written notice of its intention to do so and
any cash flows resulting from closing out such FX
Transactions shall be for the account of the
Purchaser.
11 PRICE ALLOCATION
11.1 In accordance with Schedule 3 to the Agreement, Appendix II to
this letter sets out the provisional allocation of the part of
the Purchase Price referred to in paragraph 3.1 of Schedule 3
between the assets of the UK Business, subject to adjustment
pursuant to Clause 9 of the Agreement.
11.2 The amount of the Purchase Price allocated to the Non-Leased
Properties includes amounts in respect of land, buildings and
fixed plant and machinery. The parties agree that within
ninety days of Completion, the parties will agree an
allocation of the Purchase Price between these items. If no
agreement is
- --------------------------------------------------------------------------------
- 5 -
<PAGE> 6
reached within this period, the allocation between these items
shall be referred to the Reporting Accountants for
determination.
This letter shall be governed by and construed in accordance with English law.
Please confirm receipt of this letter and your agreement to the terms set out
herein by signing and returning the enclosed duplicate of this letter.
Yours faithfully
Robert J. Siverd Robert J. Siverd
................................. .............................
for and on behalf of for and on behalf of
GK Technologies, Incorporated General Cable Corporation
We hereby acknowledge receipt of the above letter and confirm our agreement to
the terms set out therein.
Peter Zinkin
.................................
for and on behalf of
BICC plc
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- 6 -
<PAGE> 7
APPENDIX I
1 Agreementfor the provision of indirect PSDN services between BICC plc
and Cable & Wireless Communications Services Limited.
2 Agreement for the provision of managed telecommunications services
dated 16 October 1995 between BICC plc and BT Communications Management
Limited.
3 Information Systems Procurement and Implementation Framework Agreement
dated 26 June 1997 between BICC plc and Baan Company N.V.
4 Micro Control Software Licence Agreement dated 25 July 1989 between
Sema Group (UK) Limited and BICC plc.
5 Standard Support Agreement dated 6 October 1997 between BICC plc and
Infomix Software Limited.
6 Performance Guarantee dated 1 November 1997 between BICC plc and
Hewlett-Packard Ltd.
7 Microsoft Select Master Agreement dated 16 November 1998 between BICC
plc and Microsoft Operations Ltd.
8 Agreement dated 29 May 1991 between Hitachi Cable Limited and BICC
Cables Ltd.
9 Each of the licences listed in Part D of Schedule 15 to the Agreement.
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- 7 -
<PAGE> 8
<TABLE>
<CAPTION>
APPENDIX II
<S> <C> <C>
1 Land, buildings and fixtures at Erith (pound)4.79 million
2 Land, buildings and fixtures at Prescot (pound)4.5 million
3 Land, buildings and fixtures at Wrexharn (pound)4.95 million
4 Land, buildings and fixtures at Nottingham (pound)0.06 million
5 Land, buildings and fixtures at Hebburn (pound)0.55 million
6 Land, buildings and fixtures at Leigh (pound)1.75 million
7 Plant and equipment (pound)30.39 million
8 Inventory (pound)36 million
9 Debtors less creditors (pound)13 million
10 Trademarks and other intellectual property (pound)0.01 million
11 BICC Supertension (1980) Limited ordinary shares (pound)200,000
Total (pound)96.2 million
</TABLE>
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